Complaint filed on: 13-03-2017                                                      Disposed on: 21-12-2017

BEFORE THE DISTRICT CONSUMER DISPUTES

REDRESSAL FORUM,

OLD DC OFFICE COMPOUND, TUMAKURU-572 101

CC.No.36/2017

DATED THIS THE 21^st DAY OF DECEMBER 2017

PRESENT

SMT.PRATHIBHA. R.K. BAL, LLM, PRESIDENT

SMT.GIRIJA, B.A., LADY MEMBER

Complainant: -

Sri.Samiulla

S/o. Late Chotesab,

Residing at No.394, 3^rd Cross,

Gandhinagar, Tiptur town

(By advocate Sri.H.G.Prakash)

V/s

Opposite party:-       

The Manager,

M/s. India Infoline Finance Ltd,

(IIFL), Vybhav Mall, 1^st Floor, BH Road, Tiptur Town  

(By advocate Sri.P.Mahesh)

ORDER

SMT.PRATHIBHA. R.K. PRESIDENT

This complaint is filed by the complainant against the OP, under Section 12 of the Consumer Protection Act. The complainant prays to direct the OP to deliver the gold ornaments to the complainant which are pledged by him by receiving the outstanding amount as on 26-12-2016 and in alternative order to pay a sum of Rs.1,50,000=00 to the complainant toward the cost of the said Gold ornaments with interest at the rate of 18% p.a. from 26-12-2016 till its realization and to pay a sum of Rs.2,00,000=00 due to deficiency in service, mental shock and agony from the date of complaint till its realization, in the interest of justice and equity.

2. The brief facts of the complaint is as under.

          On 4-7-2016 the complainant had availed a loan of Rs.86,149=00 from the OP vide loan No.GLG529986 by pledging gold ornaments i.e. 2 nos. of Necklace totally weighting about 43.20 grams and one golden ring weighing about 3 grams totally weighing about 46.20 grams .

          The complainant further submitted that, the complainant undertook to pay the interest on the said amount regularly as prescribed by the OP and to get release the said gold ornaments from the OP on or before 11 months from the date of said mortgage date and the said due date would be closed on 3-6-2017.  

          The complainant further submitted that, the complainant had received one letter on 24-12-2016 issued by the OP dated 16-12-2016 and the said letter disclosed, directed to the complainant to pay the entire loan amount of Rs.97,001=00 within 10 days from the date of receipt of the notice. However, the complainant surprised and shocked by receiving the said letter, since the loan period is still pending. However, the complainant had received the said letter on 24-12-2016 and 25-12-2016 was holiday due to Christmas and hence the complainant visited the office of the OP on 26-12-2016 within 2 days from the date of receipt of the notice and enquired the details of balance loan amount. The OP had disclosed the fact that, they have already sold the above said gold ornaments to somebody and the amount was adjust to the said loan amount and rejected to receive any amount from the complainant. However, the tenure of the loan period is still balance for about six months and as per the instruction of the OP, the complainant reached their office within two days from the date of receipt of the notice along with money to pay the same. The OP has illegally sold the same by violating the terms and conditions of the loan transaction and they have no right to alienate the said gold ornaments to somebody within the condition period. Thereby the OP has showed his negligence and breach of terms and conditions of the business.

          The complainant further submitted that, as per the present market value of the said golden ornaments is more than Rs.1,25,000=00, but the OP has calculated less amount compared to the market value. The OP has not followed the procedure as contemplated under Money Lending Act and have violated the terms and conditions of the trade. When the complainant enquired the same, the OP has issued evasive reply and showed their negligent act and deficiency in service, which is not sustainable in law. Without having any option, the complainant got issued a legal notice to the OP by RPAD through his counsel on 31-12-2016 calling upon him to deliver the said gold ornaments by colleting the due amount in alternative to pay a sum of Rs.1,50,000=00 towards the cost of the said ornaments along with Rs.2,00,000=00 towards his mental agony and distress caused by the OP. The said notice was duly served on the OP, but the OP did not comply the same. Hence, the present complaint is filed.        

3. After service of notice, the OP has appeared through his counsel and filed objections contending interalia as under.

The complaint is not maintainable either in law or on facts. The National Consumer Disputes Redressal Commission in its order in revision petition No.50/1995 Fedral Bank V/s. Stancilaur had held that in a case were person pledges ornaments for obtaining loan the relationship between parties is the creditor and debtor and the remedy is not before the Consumer Forum but before the Civil Court. In this case also the relationship is a creditor and debtor.

