THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION

PANAJI-GOA



Present:

Smt. Sandra Vaz e Correia…Presiding Member

Smt. Caroline Collasso, …Member



Appeal No. 26/2008



1. M/s Shiv Samarth Motors,

Having office at A/6,

Skylark Apartments,

Menezes Braganza Road,

Panaji-Goa.

(Original O.P.No.1)



2. Ashok Leyland Ltd.,

(Marketing Division),

480, Anna Salai, Nandanam,

Chennai – 600 035.

(Original O.P.No.2) … Appellants



v/s



1. Jeron Mascarenhas,

R/o H.No. 38,

Bhirondem, Valpoi,

Sattari, Goa.

(Original Complainant)



2.Ashok Leyland Finance Ltd.,

Alcon Chambers, 1st Floor,

D. B. Bandodkar Road,

Panaji – Goa.

(Original O.P.No.3) … Respondents



For the Appellants ..Shri V. Kamat, Advocate.

For the Respondent No.1 ..Shri B. Sawant, Advocate

For the Respondent No.2. ..Shri Naik, Advocate.





Appeal No. 27/2008



1. M/s Shiv Samarth Motors,

Having office at A/6,

Skylark Apartments,

Menezes Braganza Road,

Panaji-Goa.

(Original O.P. No.1)



2. Ashok Leyland Ltd.,

(Marketing Division),

480, Anna Salai, Nandanam,

Chennai – 600 035.

(Original O.P. No.2) ..Appellants



v/s



1. Mr. Vinod K. Navelkar

Major of age,

Resident of H.No. 392,

Near Ganesh Temple,

Bogda, Vasco da Gama.

(Original Complainant)



2. Ashok Leyland Finance Ltd.,

Alcon Chambers, 1st Floor,

D. B. Bandodkar Road,

Panaji – Goa.

(Original O.P. No.3) .. Respondents



For the Appellants ..Shri V. Kamat, Advocate

For the Respondent No.1 ..Shri B. Sawant, Advocate

For the Respondent No.2 ..Shri Naik, Advocate.



Appeal No. 28/2008



1.Ashok Leyland Finance Ltd.,

Since merged as Induslnd Bank,

Alcon Chambers, 1st Floor,

D. B. Bandodkar Road,

Panaji – Goa. .. Appellant

(Original O.P.No.3)

v/s



1. Mr. Vinod K. Navelkar

Major of age,

Resident of H.No. 398,

Near Ganesh Temple,

Bogda, Vasco da Gama.

(Original Complainant)



2. M/s Shiv Samarth Motors,

Having office at A/6,

Skylark Apartments,

Menezes Braganza Road,

Panaji-Goa.

(Original O.P. 1)



3. Ashok Leyland Ltd.,

(Marketing Division),

480, Anna Salai, Nandanam,

Chennai – 600 035.

(Original O.P. No.2)



For the Appellant ..Shri Naik, Advocate.

For the Respondent No.1 ..Shri B. Sawant, Advocate.

For the Respondent No.2 & 3.. Shri V. Kamat, Advocate.



Appeal No. 29/2008



1. 1.Ashok Leyland Finance Ltd.,

Since merged as Induslnd Bank,

Alcon Chambers, 1st Floor,

D. B. Bandodkar Road,

Panaji – Goa. .. Appellant

(Original O.P.No.3)



v/s



1.Mr. Jeron Mascarenhas,

R/o H.No. 38,

Bhirondem, Valpoi,

Sattari, Goa.

(Original Complainant)

2. M/s Shiv Samarth Motors,

Having office at A/6,

Skylark Apartments,

Menezes Braganza Road,

Panaji-Goa.

