Date of Filing :29.10.2008

Notice served on O.P.No. 20.11.2008

Order Date: 30.03.2009.

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I,

CHITTOOR

Present:- Sri. V. Parthasaradhi Rao, B.A., L.L.B., President

Kum.S.R.Sumathi, B.A., B.L., Female Member

Sri.K.Subramanyam Reddy, B.A., B.L., Male Member

Monday, the (31st) Thirty First day of March, Two thousand and Nine

C.C. No. 109 /2008


Between


T. Prabhakar Naidu, S/o T.Doorvasulu Naidu,
Aged 54 years, Hindu, cultivation, residing at
Thatimakulapalle Village, Diguvamasapalle Post,
Chittoor Rural Mandal, Chittoor District.

… Complainant.

And

The Branch Manager,
M/s Sundaram Finance Limited,
Dr.No. 2-13/4, Officer’s Lane,
Opp: Chittoor Municipal Office,
Chittoor Town & District.

… Opposite Party.

This complaint coming on before us for final hearing on 19.03.2009 and upon perusing the complaint, written versions, affidavits, material documents and on hearing Sri K.Madhava Naidu & Sri D.Janardhana Naidu, counsels for the complainant, and Sri K.Masthanvali counsel for opposite party and having stood over till this day for consideration, the Forum made the following:-

ORDER

DELIVERED BY SRI. V. PARTHASARADHI RAO, B.A., L.L.B., President
ON BEHALF OF THE BENCH



This is a complaint filed by the complainant U/Sec. 12 of Consumer Protection Act to direct the opposite party to release the Tractor FORCE COMPANY BALWAN NO. 450 and also damages of Rs. 2,00,000/-.

The complainant submits that he purchased Tractor FORCE COMPANY BALWAN NO. 450 by availing a loan of Rs. 2,50,000/- under hire purchase agreement executed in favour of opposite party. After availing loan amount of Rs. 2,50,000/- from the opposite party he invested further sum of Rs. 1,00,000/- by borrowing from third parties and total cost of the Tractor is Rs. 4,25,000/-. As per the terms and conditions of the hire purchase agreement the complainant has to pay the loan amount in monthly installments at Rs. 9,390/- from 10.04.2007 to 10.01.2010. The complainant regularly paid installments to the opposite party up to March-08. Even though he was paying regular installments to the opposite party, but the opposite party was issuing notices unnecessarily to him, so far he paid a sum of Rs. 1,25,000/- towards loan amount to the opposite party.

The complainant submits that even though he expressed that he is prepared to pay the amount of Rs. 45,963/-, the opposite party repossessed the vehicle on 19.06.2008 from the custody of the complainant. On 01.09.2008 he requested the opposite party to inform the balance amount due to it, but there is no action from the side of opposite party.

The complainant submits that as on this day the complainant is prepared to pay all the arrears of due amount to the opposite party. Since the opposite party has not released the vehicle and failed to render necessary services to him, he filed this complaint against the opposite party to direct it to release the Tractor FORCE COMPANY BALWAN NO. 450 and to pay Rs. 2,00,000/- towards damages. The complaint may be allowed.

The opposite party filed Written Version alleging that this District Consumer Forum has no jurisdiction to entertain this complaint. Because relationship between the complainant and opposite party is admittedly lender and borrower only. As such, the complainant is not a consumer as per Article 22 of the loan agreement. Further if any dispute arises it should be adjudicated by Arbitrator only.

The opposite party submits that the complainant undertook to pay the installments, which are mentioned in the second schedule of the loan agreement. The complainant entered into an agreement dt. 23.02.2007 and has to pay the loan amount of Rs. 3,28,750/- every month without default. The complainant was irregular in payment of installments except the 1st and 2nd installments the complainant has not paid the subsequent installments according to the agreed schedule. The complainant paid September and October-07 installments in the month of January-08 and installments payable in the month of November, December-08 and January-08, since he was not evincing interest in paying amounts due to the opposite party, the opposite party took custody of the tractor and the complainant handed over the vehicle without any murmur.

The opposite party submits that it has sent a letter to the complainant on 04.11.2008 informed the amount due and payable to this opposite party. The opposite party informed the complainant that it was willing to receive the arrears amount of Rs. 1,17,897/- with an assurance to pay future installments promptly. But the complainant has not paid the arrears due to the opposite party. The complainant handed over the vehicle to it acknowledging his default, when there is default on the part of complainant, the question compensation will not arise. There is no deficiency of service on the part of opposite party. The opposite party is ready and willing to give back the Tractor to the complainant, the complainant pays the arrears installment amounts Rs. 2,54,470/-. The opposite party is ready and willing to release the vehicle on payment of amount of Rs. 1,32,400/-, which includes the amount due as on date and other expenses. If the complainant undertakes to pay prompt payment of future installments and issued postdated cheuqes towards future installments. The complainant can not continue and can not seek the vehicle on his own terms. The complaint may be dismissed.

The Complainant filed Chief Affidavit of PW-1 and marked Ex.A1 and A2. The opposite party filed Chief Affidavit of RW-1 and marked Ex.B1 to B7. Ex.A1 is the payment receipt. Ex.A2 is the Notice dt. 11.08.2008 issued by the complainant to the opposite party. Ex.B1 is the loan agreement dt. 23.02.2007 between the complainant and opposite party. Ex.B2 is the letter dt. 24.06.2008 by opposite party to the complainant. Ex.B3 is the letter dt. 01.09.2008 by opposite party to the complainant. Ex.B4 is the letter dt. 11.08.2008 by complainant to the opposite party. Ex.B5 is the legal notice dt. 13.11.2008 by complainant to the opposite party. Ex.B6 is the reply notice of Ex.B5. Ex.B7 is the letter dt. 19.06.2008 of repossession of the vehicle.

On the basis of averments, the following points arise for consideration :
1)Whether the complainant has not committed default on payment of installments, due to the opposite party ?

2)Whether the opposite party committed deficiency in service ?

3)Whether the complainant is entitled to seek a direction to restore possession of the vehicle to him by opposite party ?

