Anup K. Thakur

1.      Under challenge in this Revision Petition No.2745 of 2015 is the impugned order dated 09.05.2015 of the State Consumer Disputes Redressal Commission, Patna, Bihar (State Commission hereafter) in Appeal No.470 of 2012.  The State Commission while concurring in the finding of deficiency in service on the part of the respondent 1/OP1, had partly allowed the appeal and reduced the awarded amount granted by the District Forum, Samastipur (Forum hereafter).  The Forum, in turn, had allowed the Complaint No.45/2010 vide its order dated 30.08.2012 and directed OP1 to pay to the petitioner/complainant Rs. 4,50,000/-, with Rs.45,000/- for financial, mental and physical harassment and Rs.2,000/- for legal expenses from the date of seizure of the vehicle i.e. dated 22.11.2009 till date of payment, with interest @ 10% within 45 days, from the date of the order; in case of failure to to do so, the interest payable would become 12%.

2.      Brief facts of the case are that the petitioner/complainant-Laddu Lal Mahto (complainant hereafter) had purchased a City Ride Bus manufactured by the respondent no.1-TATA Motors Limited (OP1 hereafter) through respondent no.2-Ideal Dealers Pvt. Ltd. (OP2 hereafter) after availing a loan from OP1 of Rs.4,56,000/-.  He had made a down payment of Rs.1,92,000/- and taken delivery of the vehicle on 19.05.2008.  The loan was repayable in 47 installments as per hypothecation agreement signed between the complainant and the OP1.  Per the plaint, battery became defective in Dec. 2008; the crown, pinion and other mechanical parts of the vehicle became defective in March 2009; as such, the vehicle could not ply for some time. The complainant paid a total sum of Rs.2,14,116/- upto Nov. 2009 towards installments.  His vehicle was repossessed by OP1 on 22.11.2009 and he was advised to pay the balance dues with Rs. 18,000/-, cost of seizing the vehicle. Two legal notices dated 9.1.2010 and 18.2.2010 were served upon the complainant seeking payment of Rs.56,965/- and Rs.70,829/- respectively.  Aggrieved, the complainant approached the District Forum with a consumer complaint seeking refund of the amount deposited, the price of the battery and compensation for mental and physical harassment with litigation costs, totaling Rs.5,51,916/- with 16% interest.  The complaint was contested through a written reply on behalf of the OPs.  Preliminary objections were taken: the complainant was not a consumer under section 2 (1) (d) of the Consumer Protection Act, 1986 as the vehicle had been purchased for commercial purpose; District Forum, Samastipur had no jurisdiction to adjudicate the complaint; complex question of facts and law were involved requiring evidence and trial appropriate for a civil court.  It was further pleaded that the complainant had taken the loan voluntarily with full knowledge of the terms and conditions and therefore was subject to clause 18 (a) thereof which inter-alia authorized OP1 to repossess the vehicle in the event of default.  It was contented that no force was used and that the complainant had failed to adduce any evidence to prove use of force.

3.      The District Forum considered the preliminary objections and found that both of them were not valid. It held that the complainant was a consumer as he had purchased the vehicle for his livelihood for which purpose he had engaged a driver.  As for jurisdiction, the District Forum found that transaction of money had taken place in Samastipur and as such, the jurisdiction was found to be that of District Forum, Samastipur.  On deficiency in service, the District Forum found the following: the defective battery; defective parts such as crown, pinion, axel, bearing and other articles, evidenced in the job cards on record, suggesting manufacturing defects.  Due to this, the vehicle could not run properly.  This was the reason for non-payment of the installments.  In this way, the District Forum concluded that there was deficiency in service on the part of OP1 and partly allowed the complaint as described in para 1 above (supra).

4.      The State Commission concurred in the finding of deficiency in the act of the OP1 of supplying a defective vehicle and in repossession of the said vehicle in violation of the hypothecation agreement and in selling of the same.  The State Commission however reduced the amount awarded by the District Forum by Rs.1 Lakh reasoning that this amount would have been the approximate earnings of the complainant in the period 17.5.2008 to 22.11.2009, the date the vehicle was repossessed.  It therefore reduced the amount to be paid to the complainant to Rs.3,06,166/-.  For physical and mental harassment, it awarded compensation of Rs.40,000/- and cost of Rs. 5,000/-.  Reasoning that since the amount deposited by the complainant was being directed to be refunded, the State Commission did not allow any interest on the above amount.  It is this order of the State Commission that is under challenge in this revision petition.

