DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION ERNAKULAM

       Dated this the  31^st day of  July 2023. 

                           Filed on: 12.10.2020

PRESENT

Shri.D.B.Binu                                                                            President

Shri.V.Ramachandran                                                               Member Smt.Sreevidhia.T.N                                                                Member

C.C No. 304 /2020

COMPLAINANT

Suja R Varma, A1, Vint Pearl Apartment, Pavamkulangara, Choorakkad, Tripunithura, PIN 682301

(Adv.Raja Raja Varma, RR Varma & Associates, 1^st Floor, Gourinandanam”, VRRA-5, vayanasala Road, Chithrapuzh, Tripunithura, Ernakulam-682 309)

VS

OPPOSITE PARTIES

1. M/s Popular Exports, Regd. Office: Popular Towers, Vakayar P.O, Konni ,  Pathanamthitta, Kerala, India, Pin: 689698; Rep. by its Managing Partner Thomas Daniel

2. Thomas Daniel, age not known, S/o T.K.Daniel, Managing Partner of M/s Popular Exports Popular Towers, VakayarP.O,Konni, Pathanamthitta, Kerala-689 698.

F I N A L   O R D E R

D.B. Binu, President.

1.       A brief statement of facts of this complaint is as stated below:

          The complaint was filed under Section 35 of the Consumer Protection Act, 2019. The brief facts, as averred in the complaint, are that the first opposite party is a partnership firm managed by the second opposite party. The first opposite party offers an attractive interest rate of 18.18% per annum, and based on this offer and the introduction by the Branch Manager acting under the second opposite party's instruction, the complainant deposited Rs. 2,00,000/- on 15/10/2015 for a period of 66 months.

However, contrary to the promise, the opposite parties have made chronic defaults in paying the agreed interest, and they also declined the complainant's request for premature closure. The complainant later discovered that criminal complaints have been filed against the opposite parties for cheating, breach of trust, and fraud, involving misappropriation of large amounts deposited by the public, including the complainant.

Further inquiry revealed that the opposite party had no permission to collect or receive money/deposits from the public. They also provided a false address for their processing facility, indicating deceptive practices in their service provision. The Cochin office of the company has been closed without prior notice to the complainant.

The complainant seeks compensation for the injury suffered and a refund of the deposited amount of Rs. 2,00,000/- along with interest from the date of deposit until realization and Rs. 25,000/- as the cost of the proceedings.

2) Notice

        The notices to the opposite parties were sent by the commission through the Superintendent of Prison at Sub Jail Mavelikara . However, despite accepting the notices, the opposite parties were absent, and as a result, they are set ex-parte.

3) . Evidence

          The complainant had filed an ex-parte proof affidavit and 1 document that was marked as Exhibits-A-1.

Exhibit-A-1: A copy of receipt No. 0588908 dated 26/06/2020 issued by the opposite party acknowledging the deposit made by the complainant.

4) The main points to be analysed in this case are as follows:

i)        Whether the complaint is maintainable or not?

ii)       Whether there is any deficiency in service or unfair trade practice from the side of the opposite party to the complainant?

iii)      If so, whether the complainant is entitled to get any relief from the side of the opposite party?

iv)      Costs of the proceedings if any?

5)       The issues mentioned above are considered together and are        answered as follows:

            In the present case in hand, as per Section 2(7) of the Consumer Protection Act, 2019, a consumer is a person who buys any goods or hires or avails of any services for a consideration that has been paid or promised or partly paid and partly promised, or under any system of deferred payment.  A copy of receipt No. 0588908 dated 26/06/2020 was issued by the opposite party acknowledging the deposit made by the complainant. The receipt evidencing payment to the opposite parties (Exhibits A-1). Hence, the complainant is a consumer as defined under the Consumer Protection Act, 2019.

        The complainant filed the above case seeking compensation for the deficiency in service caused by the opposite party’s failure to refund the deposited amount. The complainant alleges that the opposite party did not fulfil their obligation to return the money, resulting in a deficiency in the service provided to the complainant.

          We have heard Sri. Raja Raja Varma, the learned counsel appearing for the complainant, who submitted that the 1st Opposite Party, a partnership firm managed by the 2nd Opposite Party, attracts the public by offering an 18.18% annual interest rate with interest accumulation. Based on this offer presented by the representatives of the Opposite Parties and the introduction by the Branch Manager acting on the 2nd Opposite Party's instructions, the Complainant deposited Rs. 2,00,000/- on 15/10/2015 for a 66-month period. (Exhibit A1).

However, despite several requests, the Opposite Parties defaulted on paying the agreed interest, and the Complainant's request for premature closure was also denied. It later came to light that criminal complaints were filed against the Opposite Parties for cheating, breach of trust, and fraud, involving misappropriation of funds deposited by the public, including the Complainant. The 2nd Opposite Party was arrested in connection with these offenses.