4)To what relief ?


Point No. 1 to 3 :-
The learned counsel for the complainant contends that the complainant availed a lone of Rs. 2,50,000/- from the opposite party and purchased the Tractor FORCE COMPANY BALWAN NO. 450 and executed hire purchase agreement in favour of the opposite party. The complainant invested an additional amount of Rs. 1,00,000/- by borrowing from the third parties and total value of the Tractor is Rs. 4,25,000/-. The complainant agreed to pay the loan amount of Rs. 9,390/- from 10.04.2007 to 10.01.2010. The complainant paid a total sum of Rs. 1,25,000/- as on 11.03.2008.

The learned counsel for the complainant submits that on 19.06.2008 the opposite party repossessed the Tractor from the complainant asking the complainant to pay total arrears of Rs. 45,963/- including the Insurance amount. Even though the complainant expressed his readiness to pay the amount, the opposite party wantonly repossessed the vehicle. The complainant submits that he got time to pay the loan amount up to 10.01.2010. Repossessed the vehicle before that period forcibly is unfair trade practice and the opposite party has to restore the vehicle to him. The opposite party may be directed to release the vehicle to him.

The learned counsel for the opposite party contends that the complainant entered in to an agreement dt. 23.02.2007 and he has to pay loan amount of Rs.3,28,750/-. The complainant was irregular payment of installment. The 1st and 2nd installments were alone paid by him and remaining installments were not paid by him according to the agreed schedule. The complainant paid September and October-07 installments in January-08. Similarly the installments of November, December-07 and January-08 were paid in the month of February-08. The complainant committed default on payment of 12th installment, which was payable on 10.02.2008. He was not evincing interest in payment of installments to the opposite party. In such circumstances the opposite party informed the complainant that it was intending to take custody of the vehicle and deputed its staff, the complainant handed over the vehicle to the opposite party.

The opposite party submits that it has sent a reply letter dt. 01.09.2008 informing the complainant for the total amount under the contract. On 04.11.2008 the opposite party sent a letter to the complainant informing him that the opposite party is willing to receive the arrears amount as on that date and also the amounts spent for registering the vehicle provided by the complainant to pay the amount as on that date, which was of Rs. 1,17,897/-. The complainant received the letter, but failed to comply the demand of the opposite party.

The learned counsel for the opposite party contends that this opposite party is ready and willing to release the vehicle on payment of amount of Rs. 1,32,400/- as on date and other expenses. The complainant who also undertake prompt payment of future installments and issued post dated cheques for such installments. Since the complainant is default of payment of installments, there is no deficiency of service on the part of opposite party and complaint may be dismissed.

The complainant filed his own chief affidavit as PW-1, it is in the same lines as averred in the complaint. Similarly the opposite party filed chief affidavit of RW-1 as stated in the written version and also written arguments.

It is an admitted fact that the complainant borrowed an amount of Rs. 2,50,000/- from the opposite party and executed hire purchase agreement in its favour, according to pay the loan amount together with interest of Rs.3,28,750/- at Rs. 9,390/- from 10.04.2007 to 10.01.2010. Ex.B1 is the first schedule of the agreement. According to the complainant that he is paying installments regularly to the opposite party and paid total sum of Rs. 1,25,000/- when the opposite party took repossession of the vehicle from his custody on 19.06.2008. The opposite party stated that the complainant is irregular in paying installments only except 1st and 2nd installments; thereafter he committed default on payment of installments.

RW-1 stated that the opposite party is ready and willing to release the vehicle on payment of amount of Rs. 1,32,400/- which includes the amount due as on the date and other expenses. A reading of the Affidavit of RW-1 it shows that the complainant is due Rs. 1,32,400/-. The complainant himself admitted in his Written Arguments that he is willing to pay Rs. 45,963/- to the opposite party. The opposite party addressed a letter dt. 19.06.2008 Ex.B7 that it is intending to take possession of the Tractor from the complainant and he is deputing its authorized agent for that purpose in Ex.B7. It is stated that the arrears of installments due by the complainant Rs. 45,963/- as on 19.06.2008. This fact the complainant is an admitted in his Affidavit and also complaint. So the complainant is due arrears of Rs. 45,963/- and he has not paid the said amount.

On 17.11.2008 the opposite parties addressed another letter to the complainant demanding the complainant to pay an amount of Rs. 1,17,897/- to release the vehicle. But the complainant has not paid amount to the opposite party. During the course of the arguments the opposite party filed statement that the complainant is due Rs. 45,963/- 12 to 16 installments as on the date of taking possession of the vehicle on 19.06.2008. The complainant is also due installments from 12 to 22 installments as on 31.12.2008 till the filing of Written Arguments. Now the complainant is due installments from 12 to 35 installments. So the complainant is due an amount of Rs. 2,54,470/- towards final settlement of the contract. The complainant has not answered in the Written Version of the opposite party, it has not disputed the installment due from 12 to 16 installments as on the date of taking possession of the Tractor. The complainant simply stated in his Written Arguments that he paid Rs. 1,18,683/-. So the complainant has not paid all the installments. The complainant could not explain that how many installments he was due as on the date of repossessing the vehicle by the opposite party on 19.06.2008. When he failed in arrears of installments and committed default and when he was given opportunity to pay the installments, he has not availed same, in such circumstances the complainant could not make out a case against the opposite party that it has taken the Tractor forcibly without any reason and played unfair trade practice against him. When the complainant is committed default on payment of installments the opposite party has a right to take possession of the vehicle under hire purchase agreement. In this connection he relied on the decision reported in 1991 (II) – An.W.R.69 – M.V.Krishna Reddy Vs. The Andhra Bank, Gudur, rep., by its Manager, Gudur, Nellore District – wherein their lordships held as follows :-

“The facts referred to above reveal that the relationship between the complainant and the opposite party is that of debtor and creditor. Admittedly, the complainant did not pay the half yearly installment which was due in the second half of the year 1986. Therefore, the tractor and the trailor were seized by the opposite party/ Bank. The opposite party-Bank seized the tractor and the trailor, as the complainant committed default in payment of the half yearly installment in acceptance with the terms and conditions subject to which the loan was advanced. Therefore, question of deficiency in the service, if any, rendered by the Bank does not arise.”

