C.C.No.85/2009

Between

1. M.Mahalakshmi,

W/o. late. M.Venkata Subba Raju.

2. M.J.B.S.K. Prasad Raju,

S/o. late. M.Venkata Subba Raju.

3. M.Syamala,

W/o. late. M.Pundari.

4. M.Mithun,

S/o. late. M.Pundari.

5. M. Pandu,

S/o. late. M.Pundari.

6. A.Lakshmirajyam,

D/o. Late. M. Venkata Subba Raju.

7. S.Sumithra,

D/o. Late. M. Venkata Subba Raju.

8. R.Dakshayani,

D/o. Late. M. Venkata Subba Raju.

9. A.Revathi,

D/o. Late. M. Venkata Subba Raju.



Residing at:

D.No.18-1-504, Bhavani Nagar,

Tirupati,

Chittoor District. … Complainants



And



1. Sapthagiri Grameena Bank,

Rep. by its General Manager,

Kongareddy Palli,

Chittoor.



2. Sapthagiri Grameena Bank,

Rep. by its Branch Manager,

T.K.Street,

Tirupati. … Opposite parties.s

This complaint coming on before us for final hearing on 21.01.10 and upon perusing the complaint, written version and other relevant material papers on record and on hearing Sri.T.Venugopal, counsel for the complainants and Sri.K.Ramesh Babu, counsel for the opposite parties, and having stood over till this day for consideration, the Forum made the following:-

ORDER

DELIVERED BY SRI. G.V.RAGHAVULU, PRESIDENT
ON BEHALF OF THE BENCH

This complaint is filed under Sections-12 and 14 of Consumer Protection Act 1986, to pass an order directing the opposite parties to return the pledged gold ornaments, to pay Rs.25,000/- towards damages for causing mental agony, to award Rs.25,000/- towards wasting the valuable time of the complainants and to pay the costs of the complaint to the complainants.

2. The averments of the complaint in brief are :- One M.Venkata Subba Raju, husband of the complainant No.1, father of complainants 2 and 6 to 9, father-in-law of complainant No.3 and grand father of complainants 4 and 5, pledged three gold articles weighing 90.5 grams, with opposite party No.2 and obtained loan of Rs.24,000/- under J.L. account No.31962 on 01.04.2003. The said Venkata Subba Raju died on 19.08.2003 leaving behind him the complainants as his legal heirs and legal representatives to succeed his estate. When opposite party No.2 issued auction notice on 17.03.2005, the complainants paid the entire loan amount due on 18.03.2005 and 30.03.2005 under jewel loan. After the payment, the complainants approached opposite party No.2 and informed him that the original borrower died and they are the legal heirs to succeed his estate and requested for return of the gold ornaments. The opposite party No.2 directed the complainants to produce the death certificate, legal heir certificates along with claim forms, indemnity bond, affidavit etc. besides two sureties with their identities. Inspite of producing all the required documents, the opposite party No.2 has been postponing the return of the gold ornaments for the reasons best known to him. When the complainants approached opposite party No.2 in the month of February 2009, he stated that the claim forms submitted by them were misplaced. Hence, the complainants again submitted claim forms etc. in the month of March 2009. Inspite of repeated demands, the opposite parties did not choose to return the gold ornaments to the complainants. The complainants then got issued legal notice to opposite party No.2 on 12.06.2008. The 2nd opposite party on receipt of the notice sent letter dt:21.06.2008 insisting the complainants to produce succession certificate. The complainants got issued notice to 2nd opposite party on 30.07.2008 stating that the succession certificate is not necessary as per the decision of the Hon’ble Supreme Court. The complainants again got issued notice to the opposite parties on 14.11.2008. The opposite parties inspite of receipt of the notices did not comply the demand. Hence the complaint.

