BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD, THIRUVANANTHAPURAM.

PRESENT

SRI. G. SIVAPRASAD : PRESIDENT

SMT. BEENAKUMARI. A : MEMBER

SMT. S.K.SREELA : MEMBER

C.C. No. 238/2006 Filed on 24.08.2006

Dated : 30.09.2011

Complainants:

1. Confederation of Consumer Vigilance Centre, Sreekovil, Kodunganoor P.O, Thiruvananthapuram-695 013.

    

2. L. Suseelan, T.C 24/365, Near Sasthamkovil, Thycaud, Thiruvananthapuram-14.

Opposite parties :

1. The HDFC Bank Ltd., Auto Loan Department, Kenton Towers, Near Kalabhavan Theatre, Vazhuthacaud, Thiruvananthapuram-14.

(By adv. T.L. Sree Ram)

2. The Popular Vehicles & Services Ltd., Kuttukaran Complex, Killippalam, Karamana P.O, Thiruvananthapuram-2.

(By adv. K.L. Narasimhan)

This O.P having been taken as heard on 16.08.2011, the Forum on 30.09.2011 delivered the following:

ORDER

SMT. BEENAKUMARI.A: MEMBER

The 1^st complainant in this case is Confederation of Consumer Vigilance Centre. The 2^nd complainant in this case purchased an Alto LXE-3 car from the 2^nd opposite party on 28.06.2005 by availing a loan from 1^st opposite party for an amount of Rs. 2 lakh. The interest rate was 7% per annum. The loan account number of 1583419 dated 25.06.2005. The price of the car was Rs. 2,79,981.55. Complainant had paid an amount of Rs. 1,01,782.55 including tax, registration fee, warranty premium etc. to the 2^nd opposite party. The 1^st opposite party paid the loan amount to the 2^nd opposite party dealer directly. But the EMI has been paying by the complainant directly to the 1^st opposite party. As per the loan agreement one EMI is Rs. 4,791/- and the complainant has to pay total 48 EMIs to close the loan. The complainant had paid first EMI along with Rs. 400/- as price of stamp. Thus the complainant will be paid total amount of Rs. 1,94,809/- to the 2^nd opposite party out of Rs. 2 lakh. But as per invoice dated 28.06.2005 the 1^st opposite party paid Rs. 1,87,479/- to the 2^nd opposite party instead of Rs. 1,94,809/-. There was a deduction of Rs. 7,330/-. The complainant informed this matter to the other officer of 1^st opposite party, then they replied that they have received an amount of Rs. 1,92,359/- from the 2^nd opposite party. The complainant alleges that this statement of the 2^nd opposite party is not correct. They ought to have given Rs. 1,94,809/- as per the loan. Thereafter the complainant had filed a complaint before Banking Ombudsman on 09.09.2005. But the findings of the Banking Ombudsman was that the 1^st opposite party had allowed the loan to the 2^nd complainant in a very low interest rate for that the 2^nd opposite party has to give commission to the 1^st opposite party and that commission amount was deducted from the loan amount and the complainant has no right to claim that amount. As a bank employee the 2^nd complainant cannot accept that contention of the bank. Even if the matter stands as thus, the complainant cannot suffer in their dealings. Thereafter the 2^nd complainant approached the 1^st complainant to get redressal of his grievance. Therefore the1st complainant sent letters to the opposite parties. In furtherance of the correspondence the 2^nd opposite party issued a statement to the complainant stating that they have refunded Rs. 3,021.25 to the 2^nd complainant. But that statement is not correct. The complainant further alleges that at the time of purchase the 2^nd opposite party offered seat cover to the complainant, but they did not give it. And they did not give the cash discount benefit of Rs. 7,330/- to the complainant as P.B. The complainant alleges that it was the cash discount amount which has to be given to the complainant by the 2^nd opposite party, that amount obtained by the 1^st opposite party as the commission given by the 2^nd opposite party to the dealer. The complainant states that the amount of cash discount Rs. 7,330/- adding with Rs. 1,87,479/-, then the amount comes to Rs. 1,94,809/-. The complainant states that Rs. 7,330/- is the cash discount amount ought to have to be paid to the complainant by the 2^nd opposite party dealer, but the 1^st opposite party bank obtained that discount benefit from the 2^nd opposite party. The 1^st and 2^nd opposite parties jointly cheated the complainant. In this circumstance the complainant approached this Forum with this complaint.

