BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD : THIRUVANANTHAPURAM

PRESENT:

SHRI. G. SIVAPRASAD : PRESIDENT

SMT. BEENA KUMARI .A : MEMBER

SMT. S.K. SREELA : MEMBER

C.C. No. 277/2006 Filed on 18/10/2006

Dated: 15..06..2010

Complainant:

Ramakrishna Pillai. M., S/o Mahadevan Pillai, Manjusha, Kavaradi Junction, Palkulangara, Pettah, Thiruvananthapuram.

(By Adv. L. Lekshmi)

Opposite parties:

1. The General Manager, ICICI Bank, Land Mark Race Course Circle, Vadodara, Bombay.

2. The Branch Manager, ICICI Bank Limited, RAPG Division, 2^nd Floor, Kamala Towers, Ganapathy Kovil Road, Vazhuthacaud, Thiruvananthapuram – 695 014.

(By Adv. K.K. Rajeev)

This O.P having been heard on 30..01..2010, the Forum on 15..06..2010 delivered the following:

ORDER

SHRI.G. SIVAPRASAD, PRESIDENT:

The facts leading to the filing of the complaint are that, complainant purchased a vehicle bearing No. KL-01/AL 1859 under Hire Purchase Agreement from the 2^nd opposite party, that complainant entered into an agreement for Rs. 7,39,494/-, that as per the agreement the said amount financed by the 2^nd opposite party is to be paid by the complainant by 48 installments of Rs.16,362/-, that complainant had spent an amount of Rs. 15,800/- towards vehicle insurance, Rs. 5,700/- towards road tax, Rs. 9,000/- towards permit, Rs. 2,000/- towards Motor Workers’ Welfare Board and Rs. 25,000/- towards cost of additional fittings. Complainant remitted 5 installments in addition, opposite party received 4 blank signed cheques of Canara Bank from the complainant along with other signed papers. It is submitted further that he could not remit the installment continuously due to business crisis and the same was informed to the opposite party by the complainant. Opposite parties without any legal basis taken away the said vehicle from the complainant. Immediately after the repossession of the vehicle by the opposite parties from the complainant, complainant approached 2^nd opposite party and agreed to pay the arrears. Due to the action of the opposite parties complainant had incurred a loss of Rs. 2,21,060/-. Hence this complaint to realize the said amount along with Rs. 10,000/- towards compensation from the opposite parties.

2. Opposite parties filed version contending that the complainant approached the 2^nd opposite party for the purchase of a commercial vehicle and accordingly as per the hypothecation agreement No. LVTVM00005120802, the opposite party financed him an amount of Rs. 6,58,000/-, which is to be paid by 48 monthly installments of Rs. 16,362/- per month, that the installment period is from 01/01/2006 to 01/12/2009, that the total default with over dues as on the date of repossession of vehicle is Rs.71,031/-, that complainant violated the agreement and caused much hardships and inconvenience to the opposite party. The complainant was not regularly repaid the monthly installment and as per the hypothecation agreement the opposite party has every legal right to repossess the vehicle. Opposite parties given various letters and intimations to the complainant to regularise the dues but complainant paid no heed at all. Opposite parties having no other way, but to take possession of the vehicle on 18/9/2006. It is further submitted by opposite parties that on 30/01/2007 opposite party issued a letter stating that it had disposed of the said asset for an amount of Rs. 3,20,000/- after due communication regarding the matter to the complainant. The allegation that the complainant has a loss of Rs. 1,63,560/- is false rather opposite party had a loss of Rs. 3,43,875/-. Hence opposite party prayed for dismissal of the complaint.

3. The points that arise for consideration are:

1. Whether complainant has committed default in payment of monthly installments?

2. Whether repossession of financed property from the complainant is lawful?

3. Whether there is any deficiency in service on the part of opposite parties?

4. Whether complainant is entitled to get a sum of Rs. 1,63,560/-?

5. Whether complainant is entitled to get any other reliefs?

In support of the complaint, complainant has filed affidavit and marked Exts. P1 to P5. In rebuttal, opposite parties did not file affidavit. Opposite parties produced 4 documents which are on the records.

