Date of filing: 01.03.2017

                                                               Date of Disposal:30.11.2022

 BEFORE THE III ADDITIONAL BANGALORE URBAN

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

                               BENGALURU – 560 027.

DATED THIS THE 30^th DAY OF NOVEMBER, 2022

CONSUMER COMPLAINT NO.314/2017

PRESENT:

SRI.RAJU K.S,

SMT.REKHA SAYANNAVAR,:MEMBER                      

Deena Dayal C/o late Venkata Subbaiah,

Aged about 65 years,

No.E-13, E-Block,

Near Bricks Factory,

Bengaluru-560 064.……COMPLAINANT

Manappuram Finance Limited

(Branch ID No.1531,

Rajaji Rajkumar Road),

Dr.Rajkumar Road,

Bengaluru-560 010.……     OPPOSITE PARTY

Rep by Sri.Kumar Kumar S, Advocate

//JUDGEMENT//

BY SRI.SHIVARAMA K, PRESIDENT

The complainant in person has filed this complaint under Section-12 of Consumer Protection Act, 1986 seeking for a direction to the opposite party to pay a sum of Rs.6,00,000/- towards mental agony caused and return the gold ornaments pledged with opposite party and the complainant is ready to pay the principal and interest on the loan borrowed. 

2. It is not in dispute that the complainant had pledged ornaments with opposite party and had borrowed the loan in total of Rs.19,900/-.

3. It is the case of the complainant that ever since from the date of pledged of the ornaments he has been paying interest on the loan borrowed and in total he has paid interest of Rs.6,044/- and the opposite party had demanded to pay a sum of Rs.2,700/- representing that the value of the gold has been fallen.  Further, the opposite party had threatened the complainant that it would auction the gold pledged if not got released.  Further, the opposite party claimed the charge for the notice sent and other charges.  Further, the opposite party had threatened the complainant.  Hence, the complaint came to be filed.     

4. It is the contention of the opposite party that the complainant is not a ‘consumer’ as contemplated under Section-2(1)(d) of Consumer Protection Act and the relationship in between the complainant and opposite party is ‘debtor’ and ‘creditor’.  Hence, the transactions are only the specific and do not come within the purview of Consumer Protection Act.  Further, as per condition No.21 of the loan agreement, all disputes shall be settled by arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996.  Further, the opposite party is a Non-Banking Finance Company (NBFC) registered with the Reserve Bank of India under the provisions of Chapter III B of Reserve Bank of India Act 1934 and it is licensed to conduct financial business as per the provisions of the said Act.  Further, the complainant was very much irregular in paying the interest and has not paid interest on the loan.  Since the complainant did not pay the interest the opposite party had sent notice to the complainant periodically, demanding the remittance of loan amount along with interest.  Since, the complainant did not repay the loan and pay the interest as per the terms and conditions of the agreement the opposite party had auctioned the gold ornaments through public auction.  Further, the transaction between the complainant and opposite party is Pawnor and Pawnee.  Hence, it is sought to dismiss the complaint.

5. To prove the case, the complainant and Area Head of opposite party have filed affidavits in the form of their evidence in chief and had produced documents in support of their case.

6. The counsel for the opposite party has filed written arguments.

       7. The points that would arise for consideration are as under:

i) Whether the complainant is a ‘consumer’ within the meaning of Section-2(1)(d) of Consumer Protection Act 1986 ?

ii) Whether the complainant proves the deficiency of service on the part of the opposite party ?

    ii) Whether the complainant is entitled for the 

         compensation as sought ?

     iii) What order ?

8.   Our findings on the aforesaid points are as follows:

Point No.1 :  In negative

Point No.2 :  In negative

Point No.3 :  In negative

Point No.4 :   As per the final order for the following;

REASONS

9.POINT NO.1:- Section 2(1)(d) of Consumer Protection Act contemplates with regard to the meaning of ‘Consumer’.  On perusal of the documents produced by the complainant and the opposite party it appears that the complainant had borrowed the loan by pledging gold ornaments with opposite party.  Further, the transaction in between the complainant and opposite party was borrowing and lending of money.    Hence, question of service from the opposite party with regard to the said transaction does not arise and the payment of consideration also does not arise.  The relationship between the complainant and opposite party is purely pawnor and pawnee as contemplated under Section-172 of Indian Contract Act.