The facts of the above case are applicable to the facts of the present case. In this case the complainant is committed default on payment of arrears. He has not paid 12 to 35 installments. Therefore he is not entitled to seek any direction against the opposite party for restoring the vehicle to him. There are no merits in the complaint.
Points 1 to 3 are answered against the complainant.
Point No. 4:-
In the result the complaint is dismissed, in the circumstances no costs.

T.Prabhakar Naidu,
S/o T.Doorvasulu Naidu, aged about 54 Years,
Hindu, Cultivation,
Residing at Thatimakulapalle Village,
Diguva Masapalle Post,
Chittoor Ruyral Mndal,
Chittoor District.
… Complainant.



And



The Branch Manager, M/s. Sundaram

Finance Limited, Door No.2-13/4,

Officers Lane, Opposite to Chittoor

Municipal Office, Chittoor.

… Opposite Party.



This complaint coming on before us for final hearing on 29.04.2009 and upon perusing the complaint, written versions, affidavits, material documents and on hearing Sri K. Madhava Naidu & Sri D.Janardhana Naidu, counsels for the complainant, and Sri K.Masthanvali counsel for the opposite party and having stood over till this day for consideration, the Forum made the following:-


ORDER


This is a complaint filed by the complainant U/Sec. 12 of C.P.Act to release the vehicle FORCE COMPANY BALWAN NO. 450, and direct the opposite party to pay damages of Rs. 2,00,000/-.



The complainant submits that he purchased a new tractor by obtaining loan of Rs. 2,50,000/- from the opposite party under Hire Purchase Agreement, besides availing loan amount of Rs. 2,50,000/- from the opposite party and he invested further amount of Rs. 1,00,000/- and purchased a new tractor FORCE COMPANY BALWAN NO. 450, total cost of the tractor is Rs. 4,25,000/-. As per the terms of Hire Purchase Agreement the complainant has to pay the amount with monthly installment of Rs. 9,390/- from 10.04.2007 to 10.01.2010. He regularly paid the amounts, so far he paid Rs. 1,25,000/- towards loan amount to the opposite party.



The complainant submits that on 19.06.2008 the opposite party repossessed the vehicle stating that the total arrears, Insurance including AFC Rs.45,963/- is due. Even though he expressed his intention to pay the amount of Rs. 45,963/-, the opposite party wantonly repossessed the vehicle from his custody. As the opposite party seized the vehicle the complainant agricultural operations were put to stand still and he sustained loss to a tune of Rs. 2,00,000/-. The complainant is prepared to pay the entire due amount to the opposite parties. He filed this complaint to direct the opposite party to release the vehicle and grant damages of Rs. 2,00,000/-.



The opposite party filed Written Objections stating that the complainant purchased FORCE COMPANY BALWAN NO. 450 tractor. The complainant undertook to pay the installments promptly which are mentioned in the second schedule of the loan agreement. The opposite party submits that the complainant was not paying installments regularly except the 1st and 2nd installments. The complainant has not paid the subsequent installments according to the agreed schedule, he paid September and October-2007 installments in January-08 and the installments of November, December-07 & January-08 were paid in February-08. The allegation that the complainant paid an amount of Rs. 1,25,000/- is not correct.



The opposite party further submits that the complainant committed default of payment of 12th installment, which was payable on 10.02.008. Since the complainant was not evincing interest in payment of amounts due and payable to the opposite party, he handed over the vehicle to the opposite party. This opposite party sent reply notice dt. 01.09.2008 informing the complainant, the total amount payable under the contract. After receiving the reply notice dt. 01.09.2008 the complainant kept quite. Again on 04.11.2008 this opposite party sent a letter informing the complainant the total amount due and payable to this opposite party and the opposite party is willing to receive the arrears amount as on that date, provided the complainant pays the amount of Rs. 1,17,897/- as on that date. The complainant received the letter, but failed to comply the demand of the opposite party. This opposite party is willing to give back the vehicle to the complainant, if he pays the amount of Rs. 2,54,000/- due to the opposite party towards final settlement of the contract.



The opposite party further submits that it is ready and willing to release the vehicle on payment of amount of Rs. 1,32,400/- and the complainant should undertake regarding prompt payment of future installments. The complainant has not come to this Forum with clean hands. The complaint may be dismissed.



On the basis of averments the following points arise for consideration:

1. Whether the complainant is entitled to seek custody of the vehicle bearing No. FORCE COMPANY BALWAN NO. 450 Tractor from the possession of the opposite party ?

2. Whether the complainant is entitled to claim damages of Rs. 2,00,000/-

3. Whether the opposite parties committed deficiency in service?

4. To what relief ?

The complainant filed Chief Affidavit of PW-1 and marked Ex.A1 to A4. The Opposite party filed Chief Affidavit of RW-1 and marked Ex.B1 to B7.

Point Nos. 1 to 3 :-



It is an admitted fact that the complainant purchased a new tractor by obtaining loan of Rs. 2,50,000/- from the opposite party. Ex.B1 dt. 23.02.2007 is the loan agreement between the complainant and the opposite party. It is also an admitted fact that the complainant invested another sum of Rs. 1,00,000/- and purchased new tractor FORCE COMPANY BALWAN No.450. The total cost of the vehicle is Rs. 4,25,000/-. It is also an admitted fact that as per the terms of Hire Purchase Agreement Ex.B1 the complainant has to pay the amount from 10.04.2007 to 10.01.2010 with monthly installments of Rs. 9,390/-. It is also an admitted fact that on 19.06.2008 the opposite party has repossessed the vehicle as per letter dt. 19.06.2008, Ex.B7. It is also an admitted fact that on the date of repossession of the vehicle the complainant fell in arrears of Rs. 45,963/- to the opposite party.