In this case 1^st opposite party is HDFC Bank Ltd. and 2^nd opposite party is Popular Vehicles and Services Ltd. 1^st opposite party filed version stating that the complaint is barred by the principles of res judicata. The very same matter has already been adjudicated by Banking Ombudsman who is a competent authority and the matter is decided against the complainant. The Banking Ombudsman who has been vested with statutory powers has examined the entire matter, had passed the order which is binding on both parties. Hence they prayed for the dismissal of the complaint. The 1^st opposite party further states that it is true that the 2^nd complainant availed the car loan facility for Rs. 2,00,000/- as per loan agreement number 1583419 from this opposite party. The loan was sanctioned upon request by the 2^nd complainant for purchase of a new Alto LX E III Motor car from the 2^nd opposite party dealer after submission of all relevant documents as required by the Bank. After according sanction of non facility an agreement was executed on 22.06.2005 between the 2^nd complainant and the 1^st opposite party. Thereafter the amount due to the dealer was disbursed. In this case the loan was processed by the dealer cum Direct Sales Agent, the 2^nd opposite party. Since the dealer has sourced the case directly he has offered the interest rate to the customer at 7.33%. It is due to a bargaining and it is a competitive rate of interest compared to the rate of interest prevailing in the market. The rate offered by the DDSA that is the 2^nd opposite party, being a competitive rate, the dealer cum agent has to suffer certain amounts to get the customer. In a competitive market the dealer cum DSA offers reduced interest rate to their customers so as to boost the sale of their products. In such circumstances the loss which may occur to the financier is compensated by giving discounts from the amounts due to them from financial institutions. In this case an amount of Rs. 7,330/- had been ascertained as discount amount due to the 1^st opposite party from the 2^nd opposite party. The said amount is offered by the 2^nd opposite party to HDFC Bank to operate the loan at the rate specified by them. This amount of Rs. 7,330/- which is an amount due to the 1^st opposite party from the 2^nd opposite party is adjusted while giving the loan amount to be paid to the 2^nd opposite party. It is for the convenience sake and for brevity of transaction the said amount was adjusted and balance was disbursed to the dealer. The 2^nd complainant is in no way concerned with the said adjustment. The first installment and stamp value amounting to Rs. 4,791/- + Rs. 400/- is collected by the 2^nd opposite party and that amount is also adjusted from Rs. 2,00,000/- which is granted by the 1^st opposite party. Likewise the plough back amount that is the amount to be compensated by the DDSA to the Bank for agreeing to the rate of interest offered by their to their customers is also adjusted. Based on the loan agreement executed the loan amount was disbursed to the dealer after deducting the following fees and charges as applicable:- (i) One EMI advance paid to the dealer – Rs. 4,791, (ii) Stamp duty paid to the dealer : Rs. 400/-, (iii) The commission/plough back amount/compensation receivable from the dealer cum sale agent. Total amount deducted : Rs. 12,521/-. Hence the net disbursable amount paid to the dealer comes to Rs. 1,87,479/- and the said amount was paid to the dealer in lump sum on 30.06.2005. It is done as per agreement which empowers the bank to disburse the loan amount directly to the dealer after deducting fees and charges as applicable. The entire loan amount availed by the complainant is disbursed after deducting the amount legally due from the 2^nd opposite party to the 1^st opposite party. The deduction made is in no way affects the complainant. It is absolutely wrong to say that the sanctioned amount is not disbursed. What is being done is an adjustment in the accounts between the 1^st opposite party and the 2^nd opposite party. The Banking Ombudsman has gone into the matter in detail and the complainant is estopped from agitating the very same matter before this Forum. Hence they prayed for the dismissal of the complaint.

