Appeal No.1649/06


Ram Avtar,6 G.Agrasen Nagar,Sriganganagar Appellant


V.

1.The Ganganagar Central Sahkari Bank Ltd.

2.Vikraya Adhikari,The Ganganagar Kendriya Sahkari Bank

3.The Ganganagar Kendriya Sah.Bnk Ltd.,Sriganganagar.

Respondents



Before

Mr.Justice Sunil Kumar Garg-President

Mr.G.S.Hora-Member


Shri Ajayraj Tantiya,counsel for the appellant

Shri Suresh Kumar Saini,counsel for the respondents



Date of judgement : 18.05.2009


BY THE STATE COMMISSION.


This appeal has been filed by the complainant appellant against the order dated 3.8.06 passed by the District Forum,Sriganganagar in complaint no.103/06,by which the complaint of the complainant appellant was dismissed.


2. It arises in the following circumstances:


That the complainant appellant had filed a complaint against the respondents bank before the District Forum,Sriganganagar on 25.1.06

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interalia stating that 2600 bags of mustard which were seized by the respondents bank on 1.12.01, were put to auction and the complainant appellant had also taken part in that auction and he had paid a sum of Rs.10,000/- as earnest money for taking part in the auction proceedings and the auction proceedings had ended in favour of the complainant appellant and since the auction was made for Rs.8 lacs,therefore, the complainant appellant had deposited 1/4th of the amount to the tune of Rs.2 lacs with the respondents bank on 13.12.01. It was further stated in the complaint that no doubt,the notices were issued by the respondents for depositing the remaining amount of 3/4th of the auction sale,but that amount could not be deposited by the complainant appellant and thereafter the complainant appellant had applied for return of the amount of Rs.2 lacs, but through letter dated 17.1.06 a reply was given by the respondents bank that the earnest money(/kjksgj jkf'k)had been forfeited. Thereafter the present complaint has been filed.


A detailed reply was filed by the respondents bank before the District Forum on 23.5.06 and prior to that some preliminary objections were also taken and it was prayed that the complaint was filed with a delay and thus it was time barred and further in the reply it was stated that since the 3/4th amount of the auction proceedings were not deposited by the complainant appellant,therefore,the respondents bank had right to forfeit the amount deposited by the complainant appellant taking into consideration clause 6 of the agreement and further prior to that, a notice was published in the newspaper in which it was also stated that in case 3/4th amount was not paid by the complainant appellant in time,the amount deposited by the complainant appellant would be forfeited and the same was rightly forfeited and complaint be dismissed.


The District Forum after hearing both the parties,through the impugned order dated 3.8.06 had dismissed the complaint of the complainant appellant as stated above interalia holding that for taking part

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in the auction proceedings,the complainant appellant had deposited Rs.10,000/- and further the auction proceedings were ended in favour of the complainant appellant and thereafter he had deposited 1/4th amount to the tune of Rs.2 lacs. But there was no dispute on the point that 3/4th amount was not deposited by the complainant appellant and further through letter dated 22.12.01 the complainant appellant was informed by the respondents bank that the amount of Rs.2.10 lacs had been forfeited as even prior notice and publication in the papers the complainant appellant had not deposited the amount and since the complaint was filed on 25.1.06,therefore,it was also time barred and further the amount of Rs.2 lacs which were deposited by the complainant appellant would be covered under the words /kjksgj jkf'k .


Aggrieved from that order,this appeal has been filed by the complainant appellant.


3. In this appeal the following contentions have been made by the learned counsel for the complainant appellant:


1.

that the findings recorded by the District Forum by which the complaint was dismissed as time barred,could not be sustained as the last notice was given by the respondents bank intimating the forfeiture of the amount in question on 17.1.06 which is produced on file and thus limitation would be counted wef 17.1.06 and from that point of view the complaint which was filed on 25.1.06 should be taken as within limitation.
2.

that the amount of 1/4th to the tune of Rs.2 lacs could not be forfeited and at the most the amount of Rs.10,000/- could be forfeited and the words /kjksgj jkf'k refers to the amount of Rs.10,000/- which was deposited by the complainant appellant before the auction proceedings, but the amount of

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1/4th to the tune of Rs.2 lacs could not be equated for earnest money or /kjksgj jkf'k and thus findings recorded by the District Forum by which the complaint was dismissed on that count are liable to be quashed and set aside and appeal be allowed.