The OP further submitted that, it is true that, the complainant by pledging her gold ornaments weighting about 46.2 grams and availed a loan amount of Rs.86.149.00 on 4-7-2016 with the OP. At the time, the complainant had filled the application with the accepted terms and conditions therein. The complainant has signed the application form in which the complainant had declared, undertake and agree to abide by condition in number 5 (d). In case of any default in the repayment of interest /installment /principal amount/ any other amount, charges I authorised IIFL to sell all or any of my pledged article in any order deemed favorable and most profitable by IIFL and recover the principal amount of the loan and interest along with cost, charges and all other amount payable in respect to the loan. In case of any deficiency after the above sale, I authorised IIFL to recover the amount from me personally. In case, I default in repaying the said deficit amount IIFL shall have to right to initiate legal action against me to take possession and sell any/all the movable and immovable properties belonging to me. As per the agreed loan agreement the complainant has to pay an interest on monthly basis and the interest will accrue on day to day basis. The complainant had not paid any interest on the loan amount and after issuing the notice and publication in the news paper and after following all the procedure the gold ornaments were sold by the OP, it is false that the complainant as visited the office of the OP on 26-12-2016 and asked for the release of the gold ornaments.

The OP further submitted that, the complainant has been filed this complaint with false facts. The interest will accrue every month and after three months the loan will be considered as default loan and the company will get every right to action the gold ornaments. When the complainant in spite of service of notice and publication of notice in the news paper had not turned up and pay the loan amount. Hence, the ornaments was sold in the auction and intimated the matter through notice dated 10-1-2017 and called upon the complainant to receive the excess amount of Rs.5,441=00. The complainant without receiving the refund amount had filed this false complaint against the OP. As all he procedures as contemplated under law are followed there is no deficiency of service as alleged in the complaint.

The OP further submitted that, in fact the terms of the loan is not the criteria for auction of the gold but the default of interest is the criteria. As the complainant has failed to repay the monthly interest on the loan become default loan and the OP will get the right to auction the ornament as per terms 5 (d) of the agreement. Hence it is prayed to dismiss the complaint with cost, in the interest of justice and equity.

4.  In the course of enquiry into the complaint, the complainant and OP have filed their affidavit evidence reproducing what they have stated in their respective complaint and version.   The complainant has produced documents which were marked as Ex-C1 to Ex-C5. We have heard the arguments of both parties and we have gone through oral and documentary of both side in between line and posted the case for order.

5. Based on the above materials, the following points will arise for our consideration.

1. Whether the complainant has proved deficiency in service on the part of the OP?
2. What Order?  

6. Our findings on the above points are;

          Point no.1: In the affirmative

          Point no.2: As per the final order below.

REASONS

          7. On perusal of the averments of complaint and objections of the OP and evidence of both parties, it is an admitted fact that, the complainant has availed a loan from the OP on 4-7-2016 vide loan No.GCG529986 for a sum of Rs.86,149 by pledging 46.20 grams of old ornaments. The complainant had to get released the said golden ornaments from the OP on or before 11 months from the date of mortgage date and due date will be on 3-6-2017.

8. The contention of the complainant is that, the OP had issued a letter dated 16-12-2016 for repayment of Rs.97,001=00 within 10 days from the date receipt of this letter. The complainant had received the letter on 24-12-2016. After receipt of the said letter, the complainant approached the OP on 26-12-2016 for payment of loan amount, but the OP had informed the complainant that, they have already sold the gold ornaments. Further on the date of auction of the gold ornaments, the market value of the said gold ornaments is more than Rs.1,25,000=00, but the OP within intent to knock off the said gold ornaments have calculated less amount on compared to the market value.  The complainant further submitted that, within the loan period, the OP has sold the gold ornaments. Hence the complainant filed the complaint.   

          9. On the contrary, the OP submitted that, after service of notice and publication of notice in the news paper, the complainant had not paid loan amount or interest.  Hence, the gold ornaments were sold in the public auction as per terms and conditions 5 (d) of the agreement and intimated through notice dated 10-1-2017 and called upon the complainant to receive the excess amount of Rs.5,441=00.