(Original O.P. 1)



3. Ashok Leyland Ltd.,

(Marketing Division),

480, Anna Salai, Nandanam,

Chennai – 600 035. …Respondents

(Original O.P. No.2)





For the Appellant ..Shri Naik, Advocate

For the RespondentNo.1.. Shri B. Sawant, Advocate

For the Respondent No.2 & 3 ..Shri V. Kamat, Advocate



Dated: 13-05-2009



ORDER



[Per Smt Sandra Vaz e Correia, Presiding Member]



1. Alleged deficiency-in-services by the automotive dealer & manufacturer and forceful re-possession of vehicles by the finance company are at the crux of these consumer disputes. Being based on similar set of facts and issues of law, these appeals are disposed off by a common order.



2. The appellants are the opposite parties in Consumer Dispute nos. 47 of 2008 and 48 of 2004 before the Consumer Disputes Redressal Forum (District Forum) North Goa, Porvorim. They are aggrieved by the orders dated 01-04-2008 and 02-04-2008 whereunder they were directed to refund to the complainants the amounts paid by them under the finance scheme alongwith compensation of Rs.10,000/-. The complainants are the first respondents in all appeals.



3. The complainants Vinod Navelkar and Jeron Mascarenhas purchased Ashok Leyland vehicles manufactured by Ashok Leyland Ltd (the opposite party no. 2) from its dealer M/s Shiv Samarth Motors (the opposite party no. 1) financed by Ashok Leyland Finance Ltd (the opposite party no. 3) in the year 2002.



Case of the parties in Complaint no. 47/2004 in brief.



4. In Vinod Navelkar’s case, his vehicle met with a major accident on 25-02-2003 and was carted to the opposite party no. 1’s workshop for repairs. But the opposite party refused to attend to his vehicle on the pretext that they were very busy resulting in loss of about a month’s time. The complainant then took the vehicle to another garage at Collem where the required work was done at a cost of Rs.78,710/- and it was back on the road in July 2003. The vehicle developed engine trouble in September 2003 whereupon it was taken to the workshop of the opposite party no. 1; this time the complainant was informed that the crank shaft was totally damaged and would be replaced with 4/5 days. But the opposite party no. 1 did nothing about it from 01-01-2003 to 05-11-2003. The complainant was then requested to procure the spare-part from outside and told that the cost thereof would be reimbursed. But the opposite party went back on its word and refused to reimburse the cost of the spare-part and instead raised a bill for Rs.12,936/- for certain unnecessary jobs done without the complainants consent. Inspite of these problems, the complainant paid two installments in December 2003. However, the vehicle was forcibly seized by the opposite party no. 3 on 27-01-2004, thus making his life totally miserable. The complainant wrote several letters to the opposite parties explaining his grievances but they apparently fell on deaf ears. He sought a direction to the opposite parties to return the vehicle in roadworthy condition and payment of compensation or alternatively for refund of the amounts paid by him to the opposite parties.



5. Per contra, the complaint was contested by the opposite parties. The opposite party no. 1 denied the allegations regarding deficiency in services rendered by it. As regards the episode after the accident-vehicle was brought to their workshop, the opposite party explained that when the vehicle was brought to their workshop on 17-03-2003, the complainant was informed that the estimated cost of repair would be Rs.55,000/- to Rs.60,000/-. The complainant informed that he would get the insurance company’s surveyor to assess the damages. The complainant then instructed them to only carry out mechanical repairs and informed that he would do the fabrication work elsewhere. Upon completion of mechanical work, the complainant took the vehicle on 10-04-2003. As regards the second occasion when the vehicle was brought to their workshop on 01-10-2003, the opposite party explained that replacement of the crank-shaft under warranty did not arise since the vehicle has lost its warranty having met with accident. The complainant promised to revert very soon but there was no response for about a week resulting in the opposite party issuing a letter dated 08-10-2003 to the complainant. On receipt, the complainant approached the opposite party and requested them to only repair the crank-shaft which was accordingly done and the vehicle was returned in a roadworthy condition. As regards the billing, the complainant was charged only Rs.12,936/- as against the bill amount of Rs.27,736/-. As regards seizing of the vehicle, the opposite party no. 1 stated that they had nothing to do with it.