The complainant as PW-1 stated that even though he expressed that he is prepared to pay the amount of Rs. 45,963/- to the opposite party, the opposite party wantonly repossessed the vehicle from his custody. Later he approached the opposite party several times and requested it to receive the arrears of amount and release the vehicle, but the opposite party did not release the vehicle.



PW-1 further stated that he gave notice dt. 11.08.2008 to the opposite party requesting to inform the balance amount due and permit him to pay the said amount to it. The opposite party acknowledged the notice, but failed to release the vehicle.



RW-1 is the Branch Manager of opposite party, he stated that the complainant was irregular in paying the installments. RW-1 further stated that the opposite party sent a reply letter dt. 01.09.2008 informing the complainant for the total amount payable under the contract. After receiving the reply notice dt. 01.09.2008 the complainant kept quite and did not remit the amount due to the opposite party.



RW-1 further stated that the opposite party is always ready to receive the arrears amounts and informed the complainant to pay an amount of Rs. 1,17,897/- with an assurance to pay the future installments promptly. The complainant received the letter, but failed to comply the reasonable demand of the opposite party. Since the complainant was not evincing interest in paying the amount due to the opposite party, the opposite party seized the vehicle from the possession of the complainant. The complainant himself handed over the vehicle to the opposite party as per the letter Ex.B7, finally RW-1 stated that the opposite party is willing to release the vehicle on payment of an amount of Rs. 1,32,400/-, but the complainant did not paid the amount, the complainant has not come to this Forum with clean hands and there is no cause of action for filing the complaint and the complaint may be dismissed.



I agree with the contention of the learned counsel for the opposite party that the complainant has not come to this Forum with clean hands. The opposite party addressed a letter dt. 19.06.2008 Ex.B7 informing the complainant that he has not paid the arrears due to the opposite party, and added that the opposite party would take possession of the vehicle, if the complainant failed to pay the arrears amount of Rs. 45,963/-. Ex.B3 is the letter dt. 01.09.2008 addressed by the opposite party to the complainant requesting the complainant to pay an amount of Rs. 2,25,752/- as on 30.09.2008. Ex.B6 is the another letter addressed to the complainant asking him to pay an amount of Rs. 1,17,897/- to release the vehicle to him. Inspite of letters Exs. B7, B3 and B6 the complainant has not paid the arrears due to the opposite party.

The opposite party also informed the complainant in its letter Ex.B2 dt. 24.06.2008, asking the complainant to pay the outstanding amount of Rs. 2,16,442/- besides additional interest and other incidental charges, otherwise the opposite party will be constrained to sell the vehicle. In spite of Ex.B2 the complainant did not pay the amount to the opposite party. The complainant instead of paying the arrears due to the opposite party simply addressed a letter Ex.B2 dt. 11.08.2008 to the opposite party requesting the opposite party to inform the balance amount due to it. By the date of letter Ex.A2 the opposite party had already written two letters Ex.B2 and B7 informing the amount due to it. But the complainant has not complied with the demand of the opposite party. The complainant had no intention to pay the arrears of Rs. 45,963/- as per Ex.B7 and he addressed a letter that he would pay the arrears amount to the opposite party without an intention to pay the same. If the complainant really honest to pay the arrears amount he would have paid the same. The complainant was given opportunity by the opposite party even after seizure of the vehicle to clear the arrears due to it till 17.11.2008 Ex.B6. But the complainant did not pay the arrears due to the opposite party. According to the opposite party as on 17.11.2008 Ex.B6 the complainant is due an amount of Rs. 1,17,897/- and the said amount was not paid to it.



The learned counsel for the complainant contends that as on the date of seizure of the vehicle on 19.06.2008 the complainant is due only Rs. 3,877/- and he filed a statement that he paid Rs. 1,27,583/- and the balance amount is Rs. 3,877/-, this statement filed by the complainant is inconsistent with the averment pleaded by him in Para 6 of his complaint, as well as his Chief Affidavit as PW-1.



PW-1 stated that “I prepared to pay the amount of Rs. 45,963/- to the opposite party, the opposite party wantonly has repossessed the vehicle from the custody of me”. Therefore the argument of the learned counsel for the complainant that he is due only Rs. 3,877/- as on the date of seizure of the vehicle is not correct. The opposite party given opportunity to the complainant to pay arrears amount of Rs. 1,17,897/- to release the vehicle to him in its letter Ex.B6 dt. 17.11.2008. But the complainant did not comply the request of the opposite party. Hence the complainant is defaulter of payment of huge arrears amount and he has not come to this Forum with clean hands. The complainant failed to show that the opposite party committed deficiency in service and that he is entitled to obtain custody of the vehicle.

Point Nos. 1 to 3 are answered against the complainant.


Point No. 4:-



In the result the complaint is dismissed without costs.

Complaint Case No : 985 of 2009

Date of Institution : 15.07.2009

Date of Decision : 11.11.2009

Saraswati Educational and Welfare Society (Regd.) Friends Enclave, Near Gear Hospital, Kharar, Tehsil Kharar, District, Mohali through its President Smt.Sukhwinder Kaur w/o Sh.Harnet Sing.

….…Complainant

V E R S U S

1] Sundaram Finance Limited, 21, Patullos Road, Chennai 60002, through its Managing Director.

2] Sundaram Finance Limited, SCO 11, Sector 26, Chandigarh, through its Branch Manager.

..…Opposite Parties

CORAM: SH.JAGROOP SINGH MAHAL PRESIDENT

SH.SIDDHESHWAR SHARMA MEMBER

DR.(MRS) MADHU BEHL MEMBER
Argued by: Sh.Chaman Lal, Adv. for complainant.

Sh.Vineet Sehgal, Adv. for Sh.Ashish Goel, Adv. for OPs.

