Date of filing:14.5.2013.
Date of disposal:15.1.2014.
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM - II:
VIJAYAWADA, KRISHNA DISTRICT
Present: SRI A. M. L. NARASIMHA RAO, B.SC., B. L., PRESIDENT
SMT N. TRIPURA SUNDARI, B. COM., B. L., MEMBER.
WEDNESDAY, THE 15th DAY OF JANUARY, 2014
C.C.No.80 of 2013
Between:
Pilla Satyanararayana, S/o Penta Rao, Hindu, 41 years, Business, R/o D.No.5-6-43/2, Upstairs of Baba Cell World, Lambadi Pet, K.T.Road, Near Jayathi Perals Apartments, Vijayawada -9.
. … Complainant.
AND
1. The Managing Director, Kanaka Durga Leasing & Finance Ltd., D.No.40-1-41, M.G.Road, Labbipet, Vijayawada – 10.
2. The Branch Manager, Kanaka Durga Leasing & Finance Ltd., D.No.11-1-25, Near Bodemma Hotel, B.R.P.Road, Vijayawada – 1.
.… Opposite Parties.
This complaint coming on before the Forum for final hearing on 9.1.2014 in the presence of Sri M.Adinarayana Rao, Counsel for complainant and Sri D.Viswa Chaitanya, Counsel for opposite parties and upon perusing the material available on record, this Forum delivers the following:
O R D E R
(Delivered by Hon’ble Member Smt N. Tripura Sundari)
This complaint is filed under Section 12 of the Consumer Protection Act,1986.
1. The averments of the complaint are in brief:
The complainant’s wife and his co-brother obtained gold loan from M/s Karvy Financial Services Limited, Vijayawada. Subsequently the opposite parties approached the complainant and informed that they will provide gold loan with lower rate of interest and also informed that they would take over the loan from any financial institution. As per the assurance given by the opposite parties the complainant requested the opposite parties to take over the loan from Karvy Financial Services, Vijayawada. Accordingly the opposite parties paid Rs.8,00,000/- to them on 9.8.2012 and the complainant also paid Rs.52,650/-to them. The complainant pledged 415.4 grams of gold with the opposite parties and obtained loan of Rs.8,54,000/-. Thereafter the opposite parties informed the complainant that interest rates are reduced to new customers and as such the opposite parties requested the complainant to clear entire loan and obtain fresh loan. The complainant cleared the entire loan on 10.9.2012 and obtained fresh loan of Rs.9,24,000/- on the same day by pledging the same ornaments. The said loan has to be cleared within one year from the date of obtaining the loan. While so, due to fluctuations of gold rate the opposite parties issued a notice on 28.4.2013 demanding the complainant to pay the entire gold loan amount on or before 30.4.2013. The complainant approached the opposite parties and informed that he was unable to clear the entire loan amount and requested three months time to clear the gold loan even though the time limit for clearing the gold loan is upto September,2013., The complainant ready to pay half of the interest on or before 10.5.2013. The complainant approached the opposite parties on 8.5.2013 to pay interest but the opposite parties informed that they are going to auction the pledged gold ornaments. The opposite parties have no right to auction the gold within one year from the date of taking the loan. But the opposite parties threatened the complainant by informing that they sent the gold for auction. As such the opposite parties committed deficiency in service. Hence the complainant is constrained to file this complaint against the opposite parties praying the Forum to direct the opposite parties for not to condut the auction of the gold ornaments of the complainant, to pay Rs.4,50,000/- towards compensation for mental agony and to pay costs of Rs.5,000/-.
2. The 1st opposite party filed its version and the 2nd opposite party adopted the same.
The version of the opposite parties is in brief:
The opposite parties denied all the allegations of the complaint and submitted that the complainant himself approached the opposite parties and asked for gold loan. The 2nd opposite party agreed to lend gold loan to the complainant and after agreeing the terms and conditions of the opposite parties in regard to sanction of gold loan by the complainant, the 2nd opposite party sanctioned the gold loan. All the ornaments pledged by the complainant are gold and some are studded with ordinary stones. The description of the gold and its gross weight and net weight was mentioned in the gold loan form. Had there been any diamonds, it should be clearly mentioned. The complainant is not a lay man. So the contention of the complainant that he deposited diamond studded gold with opposite parties is only after thought to gain wrongfully. The opposite parties acted as per terms and conditions agreed upon. As the complainant failed to pay the interest as per terms and conditions, the opposite parties followed the procedure and gave repeated noties and finally gave an auction notice and all the notices were personally intimated and took the signatures of the complainant. It was undertaken by the complainant at the backside of the application form that “The borrower should repay the loan amount with interest as agreed upon within 12 months from to day or as demanded by the Kanaka Durga Leasing & Finance Limited”. Due to fluctuations in the gold prices, the opposite parties demanded the complainant to pay the gold loan with interest. The complainant having failed to pay the interest in time and knowing the consequences of the auction of the pledged ornaments, he came up with a fictitions circumstances as if the opposite parties auction the gold ornaments without his notice and without following the procedure. The complainant is trying to put pressure on the opposite parties by making false allegations to gain time for not paying the interest in time. There is no deficiency in service on the part of opposite parties. Hence prayed to dismiss the complaint.
