DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION ERNAKULAM
Dated this the 7th day of September, 2023.
Filed on: 23/10/2020
PRESENT
Shri.D.B.Binu President
Shri.V.Ramachandran Member Smt.Sreevidhia.T.N
C.C. NO. 349/2020
Between
COMPLAINANT
Dr. V.T. Paulinose, S/o Late Thomas VJ, 5/682, Pattany House. Kalamassery, P.O., Aluva, Ernakulam, PIN- 683 104.
(Rep. by Adv. George Cherian Karippaparambil, Karippaprambil Associates, HB 48, Panampilly Nagar, Kochi 682036.)
VS
OPPOSITE PARTIES
- M/s Popular Finance, Registered office No. 13/577, Popular Tower Vakayar P.O., Konni, Pathanamthitta, Kerala - 689 698.Rep. by its Partner Smt. Prabha Thomas, W/o Thomas Daniel.
- Prabha Thomas, W/o Thomas Daniel, Partner, M/s Popular Finance, Indikkattil, Vakayar P.O., Konni, Pathanamthitta, Kerala - 689 698.
- Thomas Daniel, Partner, M/s Popular Finance, Indikkattil, Vakayar PO.,Konni, Pathanamthitta, Kerala - 689 698.
- Ria Ann Thomas, D/o Thomas Daniel, Partner, M/s Popular Finance, Indikkattil, Vakayar P.O., Konni, Pathanamthitta, Kerala - 689 698.
- Rinu Mariam Thomas, D/o Thomas Daniel, Partner, M/s Popular Finance, Indikkattil, Vakayar P.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 complainant is a retired Senior Scientist from The National Institute of Oceanography in India, has raised a complaint against a partnership firm known as the first opposite party, which is a Non-Banking Financial Company engaged in financial activities such as gold loans, recurring deposits, chitty, and foreign exchange. The second to fifth opposite parties are partners responsible for managing the day-to-day operations of the first opposite party.
The complainant had deposited Rs 3,00,000/- with the first opposite party, M/s Popular Finance, in 2018 for one year at an interest rate of 12% per annum. The interest was paid regularly until January 2020. However, during the renewal of the fixed deposits, the Kaloor branch of the first opposite party allegedly side tracked the complainant's deposit without their consent and knowledge. The complainant later experienced defaults in receiving the agreed interest, and their request for premature closure of the deposit was declined.
The complainant discovered that there were complaints against the opposite parties for misappropriation of public deposits, and the second to fifth opposite parties were arrested for this. It is alleged that the opposite parties did not have permission from the Reserve Bank of India to accept deposits from the public, and they induced the complainant to deposit funds through misleading advertisements.
The complainant is seeking compensation for mental agony, loss, and damages due to unfair contract, unfair trade practice, restrictive trade practice, deficiency in service, and negligence on the part of the opposite parties. The complainant is requesting compensation of Rs. 4,00,000/- with interest from 01.02.2020, as well as an additional Rs. 1,00,000/- as the cost of the legal proceedings.
The complainant is also requesting the commission to issue orders for appropriate relief, including the refund of the fixed deposit amount along with the promised interest and compensation.
2) Notice
The notices to the opposite parties were sent by the commission through the Superintendent of Sub Jail Mavelikara and the Superintendent of Women Prison, Attakkulagara 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 a proof affidavit and 4 documents that were marked as Exhibits-A-1- to A-4.
Exhibit A1: True copy of the misleading advertisement issued by the opposite parties.
Exhibit A2: True copy of the fixed deposit receipt No. 0570110 dated 01/08/2019 for Rs. 1,00,000/- issued by the opposite parties.
Exhibit A3: True copy of the fixed deposit receipt No. 0587710 dated 29/06/2020 for Rs. 2,00,000/- issued by the opposite parties.
Exhibit A4: True copy of the complaint dated 07/09/2020 before the Sub Inspector of Police, South Kalamassery.
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. The complainant produced copies of receipts issued by the opposite parties. The receipts evidencing payment to the opposite parties (Exhibits A-2 and A-3). 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 parties did not fulfill their obligation to return the money, resulting in a deficiency in the service provided to the complainant.