In the version 2^nd opposite party states that, the 2^nd complainant has claimed the difference in amount Rs. 7,330/-, namely the difference in amount shown in the invoice of 2^nd opposite party and the amount to be remitted by the 2^nd complainant is Rs. 1,94,809/-(Rs. 1,94,809/- - Rs. 1,87,479/- = Rs. 7,330/-). The 2^nd opposite party states that the 2^nd complainant had borrowed Rs. 2,00,000/- from the 1^st opposite party at 7% interest for the purchase of the car is not disputed. The cost of the car is Rs. 2,79,981.35. Ex-showroom price of the car is Rs. 2,79,981.35. Road tax is Rs. 14,050/-, registration fee is Rs. 1,750/-. Maruti extended warranty is Rs. 1,360/-. Accessory amount is Rs. 3,201/-, providing discount to the accessories, the bill amount comes to Rs. 2,97,141.55. The 2^nd complainant has been issued with the details of the account by the 2^nd opposite party on 09.09.2005. Under hire purchase agreement, the loan is released to the dealer only and not to the complainant. The EMI for the arrangement is Rs. 4,791/-. the stamp charge of Rs. 400/- is also payable by the company. The complainant is obliged to pay finance plough back of Rs. 4,880/-. This has to be deducted from the total amount released by the HDFC. Thus, as against Rs. 1,94,809/- this amount of Rs. 4,880/- is to be deducted from Rs. 1,94,809/-. the complainant has safely omitted the debit of Rs. 4,880/- towards finance plough back. The averment that there is shortage of Rs. 7,330/- against the amount the 1^st opposite party is obliged to pay is incorrect and denied. In fact the 2^nd opposite party has already furnished the details of adjustment against the release of Rs. 2,00,000/- by the 1^st opposite party. The break up for Rs. 1,92,359/- is Rs. 1,84,479/- towards the HDFC disbursal amount plus Rs. 4,880/- Finance plough back. There is a balance of Rs. 1,94,809/- minus Rs. 1,92,359/- equal to Rs. 2,450/- remain to be adjusted. At the time of delivery, Popular, instead of adjusting Rs. 7,330/- adjusted Rs. 4,880/- leaving a sum of Rs. 2,450/- in excess from the customer which the 2^nd opposite party is ready to refund against the receipt by the complainant.

In this case the complainant has filed proof affidavit and he has produced 19 documents. Opposite parties have no oral evidence.

Points to be ascertained are:-

1. Whether there is unfair trade practice and deficiency in service occurred from the side of opposite parties?

2. Whether the complainant is entitled to get the reliefs?

Points (i) & (ii):- The case of the complainant is that, he has availed the car loan facility of Rs. 2,00,000/- as per loan account No. 1583419 from the 1^st opposite party. The first installment and stamp value amounting to Rs. 5,191/- was collected by the 2^nd opposite party and that amount is also adjusted from Rs. 2,00,000/- which is granted by the 1^st opposite party. The balance amount ought to have been paid by the 1^st opposite party to the 2^nd opposite party is Rs. 1,94,809/-. But the 1^st opposite party paid only Rs. 1,87,479/-. The complainant states that there is a difference of an amount of Rs. 7,330/-. The complainant argued that this amount is the cash discount amount which the complainant is entitled to in this vehicle purchase. But the 1^st opposite party states that it is the plough back amount received from the dealer. The said amount is offered by the 2^nd opposite party to the 1^st opposite party to operate the loan at the rate specified by them. It is for the convenience sake and for brevity of transaction the said amount was adjusted between the 1^st and 2^nd opposite party. The 2^nd complainant is in no way covered with the said adjustment. The finding of the Banking Ombudsman is the same. In this case the 2^nd opposite party stated that the 1^st opposite party disbursed Rs. 1,87,479/- to the 2^nd opposite party and Rs. 7,330/- to Maruti. At the time of delivery instead of adjusting Rs. 7,330/- adjusted Rs. 4,880/- leaving a sum of Rs. 2,450/- in excess from the customer which the 2^nd opposite party is ready to refund. In this case the complainant claims refund of Rs. 3,021/- the price of accessories. But from the statement of the 2^nd opposite party we find that price of accessories of Rs. 3,021/- has not been charged by the 2^nd opposite party from the complainant. The 2^nd opposite party stated that the finance plough back amount is Rs. 4,880/-. But the 1^st opposite party has stated Rs. 7,330/-. To prove their contentions both parties filed documents. 2^nd complainant has filed proof affidavit and produced 19 documents which were marked as Exts. P1 to P19. In this case the 2^nd complainant was examined as PW1. 2^nd opposite party cross examined him. There was no cross from the side of 1^st opposite party.