          10. On perusal of the MTM-Final letter of OP dated 16-12-2016/Ex-C2 produced by the complainant, it reads as under:

“. . . . . . . . .  ºÁUÁV ªÉÄð£ÀzÀPÉÌ ¸ÀA§A¢¹zÀAvÉ ¸ÀzÀåzÀ ªÀiÁgÀÄPÀmÉÖ ¹ÜwUÀ¼À£ÀÄß ¥ÀjUÀt¹, CzÀÝjAzÀ £ÁªÀÄÄ ¤ªÀÄUÉ ªÀiÁgÀÄPÀmÉÖAiÀÄ «©ü£ÀßvÉAiÀÄ ªÉÆvÀÛ gÀÆ.16565=00 ¥ÁªÀw¸À®Ä CxÀªÁ F ¥ÀvÀæªÀ£ÀÄß ¤ÃrzÀ ¢£ÁAPÀ¢AzÀ 10 ¢£ÀUÀ¼À M¼ÀUÁV ¸Á®¥ÁªÀwUÁV gÀÆ.97001=00 C£ÀÄß ¥ÁªÀw¸ÀĪÀ ªÀÄÆ®PÀ ¸Á®ªÀ£ÀÄß ªÀÄÄPÁÛAiÀÄUÉƽ¸À®Ä £ÁªÀÅ ¤ªÀÄUÉ PÀgÉ ªÀiÁqÀÄvÉÛêÉ. EzÀPÉÌ «¥sÀ®gÁUÀĪÀÅzÀÄ ªÉÄÃ¯É ºÉýzÀ ªÉÆvÀÛªÀ£ÀÄß »A¥ÀqÉAiÀÄĪÀÅzÀPÉÌ ¤AiÀĪÀÄUÀ¼ÀÄ ºÁUÀÆ µÀgÀvÀÄÛUÀ¼À°è ¤¢ðµÀÖ¥Àr¹zÀÄ CqÀ«j¹zÀ ªÀ¸ÀÄÛUÀ¼À ºÀgÁdÄ DgÀA©ü¸ÀĪÀÅzÀ£ÀÄß ºÉÆgÀvÀÄ¥Àr¹ ¨ÉÃgÉ DAiÉÄÌAiÀÄ£ÀÄß ºÉÆA¢gÀĪÀÅ¢®è ªÉÄÃ¯É ºÉýzÀ ªÉÆvÀÛªÀ£ÀÄß »A¥ÀqÉAiÀÄĪÀÅzÀÄ C°è GAmÁUÀĪÀÅ ªÉZÀÑUÀ¼ÀÄ CxÀªÁ ¸ÀAQÃtðvÉUÉ ¸ÀA§A¢ü ºÉÆuÉUÁjPÉAiÀÄÄ ¸ÀA¥ÀÆtðªÁV ¤ªÀÄäzÁVgÀÄvÀÛzÉ.   

          11. Admittedly, a notice dated 16-12-2016 was sent to the complainant calling upon him to repay the loan amount of Rs.97,001=00 or loan interest amount of Rs.16,565=00 within 10 days that is before 26-12-2016. However the said notice was received by the complainant on 24-12-2016. But the OP has conducted the auction on 24-12-2016 itself. The complainant approached the OP office on 26-12-2016 since on 25-12-2016 was a holiday on the eve of Christmas. By then auction was conducted on 24-12-2016 itself. Without giving any opportunity to the complainant to repay the loan amount the OP has not provided reasonable time to the complainant even as per their own notice. The said auction of the OP is highly deprecated and condemnable. The OP has failed in their statutory right even as per their notice. Be that as it may the auction has been conducted even before the expiry of the period of mortgage i.e. on 24-12-2016, when the periods of mortgage expire on 3-6-2017. Therefore, the auction of the OP amounts to deficiency in service.

12. Further, with regard to auction of gold ornaments, no intimation was given to the complainant about the amount received through auction, except for informing the complainant to receive Rs.5,441=00 as an excess of the amount received by auction, no details have been furnished to the complainant. The complainant therefore has suffered severe mental agony for the act of the OP. Hence, we come to the conclusion that, the complaint filed by the complainant should be allowed. Hence, in view of the above discussion that, there is deficiency in service on the part of the OP. Therefore, going as per the averments made by the complainant, we come to the conclusion that, the OP shall pay Rs.1,25,000=00  by deducting loan amount of Rs.97,001=00 i.e. Rs.27,999=00 to the complainant along with 9% interest from the date of auction till the date of realization. Further in respect of mental agony, the OP is directed to pay Rs.20,000=00 as compensation and Rs.5,000=00 towards litigation cost to the complainant. Accordingly we answer this point in the affirmative. In the result, for the foregoing reasons, we proceed to pass the following order.

ORDER

The complaint filed by the complainant is allowed in part.

The OP is directed to pay Rs.27,999=00 to the complainant along with 9% interest from the date of auction i.e. on 24-12-2016 to till the date of realization.

The OP is further directed to pay compensation of Rs.20,000=00 and Rs.5,000=00 towards litigation cost to the complainant.

This order is to be complied by the OP within 30 days from the date of this order.

          Supply free copy of this order to both parties. 

          (Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open forum on this, the 21^st day of December 2017).

LADY MEMBER                          PRESIDENT