6. The opposite party no. 2 is the manufacturer of the vehicle. They raised preliminary objections regarding maintainability of the complaint considering that the vehicle was allegedly used for commercial purpose. Except for stating that under the terms of the warranty the vehicle loses its warranty when it meets with an accident, the said opposite party denied all allegations in the complaint for want of knowledge.



7. The opposite party no. 3 submitted that under the hire purchase agreement, it was the owner of the vehicle while the complainant was the hirer. In case of default in hire monies, the opposite party was empowered to re-possess the vehicle into its custody under clause 10. Re-possession of the vehicle in January 2004 through its “recovery agents” was admitted, however it was explained that the complainant had continuously defaulted in payments of hire installments and had failed to pay the dues inspite of repeated follow-up and reminders. The vehicle was re-possessed as the last resort. The complaint had been filed to extort money and escape from making payment of hire monies. Any disputes arising between the parties should be referred to sole arbitrator to be appointed by the company. The opposite party contended that they had no relationship with the other opposite parties, they being dealer and manufacturers of the vehicle.



Case of the parties in Complaint no. 48/2004 in brief.



8. In Jeron Mascarenhas’s case, he purchased an Ashok Leyland tipper of “Bison NC 1611/25” make in March 2002 from the opposite party no.1 availing loan facility offered by the opposite party no.3. The complainant availed loan of Rs.6,70,000/- and issued 48 post dated cheques aggregating Rs.9,92,000/-. The vehicle developed snags, particularly the PTO shaft malfunctioned. When brought to the notice of the opposite party no.1, they informed that the shaft would be replaced and assured that the vehicle was otherwise in road worthy condition; but the shaft never came. In first week of January 2004, the shaft broke down completely and the vehicle was rendered useless. As a result, the complainant was unable to pay the loan. He brought these difficulties to the notice of the opposite parties but they fell on deaf years. Legal notice was issued on 19-02-2004 to the opposite party nos. 1 & 2, but it evoked no response. The vehicle was forcefully re-possessed by the opposite party no. 3 on 23-04-2004 from his house when the complainant and his family were away. A police complaint was lodged. The complainant claimed return of the vehicle alongwith compensation of Rs.20,000/- per month with interest or alternatively for refund of the sum of Rs.4,57,301/- paid by him to the opposite parties.



9. On the other hand, opposite party no. 1 raised preliminary objection regarding maintainability of the complaint considering that the vehicle had been used for commercial purpose. They denied any tie-up with the opposite party no. 3 and contended that they are two distinct and independent organizations. The complainant’s averments regarding the PTO shaft problem and any assurances being given were denied. It was submitted that the complainant never brought the vehicle in for periodical check-ups/free service at 8000 kms and 16000 kms resulting in violation of warranty terms. The allegations that the said opposite party was informed about break-down of the shaft were denied. However, receipt of the legal notice was admitted but it was not replied since the contents were false and baseless. It had no connection with the forceful re-possession incident.



10. Opposite party no. 2 raised preliminary objections regarding maintainability of the complaint since the vehicle was used for commercial purpose. It submitted that it was never informed about the break-down of the PTO shaft or about any difficulties being faced by the complainant. The opposite party was duty bound to attend to defects within warranty period provided the complainant had violated the warranty terms and conditions.



