Date of filing:18-07-2012
Date of Disposal: 13-05-2014
DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: ANANTHAPURAMU
PRESENT:- Sri S.Niranjan Babu, B.A.,B.L., President (FAC).
Smt.M.Sreelatha, B.A., B.L., Lady Member
Tuesday, the 13th day of May, 2014
C.C.NO.36/2012
Between:
P.Mohammad Ali
S/o Fakruddin Sab
r/o Gangavaram Village
Belguppa Mandal
Ananthapuramu District. …. Complainant
Vs.
The Manager,
Shriram Transport Finance
Company Ltd., Gooty Road
Ananthapuramu. …. Opposite party
This case coming on this day for final hearing before us in the presence of Sri B.Vijaya Kumar and Sri V.Rajasekhar, Advocates for the complainant and Sri G.Chandrasekhar Reddy, Advocate for the opposite party and after perusing the material papers on record and after hearing the arguments on both sides, the Forum delivered the following:
O R D E R
Smt.M.Sreelatha, Lady Member:- This complaint has been filed by the complainant under section 12 of the Consumer Protection Act, 1986 against the opposite party to release the vehicle of the complainant bearing No.KA-40-3398 and to pay a sum of Rs.1,00,000/- per month towards compensation for loss of source of income from the date of seizure of vehicle till the date of release and Rs.5,00,000/- towards compensation for illegal seizure of vehicle and for defamation caused to the complainant and award costs of the complaint.
2. The brief facts of the complaint are that :-The complainant availed loan No.TSL ANTPR0000318 from the opposite party for purchasing 10 wheeler lorry. The opposite party has given specific payment schedule to the complainant and he has to pay installments starting from 15-03-2008 to 15-01-2013. Further the amount payable is at Rs.31,234/- per month up-to 15-07-2010 and later at Rs.20,129/- per month. In all the complainant has to pay a sum of Rs.15,09,650/- by 15-01-2013. The complainant stated that he paid all the installments from 3/2008 to 20-01-2012 and he also stated that he paid many amounts which are more than installment amounts payable by the complainant and he paid a sum of Rs.16,12,070/- by 20-01-2012 i.e. excess payment. But to the shock and surprise of the complainant, the opposite party seized his vehicle bearing No.KA-40-3398 on 20-05-2012. When the complainant approached the opposite party and informed that he paid the entire amount of the loan even one year earlier to the schedule, the opposite party has not cared to release the vehicle and further more issued a letter requesting the complainant to pay an amount of Rs.9,70,000/- by 10-06-2012 as full and final settlement of the loan amount. The complainant stated that the opposite party has failed to give calculation as to how they arrived at the figure of Rs.9,70,000/- to be payable by the complainant towards full and final settlement of the loan as on 10-06-2012. The complainant submits that he got issued legal notice on 18-06-2012 to the opposite party requesting to release the vehicle and to pay an amount of Rs.1,00,000/- per month from the date of seizure till the date of release of the vehicle as compensation since the complainant lost source of income due to high-handed and illegal act. The opposite party is also liable to pay Rs.5,00,000/- as compensation for illegal seizure and for defamation caused to the complainant. The opposite party has to issue clearance certificate of the vehicle declaring that loan is cleared but the opposite party issued notice on 21-05-2012 which received by the complainant on 02-07-2012 making a demand for an amount of Rs.8,51,511/- as due amount. Hence this complaint.
