BEFORE THE MANDYA DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, MANDYA<br /> <br /> PRESENT: 1. SIDDEGOWDA, B.Sc., LLB., President,<br /> <br /> 2. M.N.MANOHARA, B.A., LLB., Member,<br /> <br /> 3. A.P.MAHADEVAMMA, B.Sc., LLB., Member, <br /> <br /> ORDER<br /> <br /> Complaint No.MDF/C.C.No.139/2009<br /> <br /> Order dated this the 11th day of March 2010<br /> <br /> COMPLAINANT/S<br /> <br /> Sri.H.N.Mahadeva Rao,<br /> S/o M.Nagoji Rao,<br /> R/o Haniyambadi Village,<br /> Kothathi Hobli,<br /> Mandya Taluk, <br /> Mandya District.<br /> <br /> (By Sri.S.Jagannathan., Advocate)<br /> <br /> -Vs-<br /> <br /> OPPOSITE PARTY/S<br /> <br /> 1.The Manager, <br /> Sriram Chits (Kat) Pvt., Ltd., <br /> Registered Office,Akshodaya, <br /> No:259/31, 1st Floor, <br /> 10th Cross, Wilson Garden, <br /> Bangalore-27.<br /> <br /> 2.The Branch Manager, <br /> Sriram Chits (Kat) Pvt., Ltd.,<br /> M.C.Road, Mandya.<br /> <br /> (By Sri H.S.Nagendra., Advocate)<br /> <br /> Date of complaint 18.11.2009<br /> Date of service of notice to<br /> Opposite parties 10.12.2009<br /> Date of order 11.03.2010<br /> Total Period 3 Months 1 Day<br /> Result The complaint is partly allowed, directing the Opposite party to pay compensation of Rs.5,000/- with cost of Rs.500/- to the Complainant within six weeks.<br /> <br /> Sri.Siddegowda,<br /> President<br /> <br /> 1.This complaint is filed under section 12 of the Consumer Protection Act, 1986 against the Opposite party direction to release the motor cycle bearing No.KA-11-R.2317(TVS Star City) after remitting the due E.M.I’s and award compensation of Rs.25,000/-.<br /> <br /> 2.The case of the Complainant is that the Complainant purchased a motor bike of TVS Star City for Rs.49,000/- on the loan provided by the Opposite party in the year 2007 and E.M.I was fixed at Rs.1230/-. As per the terms and conditions and loan agreement, the Complainant repaid almost all E.M.I’s regularly. When there remains few E.M.I’s, the Complainant fell-ill and was unable to repay the same and requested the Opposite party to grant time to repay the said dues. But, the Opposite party representative one Naveen abruptly seized the said motor cycle without issuing prior notice who came with goonda elements and insulted and abused the Complainant and took the vehicle which was in good condition. Though, the Complainant approached it was in vain. Without issuing a notice and without giving sufficient opportunity, the Opposite party seized the vehicle and sold for meagre amount causing mental agony to the Complainant. In spite of legal notice dated 26.10.2009, the Opposite party has not complied to receive the E.M.I’s and release the vehicle and hence, Opposite party has committed deficiency in service. <br /> <br /> 3.The Opposite party has filed version admitting the loan sanctioned to the Complainant for purchase a motor cycle and according to it, loan of Rs.44,130/- was repayable in 30 monthly installments of Rs.1,471/- and the Complainant paid one installment in advance and for the remaining installments issued 29 cheques for Rs.1,471/- each as per the agreement. As per the agreement, if the Complainant fails to pay one E.M.I. in time, the Opposite party has power to seize the vehicle and sell it. The Complainant has not paid the installments properly, only two cheques were honoured and 27 cheques were returned without sufficient fund in his account. Therefore, the Complainant has become a defaulter. The allegation that the Complainant has paid almost of the E.M.I’s and on account of illness, he could not pay and sought for time are concocted. The Complainant purchased a motor bike in 2007 and had run the motor bike for 40,000 kilometer and it was not properly maintained. Due to non-payment of the installments in spite of demands, the Opposite party Officials seized the vehicle on 09.03.2009 without alternative. The Complainant refused to receive the seizure notice and the Complainant and his friends did not sign the mahazar, but made galata. It is denied that motor vehicle was seized by force. On 11.03.2009, a notice was issued to the Complainant informing that motor bike will be sold if amount due is not paid and it was served on 20.03.2009. But, the Complainant did not come forward to clear the loan and get the motor cycle released. Since, the motor vehicle was not in good condition and has no market value, it was sold for Rs.15,000/-. In spite of it, the Complainant is still due of Rs.30,678/- as on 31.12.2009. The Opposite party has not committed any deficiency in service and the Complainant is not entitled to any relief and complaint is liable to be dismissed with costs. <br /> <br /> 4.During trial, the Complainant has produced affidavit and produced the document Ex.C.1 & C.2. One witness for Opposite party is examined and produced the documents Ex.R.1 to R.3. <br /> <br /> 5.The Complainant has filed written arguments.<br /> <br /> 6.We have heard both the sides.<br /> <br /> 7.Now the points that arise for our considerations are:-<br /> 1.Whether the Opposite party has committed deficiency in service in seizing the motor cycle of the Complainant?<br /> 2.Whether the Complainant is entitled to the relief sought for?<br /> <br /> 8.Our findings and reasons are as here under:-<br /> <br /> 9.POINT NO.1:- The undisputed facts borne out from the materials on record are that the Complainant borrowed loan of Rs.44,130/- from the Opposite party Finance Company and purchased the motor cycle registered as KA.11-R.2317 and that amount was repayable in 30 monthly installments at the rate of Rs.1,471/- and the first installment was paid in advance and for the remaining installments, the Complainant issued 29 cheques in advance for Rs.1,471/- each. The loan agreement as per Ex.R.1 is not disputed.