PER SHRI JAGROOP SINGH MAHAL, PRESIDENT

The complainant society purchased one Swaraj Mazda Pick Up vehicle bearing Regd. No.PB-12-G-5878 after obtaining a loan of Rs.6.90 lacs from OP No.2 to be repaid in 48 monthly installments of Rs.16,620/- w.e.f. 17.12.2004 to 17.10.2008 and for the same 48 post dated cheques were issued in favour of the OP Company. A loan agreement was also executed between the parties and the interest to be paid on the loan amount was settled @7.44% per annum and as such the total loan amount along with interest to be repaid was Rs.7,97,761/-. The said vehicle was duly insured with United India Insurance Company Ltd. w.e.f. 24.11.2008 to 23.11.2009. The last installment of loan, which was to be paid on 17.11.2008 could not be credited in the account of OP due to some technical defect and the cheque of said installment was returned to the complainant and as such the amount of last installment was deposited with OP Company on 26.12.2008. Thereafter, the complainant demanded Loan Clearance Certificate and No Objection Certificate from OP so that the entry of HPA be deleted from the registered cover of the vehicle. However, the OP Company refused to issue any such certificates on the pretext that a sum of Rs.23000/- was still outstanding against the complainant towards the insurance premium paid by the OP for insurance of the vehicle, which is totally illegal & unjustified. It is averred that the complainant informed the OP Company that the vehicle had already been got insured well in time and they were never asked to get the vehicle insured at their own level and even as per the loan agreement executed between the parties, it was the duty of the borrower/complainant to get the vehicle insured and supply the copy of the policy to OP for its inspection, which was done but inspite of bringing this fact to the notice of OP Company a number of times neither the NOC &nor the Loan Clearance Certificate was issued in favour of complainant. Therefore, the present complaint has been instituted alleging the above act of OPs as deficiency in service and unfair trade practice, due to which the complainant society has suffered a lot.

2] OPs filed joint reply and admitted the factual matrix of the case. It is stated that the complainant had made defaults in payment of installments due against it and as such an amount of Rs.31,084/- plus other delay charges were due against it, which has not been deposited by the complainant. It is also stated that the complainant has not got insured the vehicle nor furnished particulars of the policy with the OPs as required by the terms & conditions of the loan agreement and therefore in order to secure & safeguard their loan amount and lien on the vehicle in question, the OP Company got the vehicle insured for the period from 24.11.2007 to 23.11.2008 as per the terms & conditions of the agreement executed between the parties. It is further stated that the complainant was liable to pay to the OPs the insurance premium as well as other charges due against it. Rest of the allegations have been denied and it is prayed that the complaint be dismissed.

3] Parties led evidence in support of their contentions

4] We have heard the ld.Counsel for the parties and have also perused the record.

5] The contention of the Complainant in Para No. 6 of the complaint is that they had issued 48 post dated cheques for repayment of loan. The contents of this para were admitted by the OPs. When the OPs were in possession of the post dated cheques, it is their duty to present the same by due dates and obtain the payment.

6] The learned counsel for the OPs has argued that the Complainant had not got the vehicle insured for the period from 24.11.2007 to 23.11.2008 and, therefore, they got it insured by paying a sum of Rs.15,063/-. It is argued that this amount is payable by the Complainant, which he has not paid so far. He has referred to Cl. No. 12.1 of the Agreement (Annexure R-2) in this respect. A perusal of Cl. No. 12.1 shows that it is the duty of the borrower to keep the vehicle insured immediately after signing the agreement and to produce and deliver (if so required by the lender) any insurance policy, cover note or receipt on demand by the lender (i.e. OP) for its inspection and verification. The contention of the Complainant is that in view of Cl. 12.1, the Complainant immediately got the vehicle insured on 20.11.2007 vide Annexure C-1. Now, it was for the OPs to require the Complainant to produce and deliver the said insurance policy or cover note, but it is not their case if they ever demanded any information about the insurance from the Complainant. If the OPs subsequently on 26.11.2007 got the same vehicle insured vide Annexure R-3, the Complainant would not be liable to pay the expenses therefor because the OPs were required to get it insured after inquiring from the Complainant and only in case the Complainant has not got it insured. To repeat the rights and duties, it was the duty of the Complainant under the general law as well as under the Agreement (Annexure R-2) to get the vehicle insured. If the Complainant failed to do so, only then the OP was to get it insured. However, before getting the vehicle insured and also to ascertain that the Complainant has not got it insured, it was necessary for the OPs to require the Complainant to produce the insurance policy or the cover note. However, in the present case, the OPs did not enquire from the Complainant about his having got the vehicle insured and straightaway went ahead with the insurance. The Complainant is, therefore, not liable to pay for the expenses incurred by the OPs on the second insurance of the vehicle got done by the OPs.

7] The learned counsel for the Complainant has argued that in fact after the vehicle was insured, the OPs deducted this amount of insurance from the Cheque which was payable towards the installment and thereafter, alleged that the installment had not been paid by due date. The accounts statement Annexure R-6 produced by the OP, shows that all the installments except the last one had been paid by due dates. As regards the last installment, which was paid on 26.12.2008, the OPs were entitled only to Rs.20/- as mentioned in the statement. There is, however, no document on the file to suggest that the OPs ever informed the Complainant about the delay in the payment or the manner in which the installment amount was being utilized by them. When the cheques were for the repayment of the loan towards installments, the same could not have been utilized by the OPs towards the payment of the insurance premium. It is clear from the accounts statement Annexure C-8 that Cheque No. LC56097 was not utilized by them towards the payment of the installment. Thereafter, certain amounts were deducted as AFC, which again is wrong on the part of the OPs, because if the demand of the insurance premium is excluded, then there was no delay in payment of any of those installments. If the OPs utilized the amount towards the installment of premium, it is deficiency on their part as they did not give any such information to the Complainant and did not ask for the premium amount from them through any letter or correspondence.

8] In view of the above discussion, we are of the opinion that the OPs were liable to issue the ‘N.O.C.’ regarding clearance of loan, but they have not issued the same. The present complaint, therefore, succeeds. The same is accordingly allowed and the OPs are directed to immediately issue the ‘N.O.C.’ and also pay to the Complainant Rs.10,000/- for causing them physical and mental harassment and Rs.2,000/- as costs of litigation. The N.O.C. shall be issued and the amounts shall be paid within 30 days from the date of receipt of the copy of the order, failing which the OPs would be liable to pay the same along with interest @12% per annum since the filing of the present complaint i.e.15.7.2009, till the N.O.C. is issued or the amounts are paid.