From the documents and pleadings of both the parties we find that there is deficiency in service from the side of opposite parties. As per the loan agreement the 1^st opposite party has to disburse Rs. 1,94,809/- to the 2^nd opposite party. But the 1^st opposite party disbursed only Rs. 1,87,479/-. The 1^st opposite party stated that the balance amount Rs. 7330/- was the plough back amount and that amount was entitled to them from the 2^nd opposite party as the commission of this loan transaction. The 2^nd opposite party states that the plough back amount was only Rs. 4,880/-. In these circumstances, we find that there is some unfair trade practice from the side of opposite parties. It is the duty of the opposite parties to disclose the entire money dealing of this loan transaction to the complainant. It is the complainant who availed the loan from the 1^st opposite party and he has the liability to repay the loan amount. From the pleadings of the opposite parties they admitted that they have obtained some amount from the loan amount as plough back amount or commission. As the statement given by the 1^st opposite party in their version Rs. 7,330/- is stated as plough back amount received from the dealer out of the loan amount. As per the statement given by the 2^nd opposite party in their version they admitted that Rs. 4,880/- is received from the complainant as finance plough back amount. The 2^nd opposite party admitted in their version that there is a balance of Rs. 2,450/- remaining to be adjusted and they are ready to refund that amount to the complainant. In this case the 2^nd opposite party has no case that the 1^st opposite party paid only Rs. 1,87,479/- instead of Rs. 1,92,359/-. They admitted that the balance amount is the P.B amount which was adjusted from the loan amount. In this case there is some unfair trade practice and deficiency in service from the side of opposite parties. The 2^nd opposite party has no right to obtain this amount as plough back amount from the complainant. There is no need to suffer the complainant in their business adjustment. Hence the complainant is entitled to get the amount from the opposite parties. In this case the 2^nd opposite party is ready to refund Rs. 2,450/- to the 2^nd complainant. Hence we find that it is reasonable to direct the 1^st opposite party to refund the balance amount Rs. 4,880/- (Rs. 7,330/- - Rs. 2,450/-) and the 2^nd opposite party to refund Rs. 2,450/- to the complainant. Hence the complaint is allowed.

In the result, the 1^st opposite party is directed to pay Rs. 4,880/- and 2^nd opposite party is directed to pay Rs. 2,450/- to the 2^nd complainant. The opposite parties are directed to pay Rs. 5,000/- as compensation and costs to the 2^nd complainant. Time for compliance one month from the date of receipt of the order. Otherwise 9% annual interest shall be paid to the entire amount.

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 30^th day of September 2011.

Sd/- BEENAKUMARI. A : MEMBER

Sd/-

G. SIVAPRASAD : PRESIDENT

Sd/-

S.K. SREELA : MEMBER

jb

C.C. No. 238/2006

APPENDIX

I COMPLAINANT'S WITNESS :

PW1 - Suseelan. L

II COMPLAINANT'S DOCUMENTS :

P1 - Copy of order booking form.

P2 - Copy of cash receipt

P3 - Copy of bank receipt

P4 - Copy of cash receipt

P5 - Copy of cash receipt

P6 - Copy of cash receipt No. 337 dated 29.06.2005.

P7 - Copy of invoice dated 28.06.2005

P8 - Copy of customer account settlement voucher.

P9 - Copy of letter dated 07.08.2005 issued by the complainant

P10 - Copy of letter dated 07.08.2005 issued by the complainant

P11 - Copy of letter dated 09.09.2005 issued by the opposite party.

P11(a)- Copy of letter dated 18.09.2005 addressed to 2^nd opposite

party.

P12 - Copy of letter dated 09.09.2005 issued by the complainant

P13 - Copy of letter dated 20.02.2006 issued by the complainant

P14 - Copy of letter dated 06.04.2006 issued by the opposite party.

P15 - Copy of letter dated 07.06.2006 addressed to 2^nd opposite

party.

P16 - Copy of letter dated 15.06.2006 issued by 2^nd opposite party.

P16(a)- Copy of letter dated 09.09.2005 issued to the complainant.

P17 - Copy of letter dated 14.06.2006 issued to 1^st opposite party.

P18 - Copy of acknowledgement card and postal receipt.

III OPPOSITE PARTY'S WITNESS :

DW1 - Susheelan.

IV OPPOSITE PARTY'S DOCUMENTS :

D1 - Copy of agreement for auto loan

D2 - Copy of letter dated 09.09.2005 issued by the complainant.

Sd/-

 PRESIDENT