IA/4702/2016 (Application for Revival of the Complaint)

By this Application, the Complainant, namely Punjab Agriculture University, Ludhiana, Punjab (for short “the University”), prays for revival of the Original Complaint, being Original Petition. No. 51 of 2005, on the ground that the Appeal preferred by the Opposite Parties, namely, UTI of India and one of its functionaries, against the order passed by this Commission on 17.04.2009 has been dismissed by the Hon’ble Supreme Court vide judgment dated 09.07.2014 in Civil Appeals No. 400 of 2007, 503 of 2008 and 4664 of 2009.  While Civil Appeals No. 400 of 2007 and 503 of 2008 had been filed by the University and the UTI against the order dated 17.10.2006 passed by this Commission, Civil Appeal No. 4664 of 2009 was preferred by the UTI against the aforesaid order dated 17.04.2009 passed by this Commission respectively in Original Petition No. 97 of 2004 and in Original Petition No. 51 of 2005, the present case.

UTI was dissatisfied with the order dated 17.04.2009 because the preliminary objection raised by it regarding the maintainability of the Complaint, on the ground that the University was not a “Consumer” within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986, was decided in favour of the University.  Now the said order having been affirmed by the Hon’ble Supreme Court, the question as to whether there was deficiency in service on the part of the UTI needs to be examined.  Accordingly, the Original Petition, which was adjourned sine die for awaiting the decision of the Hon’ble Supreme Court, has to be revived.   

Consequently, the Application is allowed and Original Petition No. 51 of 2005 is revived.

Original Petition No. 51 of 2005

          Having heard learned Counsel for the parties and compared the prayers made in the present Complaint with the relief claimed in Original Petition No. 97 of 2004, I am of the view that, in the light of the decision of the Hon’ble Supreme Court dated 09.07.2014 in Civil Appeal No. 400 of 2007 and other connected Appeals, the substantive legal issue raised in the present Complaint is no more res integra.

          For ready reference, prayers made in the present Complaint and Original Petition No. 97 of 2004 are reproduced hereunder:  

Prayer in the present Complaint

“PRAYER    

          In view of the facts and circumstances of the above case, the Complainant most humbly prays that this Hon’ble Commission may be pleased to:

1. Pass an order granting compensation and damages to the tune of Rs.17,22,02,477/- towards the difference, as mentioned in Claim A and Rs.4,96,33,058.39 – Interest @ 13.5% from 01.06.2003 to 31.05.2005 on the above amount;

    

2. Pass an order granting pendent lite and future interest @ 13.5% per annum from the date of filing this petition upto realization;

1. Award and costs;

1. Pass such other order or orders which this Hon’ble Commission may deem fit and proper in favour of the Complainant.”

    

   Prayer in Original Petition No. 97 of 2004

    

   “It is therefore respectfully prayed that respondents/op’s be directed to make the payment of the amount of Rs.18,31,65,024.89/- and Rs.4,21,93,558/- along with interest @ 18% p.a. from 01.06.2003 till the date of payment in the interest of justice.

    

   Further, it is also prayed that damages to the extent of Rs.1 crore may also be awarded for the mental agony and sufferance of the complainant and for harassment and causing agony and mental torture to more than thousands of University employees and their families whose Provident Fund amount was invested with op’s. 

    

   Or Any other relief, order or direction be passed which this forum may deem fit in the circumstances of the present complaint.

    

   It is further prayed that legal expenses to the extent of Rs. 4 lacs may also be awarded.”

    

   Although the relief claimed in the two Complaints were differently worded, but the core issue in both the Complaints revolved around the question as to whether the University was entitled to interest @ 13.5% p.a. on the reinvested amount received by it as dividend on its investment in the Institutional Investors’ Special Fund Unit Scheme, 1993 (IISFUS) out of the funds in the Provident Fund Accounts of its employees.  In short, the stand of the University is that it was assured that the dividend income would be reinvested in further Units at NAV (Net Asset Value) and on those Units also, it was assured a minimum return @ 13.5%, as well and it would be repurchased at par i.e. @ ₹10/-.  The stand of the UTI, on the other hand, was that the University was entitled to receive the guaranteed dividend at the rate of 13.5% on the capital and with regard to the income (dividend), which was reinvested by repurchasing the Units, the UTI was required to purchase the same at NAV.

   On a thorough analysis of all the relevant terms of the Scheme (IISFUS), vide order dated 17.10.2006, this Commission rejected the stand of the University, observing thus:

   “In our view, considering the terms of the offer, the contention raised by the Complainant cannot be accepted.  Because, on the dividend which was invested for purchase (repurchase of the units) of the units, there was no guarantee that it would be repurchased at face value.  Those units were to be repurchased on the basis of NAV.  At the relevant time when the units were encashed NAV, as stated above, was only Rs.3.8471 and on that basis, UTI has paid Rs.11,86,00,650/- to the Complainant.  This would be in consonance with the fact that units which were purchased from the return/dividend were purchased not on the basis of the face value, but on the prevailing market price of the units, i.e. the NAV.

    

   It is true that in the letter dated 9.3.1998 written by the Chairman of the UTI to the Complainant, it is mentioned “we are assuring the return of 13.50 per cent p.a. under the scheme for all the five years”.  However, there is a further line to the effect that the abridged terms of offer for IISFUS – 98 were enclosed.

    

   The terms of the offer specifically provides that the UTI would pay an assured return of 13.5% p.a. for all the 5 years of the scheme.  The said return (income) for the first year was agreed to be paid in July, 1998.  Thereafter, income for the subsequent years was to be paid in July each year.  The balance period from 1^st July, 2002 to 31^st May, 2003 the income was to be paid in May, 2003.  After this, option is given to the investors to reinvest the income at prevailing NAV.  The controversial clause is – on maturity it is guaranteed that repurchase price will not be less than the par value of the units, i.e. Rs.10/-.  However, there is no such guarantee for premature repurchase and the purchase price will depend on NAV.  Further, income assured under the scheme and protection of capital on maturity is guaranteed by the Development Reserve Fund of the Trust.

    

   With regard to capital invested, admittedly, the units are repurchased at par value of unit, i.e. Rs.10 and not at NAV.”  

    

   In my opinion, the said decision is on all fours to the facts at hand.  As afore-stated, the decision dated 17.10.2006, having been affirmed by the Hon’ble Supreme Court, the afore-noted question has to be answered against the Complainant/University.

             Learned Counsel appearing for the University has strenuously urged that some of the issues raised and claims made in the present Complaint are different from those raised in Original Petition No. 97 of 2004, in which the order dated 17.10.2006 was made.  Having glanced through the averments in the Complaint, I am unable to persuade myself to agree with the learned Counsel and at this juncture permit the Complainant to amend the Complaint in order to incorporate certain other reliefs.   

   Consequently, following the earlier decision of this Commission in Original Petition No. 97 of 2004, I hold that there was no deficiency in service on the part of the Opposite Parties towards the University.  Resultantly, the Complaint is dismissed, leaving the parties to bear their own costs.