Certified copies of this order be sent to the parties free of charge. The file be consigned.

Consumer Complaint No


1328 of 2009

Date of Institution

16.09.2009

Date of Decision

15.12.2009

Inderjit s/o Sh. Paras Ram, r/o Village Chalan, P.O. Kathgarh, District Nawashahra, Now Shahid Bhagat Singh, Punjab

…..Complainant

V E R S U S

Sundaram Finance Limited, through its Manager, S.C.O. No.11, First Floor, Sector-26, Chandigarh



……Opposite Party



CORAM: SH.JAGROOP SINGH MAHAL PRESIDENT

SH.SIDDHESHWAR SHARMA MEMBER

DR.(MRS) MADHU BEHL MEMBER



Argued by: Sh.Davinder Lubana, Adv. for complainant.

OP ex-parte.



PER SHRI JAGROOP SINGH MAHAL, PRESIDENT

Succinctly put, the complainant, took a loan of Rs.2,00,000/- in the month of January, 2006, from Sundaram Finance Limited (OP) vide Contract no. BP0199 and purchased a vehicle-Mohindra Pick-up now bearing Registration No. PB-32-F-6391. According to the complainant, he paid monthly installment of Rs.9333/- each regularly to the OP towards the repayment of the loan. After making full and final payment of the loan, the complainant approached the OP for issuance of N.O.C. but OP without explaining any reason asked the complainant to deposit Rs.10,997/-, as according to the OP, the two cheques of the complainant had bounced. The complainant stated that his account had always remained with sufficient funds and the cheques bounced due to the lapse on the part of the OP because one cheque was not deposited in time by OP and another cheque was deposited in other branch wrongly by OP, for which both the cheques got dishonoured. The complainant sent a legal notice to the OP on 3.07.09, regarding issuance of N.O.C and to refund the excess amount of the complainant and compensation for unnecessary mental agony and harassment but the OP did not reply the said legal notice. In view of the above facts and circumstances, the complainant prayed that the OP be directed to issue N.O.C and compensation for mental agony, harassment, deficiency in service for not providing N.O.C. in time and unfair trade practice.

2] Notice of the complaint for written reply and evidence was sent to OP, seeking their version of the case. Counsel for OP filed his memo of appearance only. Proxy Counsel for OP appeared on 4.11.09 and sought time to file vakalatnama, reply & evidence. None appeared on behalf of OP; accordingly OP was proceeded against ex-parte.

3] The complainant led evidence in support of his contention.

4] We have heard the Counsel for the complainant and have also perused the record.

5] Annexure C-1 is the statement of transactions showing that the amount of loan was to be repaid by the complainant in 24 installments of Rs.9,333/- each. The complainant has produced the statement of accounts obtained from the Kathgarh Branch of Punjab and Sind Bank which is now marked as Annexure C-8, showing that 23 installments of loan had been repaid by him. The complainant has also paid the first installment of Rs.9,333/- in cash on 26.07.06 as is reflected from Annexure C-1 and in this manner all the 24 installments have been paid by him. He also paid Rs.20,000/- in cash on 26.09.08 as reflected from account statement Annexure C-1. The OP is still demanding Rs.10,997/- and has not so far issued N.O.C. to the complainant.

6] The Learned Counsel for the OP has argued that the cheque no.429533 which was payable on 12.07.06 was dishonoured and due to that fact the complainant is therefore liable to pay interest and late payment charges. The complainant has placed on file Annexure C-2 which is the copy of the said cheque dated 10.07.06. Annexure C-3 shows that it was dishonoured by the bank because instead of sending the said cheque to Kathgarh Branch of the OP for encashment, the same was sent to Nawanshahr Branch. Annexure C-3 is the memo vide which it was dishonoured due to the reason that it was not drawn to the said branch of the OP bank. The cheque Annexure C-2 shows that thereafter cutting was made in the date of the cheque and under the date 10.07.06 another date 10.01.07 was written. It is clear that this cutting was made unauthorizedly by the officials of the OP and the said cheque was again submitted to the Kathgarh Branch but it was again dishonored vide Annexure C-4 due to the cheque being “mutilated/postdated/out of date”. In this manner if there was any delay in the payment of this installment, it was due to the fault of the OP, first in presenting the cheque in a wrong branch and secondly presenting it after a period of 6 months by illegally changing the date thereof. The complainant therefore cannot be burdened to pay interest or late payment charges for non payment of this installment. The OP has already paid much more than the amount due from the complainant.

7] In view of the above discussion, we are of the opinion that the present complaint succeeds. The same is accordingly allowed. The OP is directed to overhaul the account and not to charge anything from the complainant for the dishonored cheque no.429533 and further directed to refund to the complainant the amount received in excess from the complainant as referred to above and also issue N.O.C. to the complainant with respect to the loan alongwith costs of litigation of Rs.5,000/- within 30 days of receipt of the copy of this order, failing which they would be liable to pay the same alongwith penal interest @ 12%p.a. since the filing of the present complaint i.e. 16.09.09, till the amount is actually paid to the complainant.

Certified copies of this order be sent to the parties free of charge. The file be consigned.

C.C.No.693 of 2007
BETWEEN:

Vontur Venkatappa Reddy,

S/o. Sesha Reddy,

R/o. D.No.2-697,

Gurazala Post & Mandal, Guntur District.

C/o. The Guntur Consumer Council,

Near Brahmananda Municipal Buildings,

Beside Post Office, Guntur. … Complainant
AND

1. M/s.Sundaram Finance Limited,

Rep. by its Managing Director,

Regd. Office, No.21

Patullos Road, Chennai – 600 002.

