Date of filing:  02.02.2015

Date of order:  14.09.2022

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, VELLORE AT VELLORE DISTRICT.

  PRESENT:      THIRU. A. MEENAKSHI SUNDARAM, B.A.,B.L.        PRESIDENT

                          THIRU. R.  ASGHAR KHAN, B.Sc., B.L.                     MEMBER – I

                          SELVI. I. MARIAN RAJAM ANUGRAHA, M.B.A.,       MEMBER - II

WEDNESDAY THE 14^TH DAY OF SEPTEMBER 2022

CONSUMER COMPLAINT NO.6/2015

P. Pandurangan,

S/o. Kanna Mudali,

No.141, Kamaraj Street,

Arumparuthi Village,

Katpadi Taluk,

Vellore District.                                                                                          …Complainant

-Vs-

1. The Senior Manager,

    Indian Overseas Bank,

    Vandranthangal Branch,

    Vandranthangal Village & post,

    Katpadi Taluk,

    Vellore District.

2. The Proprietor,

    Karthik Tractors,

    Indo Farm Industries Limited,

    Kavi Power Tiller,

    No.10, 8^th East Main Road,

    Gandhi Nagar, Vellore – 632 006.                                              ….Opposite Parties

Counsel for complainant            :  Tmt.  N. Selvi

Counsel for first opposite party  :  Thiru. K.M. Boopathy

Second opposite party               :  Exparte  on 30-11-2018

ORDER

THIRU. A. MEENAKSHI SUNDARAM, B.A.,B.L. PRESIDENT

This complaint has been filed under Section 12 of Consumer Protection Act 1986, Complainant has prayed this Hon’ble Commission to direct the opposite parties to release of the Power Tiller, Engine No. G10Z0002461 and Chasis No. 15110948 and return of the documents mortgaged, the expected loss of income for the failure to return the Power Tiller inspite of demand made by the complainants, commencing from August 2012 at the rate of Rs.15,000/- per month and to continue till the actual date of handing over of the Tiller. The value of claim for the petition is Rs.2,00,000/- being the loss of income from the month of August 2012 to December 2014 and to pay at the same rate from the date of petition till the date of actual handing over, The damages to the Power tiller are estimated at Rs.1,50,000/- has to be made good by the opposite parties, metal agony is valued at Rs.4,00,000/- and also to cost Rs.20,000/-. 

1. The case of the complaint is briefly as follows:

            The complainant availed an agriculture loan for purchasing a15 HP Power Tiller with implements and the first opposite party sanctioned a loan of Rs.1,96,000/-.  The complainant has also executed the necessary documents for the aforesaid loan.  Further he has also executed mortgage by way of memorandum of deposit title deeds on 17.03.2011 as security for the aforesaid loan for the said power tiller with the first opposite party.  After sanctioning the aforesaid loan the second opposite party did not deliver the vehicle in time and he has handed over the vehicle only in the month of June 2012.  Due to perennial trouble and irrigation problem and also due to the failure of monsoon, the low yield of crops made the complainant difficult to repay the loan for the month of September 2012.  The first opposite party came along with the second opposite party staff and seized the vehicle and took back the said vehicle to their custody.  The complainant states that from the date of taking delivery of the power tiller during the month of June 2012, the complainant never used the power tiller for agricultural purpose and the said power tiller is only in the custody of the complainant for the period of only month.  After seizing the aforesaid vehicle the complainant was shocked and surprised.  The first opposite party sent a demand notice to the complainant on 29.08.2012 calling upon to repay a sum of Rs.1,97,257/- and a sum of Rs.23,257/- and Rs.35,670/- and threatening the complainant that if the complainant failed to do so, legal action will be taken for recovery of the aforesaid loan.  On receipt of this notice the complainant went personally to the bank and requested that time may be granted in view of the strained circumstances, in which the complainant was facing and the first opposite party is sending notices of recovery of debt amount.  The complainant further states that he never utilized the power tiller and it was only in his custody for the period of only one month and without giving any chance to use the power tiller, the first and second opposite party seized the vehicle.  The opposite party is well aware of fact that the loan availed by the complainant was an agricultural loan and that as an agriculturist he would also been entitled to protection that the benevolent government was extending to agriculturists.  Further the first opposite party was also well aware of the fact that there has also been moratorium on the collection of arrears from agriculturist and therefore the complainant was under the impression that the loan being an agricultural loan, the bank would extend the benefits to the complainant.  The first opposite party without giving any chances to the complainant for use of the power tiller, in the absence of the complainant in the house , with the help of the second opposite party came to the complainant’s house and has taken back the vehicle. The complainant came to know about the seizure only after returning to his house and he further submits that he never utilised the service of the Power Tiller and that it was under the custody of him only for a period of one month and that too without any use and that the complainant is now faced with two problems namely that his property has been hypothecated with the first opposite party and also his Power Tiller has been seized, completely crippling the complainant is his Agricultural Operations.  Further submits that he vehicle is under the custody of the second opposite party from the month of June 2012.  The first opposite party is a public utility organization and its end aim should be to protect the interest of the borrower, practically because the loan itself service oriented loan and the complainant would be entitled to as much leverage as possible.  The hasty action of the opposite parties in seizing the Power Tiller, without using the same by the complainant and at the time of the seizure the market value of the Power Tiller will be its original price since the said Power Tiller was out for delivery and seized within a span of one month only and its present value will be considerably less than that because the opposite parties has left in the open air subject to all the vagaries of the weather and rust due to oxidization and the loss of value is more than Rs.1,50,000/-.  The seized vehicles are exposed to the vagaries of the weather and their potential value has also deteriorated considerably.  It may be more or less termed as a condemned Power Tiller and the opposite parties are primarily responsible of the deterioration in the value of the seized power tiller.  The first opposite party has more or less adopted a “Dog in the Manager Policy” in that, it would not use and at that time not hand over it over to the complainant for him to use him.  Such an attitude by Nationalized Bank is despicable and really the expose the first opposite party in the wrong light.  Hence this complaint.