3. The opposite party filed counter stating that the complaint is not maintainable and liable to be dismissed as the averments of the complaint are false and baseless and the opposite party mentioned that the complainant is not a consumer within meaning of Consumer Protection Act and the complaint is liable to be dismissed. The complainant is a borrower and obtained loans from the opposite party under loan-cum-hypothecation agreement and other child loans. The complainant availed the services of the opposite party for commercial purposes and he is doing business through the said vehicle and the same was admitted by the complainant in the complaint repeatedly. Therefore under section 2(d)(ii) of the Consumer Protection Act, the complaint is not maintainable and liable to be dismissed. The opposite party explained all the terms and conditions of the agreement at the time of entering into the agreement and the agreement contains arbitration clause hence any dispute arises between the parties and the dispute has to be referred to the sole arbitrator at Penukonda to resolve the dispute. Therefore this Forum has no jurisdiction to maintain the complaint. The opposite party submitted that the complainant entered into loan-cum-hypothecation agreement with the opposite party to purchase 10 wheeler commercial lorry No.KA-40-3398 and he agreed for the terms and conditions of the loan agreement. The complainant has entered into the main agreement vide agreement No.TSL ANTPR0000318 on 15-03-2008, which shall be concluded by 15-01-2013. It is further submitted that the complainant after entering into the main agreement, he has availed different loans (child agreements) for purchase of tyres and other purposes. Further the complainant requested the opposite party to pay insurance premiums of the vehicle. As per the agreement the borrower has to pay the finance charges and liable for overdue charges for delayed payment and default of installments. As such the complainant has to pay the overall amount of Rs.24,08,326/- to the opposite party, but he paid only a sum of Rs.13,42,620/- towards parent and child agreement installments. The complainant is a defaulter and he has to pay an amount of Rs.8,51,511/- by the date 15-05-2012. It is submitted that as per the terms of agreement the opposite party being the lender is entitled to take repossession of the vehicle in the event of default of the borrower. The opposite party has reliably learnt that the complainant is trying to dismantle the vehicle and sell away spares at whatever price he gets. Then the opposite party has no other option repossessed the vehicle on 20-05-2012 after due intimation and by serving the vehicle inventory report. The opposite party has also got issued notice after repossession of the vehicle to the complainant requested to settle the amount, but the complainant did not respond to the notice. Later the complainant approached the opposite party and agreed for final settlement of the loan and requested 8 days’ time for payment and that the opposite party has calculated the loan amount up-to 10-06-2012 and gave full and final settlement letter dt.02-06-2012 intimating the full and final settlement figure at Rs.9,70,000/-. The complainant has suppressed the child loans and other amounts advanced by the opposite party and he cunningly approached the opposite party pretended that he is going to settle the loan and obtained the letter for final settlement but he filed the present complaint with false accounts. The complainant has agreed and given undertaking that the payment of installments and for final settlement but suppressing the commitments and undertakings filed the present complaint. The opposite party has not shown any illegal act and did not violate any terms of loan-cum-hypothecation agreement. Therefore the opposite party cannot be restrained from exercising their rights to take action under the terms of agreement. The opposite party is a reputed company and takes action against the defaulters as per clause for the agreement. Hence there is no deficiency of service on the part of the opposite party and there is no cause of action to file the complaint and the complaint is liable to be dismissed as complaint filed with fabricated records.
4. Basing on the above pleadings, the points that arise for consideration are:-
1. Whether the vehicle seized by the opposite party is illegal and arbitrary?
2. Whether the complainant is entitled for the compensation as claimed in the
complaint ?
3. To what relief?
5. In order to prove the case of the complainant, the complainant has filed evidence on affidavit on his behalf and examined as PW1 and marked Ex.A1 to A10 documents. On behalf of the opposite party, the opposite party has filed evidence on affidavit on its behalf and examined as RW1 and marked Ex.B1 to B4 documents.
6. Heard on both sides.
7. POINT NO.1:- The counsel for the complainant argued that the complainant availed loan from the opposite party in the year 2008 and agreed to pay the same by installments till 15-01-2013. As per agreement, he has to pay Rs.31,234/- per month up-to 15-07-2010 and later Rs.20,129/- per month. The complainant paid entire installments before due date. He paid installment amounts by the date of 20-01-2012 to the tune of Rs.16,12,070/- and the complainant paid excess amount than the loan amount. The counsel for the complainant argued that even then the complainant discharged the entire loan amount, the opposite party has seized his vehicle on 20-05-2012 without any prior notice or intimation. When the complainant questioned the same, the opposite party issued a letter stating that he is still due amount of Rs.9,70,000/- on 10-06-2012 for this there is no explanation from the opposite party to arrive the above figure. Then the complainant got issued legal notice requesting the opposite party to release the vehicle and also to pay Rs.1,00,000/- per month for illegal seizure of the vehicle till release of the vehicle for this there was no reply from the opposite party. Then the opposite party issued repossession letter with previous date as 21-05-2012 but the same was received by the complainant on 02-07-2012. Hence the complainant is entitled to release of the vehicle and also compensation as claimed.