<br /> <br /> 10.According to the Complainant, he has paid almost all E.M.I’s promptly except few installments and when he fell-ill and unable to repay the same, requested the Opposite party to grant time to repay the remaining E.M.I’s. But, without giving any opportunity, the Opposite party representative Naveen abruptly seized the vehicle coming with goonda elements in spite of request by the Complainant. The Opposite party admitting the seizure of the motor cycle from the Complainant denied that by force with goonda elements, the motor cycle was sized and according to the Opposite party several times, the loan collecting agents had informed the Complainant about the E.M.I.’s due and bouncing of the cheques and to repay the dues otherwise the vehicle would be seized. So, it is an admitted fact that the Complainant is still some of E.M.I’s, but has not come to Court with clean hand about the payment of the E.M.I’s. In the complaint, he has not whispered how money installments and in what manner he has paid, whether by cash or through the cheques issued by him. According to his affidavit, the Opposite party has collected some installments by presenting the cheques and some installments were collected by cash directly. But, in the cross-examination, the Complainant has deposed that he has paid 12 installments and out of which he has paid cash for 10 installments and two through the Bank. But, according to the Opposite party, out of 29 cheques issued by the Complainant only two cheques were honoured and 29 cheques were dis-honoured and returned back and the Complainant has become defaulter and as per the agreement Ex.R.1, the Opposite party is entitled to seize the vehicle in case of single default and recover the entire loan amount by selling the vehicle. Condition No.10.2 reads as follows; “a) Demand that the borrower return the product/vehicle in the lender in the same condition as delivered, reasonable wear and treat expected, and in the event of failure of the Borrower to comply with the same within 7 days from the date of the demand, enter upon the premises where such Product/Vehicle is located and take immediate possession of and remove the same, all without the liability to the Lender or its agents for such entry of for damage to property or otherwise. The Lender has the right detach and dismantle the Product/Vehicle form any part of the freehold or process machinery to which it may be affixed without the prior permission of the Borrower. For the purposes of possession of the Product/Vehicle of the Borrower expressly grants irrevocable licence to the Lender/Security Trustee or its agents or any other authorized representative for the purpose of exercising its rights under this clause. b) Sell the Product/Vehicle by public auction or private sale with or without notice to the Borrower or otherwise dispose of hold, use operate, hire to others, or keep idle such Product/Vehicle, without any duty to account to the Borrower for such action or inaction or for any proceeds with respect thereto. c) Require the Borrower to pay any liquidated damages equal to all unpaid installments which in the absence of a default would have been payable by the Borrower for the full terms hereof, or. d) Exercise any other right to remedy which may be available to it under the applicable laws. e) Any default whatsoever of the terms and conditions of this agreement committed by the Borrower shall constitute a default of the terms and conditions of any other agreement entered into between the Borrower (if any capacity) and the Lender or its associate, affiliated, subsidiaries, promoters, holding Lender, or any other group lender and the lender or its associate, affiliate, subsidiaries, promoters, holding company, or group company and the group company shall have a right to proceed against the Borrower, as it may deem fir and may exercise any and rights and remedies of a secured party under applicable law and as otherwise granted to the company or its associates, affiliates, subsidiaries, promoters, holding company or group company under any other agreement”.<br /> <br /> 11.So, according to the terms and conditions of the agreement, even in case of single default by the Complainant for the entire loan due, the Opposite party is empowered to seize the vehicle. But, the condition to be fulfilled is that Opposite party should inform in writing about the installments due and give an opportunity of 7 days and if the Complainant fails to repay the amount. the Opposite party shall issue notice through its agents of 7 days notice to return the vehicle hypothecated, otherwise the vehicle would be seized. This condition is not at all complied by the Opposite party at all and it has contravened the terms and conditions of the agreement. Though the Complainant denied notice as per Ex.R.2 was issued by the Opposite party on 11.03.2009 through registered post and it was served on the Complainant on 20.03.2009 as per Ex.R.3 the postal letter, suggestion by the Complainant side that the notice was sent to the wrong address is a utter strange, because the address in Ex.R.2 is similar to the address given in the complaint. So, before selling the vehicle an opportunity was given to the Complainant, but the Complainant has not availed that opportunity before the sale of the vehicle by the Opposite party. But, as observed above, the Opposite party has not observed the conditions of the loan agreement before seizing the vehicle and according to the Complainant, it was forcibly