4. On the other hand,the learned counsel for the respondents bank has supported the impugned order and has placed reliance to the judgement of the Hon'ble Supreme Court in a case National Highway Authority of India V. M/s Ganga Enterprises & anr reported in AIR 2003 SUPREME COURT 3823.


5. We have heard the learned counsel for the parties and perused the record.


6. So far as the factual position in this case as stated above is not in dispute and as per the case of the complainant appellant the last notice which was given by the respondents bank to the complainant appellant was given on 17.1.06 forfeiting the amount,therefore,this Commission is of the view that the limitation starts from 17.1.06 and thus the complaint is treated being filed in time and thus,the preliminary objection of the respondents bank stands rejected and the findings of the District Forum by which the complaint was found time barred are also quashed and set aside.


7. On second point,as per the case case of the respondents bank the amount of 1/4th should be treated as the amount /kjksgj jkf'k and as per terms and conditions of clause 6 of the agreement,the respondents bank had the right to forfeit that amount.


8. For convenience, the clause 6 is reproduced here:

^^6& uhykeh dh iqf"V ds i'pkr~ 'ks"k jkf'k tek u djus

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ij iwoZ esa tek /kjksgj jkf'k tCr dj yh tkosxhA**


9. Thus,the case of respondents bank is that the amount of 1/4th which was deposited by the complainant appellant was the amount of

/kjksgj jkf'k and they had the right to forfeit though the case of the complainant appellant is that this clause refers to the amount of Rs.10,000/- which was deposited by the complainant appellant as earnest money.


10. For convenience,the Hob'ble Supreme Court in the case of HUDA and another V. Kewal Krishan Goel and others(1996) 4 SCC 249 has defined the word “Earnest” in the following manner:


Earnest. “Earnest” means something given for the purpose of binding a contract,something to be used to put pressure on the defaulter if he failed to carry out his part. If the contract went through,the thing given in earnest was returned to the giver,or,if money,was deducted from the price. If the contract went off through the giver's fault the thing given in earnest was forfeited. The 'earnest money' is a part of the pruchase price when the transaction gets through and the same is forfeited when the transaction falls through by reason of the default or failure on the part of the vendee.”


11. In our considered opinion,the word /kjksgj jkf'k a Hindi word found in condition no.6 can be substituted for the words earnest money and in the present case the earnest money is the amount of Rs.10,000/- deposited by the complainant appellant and the amount of Rs.2 lacs which were deposited by the complainant appellant after the auction proceedings as 1/4th of the amount of bid,that amount could not be treated or equated for the word earnest . Therefore, the respondents bank could not forfeit the amount of Rs.2 lacs and thus the findings recorded by the District Forum on that count, could not be sustained.

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12. So far as the law laid down by the Hon'ble Supreme Court in the case supra is concerned, it may be stated here that in para no.8 of the judgement the words earnest/security money were mentioned and it was further observed that the person concerned have a right to withdraw his offer but he has no right to that earnest/security amount. Thus the amount of Rs.10,000/-, for all purposes,could be treated as earnet/security money that could be forfeited but not the amount of Rs. 2 lacs which were deposited by the complainant appellant as amount of 1/4th of the auction proceedings which were ended in favour of the complainant appellant. Thus from every point of view for the amount of Rs.2 lacs which were deposited by the complainant appellant and that amount could not be equated with the amount of Rs.10,000/- which were deposited as earnest money. Therefore,the word /kjksgj jkf'k would refer to the amount of Rs.10,000/- and not to the amount of Rs.2 lacs. Thus this authority would not be helpful to the respondents bank.


13. For reasons as stated above,the findings of the District Forum by which the complaint was dismissed, could not be sustained as they suffer from basic infirmity,illegality and perversity and the appeal deserves to be allowed.


14. The result is that this appeal filed by the complainant appellant is allowed and impugned order dated 3.8.06 passed by the District Forum,Sriganganagar is quashed and set aside and the complaint filed by the complainant appellant is allowed in the manner that the respondents bank would pay a sum of Rs.2 lacs to the complainant appellant with interest @ 6% p.a from the date of filing of the complaint alongwith Rs.5000/- as amount of cost of litigation.




Member President