2. A.Bhaskar Krishna,

Branch Manager of Guntur Branch,

M/s.Sundaram Finance Limited,

1st floor, Gayathri Enclave,

8/1, Arundelpet, Guntur. … Opposite parties

This complaint coming up before us for final hearing on 19-01-10 in the presence of Sri P.Ramanjaneyulu, Advocate for complainant and of Sri Y.Tulasi Ram, Advocate for opposite parties, upon perusing the material on record, hearing both sides and having stood over till this day for consideration, this Forum made the following:

O R D E R

Per Sri T.ANJANYULU, PRESIDENT:

This complaint is filed under section 12 of Consumer Protection Act, 1986 by the complainant seeking directions on the opposite parties for return of school bus namely EICKER 10.50 or to refund an amount of Rs.2,52,249/- along with interest @ 24% p.a. and also to award Rs.5,00,000/- for loss of reputation of school and Rs.20,000/- towards legal expenses.

The brief facts of the case are that

The complainant herein and his brother are running a school known as Viswasanthi Public School at Gurazala Village, Guntur District. The school runs the classes from 1st to 10th to the children who are attending from surrounding villages at distance 10 to 15 K.M. from Gurazala. In order to facilitate easy transportation, the Management of School thought it fit to purchase a mini Omni Bus. Accordingly on 24-11-04 they purchased one EICHER 10.50 E School Bus through invoice No.E45, dt.24-11-04 at the cost of Rs.6,86,649/- with the financial assistance of opposite parties by hypothecating the school bus. The complainant has signed loan agreement on 26-11-04. The loan amount is repayable in 47 monthly installments and first installment commenced on 05-12-04. The last installment was payable on 22-09-08. The complainant initially paid an amount of Rs.1,06,649/- towards cost of bus and the opposite parties financed Rs.5,80,000/- and agreement is concluded at Rs.6,84,000/- out of it Rs.1,04,400/- is interest.

The complainant has paid 10 installments from 21-12-04 to 24-10-05 amounting to Rs.1,45,600/- to opposite parties. Thereafter due to unavoidable circumstances and financial crisis, the complainant diverted funds to school and as such the payment not made in time. Due to nonpayment of installments in the moths of November and December, 2005, the opposite parties have forcibly with the help of hired musclemen seized the school bus on 26-12-05 at about 1.00 pm without giving prior notice. Because of this act, the children and school management suffer a lot. That on 24-05-06, the opposite parties have also sold away the school bus to third party for a meager price of Rs.3,80,000/- as it belongs to 2004 model. Thus, the acts amounts to deficiency of service. The complainant has suffered mentally, physically and as well as financially. Hence, the complaint.

The opposite parties have filed their version, which is in brief as follows:

They have denied all the allegations made in the complaint. The 1st opposite party company is a public limited company incorporated under the Indian Companies Act, 1913, having its registered office at Chennai and has branches all over India including one at Guntur. It carries the business of hire purchase and extending loan facilities to customers for purchase of commercial and other vehicles. The 2nd opposite party is described in his personal capacity, which is not correct.

It is submitted that during November, 2004 the complainant has approached the 1st opposite party with a request to extend loan facility to him for purchase of mini bus bearing chasis No.11EF4F107071 and fitted with engine No.E483ND4F104911. Accordingly, the said request is accepted and loan agreement was entered on 26-11-04 and it granted loan for Rs.5,80,000/-. One M.Mattaiah of Gurazala stood as guarantor on behalf of complainant for due performance of contract. Under the terms and conditions of loan agreement, the complainant has to pay a total agreement amount together with interest @ 8.99% p.a. which is of Rs.6,84,400/- in 47 monthly installments from 05-12-04 to 22-09-08. The vehicle was also hypothecated in favour of 1st opposite party company. The hypothecation is also incorporated in registration certificate bearing No.AP 07W 5207 and also in the invoice issued by the dealer.

As per terms and conditions of agreement, the complainant has to pay installments punctually on due dates. The complainant has committed default as stipulated in Art.13 of agreement, in payment of installments from 11th installment onwards. In case of default of payment of installment, the 1st opposite party is entitled to repossess the vehicle and sell the same and appropriate sale proceeds towards the amount due and payable by the complainant as per Art.14 of agreement. Apart from its right to repossess the vehicle, the 1st opposite party is also entitled to additional charges on the amount due from date of arrears till the day of payment. It got issued a demand notice dt.14-12-05 for payment of dues. The complainant received the same and kept quite. Inspite of service of notice, the default persisted. In the said circumstances, the 1st opposite party was compelled to take steps fro custody of vehicle in accordance with terms of loan agreement and accordingly took custody of vehicle on 26-12-05, and informed the same to complainant by way of notice dt.31-12-05, which he has received on 21-01-06. He was also called upon to clear the amounts due to company and take back the vehicle. Further it got issued a notice dt.15-05-05, before the same of vehicle, which was received by complainant on 19-05-05. Having received the same, the complainant did not choose to pay the amounts. In turn the vehicle was sold on 24-05-06 for a sum of Rs.3,80,000/- being the best price offered for vehicle in its “as is where is condition” and appropriated sale proceeds after publication dt.28-04-06 in largest circulated news daily “Eenadu”. The transport authority also got issued a notice to complainant as per law when this opposite party applied for issuance of fresh registration certificate but the complainant did not choose to raise any objection and kept quite.

It is further submitted that after appropriating sale proceeds an amount of Rs.1,42,979-36 is still due and payable by the complainant towards short fall after the sale of vehicle. The 1st opposite party also got issued legal notice on 10-10-06 demanding payment from the complainant and guarantor, but they fail to do so.

In accordance with the arbitration clause stipulated under Art.22 of loan agreement, the 1st opposite party initiated Arbitration proceedings against the complainants and guarantor of complainant at Chennai. During the pendency of Arbitration proceedings the 1st opposite party filed an application under section 9 of Arbitration and Conciliation Act, 1996 for interim measures against the property of complainant which was pending before Hon’ble II Addl. District Judge, Guntur in O.P.No.155/2007. The complainant filed his counter and in his counter, he never pleaded deficiency of service and also forceful seizure of vehicle. The arbitration proceedings before the Arbitrator P.M.Ramani were closed and an award dt.25-01-08 was passed against the complainant and guarantor namely Mattaia in Arbitration Case No.PMR/238/WA1862/2007. This complaint is filed as a counter blast to the above said proceedings and the same is not tenable. Therefore, it is prayed to dismiss the complaint with costs.