seized. When the conditions are not fulfilled by the Opposite party, it should be accepted that forcibly the agents of the Opposite party have seized the motor cycle. In the decision II (2009) CPJ page 273 in the case of Rakesh Verma –Vs- Apple Finance Ltd., the Delhi State Commission has held that No financier, bank has authority to forcibly take possession of the vehicle Loan agreement being civil contract, have to be executed through civil remedy. Bank unless equipped with Court order for repossessing the vehicle has no authority to go to house of borrowers to take away vehicle forcibly. In the decision II (2009) CPJ page 368 in the case of Tata Motors Ltd., -Vs- Indrasen Choubey, the Hon’ble National Commission has held that in case of finance to the vehicle, when the installments are defaulted and when the vehicle was seized and auctioned without intimation to the Complainant, Unjust method resorted by the Bank for forcibly repossessing of the vehicle is illegal. The Hon’ble National Commission has observed that many financiers are in the race for giving loan for purchase of vehicles and after giving loan and taking interest in advance, the polite behaviour changes because of the documents which are signed on the dotted lines by the borrower. On occasions, borrower suffers harassment, torture, or abuses at the hands of the muscleman of the money lender. Such a behaviour is required to be prohibited and the process of repossession is required to be streamlined so as to fit in cultural civilized society. Let the rule of law prevail and not that of jungle where might is right. In such cases, even the police does not register the FIR or help the aggrieved consumer. The Apex Court in ICICI Bank –Vs- Prakash Kaur has held that now the bank is the aggressor and the public is the victim. The first step to recover of the money due is through the so-called recovery collection agents. A very dignified terms used for paid recovery agents who are individual and independent contractors hired by the banks both to trace the defaulters and to physically, mentally and emotionally torture and force them into submitting their dues. A man’s self-respect, stature in society are immaterial to the agent who is only primed at recovery. This is the modernized version of Shylock’s pound of flesh. No explanation is given regarding the interest charge and the bank takes cover under the guise of the holder of the card or the loan having signed the agreement whether find or explained to the owner.<br /> <br /> 12.In the present case as observed above, though before selling the seized motor cycle of the Complainant, the notice was served to the Complainant, but the Opposite party has committed deficiency in service in not observing the conditions of the loan agreement Ex.R.1 before seizing the vehicle by giving the opportunity provided under the agreement. Therefore, the Opposite party has committed deficiency in service in seizing the vehicle illegally.<br /> <br /> 13.The Complainant has sought for redelivery of the motor cycle from the Opposite party after remitting the due E.M.I’s and also compensation of Rs.25,000/-. But, in the present case, both Complainant and the Opposite party have not produced the documents to actually prove how many E.M.I’s were paid by the Complainant or received by the Opposite party. According to the Complainant evidence, he has paid 10 installments by cash and two installments through Bank out of 30 installments and is due of only 17 installments. According to the Opposite party, out of 29 cheques issued by the Complainant, only two cheques were encashed and remaining cheques were bounced due to insufficient funds. The Complainant has failed to produce the vouchers for having paid 10 installments in cash. The burden is on the Complainant to prove the same. Even, the Complainant’s version in the complaint about the amount of installment is contrary to agreement because 30 installments comes to Rs.36,900/-, but admitted loan is Rs.44,130/-. The plea that he has paid almost all installments except few E.M.I’s is contrary to his own evidence in the cross examination. Therefore, he has not come to Court with clean hands. Further, as per admission of the Complainant, the motor cycle seized is already sold by the Opposite party. Therefore, the Complainant cannot seek repossession of the motor cycle from the Opposite party and even this Forum cannot pass any orders directing the Opposite party to deliver the motor cycle, since it is already sold. So, the next alternative relief that could be ordered is only payment of compensation. As observed above, the Complainant has not come with clean hands about the number of installments he has paid. In view of the defence of the Opposite party that admittedly two cheques were honoured and remaining cheques are dis-honoured and as on 31.12.2009, the Complainant is due of Rs.30,678/- after giving deduction of Rs.15,000/- being the sale amount of the motor cycle. In view of the above situation about the material not available about the actual installments proved by the Complainant, it is just and proper to award compensation of Rs.5,000/-. Since, the Complainant has used the motor cycle for two years. <br /> <br /> 14.In the result, we proceed to pass the following order;<br /> ORDER<br /> The complaint is partly allowed, directing the Opposite party to pay compensation of Rs.5,000/- with cost of Rs.500/- to the Complainant within six weeks. <br /> <br /> (Dictated to the Stenographer, transcribed, corrected and then pronounced in the open Forum this the 11th day of March 2010).<br /> <br /> (PRESIDENT) (MEMBER) (MEMBER)<br /> <br />