5.      Arguments of the learned counsels for the parties were heard on 14.09.2020.

6.      Counsel for the petitioner/complainant, pointing to the near concurrent orders of the lower fora, submitted that the limited issue to be considered in this revision petition was the apparent error in the impugned order vide which the State Commission had reduced the amount awarded by Rs.1 lakh and had also not allowed interest on the said amount.  The learned counsel read out para 9 of the State Commission which is reproduced below for ease of reference:

          “We too find serious deficiency on the part of the appellant by supplying a defective vehicle, repossessing the vehicle violating the Hypothecation Agreement and sold the same. In such circumstances we are of the view that the complainant is entitled to get back the amount deposited by him i.e; Rs.1,92,000 as down payment + Rs.2,14,166/- as installments deposited in different months up to November, 2009, total sum of Rs.4.06,166/- (-) the amount earned by the complainant between the period 17.5.08 to 22.11.09 which were by rough estimate assessed as sum of Rs.1.00,000/-. Therefore, the refundable amount comes to Rs.3,06,166/-. Since the complainant was suffered physical and mental harassment as such he is also entitled to be compensated for the same.  We assess the compensation for a sum of Rs.40,000/- (Forty thousand) only to be paid, besides litigation cost of Rs.5,000/- (Five thousand) only. Since the amount deposited by the complainant is being directed to be refunded as above, as such we do not allow any interest on the above amount.”

(Ad verbatim per record)

7.      The counsel for the complainant argued that the manner in which the vehicle had been repossessed was not as per the hypothecation agreement: the mandatory notice envisaged therein had not been served upon the complainant. This was deficient service.

8.      Counsel for OP1 referred to para (q) of the revision petition to make the submission that the complainant had admitted that he was ready to pay half the money due against installments but was not ready to pay the muscle men charges of Rs.18,000/- for repossession of vehicle.  The point made was that this clearly showed that the complainant acknowledged that he was in default of payment. Such a default was actionable under the hypothecation agreement.    Still further, he referred to para (o) of the revision petition in which the complainant had suggested that OPs had connived to seize the vehicle on 22.11.2009 with some unsocial elements and had obtained the driver’s signature on the seizure list on. The point made was that the very fact that  there was a driver meant that the complainant was not a consumer under the Consumer Protection Act 1986 (the Act) as he was engaged in business with the vehicle for a commercial purpose.  Invoking the Hon’ble Supreme Court’s order dated 1.11.1996, in CA 14787 of 1996, in M/s Cheema Engineering Vs. Rajan Sood, learned counsel argued that after discussing the explanation under sec 2(1)(d) of the Act qua “commercial purpose” not including use of goods bought by a consumer exclusively for earning his livelihood by means of self employment, it had been held that whether livelihood was through self employment was a matter of evidence; so observing, the matter had been remitted to the District Forum. Counsel accordingly argued that since the complainant had engaged a driver, it could not be said that he was a consumer earning his livelihood through self employment. Therefore, on jurisdictional grounds, the Commission should dismiss the RP and the consumer complaint. He further argued that the revisional jurisdiction, as laid down by the Hon’ble Supreme Court in the matter of Mrs. Rubi (Chandra) Dutta Vs. M/s United India Insurance Co. Ltd., (2011) 11 SCC 269,  was limited to prima-facie jurisdictional errors, and could not be used to re-appreciate the same facts.

9.      Counsel for OP2 submitted that he was only a proforma party and had nothing to say.

10.    Counsel for the complainant made a brief rebuttal.  He admitted that there was some delay in making the payment of installments; however, most of the time, the vehicle was lying idle and despite that, the complainant had continued to pay the installments for a substantial period of time.  He reiterated strongly that no notice of repossession had been given, as mandated vide clause 18 (a) of the Loan cum Hypothecation cum Guarantee Agreement: it was clearly provided therein that in the event of default the lender by notice in writing was to declare the loan to be immediately due and payable and forthwith recall the loan together with all interests etc. and in default of such payment enforce the charge created in terms of the loan agreement.  The allegation of the complainant is that he was not served this mandated notice.  As for role of the driver and seizure list, the counsel explained that driver had said nothing and had only signed the seizure list. This proved nothing.  Concluding, he submitted that there was a patent illegality in the impugned order of the State Commission in reducing the amount without any real basis and further in denying interest on the awarded amount. 