Further investigation revealed that the Opposite Party had no permission to collect or receive money/deposits from the public. This non-disbursement of interest and principal, coupled with a false representation regarding their permission status, is considered an unfair trade practice and deficiency in service to benefit from others' money.

The Opposite Parties also provided a deceptive address for their processing facility. The Cochin office of the company closed without prior notice to the Complainant.

As a result, the Complainant seeks compensation for the suffered injury and a refund of the Rs. 2,00,000/- deposited with the Opposite Parties, along with interest per annum from the date of deposit until realization. The Complainant prays that the commission directs the Opposite Parties to pay Rs. 2,00,000/- as compensation, the deposited amount, and an additional cost of Rs. 25,000/-.

         The evidence presented included an ex-parte proof affidavit filed by the complainant, and it was unchallenged by the opposite parties. Therefore, the complainant's claims were considered credible and supported by the evidence. Therefore, the complainant requests the commission to grant the relief sought, including compensation for mental agony and unfair trade practices.

          The opposite parties’ conscious failure to file their written version in spite of having received the Commission’s notice to that effect amounts to an admission of the allegations levelled against them.  Here, the case of the complainant stands unchallenged by the opposite parties.  We have no reason to disbelieve the words of the complainant as against the opposite parties. The Hon’ble National Commission held a similar stance in its order dated 2017 (4) CPR page 590 (NC).

         In the matter of the complaint filed against the 1st Opposite Party, a partnership firm managed by the 2nd opposite party, the main grievance of the complainant is the deficiency in service caused by the opposite party's failure to refund the deposited amount. It has been alleged that the opposite party accepted money from the public by offering 12% interest per annum, but failed to pay the agreed interest and declined the complainant's request for premature closure. Additionally, it was discovered that the opposite parties had no permission to collect deposits from the public, and criminal complaints had been registered against them for cheating and misappropriation of funds, including the complainant's deposit.

The opposite parties, despite being served with the notice, did not challenge the allegations made by the complainant. This conscious failure to file their written version is considered an admission of the allegations against them. As per legal precedent, this stance of the opposite parties is not credible, and we have no reason to disbelieve the complainant's claims in this matter.

          Considering the evidence, the complainant's unchallenged contentions, and the serious deficiency in service caused by the opposite parties, we find the issues in favour of the complainant. The opposite parties' actions amount to unfair trade practices and deficient services, deceiving and enriching themselves with the complainant's money and that of the public.

In conclusion, the complaint is deemed maintainable, and the opposite party is found to have engaged in unfair trade practices and deficient services.

The case highlights the importance of consumer protection and awareness, even in fully literate states. Financial fraud can have severe consequences, particularly for vulnerable sections of our society. The opposite parties' deceptive practices and deficient services have caused significant harm to the complainant, necessitating appropriate compensation.

           We find the issue Nos. (II) to (IV) are also found in favour of the complainant for the serious deficiency in service that happened on the side of the opposite party. Naturally, the complainant had suffered a lot of inconvenience, mental agony, hardships, financial loss, etc. due to the negligence on the part of the opposite parties.

In view of the above facts and circumstances of the case, we are of the opinion that the opposite parties are liable to compensate the complainant.

Hence the prayer is partly allowed as follows:

1. The Opposite Parties shall refund of Rs.2,00,000/- towards the deposited amount along with the interest @9.5% from the date of deposit 15.10.2015 till the date of realization.
2.  The Opposite Parties shall pay Rs 1,00,000/- towards compensation for the deficiency of service committed by the opposite parties, and for the mental agony and physical hardships sustained by the complainant.
3.  The Opposite Parties shall also pay the complainant Rs.8,000/- towards the cost of the proceedings.

The Opposite Parties be jointly and severally liable for the above-mentioned directions which shall be complied with by the Opposite Parties within 30 days from the date of the receipt of a copy of this order failing which the amount ordered vide (i) and (ii) above shall attract interest @9.5% from the date of deposit 15.10.2015 till the date of realization.

Pronounced in the Open Commission on this 31^st day of July 2023.

Sd/-                  

D.B.Binu, President

                                                                        Sd/-                  

                                                                    V.Ramachandran, Member

                                              Sd/-                  

                                                                      Sreevidhia.T.N, Member

Forwarded/by Order

Assistant Registrar

Forwarded/by Order

Assistant Registrar

Appendix

Complainant’s Evidence

Exhibit-A-1: A copy of receipt No. 0588908 dated 26/06/2020 issued by the opposite party acknowledging the deposit made by the complainant.