IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM
Dated, the 28th day of June, 2024
Present: Sri. Manulal V.S. President
Sri. K.M. Anto, Member
C C No. 244/2023 (Filed on 29/07/2023)
Complainant : Sivarajan K.S
Kunnenmakkethil,
Mundakayam, Madukka,
Kottayam – 686 513
(By Adv. K.S.Asif )
Vs.
Opposite party : The Manager,
Muthoot Vehicle and Assets Finance Ltd.,
Ground Floor, Muthoot Round Plaza,
Tourist Banglow Road,
Kottayam
(By Adv. R. Ajith )
O R D E R
Sri. Manulal V.S. President
The complaint is filed under section 35 of the Consumer Protection Act 2019.
The opposite party provided a vehicle loan of Rs.2,64,934 to the complainant on 26-9-2019 for purchasing a Hyundai Eon Car bearing Reg. No. KL 26H 9561. The car was registered in the name of the complainant's son, Jayaraj. The loan had to be repaid in 36 equal installments of Rs. 9375/-The monthly installments were remitted by the complainant.
Although it was agreed to deduct the installment amount from the bank account of the complainant, sometimes, the executives of the opposite parties collected monthly installments directly from the petitioner. The installment was directly collected after the lockdown period.
The complainant remitted all 36 installments as agreed. After paying the installments, the son of the complainant, the registered owner of the vehicle, demanded NOC of the vehicle, but the opposite party raised unnecessary claims and demanded the complainant pay an additional amount of Rs. 40,000. The opposite party has no right to demand an additional amount to issue the NOC. When the complainant was reluctant to issue the NOC, the complainant's son issued a lawyer's notice demanding to issue the NOC. The opposite party did not pay any heed to the reasonable demand of the complainant. The act of the opposite party demanding payment of money after the full payment of the loan amount is a clear instance of unfair trade practice, and it also amounts to a deficiency of service.
Hence this complaint is filed by the complainant praying for an order to direct the opposite party to release the NOC of the vehicle bearing Reg. No. KL 26 H 9561 and to direct the opposite party to pay Rs. 20,000 as compensation to the complainant for his mental agony, along with a cost of Rs 30,000.
Upon notice from this commission, the opposite party appeared before the commission and filed version contending as follows:
The opposite party is a non-banking finance company providing vehicle loans. On 17-09-2019, Jayaraj K. S. took a loan of Rs. 2,62,934 by executing a hypothecation agreement by pledging a Hyundai Eon car with registration number KL-26/H 9561 as collateral security. It was agreed that this amount would be repaid in 36 monthly installments starting from 10-10-2019, including interest and other charges. The complainant is only the guarantor in the hypothecation agreement and is not the registered owner of the vehicle. The complainant does not fall within the purview of the Consumer Protection Act.
All the amounts paid by the borrower Jayaraj K. S. have been credited to the account of the opposite party company. The borrower received a message upon payment. None of the executives from the opposite party received money from the complainant in this case. The borrower also availed of the moratorium facility. The total outstanding amount payable by 27-12-2023 is Rs. 74,138.
It is evident from the account statement that the borrower has made irregular payments of the monthly installments. Hence, according to the terms of the hypothecation agreement, the borrower and the guarantor are liable to pay penalty interest/delay payment charges. The opposite party has replied with the facts to the notice sent by the borrower showing false claims. The complainant has not paid the installments.
Due to the irregular payment of installments by the borrower, he is liable to pay overdue EMIs, penal overdue charges, GST/recovery charges. There has been no deficiency in service or unfair trade practice on the part of the opposite party. The opposite party has only demanded the amounts according to the terms of the hypothecation agreement. The opposite party is obliged to issue the NOC only after the full payment of the outstanding amount. The allegation that he asked for the NOC is false. The opposite party made no special promise to the complainant when executing the hypothecation agreement. The complainant never requested a copy of the loan agreement.
According to clause 20(a) of the hypothecation agreement executed by the complainant, any disputes regarding the loan transaction must be referred to arbitration. None of the reliefs sought in the above-numbered case are admissible. The complainant is not entitled to compensation or costs.
The complainant is examined as PW1, and Exhibits A1 to 6 were marked from the side of the complainant. Kalesh P K, who is the accounts executive of the opposite party, filed a proof affidavit and marked Exhibit B-1 to B3 from the side of the opposite party.
We would like to consider the following points in evaluating the complaint, version, and the evidence on record.
- Whether the complaint is maintainable before this commission or not?
- Whether the complainant had succeeded to prove deficiency in service or unfair trade practice on the part of the opposite parties?
- If so, what are the reliefs and costs?
POINTS 1 & 2:-
The specific case of the complainant is that he availed a loan of Rs. 2,64,934 from the opposite party for purchasing a Hyundai Eon car bearing registration number KL-26-H-9561. Though the complaint remitted all 36 monthly installments as he agreed, the opposite party illegally demanded an additional amount of 40,000 rupees to issue the NOC of the vehicle. The opposite party resisted the complaint, contending that the loan was availed by one Jayaraj K S and the complainant was the guarantor in the hypothecation agreement executed between Jayaraj K S and the opposite party.
On going through exhibit B-1, the hypothecation agreement executed between Jayaraj K S and the opposite party, we can see that the complainant has affixed his signature in B-1 as a guarantor to the hypothecation agreement. Moreover, during the cross examination PW1 who is the complainant deposed that the loan was availed by his son. He further deposed that the vehicle was registered in the name of his son.
Thus, the loan in question was taken by Jayaraj K.S.; hence, the consumer complaint, if though maintainable, ought to have been filed by Jayaraj K.S. and not by the complainant. Therefore, on this score, the consumer complaint was liable to be dismissed, as the complainant cannot be said to be a "consumer" of the opposite party, for the reason that the loan was granted to Jayaraj K.S and not the complainant.
Most importantly, it is to be noted that the Principal borrower, Jayaraj K.S, who is the actual consumer, is not a party to the proceedings, and admittedly, the complainant is only a guarantor of the principal borrower. The complainant has not availed any service from the opposite party. So, he cannot be considered a consumer of the Opposite Party.
Therefore, we relegate the parties to approach the Civil Court for the fair adjudication of this dispute. If the complainant chooses to file a suit for the relief claimed in this proceedings, he can do so according to law, and in such case, he can claim the benefit of Sec 14 of the Limitation Act to exclude the period spent in prosecuting proceedings under Consumer Protection Act while computing the period of limitation prescribed for such a suit as per law. As a result, the complaint is dismissed as not, maintainable before this commission.
Pronounced in the Open Commission on this the 28th day of June, 2024
Sri. Manulal V.S. President Sd/-
Sri. K.M. Anto, Member Sd/-
APPENDIX :
Exhibits from the side of the Complainant :
A1 - Copy of the Registration Certificate Vehicle No. KL26H9561
A2 - Repayment Schedule of Loan Account
A3 - Copy of notice send to the opposite party dated 07/01/2023
A4 - Copy of reply of notice dated 21/01/23 send by Opposite Party
A5 - Copy of Notice dated 09/09/2023 issued by the opposite party to
complainant’s son
A6 - Copy of Notice dated 15/01/2024 issued by the opposite party to
Complainant.
Exhibits from the side of Opposite parties :
B1 - True copy of Hypothecation agreement
B2 - Account Statement
B3 - Power of Attorney
By Order,
Assistant Registrar