11. Opposite party no. 3 while admitting that it financed the purchase of the vehicle under hire-purchase scheme, submitted that it was not responsible for the break-down of the vehicle and the complainant being unable to pay the loan amount as a result. Under the hire purchase agreement, it was the owner of the vehicle while the complainant was the hirer. In case of default in hire monies, the opposite party was empowered to re-possess the vehicle into its custody under clause 10. Re-possession of the vehicle in January 2004 through “recovery agents” was admitted, however it was explained that the complainant had continuously defaulted in payments of hire installments and had failed to pay the dues inspite of repeated follow-up and reminders. The complainant had been informed that if payment was not done the vehicle would be re-possessed. It was denied that the vehicle was taken by threatening the family members of the complainant. The vehicle was re-possessed as the last resort. The complaint had been filed to extort money and escape from making payment of hire monies. Any disputes arising between the parties should be referred to sole arbitrator to be appointed by the company. The opposite party contended that they had no relationship with the other opposite parties, they being dealer and manufacturers of the vehicle.



Findings of the District Forum.



12. The District Forum considered the case of the parties, and, relying on the decision of the Hon’ble National Commission in Citicorp Maruti Finance Ltd vs. Vijaya Laxmi 2005 Vol. II CPJ 327 found that the action of forceful possession of the vehicles was not an accepted norm in a civilized society and that hire purchase agreement was a civil contract and any dispute arising had to be settled by way of civil remedy and not by use of force.



Submissions.



13. We called for and perused the records and proceedings of the trial forum and gave due consideration to the submissions advanced by learned counsel on behalf of the parties. Notes of arguments are also filed. There are two sets of appeals; one filed by the original opposite party nos. 1 & 2 and the other filed by the original opposite party no. 3.



14. In their appeals (Appeal nos. 26/2008 & 27/2008), the appellants/opposite party nos. 1 & 2 contended that if one peruses the impugned order, it is clear that the District Forum did not find any fault with them while they were made collectively liable to pay the decretal amount to the complainant. They had absolutely no role to play in the method of seizure of the vehicle and nowhere in the judgment did the Forum find any fault or deficiency in service on their part. Their detailed written arguments were not considered at all in the impugned order. They argued that the trial forum ought to have dismissed the complaint against them.



15. On the other hand, the first respondent/complainant defended the impugned order and reiterated his case. It was submitted that the appeal had been preferred wholly on frivolous and baseless grounds and that they had failed to prove that they had no role to play in the illegal seizure of the vehicle.



16. The second respondent/original opposite party no. 3 joined chorus with the appellants and prayed for setting aside of the impugned order.



17. In Appeal nos. 28/2008 and 29/2008, the appellant/opposite party no. 3 assailed the impugned order and submitted that the District Forum had wrongly relied on the decision cited by the complainant and failed to consider that they were the owners of the vehicle under the agreement and the parties could not go beyond the terms of the agreement. They submitted that the District Forum had wrongly recorded that they had admitted forceful re-possession of the vehicle. The Forum committed irregularity in holding them guilty for no fault of theirs. It was also brought to our notice that the appellant - company has merged with ‘IndusInd Bank’.



Issues.



18. Considering the rival contentions of the parties, the following points arise for our consideration for determination of these appeals:



i. Whether, in the facts and under the circumstances, the services rendered by appellants/opposite party nos. 1 & 2 to the complainants were deficient?



ii. Whether, in the facts and under the circumstances, the forceful re-possession of the complainant’s vehicles by the opposite party no. 3 amounts to deficiency in service?









Point no. 1.



19. Complainant Vinod Navelkar alleged that when he took his vehicle to the opposite party no 1’s workshop for repairs after the major accident, they did not attend to it for about a month forcing him to take it to another garage at Collem. When the crank-shaft broke down, the said opposite party initially assured to replace the part free of cost but then asked the complainant to procure it from elsewhere and agreed to reimburse the cost, but went back on their word and refused to pay up the cost thereof. The allegations are denied by the opposite party. They stated that mechanical repairs were carried out by them and thereafter the complainant himself took the vehicle to another garage for fabrication repair work. Except for mention of this fact in the communications with the opposite parties after re-possession of the vehicle, the complainant has not produced any relevant documents in support of his contention that the vehicle remained idle for a month on account of neglect of the opposite party or to controvert the explanation given by the said opposite parties. Likewise, as regards the allegation regarding replacement of the crank-shaft, it would be rather unreasonable to expect the opposite party no.1 to replace the damaged part under warranty since the vehicle had met with a major accident; it fell from a height of 45 to 50 metres in the complainants own admission. In such an event, the warranty on the vehicle would cease to have effect. We do not see any deficiency in the services rendered by the opposite party nos. 1 & 2 to the complainant.