8. The counsel for the opposite party argued that the complainant approached the opposite party after seizing the vehicle and requested the opposite party for full and final settlement, then only the opposite party issued a letter on 02-06-2012 with endorsement that the amount of Rs.9,70,000/- is due. In the meanwhile, the complainant got issued legal notice on 18-06-2012 by suppressing the amount due by him to the opposite party. The complainant is a chronic defaulter and the vehicle was seized when the opposite party reliably learnt that the complainant is trying to dismantle and sell away the vehicle, to safe-guard their loan, they have seized the vehicle after following due procedure and the vehicle was seized only after due process as per the agreement. There is no illegal seizure of the vehicle.
9. There is no dispute with regard to obtaining of loan by the complainant with the opposite party to purchase 10 wheeler lorry and to pay the installments as per agreement. When we go-through the exhibits filed by the complainant about the seizure as per Ex.A3 vehicle was seized on 20-05-2012. The case of the complainant is that before the loan due date i.e. 15-01-2013 the complainant discharged the entire loan amount to the opposite party on 20-01-2012 as per Ex.A5 and more over the complainant paid excess amount then the payment schedule amount as per Ex.A5.Whereas as per Ex.A1 the complainant has to pay Rs.15,09,650/-, the complainant paid a sum of Rs.16,12,070/- on 20-01-2012. The above said documents were marked without any objection by the opposite party though the documents were not bearing signatures nor seal of the opposite party. The witness of the opposite party i.e. RW1 in cross-examination he admitted that they have not mentioned lump sum amounts which are due by the complainant and also number of installments due. The complainant stated that his vehicle was seized by the opposite party on 20-05-2012 under Ex.A3 unlawfully and with illegal act even after the entire amount paid by him as per Ex.A5. The complainant stated that the opposite party failed to file any account extract to show that the complainant is a defaulter. As per Ex.A2 and A5 the complainant discharged the entire loan amount even-though the vehicle seized on 20-05-2012 unauthorizedly without following any procedure contemplated under law. When we go-through Ex.A9 i.e. repossession letters bears the date as 21-05-2012 whereas Ex.A10 i.e. envelope cover contains the name of the complainant and seal of the post office with date as 21-06-2012. To believe the same RW1 admitted in cross-examination that he cannot say the correct date of dispatch of repossession letter i.e. Ex.A9 and he also admits that Ex.A10 contains the postal seal dt.21-06-2012 and delivery date as 22-06-2012. The above said letter was reached to the complainant on 02-07-2012 as stated by the complainant is not denied by the opposite party. We agreed with the arguments of the complainant as Ex.A9 was prepared after issuing legal notice dt.18-06-2012 under Ex.A6. Admittedly the vehicle was seized when the vehicle was in possession of the brother-in-law of the complainant. Admittedly the opposite party has not filed any document to show that the complainant is a defaulter and how much of amount is due and how many installments. Either in the counter or in the affidavit, the opposite party has not mentioned whether they have issued any demand notice to the complainant at any point of time before seizure of the vehicle. They have not even filed any document to show that they have demanded for repayment of the installments. They have simply stated that they have demanded for repayment of the loan amount.
10. The complainant has also filed decision reported in AIR 2012 Supreme Court page 509 between State Corporation Vs. Vijayalakshmi, wherein it is stated that “ repossession of vehicle by force even in case of mortgaged goods subject to Hire Purchase agreements, recovery process has to be in accordance with law and not by use of force till such time as ownership is not transferred to purchaser, hirer normally continues to be owner of goods, but that does not entitle him on the strength of the agreement to take back possession of the vehicle by use of force. “ Admittedly the vehicle is in the name of the opposite party and the same was not transferred in the name of the complainant. Hirer clearly continues to be owner of goods. The opposite party is holding right on the vehicle as the vehicle was obtained on Hypothecation agreement and the opposite party has got liberty to initiate legal action under due process of law against the complainant if any amount due by the complainant to the opposite party. The opposite party stated that the complainant is a chronic defaulter and when he tried to sell the parts of the vehicle and vehicle, then the vehicle seized in a bad condition. The opposite party failed to establish that the complainant is a defaulter and also failed to establish that the vehicle seized after following the procedure as contemplated. We are relying on the decision cited by the complainant that taking advantage of hypothecation, the opposite party has no right to seize the vehicle with force. They have not followed the procedure contemplated under law. Hence this point is answered accordingly in favour of the complainant and against the opposite party.