3. On behalf of the complainant he filed his affidavit and got marked Ex.A.1 to Ex.A.14 and on behalf of the opposite parties Sri S.Laxmi Narayana, Managing Director of the 1st opposite party filed his affidavit and got marked Ex.B.1 to Ex.B.4.
4. Complainant filed written arguments. Heard and perused.
5. Now the points that arise for consideration in this complaint are:
1. Whether there is any deficiency in service on the part of opposite parties
towards the complainant in auctioning the gold ornaments of the complainant
within one year even though there is time to release the gold?
2. If so is the complainant entitled for any relief?
3. To what relief the complainant is entitled?
POINTS 1 AND 2:-
6. On perusing the material on hand, the complainant says that his wife and his co-brother obtained gold loan by pledging their gold ornaments from one Karvy Financial Services Ltd. and subsequently the opposite parties approached him and informed that they will provide gold loan with lower rate of interest and they would take over the loan from any financial institution. As per the assurance of the opposite parties he requested them to take over the loans from Karvy Financial Services Ltd. The opposite parties take over the loan from Karvy Financial Services by paying Rs.8,00,000/- to them on 9.8.2012. The complainant pledged 415.4 grams of gold with the opposite party and obtained Rs.8,54,000/- and cleared the entire loan and obtained fresh loan of Rs.9,24,000/- on 10.9.2012 under various accounts. The opposite parties issued four receipts for the same on same day under Ex.A.4. Due to fluctuation of the gold rate the opposite parties issued four notices under Ex.A.5 to the complainant to release the gold within 30.4.2013 or to pay upto date interest and pledge the gold again. The complainant sent request letter Ex.A.6 dated 30.4.2013 to the opposite parties stating that as he had ill health due to accident he could not pay the interest in time and requested to grant three months time to pay the interest if they do not grant any further time for payment of interest, the opposite parties are the responsible for the actions taken by him. As there was no response from the opposite parties he got issued legal notice Ex.A.8 dated 8.5.2013 through his advocate demanding the opposite parties not to sell or conduct auction of the gold of the complainant if the opposite parties do so the complainant will take actions against the opposite parties in the court of law. The opposite parties received the said notice under Ex.A.11. The complainant filed three documents on 16.12.2013 and they were marked as Ex.A.12, Ex.A.13 and Ex.A.14. Ex.A.12 is advertisement of opposite parties on buses stating that Rs.2,300/- per every gram and interest is one rupee and there are two stars stating that conditions apply. Ex.A.13 is advertisement of the opposite parties on B.R.T.S. bus shelter P.W.D. grounds stating the same as in Ex.A.12 and Ex.A.14 is paper advertisement stating the same as in Ex.A.12 and Ex.A.13.
7. The opposite parties says that the complainant himself approached the opposite parties for gold loan and the complainant agreed the terms and conditions of the opposite parties and obtained gold loan under Ex.B.1 to Ex.B.4. As the complainant failed to pay interest as per terms and conditions, the opposite parties followed the procedure and gave repeated notices personally to the complainant and finally gave an auction notice. It was undertaken by the complainant at the backside of the application form that “The borrower should repay the loan amount with interest as \agreed upon within 12 months from to-day or as demanded by the Kanaka Durga Leasing & Financial limited”. Due to fluctuations in the gold prices the opposite parties demanded the complainant to pay the gold loan with interest.
8. The Forum noticed the contents of Ex.A.4 that the borrower has to pay interest every month for the loan amount, if he failed to pay interest every month for the said amount, the company is entitled to receive penalty charges for the due interest. We also noticed in Ex.A.4 that the next due date is 9.10.2012 for all loans taken by the complainant. In Ex.B.1 to Ex.B.4 it was mentioned about the items of gold and its weight as
Ex.B.1
Sl No. | Gold Items | Gross Weight | Stone Weight | Net Weight | Approx.Value |
1 | Long Neck-1 | 101.1 | 1.5 | 98.48 | Rs.2,26,500/- |
2. | B/L (Small – 1) | | | | |
3. | Studs & Drops (2) | | | | |
4. | F/R (SF) – (5) | | | | |
Ex.B.2
1 | Bracelet (1) | 160.4 | 4.5 | 154..35 | Rs.3,55,000/- |
2. | Baby Bangles (2) | | | | |
3. | Chain with Lkt (1) | | | | |
4. | F/r (SF) (6) | | | | |
Ex.B.3
1. | Neck (1) | 39.6 | 0.2 | 39.14 | Rs.90,000/-. |
2. | Studs & Drops – 4 | | | | |
3. | Matties ( 2) | | | | |
Ex.B.4
1. | Chains (3) | 114.3 | 3.5 | 109.8 | Rs.2,54,500/- |
2. | SF, N/c – (1) | | | | |
3. | Matties (3) | | | | |
4. | SF,LKT (1) | | | | |
5. | SF, F/R (2) | | | | |
The opposite parties grant loan for full value of the gold. We did not find any diamond item in the said gold items as mentioned in the complaint by the complainant. In the terms and conditions of Ex.B.1 to Ex.B.4 the period of loan is for one year and the borrower has to repay loan with interest on or before 12 months the full amount of the loan with interest is not made within period of the loan or – such period as demanded, by the borrower out of his/ her free will here by authorize the company to dispose of the pledged ornaments either by public auction or by private arrangements at any time after two weeks from the date to the company in respect of the loan.