3. The opposite parties resisted the complaint. In the objections filed on behalf of opposite party No.2, adopted by opposite party No.1, while admitting that M.Venkata Subba Raju, pledged three gold articles weighing 90.5 grams and obtained loan of Rs.24,000/- under J.L account No.31962 on 01.04.2003, and the complainants caused legal notices on 12.06.2008 and 14.11.2008 and denying the other material allegations made in the complaint, it is inter alia stated that when the opposite party No.2 issued letter on 21.06.2008 asking for the succession certificate, the complainants failed to do so. When Venkata Subba Raju, became defaulter and died leaving behind him the complainants as his legal representatives, the opposite party No.2 gave auction notice dt:17.03.2005 and in-turn the complainants discharged the debt due under the loan. At that time, the opposite party No.2 informed the complainants to furnish family members certificate and succession certificate and also to discharge the liability of M.Pundari, the son of late.Venkata Subba Raju, who is indebted to the bank in another loan as guarantor. The complainants are also the legal representatives of the said M.Pundari. M.Pundari is the sole legal heir of M.Venkata Subba Raju and as the said Pundari also died, the complainants became the legal representatives of both Venkata Subba Raju and M.Pundari. One P.M.Chandrasekhar, availed loan of rs.30,000/- on 17.01.2002 under CL/18/02 from opposite party No.2 and M.Pundari stood as guarantor. As the borrower committed default, there is an outstanding due of Rs.96,002/- for which a suit in O.S.1238/2009 on the file of I Additional Junior Civil Judge, Tirupati, was filed against P.M.Chandrasekhar and legal representatives of M.Pundari. The opposite party No.2 also sought for attachment before judgment of the gold items pledged with the bank by the late M.Venkata Subba Raju and the attachment was ordered in I.A.No.1094/2009 and the attachment was also effected. Similarly one K.Chandramuni, availed loan of Rs.20,000/- on 24.10.2000 under CL/118/2000 from opposite party No.2 and in this also M.Pundari stood as one of the guarantor and as the borrower committed default there is an outstanding due of Rs.34,438/- as on 30.09.2009 for which a notice was issued to the borrower as well as the L.Rs of M.Pundari on 09.10.2009. In both the above said loans, M.Pundari as guarantor executed letters of guarantee on respective dates. As per clause.5 of the letter of guarantee “So long as any money remains owing under this guarantee, the Bank shall have a lien on all moneys standing to the credit of the guarantor / his accounts and on any of his securities or goods in possession at any branch (es) of the Bank towards the satisfaction of his (guarantor’s) liability”. As the liability of the said Pundari as guarantor in both the transactions is existing, the gold pledged by his father could not be released. Except discharging its duties basing on the documents executed by the guarantor, the opposite party No.2 has not committed any deficiency of service. The opposite party No.2 is ready to release the gold jewelry provided the liability of M.Pundari as guarantor in both the loans is discharged by the L.Rs / complainants. The complainants are not entitled to the relief sought for. The opposite party No.2 has been informing about the liability of the complainants as L.Rs of the guarantor from time to time and as such the alleged mental agony, wasting of time is not concerned to opposite party No.2. Only to escape from the liability, the complainants have come up with the complaint by suppressing real facts about the liability. The complaint may be dismissed with costs.

4. In support of the averments made in the complaint, the 1st complainant filed her affidavit and the complainants got marked Exs.A1 to A12. Ex.A1 is jewel loan identity card issued by opposite party No.2. Ex.A2 is Auction Notice dt:17.03.2005 sent by opposite party No.2 to M.Venkata Subba Raju. Ex.A3 is the counter foil of pay-in-slip dt:18.03.2005 showing payment of Rs.20,000/- to the credit of gold loan account of M.Venkata Subba Raju. Ex.A4 is counter foil of pay-in-slip dt:30.03.2005 showing payment of Rs.11,300/- to the credit of gold loan account of M.Venkata Subba Raju. Ex.A5 is xerox copy of Death Certificate of M.Venkata Subba Raju., issued by Panchayat Secretary, Rachapalem Panchayat. Ex.A6 is xerox copy of Family Members Certificate issued by Tahsildar, Puttur mandal, certifying that the complainants are the family members of late M.Venkata Subba Raju. Ex.A7 is office copy of legal notice dt:12.06.2008 got issued by the complainants to opposite party No.2 with postal receipt and acknowledgement. Ex.A8 is letter dt:21.06.2008 sent by opposite party No.2 to the advocate for complainants in reply to the legal notice dt:12.06.2008. Ex.A9 is office copy of legal notice dt:30.07.2008 got issued by the complainants to opposite party No.2 with postal receipt and acknowledgement. Ex.A10 is office copy of another legal notice dt:14.11.2008 got issued by the complainants to opposite parties 1 and 2. Ex.A11 are the postal acknowledgements of opposite parties 1 and 2 for Ex.A10 notice. Ex.A12 is xerox copy of claim form submitted by the complainants to opposite party No.2 with enclosures.