10. It is further contended by the learned counsel for the opposite party that since the relationship of the complainant and the opposite party being debtor and creditor, this Commission has no jurisdiction.  In this regard the Hon’ble National Consumer Disputes Redressal Commission, New Delhi in II (2002) CPJ 20 (NC) D.K.Lalwani and others V/s The President, Indian Bank Mutual Fund and another has passed the judgment in dismissing the complaint.  In the said case, the complainants had bought certain IND Ratna Units (Shares) in their joint names.  The said shares were pledged with respondent-bank. No attempt was made by the complainants to repay the amount.  The complaint was dismissed on the ground that there was relationship of ‘creditor’ and ‘debtor’ between the complainant and respondent-bank and the fora had no jurisdiction.   Further, in a judgement rendered by the Hon’ble Kerala State Consumer Disputes Redressal Commission, Thiruvananthapuram in I (2000) CPJ 308 in between M/s Muthoot Bankers V/s N.Shadadharan, the fact is that gold ornaments were pledged and loan been borrowed and since loan has not been cleared, ornaments were sold in auction and for the compensation claimed the court held that the consumer fora has no jurisdiction since the relationship in between them was creditor and debtor and further observed that the matter can be entertained by civil court.   Further, in a judgement rendered by the Hon’ble NCDRC, New Delhi in III (1997) CPJ 3 (NC) in between Standard Chartered Bank V/s P.N.Tantia and another, the fact is that the complainant had pledged shares for availing of advance/overdraft facilities and the Bank had sold shares and for the complaint filed before the consumer commission, the commission has held that if the sale was not effected in terms of their instructions, or it was in violation of the provisions of Section-176 of the Contract Act, the complainant would proceed against the bank by way of a civil suit for recovery of damages and the complainant cannot resort to the remedies provided under the Consumer Protection Act, 1986.

11. In the cited judgments the Hon’ble Commissions had given verdict that the transaction cannot be within the purview of Consumer Protection Act as the pawnor cannot be a ‘consumer’ within the meaning of Section-2(d) of Consumer Protection Act 1986.  The facts involved in the judgment cited and the facts of the case on hand are similar.  Therefore, the same is applicable to the case on hand also.  Hence, in view of the facts involved in the case and the principles laid down in the said judgment, we answer this point in negative.

12.POINT No.2  The complainant did not produce any documents to substantiate with regard to the deficiency of service on the part of the opposite party.  It is the contention of the opposite party that as per the terms and conditions of the loan agreement, since the complainant did not pay the principal and interest it had auctioned the property and notices been issued for payment of loan and its interest.  In spite of that the complainant did not repay the loan and interest thereon. 

13. It is the contention of the learned counsel for the opposite party that as per the conditions of the loan agreement the dispute with regard to the transaction would be settled by the arbitration in accordance with the provisions of the Arbitration and Conciliation Act, 1996.  The complainant did not produce the agreement for loan.  Hence, there is no merit in the contention of the opposite party and opposite party had failed to prove the said aspect. Hence, we answer this point in negative. 

14. POINT NO.3:- In view of the discussions made above and findings given on point No.1 and 2, the complainant is not entitled for any relief sought. Accordingly, we answer this point in negative. 

15. POINT NO.4:-  In view of the discussion made above, we proceed to pass the following;

The complaint is dismissed.   No order as to costs.

Supply free copy of this order to both the parties and return extra copies of the pleading and evidence to the parties.

Applications pending, if any, stand disposed of in terms of the aforesaid judgment.

  (Dictated to the Stenographer, typed by her, the transcript corrected, revised and then pronounced in the open Commission on 30^th day of November, 2022)                                            

• REKHA SAYANNAVAR)    (RAJU K.S)        (SHIVARAMA. K)    
•  

Witness examined for the complainants side:

Sri.Deena Dayal, the complainant has filed his affidavit.

Documents marked for the complainant side:

1. Memo for paper publication.

2. W.P.No.18597/2012-online copy.

3. W.P.No.18597/2012 objections filed by opposite party no.4 (State Government of Karnataka).

4. W.P.No.47108/2011-online copy.

5. W.P.No.47108/2011 objections filed by respondent-3   State Government of Karnataka)

6.W.P.No.3208/2012-online copy (Link with W.P.No.47108/2011).

7. W.P.No.10835/2012 online copy.

8.W.P.No.10835/2012 (gm-RES objections filed by respondent No.2 (State Government of Karnataka).

9. Karnataka State Interest Act-2004.

10. Circular of Registrar of co-operative societies.

11. Under Secretary to chief minister letter.

12. Registrar of Co-operative societies (legal cell letter).

13. RTI First appeal.

14. Registrar of Co-operative society’s letter.

15. RTI applications by the complainant.

16. Model of the auction notice.

17. RBI non-banking regulations.

18. List of NBFC Registered with RBI.

Witness examined for the opposite party side: 

Sri.Girish, Area Head of opposite party has filed his affidavit.

Documents marked for the Opposite Party side:

1. Pawn Ticket.

2. Demand Promissory Note.

3. Scheme Chart.

4. Loan Duration Slip.

5. Certificate of registration issued by RBI.

6. Certificate of Incorporation under Companies Act.

7. Interim order in W.P.No.18597/2012, before High Court of Karnataka.

8. Interim order in SLP No.34057/2009.

• REKHA SAYANNAVAR)    (RAJU K.S)      (SHIVARAMA. K)    
•