4. Points (i) to (v): Admittedly, complainant availed financial assets from opposite parties for the purchase of the vehicle bearing No. KL-01/AL 1859 and entered into an agreement with 2^nd opposite party. According to complainant he availed a loan of Rs. 7,39,494/- from the 2^nd opposite party while according to opposite party they facilitated and financed complainant an amount of Rs. 6,58,000/-. Complainant did not furnish any document to show the amount availed by him from the 2^nd opposite party. It is the specific case of the complainant that he had remitted Rs.81,000/- in advance to 2^nd opposite party to purchase the aforesaid vehicle. There is no material on record to show that complainant had remitted Rs. 81,000/- to 2^nd opposite party as advance amount. Ext. P1 is the copy of the Retail Invoice dated 6/2/2006. As per Ext. P1 the name of the purchased vehicle is Swaraj Mazda Samrat Truck, purchaser is Ramakrishna Pillai, Unit price of the said vehicle is Rs. 6,57,328/-, tax amount is Rs. 82,166/- total comes to Rs. 7,39,494/-. Ext.P2 is the copy of the certificate of registration. Ext. P3 is the copy of the tax receipt. Ext. P4 series include copies of payment receipts dated 30/5/2006, 29/6/2006 and 27/8/2006. Ext. P5 is the copy of the advocate notice. As per Ext.P4 series, complainant remitted only 3 monthly installments. No other documents furnished by the complainant to substantiate the case of the complainant. According to opposite parties the total default with over dues as on the date of repossession of the vehicle is Rs. 71,031/-. According to opposite parties there is a clause in the hypothecation agreement that “In the event of any breach or default by the borrower in the performance of its obligations hereunder or any of the terms, covenants, obligations and conditions stipulated in the Loan Terms and/or the other Transaction Documents or in the event of the charge on the assets having become enforceable for any reason whatsoever, the Bank or their nominees or authorised persons shall, in case such breach or default is not remedied by the borrower to the satisfaction of the bank without any notice and without assigning any reason and at the risk and expense of the borrower and if necessary as attorney for and in the name of the borrower, be entitled exercise such rights and remedies including (i) to enter into and upon the premises of the borrower and/or any other person who then has possession of the assets, (ii) to seize, recover, collect, withdraw, receive the assets and/or any income, profits and benefits thereof without interruption or hindrance by the borrower and/or any persons, (iii) to remove, and/or sell by public auction or by private contract, despatch or consign for realization or otherwise dispose of or deal with or any part of the assets and enforce, realize, settle, compromise and deal with any rights or claims relating thereto without being bound to exercise any of these powers or be liable for any losses in the exercise or non-exercise thereof, (iv) to be freed and discharged and well and sufficiently saved and kept harmless and indemnified of, from and against all former and other estates, titles, claims, demands, charges and encumbrances whatsoever, or to direct the borrower and/or other concerned person to sell, assign or otherwise liquidate, any or all of the assets”. It is submitted by opposite parties in the version that opposite parties had issued various letters and intimations to the complainant to regularise the dues, but complainant had paid no heed at all. Opposite party has produced 4 documents which are on the record. As per Demand Notice dated 7/9/2006 it is seen informed the complainant that he has defaulted in honouring his commitment by defaulting in making payment of the monthly installments despite their repeated requests and reminders. It is further stated in the said letter that net outstanding amount is Rs. 65,448/-. In the said notice complainant was directed to pay the said amount within 7 days from the receipt of the said letter and regularize the account in order to avoid unpleasant situation including taking possession of his asset and filing a suit under Negotiable Instrument Act. Another document shows the statement of account as on 25/9/2006. As per the statement of account, amount financed is Rs. 6,58,000/-, installment period is 1/1/2006 to 1/12/2009, installment over dues for an amount of Rs. 65,448/-, other over dues: Rs. 5,583/-, future installment Rs.6,38,118/-, installment paid: Rs. 81,810/-, principal paid Rs. 59,053/- and interest paid: Rs. 22,757/-. Another document dated 18/9/2006 by which complainant was requested to provide original RC book, insurance policy, tax payment, certificate and all other statutory documents required to sale or deal with the said vehicle., Another document dated 30/1/2007 shows sale notice on loss. As per the said notice the vehicle was taken possession on 18/9/2006. Thereafter complainant neither made payment nor responded to 4 letters issued by the opposite parties. Opposite parties disposed of the said vehicle for Rs. 3,20,000/- and sales proceeds credited in his account and Rs. 3,43,875/- is still due to the opposite party. Opposite party did not file affidavit to substantiate the contentions in the version nor attempted to mark documentary record. The initial burden of proving the case would rest on the complainant. Complainant did not adduce sufficient evidence nor attempted to produce documents from the opposite party in connection with loan transaction. On perusal of the available records we are of the view that complainant is a defaulter of payment of monthly installments. As regards the repossession of the vehicle we need to highlight the guidelines to be strictly followed by the Finance Company before its exercises, its power to repossess the vehicle which have been re-iterated time and again various courts. If the amount is not paid the borrower which would be upon to the Finance Company in exercise of its power in the finance agreement to recall the loan. If it exercises its power, another notice be given to the borrower intimating that the loan has been recalled the borrower should be called upon to pay the amount within 7 days of the receipt of the notice. This notice to be sent by registered post at the address given by the borrower. If the amount is not paid within the stipulated period as per notice the Finance Company would be authorised to repossess the vehicle, but this power of repossession would not entitle the Finance Company to take the vehicle while plying on the road. In case the borrower refuses to sign papers when the vehicle is repossessed, on repossession of the vehicle immediate information to be provided by Finance Company to local police intimating the time and place when the vehicle was repossessed. It is the case of the complainant the vehicle was repossessed by the opposite party while plying on the road. In view of the guidelines referred above, in the instant case, to support the documents furnished by the opposite parties, neither postal receips nor acknowledgment cards are produced. As such we are of the belief that no such guidelines followed by opposite parties before it exercises its power to repossess the vehicle concerned. Complainant never produced any document to claim Rs. 1,63,560/- nor mentioned the No.of the blank signed cheques. In view of the foregoing discussion and as per the available evidence on record we find complainant is not entitled to get the amount claimed in the complaint. Opposite parties also not furnished any document to show that the vehicle concerned was sold at Rs. 3,20,000/-. Initial onus of establishing the case would fall on the complainant, complainant failed to do so. Since the vehicle was repossessed without observing the guidelines. We find there is deficiency in service on the part of opposie party for which complainant is entitled to get compensation of Rs. 10,000/-.

In the result, complaint is partly allowed. Opposite party is directed to pay Rs. 10,000/- as compensation to the complainant. Parties shall bear and suffer their costs.

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.

Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the open Forum, this the 15^th day of June, 2010.

G. SIVAPRASAD PRESIDENT.

BEENA KUMARI. A : MEMBER

S.K. SREELA : MEMBER

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C.C.No. 277/2006

APPENDIX

I. Complainant’s witness:

PW1 : Ramakrishna Pillai

II. Complainant’s documents:

P1 : Copy of Retail Invoice dated 6/2/2006

P2 : " of certificate of Registration

P3 : " the Tax receipt

P4 : Series include copies of payment receipts dated 30/5/2006, 29/6/2006 & 27/8/2006.

P5 : " advocate notice

III. Opposite parties’ witness : NIL

IV. Opposite parties’ documents : NIL

PRESIDENT

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