20. In the case of complainant Jeron Mascarenhas, his grievance is that the vehicle developed problem with PTO shaft and that he was assured of its replacement by the opposite parties, but they failed to do so and the shaft completely broke down and came to a standstill. The opposite party nos. 1 & 2 have stoutly denied the allegations in their written version. Here again, except for the legal notice, the entire documentation produced by the complainant concerns his transaction with the opposite party no. 3. The complainant has not met the opposite party’s claim that he did not bring the vehicle for periodic check-up/free servicing when the vehicle attained mileage of 8000 kms and 16000 kms. The terms and conditions of the contract of warranty required such check-up/servicing to be undertaken. The complainant did not produce any job-card of the opposite party to indicate that he approached them at any point of time. Assuming that the opposite parties neglected to replace the damaged part, the complainant could have acted diligently by getting the part replaced himself and got the vehicle running to minimize his losses and claim the cost and other expenses from the opposite party. In these circumstances, merely not replying to a legal notice cannot be construed as an admission of its contents. In this case also, we feel that the complainant has not established preponderance of probability of his case against the opposite party nos. 1 & 2.



21. It is also pertinent to note that the District Forum did not record any finding as regards any deficiency in services rendered by these opposite parties and focused entirely on the action of forceful re-possession of the vehicles by the opposite party no. 3.



22. In view of our foregoing discussion, we did not find any deficiency-in-services rendered by the opposite party nos. 1 & 2 and hold the first point in the negative.



Point no. 2



23. The re-possession of the vehicles through its “recovery agents” is admitted by the opposite party no. 3. The said opposite party has attempted to justify its action by taking refuge under the provisions of the hire-purchase agreement. The opposite party has produced copies of communications purportedly addressed to the complainant notifying him of impending re-possession if he did not pay the dues and later threatening to sell off the vehicle after re-possession, but there is no evidence at all of these communications having been received by the complainants. The modus operandi of some banks and finance companies of using muscle power against helpless debtors to forcefully seize hypothecated assets without any prior notice and extortion has been deprecated by the Hon’ble Supreme Court and the Hon’ble National Consumer Disputes Redressal Commission; it has been described as a violation of human rights. The decision in Citicorp Maruti Finance Ltd vs. Vijaya Laxmi 2005 Vol. II CPJ 327 cited by the complainants is a clear case in point. Besides, this Commission, in Francis Soeiro vs. Tata Finance Ltd. Complaint no. 40/2002, awarded compensation to the consumer in similar circumstances, which order was finally upheld by the Hon’ble Supreme Court in S.L.P. (Civil) no. 11370/2008. The action of the appellant/opposite party to take away the complainant’s vehicle without any prior notice and using muscle power amounts to gross deficiency in services rendered to the complainant - consumer and a violation of his human rights.



24. The finding of the District Forum in this respect does not call for any interference. We find the point in the affirmative.



25. The amounts awarded by the District Forum would have to be borne entirely by the opposite party no. 3 – Ashok Leyland Finance Ltd, now merged with IndusInd Bank. In case they are not paid within thirty days, they shall carry interest @ 12% p.a. thereafter till full payment.



26. In the result, the impugned orders stand modified to the limited extent as above. Appeal nos. 26/2008 and 27/2008 are allowed. Appeal nos. 28/2008 and 29/2008 stand dismissed with costs of Rs. 1000/- to be paid to the first respondent in each appeal.



Pronounced.



[Sandra Vaz e Correia]

Member





[Caroline Collasso]

Member