5. In support of the case set up in the objections, the opposite party No.2 filed his affidavit and the opposite parties got marked Exs. B1 to B9. Ex.B1 is xerox copy of gold loan application submitted by M.Venkata Subba Raju on 04.01.2003. Ex.B2 is xerox copy of Auction Notice dt:17.03.2005 issued by opposite party No.2 to M.Venkata Subba Raju. Ex.B3 is xerox copy of letter of guarantee dt:24.10.2000 executed by M.Pundari, for the loan in favour of K.Chandramuni. Ex.B4 is xerox copy of letter of guarantee dt:17.01.2002 executed by M.Pundari, for the loan in favour of P.M.Chandrasekhar. Ex.B5 is xerox copy of legal notice dt:09.10.2009 got issued by opposite party No.2 to P.M.Chandrasekhar and L.Rs of M.Pundari. Ex.B6 is xerox copy of legal notice dt:09.10.2009 got issued by opposite party No.2 to K.Chandramuni and L.Rs of M.Pundari. Ex.B7 is xerox copy of complaint in O.S.No.1238/2009 on the file of I Additional Junior Civil Judge, Tirupati, filed by opposite party No.2 against P.M.Chandrasekhar and L.Rs of M.Pundari. Ex.B8 is xerox copy of petition with affidavit in I.A.No.1094/2009 in O.S.No.1238/2009. Ex.B9 is xerox copy of legal notice dt:31.01.2004 got issued by opposite party No.2 to M.Pundari.

6. On behalf of the complainants and opposite parties written arguments were filed and we have heard the oral arguments of counsel of both sides.

7. On the basis of pleadings of both sides, the points that arise for determination are:-

(i) Whether there is any deficiency in service on the part of opposite parties towards the complainants?

(ii) Whether the complainants are entitled to the reliefs as prayed? If so, to what extent?

(iii) To what result?

8. Point No.(i):- The brief facts of the case are:- M.Venkata Subba Raju, pledged three gold articles, weighing 90.5 grams, and obtained loan of Rs.24,000/- under J.L. account No.31962 dt:04.01.2003 from opposite party No.2. M.Venkata Subba Raju died on 19.08.2003 leaving behind him complainant No.1, his wife; complainant No.2 and M.Pundari his sons; A.Lakshmirajyam, S.Sumithra, R.Dakshayani and A.Revathi, complainants 6 to 9, his daughters to succeed his estate. The loan was repayable on 04.01.2004. As the loan was not repaid, opposite party No.2 issued Ex.A2 notice intimating that the gold ornaments will be sold in public auction on 30.03.2005 for realization of the loan amount. M.Pundari also died leaving behind him complainant No.3, his wife and complainants 4 and 5, his sons as L.Rs to succeed his estate. After receipt of Auction Notice, the complainants paid Rs.20,000/- on 18.03.2005 and Rs.11,300/- on 30.03.2005 and discharged the entire loan. The complainants got issued Ex.A7 legal notice to the opposite party No.2 on 12.06.2008 demanding return of the pledged gold articles. The opposite party No.2 sent Ex.A8 letter requesting the advocate for the complainants to advise the complainants to obtain succession certificate from the competent court of law. The complainants then got issued Ex.A9 rejoinder notice informing that there is no need to get succession certificate from the competent court and demanding return of the pledged gold articles. The complainants issued another legal notice (Ex.A10) to both the opposite parties on 14.11.2008. The complainants submitted claim forms on 02.03.2009. As the gold articles were not returned, the complainants filed the complaint on 25.09.2009.

9. One K.Chandramuni, availed loan of Rs.20,000/- from opposite party No.2 on 24.10.2000 and one P.M.Chandrasekhar availed loan of Rs.30,000/- on 17.01.2002 from opposite party No.2. In both the loan transactions, M.Pundari, stood as guarantor. On 09.10.2009 the opposite party No.2 got issued Ex.B5 legal notice to P.M.Chandrasekhar and complainants 3 to 5, the L.Rs of M.Pundari to repay the outstanding balance loan amount of Rs.86,386/-. The opposite party No.2 also got issued Ex.B6 legal notice dt:09.10.2009 to K.Chandramuni and complainants 3 to 5, the L.Rs of M.Pundari to repay the outstanding balance loan amount of Rs.34,438/-. The opposite party filed suit in O.S.No.1338/2009 on the file of I Additional Junior Civil Judge Court, Tirupati, against P.M.Chandrasekhar and complainants 3 to 5 for recovery of suit amount of Rs.96,002/-. The opposite party No.2 filed I.A.No.1094/2004 (Ex.B8) in O.S.No.1238/2009 to order attachment of gold jewels pledged by M.Venkata Subba Raju. The I Additional Junior Civil Judge, Tirupati, ordered attachment of gold jewels on 23.10.2009.