Both sides have filed their respective affidavits. On behalf of complainant Ex.A1 to A3 are marked. On behalf of opposite parties Ex.B1 to B11 are marked.

Now the points for determination are that

1. Whether the complainant is entitled for return of bus or refund of amounts as claimed in the complaint?
2. To what relief?

POINTS 1 & 2

The complainant in this case seeks return of school bus he purchased under sale invoices, sale certificate and receipt (Ex.A1 to A3) on the ground that it was illegally seized by opposite parties for nonpayment of installments for the months of November and December, 2005 and sold away the vehicle for meager price. According to complainant this is deficiency of service on the part of opposite parties. He also claimed alternatively balance refund of amount to the tune of Rs.2,52,249/- with interest, compensation of Rs.5,00,000/- as their reputation is effected and legal expenses.

The ownership of vehicle in question is no way in dispute. The opposite party claims that they have financed for the purchase of vehicle under loan agreement vide Ex.B1 and as per schedule annexed the total sum was due to the tune of Rs.6,84,400/- by the complainant which is repayable in monthly installments @ Rs.14,560/- for a period of 46 months from the month of December, 2004 to September, 2008 and that vehicle was also hypothecated to them under said the agreement with an endorsement under certificate of registration vide Ex.B2. As the complainant committed default in payment of installments they have issued notice on 14-12-05 informing that if the amounts are not paid as per schedule the vehicle will be seized (Ex.B3). despite of that, the complainant has not taken steps, as such another notice dt.31-12-05 vide Ex.B4 was issued mentioning outstanding amount due as Rs.5,38,261/- requesting the party to settle the loan amount. They would be constrained to take further steps in seizer and sale of vehicle and appropriating the sale proceeds. There are acknowledgements for receipt of these notices from complainant. Accordingly, they have seized as per terms of agreement. Thereupon on 15-05-06, they have given one more opportunity calling upon the complainant to come down to their office at Guntur and settle the account by 18-05-06, otherwise they would sell away the vehicle to the highest price and if the matter is delayed resale value would come down. The opposite party also relied on publication given in Eenadu newspaper about sale of vehicle vide Ex.B6. After sale of vehicle on 24-05-06 for a sum of Rs.3,80,000/- being the best price offered by a purchaser as is where in condition they appropriated sale proceeds and still an amount of Rs.1,42,979.36 found due for which the complainant is called upon to pay the same by registered legal notice dt.10-10-06 vide Ex.B7. The opposite party also initiated arbitration proceedings before the District Judge, Guntur vide OP No.155/07 restraining the complainant from disposing of their immovable property as mentioned in schedule for further realization of due amount, which is evident from Ex.B8. The complainant has appeared and filed counter in it. Ultimately an award was passed on 25-01-08 vide Ex.B10 by the Arbitrator for realization of balance amount. Subsequent to that, the opposite party also filed execution proceedings in arbitration case which is evidence from Ex.B11.

Further the learned counsel for opposite party rely upon clause 14.2 to 14.4 of loan agreement which may appears that the lender and their men have right to repossess the vehicle hypothecated in case of default of payment of installments and unrestricted right vested for resale of vehicle and adjust sale proceeds towards balance due. Basing on these terms and conditions, the learned counsel for opposite party contends that the opposite party is vested with such rights as referred above to seize the vehicle, sell it away in public auction, realize the sale proceeds and adjust the same towards outstanding due. It is also contended that the complainant/borrower has no right in any manner to challenge the seizer or the sale of vehicle and bound by the terms of agreement. Further more his contention is that the opposite party gave sufficient opportunity even before seizer of vehicle or thereafter calling upon the complainant to come down to their office, settle the accounts and pay the outstanding due. But the complainant deliberately avoided to avail such opportunity. In the aforesaid circumstances, the opposite party was compelled to sell away the vehicle so as to its resale value may not come down and further sustained loss in fetching price amount. It is impressed upon the forum after giving wide publicity of the auction they have sold it to the highest bidder which is the best price they could obtain. Even after adjustment of such sale proceeds the complainant was avoiding due sum of Rs.1,42,979.36ps., as such arbitration proceedings were initiated before Prl. District Judge, Guntur restraining the complainant from sale of other property in order to realize the balance amount found due. The complainant having appeared in the arbitration proceedings and contest, an award was passed. Thereafter, the opposite party took steps to file execution proceedings. At that stage, the complainant approached this Forum by filing this complaint as a counter step. As such absolutely no deficiency of service is committed by opposite parties.

In support of their arguments, the learned counsel for opposite parties relied upon decisions rendered by Andhra Pradesh High Court in case between (1) Kotak Mahindra Primus Ltd., Secunderabad Vs. S.Laxmana Rao, 2004 (5) ALD 776

(2) State Bank of India Vs. S.B.Shah Ali (died) and others, AIR 1995 ANDHRA PRADESH 134.

In the first case in para 6 it is observed that “It is the evident from the loan agreement that the lender is empowered to seize the vehicle consequent on the default in payment of installments by the borrower. The action of seizure of the vehicle is in terms of the agreement settled between the parties. Therefore, it cannot be said that the clause empowering the lender to seize the vehicle hypothecated to it is against the public policy.”

In the second case it is observed that “when there is no specific clause in Hypothecation Agreement empowering the hypothecatee to take possession of the goods and sell the same, in the event of default in payment, as per the said terms the hypothecatee can proceed ahead without intervention of court”.

The aforesaid decision rendered by AP High Court are in consonance with the terms of present loan agreement vide Ex.B1. Therefore considering the same we are of the view that the complainant is not entitled for return of vehicle or the amount claimed herein, as the seizure of vehicle was rightly effected for nonpayment of dues and the same was sold which fetched appropriate price though the model of vehicle is 2004. We see absolutely no deficiency of service on the part of opposite party.

In the result, the complaint is dismissed. Each party shall bear their own costs.