11. POINT NO.2 - With regard to compensation, the counsel for the complainant argued that the though the complainant used to pay installments regularly and in some occasions he used to pay more amounts than the installments. It clearly shows that under Ex.A2 receipts issued by the opposite party that the complainant paid 3 or 4 installments on one day. The counsel for the complainant also argued that the complainant paid installments amount more than the amount under Ex.B1 loan agreement. The vehicle of the complainant seized high handedly without following the procedure then the complainant got issued legal notice dt.18-06-2012 under Ex.A6 for which there is no reply from the opposite party. For the illegal seizure of the vehicle, the complainant lost amount of Rs.1,00,000/- per month though he is depending on the sole income arrived form the vehicle and the it is a clear case of deficiency of service on the part of the opposite party and the complainant is entitled the amount claimed by him. The opposite party argued that the complainant agreed the terms and conditions of agreement under Ex.B1 after admitting the same he has taken loan. As per Ex.B1 that if any dispute arise between the parties dispute may be referred to arbitrator. The complainant has not filed any complaint before the arbitrator. Hence this complaint is not maintainable. The allegation of the complainant that he paid entire amount is not tenable because Ex.A2 and A5 does not contain the signature or seal of the opposite party. The opposite party also argued that the complainant admitted that in some of the receipts under Ex.A2 it does not contain the loan number, seal or signature of the opposite party. It was fabricated receipts alongwith Ex.A5. The complainant approached the opposite party after seizure of the vehicle and requested to settle the claim as per Ex.B3 and B4 then only the opposite party has issued a letter intimating the amount of Rs.9,70,000/- is due towards installments. The opposite party also argued that the complainant has taken child loan alongwith parent loan and requested the opposite party to permit him to pay installments under one head under Ex.B3. The complainant suppressed about the child loans, which were taken by him alongwith parent loan and the complainant due an amount of Rs.9,70,000/- as per Ex.B4 and A4 and the opposite party also argued that the complainant failed to establish his case that he is depending on the sole income of the vehicle which was seized by the opposite party. The opposite party also contended that without paying the admitted amount by the complainant, he has filed the present complaint to harass the opposite party and to evade the payment due by the complainant. Hence the complainant is not entitled any compensation as claimed and mental agony as there is no deficiency of service on the part of the opposite party.
12. When we go-through the cross-examination of PW1 he admitted arbitrator clause in the agreement. He has not made any complaint to the arbitrator. The complainant has no bar to approach this Forum and when there is clause in the agreement to refer the matter to the arbitrator. The complainant is at liberty to approach the Consumer Forum and the same was held in 2012 CPJ Supreme Court between National Seeds Corporation Ltd., Vs. M. Madhusudhan Reddy. The Hon’ble Supreme Court observed that remedy of arbitration is not only remedy available to grower and it is optional remedy he can either seek reference to arbitrator or file complaint under Consumer Protection Act. If he opts remedy of arbitration then it may be possible to say that he cannot subsequently file complaint under Consumer Protection Act. If he chooses to file the complaint before the District Consumer Forum, then he cannot be denied relief by invoking section 8 of Arbitration and Conciliation Act. Moreover section 3 of Consumer Protection Act clearly states that remedy available in that act is in addition and not in derogative of the provisions of any other law. Hence we are of the opinion that this Forum has got territorial jurisdiction and the complainant has rightly approached this Forum and the complaint is maintainable before this Forum. The complainant admitted in cross-examination that signatures in document i.e. Ex.B2 loan belongs to him and he also admitted that under Ex.A2 & A5 