10. The complainants discharged the entire amount due under gold loan by 30.03.2005. In the complaint it is alleged that inspite of repeated demands, the opposite party No.2 did not choose to return the gold ornaments. In the complaint it is not specifically stated the date of the claim made by the complainants for return of the gold ornaments. In para.5 of the complaint, it is stated that when the complainants approached opposite party No.2 in the month of February 2009, it is stated that the claim forms were misplaced and hence the complainants submitted claim forms in the month of March 2009. Ex.A12 is the claim forms submitted by the complainants on 02.03.2009. The complainants got issued three legal notices to the opposite party No.2 for return of the pledged gold ornaments. The opposite party No.2 addressed Ex.A8 letter to the advocate for the complainants on 21.06.2008 requesting to advise the complainants to obtain succession certificate from the competent court of law. The opposite party No.2 prior to filing of the present complaint never informed the complainants that the liability of M.Pundari as guarantor in the loans taken by P.M.Chandrasekhar and K.Chandramuni is existing and unless both the loans are discharged the gold articles pledged by Venkata Subba Raju cannot be released. For the first time, the opposite party No.2 in the objections raised the plea that M.Pundari executed letter of guarantee in both the loan transactions and unless the loans are discharged the gold articles cannot be released. Exs. B3 and B4 are the copies of letter of guarantee executed by M.Pundari in the loans obtained by K.Chandramuni and P.M.Chandrasekhar. Clause.5 of Exs.B3 and B4 letters of guarantee reads “So long as any money remains owing under this guarantee, the bank shall has a lien on all moneys standing to the credit of my / our accounts and on any of our securities or goods in possession at any branch (es) of your bank towards the satisfaction of my / our liability”. The contention of counsel for opposite parties is that the opposite party No.2 has a general right of lien to retain gold ornaments pledged by M.Venkata Subba Raju, even after discharge of gold loan for recovery of loans advanced to Chandramuni and Chandrasekhar in which M.Pundari stood as guarantor. In support of his contention, he placed reliance in the decision of A.P.High Court in K. Sita Vs. Corporation Bank reported in 1999(3) ALT 443. In the above decision, the Hon’ble A.P.High Court held that the Banker’s lien contemplated by Section.171 of Contract Act as such is specific provision relating to banker’s lien and has an overriding effect on general provisions of Section.174 of Contract Act which provide for relationship of pawnee and pawner in respect of pledged goods and the banker’s lien will carry over to such pledges and bank can retain pledged goods if the debtor had not cleared his amount in connection with another loan. The loans taken by Chandramuni and Chandrasekhar are prior to the gold loan obtained by Venkata Subba Raju. The contention of the counsel for complainants is that the above decision is not applicable as in that case the principle borrower obtained another loan where as in the present case M.Pundari, stood as guarantor for the loans obtained by Chandramuni and Chandrasekhar. We are not inclined to agree with him, as the liability of guarantor is co- extensive with that of principle borrower. It is not the case of the complainants that as the two loans obtained by Chandramuni and Chandrasekhar are prior to the gold loan obtained by Venkata Subba Raju, the opposite parties cannot take the plea of right of lien. Further, the gold articles are now attached before judgment in I.A.No.1094/2009 in O.S.No.1238/2009 by the I Additional Junior Civil Judge Court, Tirupati. Therefore, it cannot be said that the opposite parties committed deficiency in service in returning the pledged gold articles.

11. For the above reasons, we find that there is no deficiency in service on the part of the opposite parties towards the complainants. This point is accordingly answered against the complainants.

12. Point No.(ii):- In view of our finding on point No.1, the complainants are not entitled to any relief. This point is accordingly answered.

13. Point No.(iii):- In the result, the complaint is dismissed, but without costs.