11.    After having heard the learned counsels and perused the record carefully, in my considered view, for reasons discussed below, this revision petition can be allowed partly: the reduction in the award seems to be reasonable; however, denying any interest does not seem to be reasonable in the facts of the case.

12.    As correctly argued by the learned counsel for the OPs, concurrent orders of the lower fora do not warrant revisionary interference.  However, the orders of the lower fora differ in two aspects, as noted earlier.  As such, this RP is maintainable. Also, as to whether the complainant is a consumer under the Act, from the standpoint of whether he had purchased the vehicle to earn his livelihood through self employment, the cited judgement of the Hon’ble Supreme Court (supra) also holds that this would always be a matter of fact, to be decided in the facts of each case. In the instant case, indisputably, the complainant, a khalasi, earning his livelihood by working in Citi Ride Bus as a khalasi, going in to purchase a vehicle with loan, is not taken out of the purview of being a consumer merely because he had engaged a driver. Had he owned several buses and engaged several drivers and other workers, matter may have been different. The lower fora were therefore correct in accepting the complainant as a consumer under sec 2(1)(d) of the Act.  

13.    The first point raised by the complainant in this RP is that the State Commission committed a patent illegality in reducing the amount awarded by the District Forum.  This was so because the State Commission did this after having accepted that there was a serious deficiency of service on the part of the OPs.  However, in my view, this is not a very reasonable argument. The District Forum had completely failed to take into account that the vehicle had been used by the complainant for some time and would have earned some revenue.  Complainant, as a matter of fact, should have disclosed the earnings from the vehicle before the District Forum; he failed to do so; the District Forum too failed to take into account this factum.  The State Commission, by rectifying this apparent error in the order of the District Forum, cannot be faulted for doing so.  Admittedly, the amount of Rs. one lakh was a presumption. But, in the absence of the complainant submitting any accounts, the State Commission can be said to have done it’s best. Ideally, perhaps, it could have asked for a statement of account or have remitted the matter back to the District Forum: however, both these would have resulted in delays; instead, the State Commission chose not to let good become the enemy of the best and made a reasonable  award in keeping with the mandate of summary proceedings. As such, there is no error in the award granted by the District Forum having been reduced by Rs.1 lakh. As for physical and mental harassment, the State Commission reduced this from Rs.45,000/- to Rs.40,000/-.  No major issue is involved in this.  As such, this can also be accepted.  Especially because, Rs.5,000/- has been awarded by the State Commission towards litigation costs against Rs.2,000/- by the District Forum.  One way looking at this would that apart from the main amount to be refunded, the other amounts were assessed at Rs.47,000/- by the District Forum and Rs.45,000/- by the State Commission.  I see no reason not to accept the amount of Rs.45,000/- awarded by the State Commission.

14.    However, it is not clear as to what could be the reason for the State Commission to have denied any interest on the above amount.  No reason has been furnished by the State Commission except the statement that since the amount deposited by the complainant was being directed to be refunded, it did not allow any interest on this amount.  This seems to be an error apparent considering the nature of money and the fact that it earns interest for it’s holder.  However, award of interest @ 10% to be paid within 45 days and 12% thereafter, in the facts of the present case, seems excessive : this is so because the complainant had also admittedly not paid installments on time and was therefore negligent and deficient too.  Accordingly, I deem it reasonable to award an interest of 8% p.a. on the amount of award from 22.11.2009 till the date of payment.  This payment should be made within three months of the receipt of this order.

15.    In view of discussion above, this revision petition is disposed off with the following directions:

(i)      The State Commission’s order of award of Rs.3,06,166/- (Rupees Three Lakh Six Thousand One Hundred Sixty Six) is confirmed ;

(ii)      The State Commission’s order awarding Rs.40,000/- (Rs. Forty Thousand) towards compensation for harassment and Rs.5,000/- towards ligation costs is also affirmed;

(iii)     On refundable amount in (i) above, the OP shall pay simple interest @ 8% p.a. from 22.11.2009, the date of repossession of the vehicle, till the actual payment.

This order shall be carried out within three months of the date of it’s receipt, failing which the petitioner/complainant  would be free to pursue it’s execution before the District Forum.