The learned counsel for the complainant submitted that the first opposite party operates as a Non-Banking Financial firm, managed by opposite parties 2 to 5. The firm conducts various financial activities, including gold loans, recurring deposits, chitty, and foreign exchange. Through 269 branches across India, the opposite parties collect public funds via short-term fixed deposits under the names of sister concerns like M/s Popular Traders and M/s Mary Rani Trading LLP.
Attracted by video advertisements, the complainant deposited Rs. 3,00,000/- with M/s Popular Finance in 2018, with an interest rate of 12% per annum. Regular interest payments were made until January 2020. However, upon maturity, the deposit was renewed without the complainant's consent, diverting it for unrelated purposes.
Despite multiple requests, the opposite parties defaulted on paying the agreed interest. Moreover, the complainant's appeal for premature closure of the deposit was rejected. The opposite parties faced complaints and arrests due to misappropriation, revealing their lack of authorization to accept public deposits.
The complainant contends that misleading advertisements falsely claiming Reserve Bank of India approval constitute unfair practices, negligence, and a breach of contract. Opposite parties 2 to 5 are accused of misappropriating substantial sums from depositors and investing in real estate.
As the opposite parties did not respond and are ex-parte, the complainant submitted evidence, including misleading ads (Exhibit A1) and deposit receipts (Exhibits A2, A3). These documents substantiate the consumer relationship and the Rs. 3 lakh fixed deposit, supporting the request for the consumer complaint to be granted as sought.
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).
The opposite parties had inadequately performed the service as contracted with the complainant and hence there is a deficiency in service, negligence, and failure on the part of the opposite parties in failing to provide the Complainant desired service which in turn has caused mental agony and hardship, and financial loss, to the Complainant. The aforesaid acts of the opposite party would stand to show their callous attitude, utter negligence, and deficiency of service, for which they are solely answerable.
The complainant's assertion that the opposite parties misled them through false advertisements claiming Reserve Bank of India approval raises concerns of unfair trade practices and negligence. The misleading advertisements are confirmed by Exhibit A1.
In light of the presented evidence and the unchallenged contentions of the complainant, it is evident that the opposite party failed in their obligation to provide the promised service, leading to mental distress and financial loss. Their actions also reflect negligence and unfair trade practices.
The opposite party is liable to compensate the complainant for deficiency in rendering service and also for immense physical harassment and mental agony.
We find the issue Nos. (I) to (IV) are found in favour of the complainant for the serious deficiency in service that happened on the side of the opposite parties. 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 is liable to compensate the complainant.
Hence the prayer is partly allowed as follows:
- The Opposite Parties shall refund Rs. 3,00,000/- being the deposited amount along with the interest @9.5% from the dates of deposits till the date of realization.
- The Opposite Parties shall pay 50,000/- as compensation for the mental agony, loss, and damages suffered by the complainant due to the unfair trade practice, deficiency in their service, and negligence on the part of the opposite parties.
- The Opposite Parties shall also pay the complainant Rs.25,000/- 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 dates of deposits till the date of realization.
Pronounced in the Open Commission on this the 7th day of September, 2023
Sd/-
D.B.Binu, President
Sd/-
V.Ramachandran, Member
Sd/-
Sreevidhia T.N., Member
Forwarded/by Order
Assistant Registrar Or
der
Registrar
Appendix
Complainant’s evidence
Exhibit A1: True copy of the misleading advertisement issued by the opposite parties.
Exhibit A2: True copy of the fixed deposit receipt No. 0570110 dated 01/08/2019 for Rs. 1,00,000/- issued by the opposite parties.
Exhibit A3: True copy of the fixed deposit receipt No. 0587710 dated 29/06/2020 for Rs. 2,00,000/- issued by the opposite parties.
Exhibit A4: True copy of the complaint dated 07/09/2020 before the Sub Inspector of Police, South Kalamassery.
Opposite party’s evidence
Nil
Despatch date:
By hand: By post
kp/
CC No. 349/2019
Order Date: 07/09/2023