9. We, concluded that the complainant pledged his gold ornaments weighting of 415.4 grams gross weight gold ornaments with the opposite parties on 10.9.2012 and obtained loan of Rs.9,24,000/-. As per the opposite parties the period of loan is one year. The complainant has to clear the loan on or before within one year. The opposite parties gave notice to clear the loan within 30.4.2013. No where it was mentioned in Ex.B.1 to Ex.B.4 that interest shall be paid every month and penalty should be paid in default. So such condition in Ex.A.4 is not valid and binding on the complainant. The complainant says that he was attracted by those advertisements and approached the opposite parties for gold loan and the opposite parties are entitled to receive only one rupee interest rate for every month. But we do not agree with the complainant as now a days even the nationalized banks are not giving the gold loan at the rate of 12% per annum. At the time of agreement the complainant knows very well that he was sanctioned full value for his gold by the opposite parties. No bank can sanction the loan for its full value. So a man who wants higher amount of loan, approaches the private financial institutions not banks. The opposite parties did not send any auction notice and as per their terms they have not obtained the permission of the complainant to recover the loan amount by auctioning his gold. Moreover due period of one year is not over and it would be over on 9.8.2013. Meanwhile the complainant filed this complaint along with IA.146/13 on 14.5.2013 praying the Forum to pass an interim order against the respondents not to conduct auction of the gold ornaments in A/c Nos.VOT-423 to VOT – 426 belongs to the complainant till disposal of the main complaint. We, the Forum granted the interim order as prayed by the complainant. Now the complainant gold is with the opposite parties. The complainant has to pay the loan amount along with interest to the opposite parties and the opposite parties has to release the gold. The opposite parties are entitled to receive the loan amount with interest at the rate of 27% per annum as agreed upto date. In view of Natural justice, the opposite parties are not entitled to get penalty charges and other charges from the complainant except monthly interest @ 27%upto date. Accordingly these points are answered.
POINT No.3:-
10. In the result, the complaint is allowed in part and the opposite parties are directed to receive the gold loan amount with interest at the rate of 27% per annum upto date as agreed without any penalty charges and other charges and release all the gold items of the complainant to him. The complainant is also directed to pay the gold loan amount with interest @ 27% p.a. upto date and get release the gold within three months time. If the complainant failed to pay the loan amount with interest as ordered by the Forum, the opposite parties are at liberty to auction the gold of the complainant and recover the loan. If any surplus amount remains the opposite parties have to hand over the same to the complainant or deposit the same in the Forum on intimation to the complainant. Rest of the claims of the complainant are rejected. No costs are imposed in view of the circumstances of the complaint.
Typewritten by Stenographer K.Sivaram Prasad, corrected by me and pronounced by us in the open Forum, this the 15th day of January, 2014.
PRESIDENT MEMBER
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
For the complainant: For the opposite parties:-
P.W.1 Pilla Satyanararayana D.W.1 S.Laxmi Narayana,
Complainant Managing Director of the
(by affidavit) 1st opposite party,
(by affidavit)
DOCUMENTS MARKED
On behalf of the complainant:-
Ex.A.1 09.08.2012 Cash receipt issued by the Karvy Financial Services Ltd., for
Rs.3,59,363/-.
Ex.A.2 09.08.21012 Cash receipt issued by the Karvy Financial Services Ltd., for
Rs.4,93,291/-.
Ex.A.3 10.09.2012 Four Cash receipts issued by the 1st opposite party.
Ex.A.4 10.09.2012 Four Pledge receipts issued by the 1st opposite party.
Ex.A.5 10.09.2012 Four final notices issued by the 1st opposite party.
Ex.A.6 30.04.2013 Photocopy of letter from the complainant to the 2nd opposite
party.
Ex.A.7 30.04.2013 Postal receipt.
Ex.A.8 08.05.2013 Office copy of legal notice.
Ex.A.9 08.05.2013 Two courier receipts.
Ex.a.10 09.05.2013 Two postal receipts.
Ex.A.11 08.05.2013 Two courier receipts.
Ex.A.12 . . Photo.
Ex.A.13 . . Photo.
Ex.A.14 . . Paper publication.
For the opposite parties:-
Ex.B.1 10.09.2012 True copy of particulars of gold loan.
Ex.B.2 10.09.2012 True copy of copy of particulars of gold loan.
Ex.B.3 10.09.2012 True copy of Notarized copy of particulars of gold loan.
Ex.B.4 10.09.2012 True copy of copy of particulars of gold loan.
PRESIDENT