2.  The written version of first opposite party is as follows:

            The complainant approached the first opposite party and asked Agricultural Loan for the purchase of the Power Tiller and the first            opposite party sanctioned the loan on 16.03.2011 for a sum of Rs.1,96,000/-.  And for that he mortgaged the complainant’s properties and also deposited the title deeds dated 17.03.2011.  The said Power Tiller is hypothecation to the first opposite party is hereby admitted.   The other allegations made in the petitioner namely the fist opposite party directed the complainant to approach the second opposite party for delivery of the power tiller but the second party never delivered the power tiller and that the complainant was forced to approach the first and second opposite parties frequently for more than one year and that the second opposite party dragged on the matter and not delivered the vehicle to the complainant and after the complainant complaining the matter to the first opposite party alone the second opposite party delivered the Power tiller in the month of June 2012 and due to perennial trouble due to irritation problem and also the failure of the Monsoon and the low yield of crops the complainant cannot able to repay the loan during the said months and suddenly in the month of September 2012  the first opposite party came along with second opposite parties staff and seized the said vehicle and taken back the said vehicle to their custody and the Power tiller is only in the custody of the complainant for the period of only one month are all hereby specifically  and categorically denied as the same is false. The other allegations made in the petition namely the first opposite party sent a demand notice to the complainant dated 29.08.2012 calling upon him to repay a sum of Rs.1,97,257/- and a sum of Rs.23,257/- and Rs.35,670/- and threatening the complainant and legal action to be taken for the recovery of the said loan to the complainant and receipt of the notice the complainant went personally to the bank and requested time may be granted in view of the strained circumstances and without given chance to the complainant the opposite parties 1 and 2 seized the power tiller and the first opposite party was aware of the fact that the loan availed by the complainant was Agricultural Loan and he should be given protection from the Benevolent  Government and bank should extend the benefits to the complainant and the first opposite party without giving any chance to the complainant and in the absence of the complainant’s house and taken back the vehicle and the complainant came to know about the seizure only after returning to his house are all hereby specifically and categorically denied as the same is false.   The complainant never utilized the power tiller and it was under his custody for the period of one month and that to the complainant has hypothecated his property and the power tiller was also seized and completely crippling the complainant’s agricultural operation and the first opposite party should protect the interest of the borrower and hasty action of the opposite parties in seizing the power tiller and value of power tiller will be its original price and the opposite party has left in the open air subject to all the vagaries of the weather and rusty due to oxidization  and the loss of value is more than Rs.1,50,000/-  and the other allegations made against the first opposite party that a dog in the manager policy and the complainant should be protected from the Consumer protection Act and by way of hypothecation of mortgage by deposit of the title deeds and not returning  the power tiller will clearly amount to deficient  in service due to that the complainant  affect a lot of mental agony are all hereby specifically and categorically denied as is false.   Further, there is no allegations against the Indian Overseas bank in the complainant for the dispute between the complainant and the second opposite party was unnecessarily imp leaded us one of the party.   Therefore there is no deficiency in service on this part of this opposite party and they have got every right to seize the vehicle and prior notice for seizure is not at all mandatory.  It is therefore prayed that this Hon’ble Commission may be pleased to dismiss the complaint with cost.