does not contain signature or seal of the company. Though the complainant admits about the signature in the child loan agreement Ex.B2 he is denying about the child loans which were availed by him towards tyres and other purposes. The complainant admitted that he approached the opposite party after seizure of the vehicle 10 times and he also admits that in Ex.B3 and B4 document’s belongs to his signatures. Whereas he denied the contents about the same. Ex.B3 is document that the complainant requested the opposite party that the installment amounts may be recovered alongwith child loan. Ex.B4 is request made by the complainant on 02-06-2012 that he intent to settle the claim, after going through the extract he admitted to pay the amount of Rs.9,70,000/- within 8 days and take back his vehicle. But the complainant denying about the amounts due by him. On the other hand the opposite party also failed to show that how much of amount is due by the complainant, he simply stated that the complainant paid only Rs.13,42,620/- overall the amount of Rs.24,08,326/- is due under the heads of parent and child loans. The opposite party has not filed any document or extract to show how much of the amount due by the complainant. The complainant simply stated that he sustained loss of Rs.1,00,000/- per month for illegal seizure of the vehicle. In the entire complaint nowhere mentioned how much of the amount he used to get per month whether the complainant is solely depending on the income of the vehicle is not mentioned in the complaint. The complainant has also not even filed any proof to how he arrived the figure of Rs.1,00,000/- per month. As per cross-examination, the complainant has not filed driving licence and vehicle registration certificate before the Forum. The complainant has not established his case about the compensation how he is entitled Rs.1,00,000/- per month from the date of seizure. Hence, this point is answered accordingly in favour of the opposite party and against the complainant.
13. POINT NO.3 - In the result the complaint is allowed partly directing the opposite party to release the vehicle of the complainant bearing No.KA-40-3398 seized unauthorizedly on 20-05-2012 within one month from the date of this order. The opposite party is also at liberty to initiate legal action against the complainant if any amounts due by him under due process of law only after release of the vehicle to the complainant. Claim about compensation is dismissed as the complainant failed to establish the same and both parties do bear their own costs.
Dictated to Steno, transcribed by him, corrected and pronounced by us in open Forum this the 13th day of May, 2014.
Sd/- Sd/-
LADY MEMBER, PRESIDENT(FAC),
DISTRICT CONSUMER FORUM, DISTRICT CONSUMER FORUM,
ANANTHAPURAMU ANANTHAPURAMU
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
ON BEHALF OF THE COMPLAINANT: ON BEHALF OF THE OPPOSITE PARTY
PW1 – P.Mohammad Ali, complainant RW1 – Sri Nandyal Rajasekhar,
on 22-02-2013. Branch Manager, Shriram Transport
Finance Ltd., on 18-06-2013.
EXHIBITS MARKED ON BEHALF OF THE COMPLAINANT
Ex.A1 - Repayment schedule issued by the opposite party to the complainant.
Ex.A2 - Bunch of Loan receipt
Ex.A3 - Carbon copyof Vehicle Inventory Report dt.20-05-0212 issued by the opposite party to
the complainant.
Ex.A4 - Settlement letter dt.02-06-2011 issued by the opposite party to the complainant.
Ex.A5 - Details of payment extract relating to complainant issued by the opposite party.
Ex.A6 - Office copy of legal notice dt.18-06-2012 got issued by the complainant to the
Opposite party.
Ex.A7- Postal Receipt dt.19-06-2012.
Ex.A8 - Postal acknowledgment signed by the opposite party.
Ex.A9 – Notice after repossession dt.21-05-0212 issued by the opposite party to the
complainant.
Ex.A10 - Postal cover addressed to the complainant.
EXHIBITS MARKED ON BEHALF OF THE OPPOSITE PARTY
Ex.B1 - Original Loan-cum-Hypothecation Agreement dt 12-01-2008 executed between the
Complainant and opposite party.
Ex.B2 – Original Child Loan Agreements 13 in number.
Ex.B3 - Letter dt.12-02-2008 submitted by the complainant to the opposite party.
Ex.B4 – Letter dt.02-06-2012 submitted by the complainant to the opposite party.
Sd/- Sd/-
LADY MEMBER, PRESIDENT(FAC),
DISTRICT CONSUMER FORUM, DISTRICT CONSUMER FORUM,
ANANTHAPURAMU ANANTHAPURAMU
Typed by JPNN