3.         On receipt of this notice from this Hon’ble Commission.  The second opposite party did not appear, several opportunities given, the opposite party called absent set exparte.

4.         Proof affidavit of complainant filed.  Ex.A1 to Ex.A7 were marked.  Proof affidavit of first opposite party filed.  Ex.B1 to Ex.B3 were marked.  Written arguments of both sides not filed.  Oral arguments of first opposite party also heard.

5. The Points that arises for consideration are:

1.   Whether there is any deficiency in service on the part of the opposite 

      parties?

2.   Whether the complainant is entitled for relief as claimed in the

      complaint?

3.   To what other relief, the complainant is entitled to?

6. POINT NOS. 1&2:          

            The complainant approached first opposite party and availed a loan of Rs.1,96,000/- for purchasing a Power Tiller on 16.03.2011 as a security.  He also executed a mortgage by way of depositing the title deeds on 17.03.2011 for the repayment of the said loan. Further, he also hypothecated the said Power tiller in favour of the first opposite party.   That being so, the complainant defaulted in repayment of the said loan.  Hence, the opposite party seized the vehicle from the complainant. The allegation of the complainant is that he is doing agricultural activities and hence the power tiller is a main equipment for his survival, There  was a unfortunate situation like drought and failure of  monsoon which ended low yield in their agricultural activities,  therefore, he could not make repayments of the loan in time.  The opposite party without giving any prior notice, take seized his  power tiller.  Further they also issued a legal notice demanding to pay Rs.1,97,257/- and Rs.23,257/- and Rs.35,670/-  and if not paid legal action would be taken.   The opposite party after seizer of the power tiller left in the open air subject to all vagaries of the weather and rust due to oxidization and hence the loss of value is more than Rs.1,50,000/-.  Per contra, the opposite party contended that in view of the legal position if the, complainant is in default in repayment of the loan amounts, the opposite party having got every right to seize the vehicle and prior notice of seizure  is not  at all mandatory. Therefore they have seized, as per the procedure of established law.  In considering the argument advanced by the both parties.  We refer the following Orders  

1.                               THE HON’BLE SUPREME COURT  OF INDIA

ICICI Bank

Vs

Shanti Devi Sharma  & Ors.

on 15^th May, 2008

Held that,

Para 13(4) Complaints received by Reserve Bank regarding violation of the above guidelines and adoption of abusive practices followed by bank’s recovery agents would be viewed seriously.  Reserve Bank may consider imposing a ban on a bank from engaging recovery agents in a particular area, either jurisdictional or functional, for a limited period.  In case of persistent breach of above guidelines, Reserve bank may consider extending the period of ban or the area of ban.  Similar supervisory action could be attracted when the High Courts or the Supreme Court pass strictures or impose penalties against any bank or its Directors/Officer/agents with regard to policy, practice and procedure related to the recovery process.

Para 14.  We deem it appropriate to remind the banks and other financial institutions that we live in a civilized country and are governed by the rule of law. 

2.                                           THE HON’BLE HIGH COURT OF MADRAS

IN W.P.NO. 30194 OF 2002

P. Janakirama Reddy

Vs

The Special Officer & Ors.

Held that,

Para 9(i) The petitioner had also contributed a sum of Rs.93,651/- for purchasing the said tractor  after executing loan agreement and after depositing the title deeds of immovable properties, as such the seizure order is violative of the natural welfare since the tractor is being used for cultivating purpose and for generating the production of food  grains and not for his personal  luxury.  

Para 10.  This Court’s earlier order passed on 24.07.2002 and directed the petitioner to deposit a sum of Rs.50,000/- and if that order is already executed then this Court’s order will not be operated upon.  If not executed, the respondents shall release the Tractor bearing registration No.TN20 Z6509 forthwith at his door steps unconditionally. The respondents are at liberty to recover the dues from the petitioner in an alternative way by due process of law.  

3.                               THE HON’BLE HIGH COURT OF MADRAS

IN APPEAL NO. 23670 of 2011

G. Palanisamy

Vs

The Branch Manager

State Bank of India

Held that,  

Para 34. The reading of the judgement of this Court as well as the Hon’ble Supreme Court on which reliance was placed by the learned counsel for the parties shows, that the settled law is that the possession of the vehicle though hypothecated  cannot be taken illegally by use of force. 

Para 35.  In this case in hand, it is admitted that the vehicle was taken forcibly from the petitioner without following due process of law.  Thus, the action of the respondent cannot be sustained in law specially when the loan amount of the bank is further secured by mortgage  of land. 

Para 36. Consequently, this writ petition is allowed.  A writ of mandamus is issued directing the respondent bank to return the tractor bearing  registration No. TN-33, AE-8834 to the petitioner, in any case not later than one week of receipt of certified copy of this order.

Para 37. However, this order shall not bar the respondent Bank to take steps to recover the outstanding amount from the petitioner in accordance with law by enforcing the securities.   

            The National Consumer Disputes Redressal  Commission also held that  “In my opinion a seizer of vehicle in such circumstances violating the principles of natural justice without giving an opportunity to the borrower to show is bonafides, amounts not only to unfair trade practice but also deficiency of service for which the financier is liable to compensate the complainant. In our view of the aforesaid decision rendered by the Hon’ble Supreme Court, High Court and National Commission, we are of the opinion that there is a unfair trade practice on the part of the first opposite party in seizing the vehicle.   Hence, these Point Nos. 1 and 2 are decided in favour of the complainant.

7. Point No.3:           In Point Nos.1 and 2, we have decided that there is a deficiency in service on the part of the first opposite party.  The first opposite party is hereby directed to return the Power Tiller with Engine NO.G10Z0002461 and Chassis No.15110948.  In the alternative the first opposite party is hereby directed to pay Rs.1,96,000/- (Rupees One Lakh and Ninety Six Thousand only) the cost of the Power Tiller and implement with interest at 9% p.a. from September, 2012 to till the date of this order and to pay a sum of Rs.3,00,000/- (Rupees Three Lakhs only) as compensation for deficiency in service and mental agony and also to pay a sum of Rs.25,000/- (Rupees Twenty Five Thousand only) towards cost to the complainant.  Hence this Point No.3 is also answered accordingly. 

8.         In the result, this complaint is partly allowed.  The first opposite party is hereby directed to return the Power Tiller with Engine NO.G10Z0002461 and Chassis No.15110948.  In the alternative the first opposite party is hereby directed to pay Rs.1,96,000/- (Rupees One Lakh and Ninety Six Thousand only) the cost of the Power Tiller and implement with interest at 9% p.a. from September, 2012 to till the date of this order and to pay a sum of Rs.3,00,000/- (Rupees Three Lakhs only) as compensation for deficiency in service and mental agony and also to pay a sum of Rs.25,000/- (Rupees Twenty Five Thousand only) towards cost to the complainant, within one month from the date of receipt of this order, failing which the above amounts shall carry interest at the rate of 9%per annum from the date of receipt of this order to till date of realization.  As against the second opposite party this complaint is dismissed.

            Dictated to the steno-typist transcribed and typed by her corrected and pronounced by us in the open Commission on this the 14^th September, 2022.

Sd/-                                                                 Sd/-                                                     Sd/-

MEMBER – I                                      MEMBER – II                                 PRESIDENT

LIST OF COMPLAINANT SIDE DOCUMENTS:

Ex.A1 – 17.03.2011 -  copy of Memorandum of Deposit of Title Deeds

Ex.A2 – 16.03.2012 -  Proforma invoice issued by second opposite party

Ex.A3 – 20.04.2012 -  Quotation / Bill issued by second opposite party

Ex.A4 – 29.08.2012 -  Seizure Notice of first opposite party

Ex.A5 – 22.05.2013 -  Notice from first opposite party

Ex.A6 – 06.02.2014 -  Notice from first opposite party

Ex.A7 – 05.11.2014 – Notice from first opposite party.

LIST OF  FIRST  OPPOSITE PARTY SIDE DOCUMENTS: 

Ex.B1-21.03.2011 – Proforma Invoice

Ex.B2-21.03.2011 -  Voucher

Ex.B3                    -  Office copy of the plaint  in O.S.No. 142/126

Sd/-                                                                 Sd/-                                                     Sd/-

MEMBER – I                                   MEMBER – II                                 PRESIDENT