Haryana

Ambala

CC/136/2022

Pardeep Kumar - Complainant(s)

Versus

Sahara Credit Co-Operative Society Ltd - Opp.Party(s)

Balwinder Singh

02 Jun 2023

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, AMBALA.

Complaint case no.	:	136 of 2022
Date of Institution	:	05.05.2022
Date of decision	:	02.06.2023

 

Pardeep Kumar S/o Sh. Som Nath, Aged 35 years, R/o H.No.212, Vijay Nagar, Dayal Bagh, Ambala Cantt.

……. Complainant.

                                                Versus

1. Sahara Credit Co-operative Society Ltd. Through its Managing Director, having Regd. Office at Sahara India Bhawan, 1, Kapoorthala Complex, Aliganj, Lucknow-226024.
2. Sahara Credit Co-operative Society Ltd. Through its Manager, having its Branch Office at Sahara India Parivar, 5744-46, 1" Floor, Nicholson Road, above Corporation Bank (Now Union Bank) Ambala Cantt-133001.

….…. Opposite Parties.

 Before:        Smt. Neena Sandhu, President.

                              Smt. Ruby Sharma, Member,

           Shri Vinod Kumar Sharma, Member.           

 

Present:       Shri Balwinder Singh, Advocate, counsel for the complainant

                    Shri Manish Sharma, Advocate, counsel for OPs.

 

Order:        Smt. Neena Sandhu, President.

1.                 Complainant has filed this complaint under Section 35 of the Consumer Protection Act, 2019 (hereinafter referred to as ‘the Act’) against the Opposite Parties (hereinafter referred to as ‘OPs’) praying for issuance of following directions to them:-

1. To refund the amount of Rs.3,46,394/- alongwith interest @ 11% p.a. from date of maturity i.e. from 28.08.2020.
2. To pay a sum of Rs.50,000/- as compensation/damages on account of physical and mental harassment besides Rs.50,000/- for causing financial losses as well as for rendering deficient service.
3. To pay Rs.25,000/- on account of litigation expenses
382.  

Grant any other relief which this Hon’ble Commission may deems fit.

 

2.             Brief facts of this case are that the OPs induced the complainant to invest money in various Saving FDRS Schemes launched by them and offered high rate of interest with safety and security of money. As such, the complainant invested Rs.3,02,000/-, with the OPs under the scheme named Sahara A. Select for 1 ½ years w.e.f. from 28.02.2019 to 28.08.2020. FDR certificate no. 925010419626 dated 28.02.2019 in that regard was issued by the OPs. Maturity date of the said FDR was 28.08.2020 and maturity amount was Rs.3,46,394/-. On maturity of the said FDR, the complainant started requesting the OPs to pay him the maturity amount but they started lingering on the matter and the other hand insisted the complainant to reinvest the amount for further period of one or two years to which complainant did not agree. Thereafter, the OPs did not give any response to the complainant regarding payment of maturity amount in respect of the FDR in question.  Hence this complaint.  
3.           The OPs put in appearance through their Counsel, and filed written version wherein various objections were taken to the effect that the complainant is not a consumer of the OPs, as there is no relation of consumer and service provider between them; that for any dispute between society and its member, consumer complaint is not maintainable. In Ms. Anjana Abraham Chambethil Vs. The Managing Diretor, The Koothattukulam Farmers Service Co-operative Bank Ltd., NCDRC759@2013) 4 CPJ 333 (NC) the Hon'ble National has held that the consumer forum have no jurisdiction to try the dispute arising between co-operative society and its members. As per Section 3 (N) of The Multi State Co-operative Society Act, 2002 definition of member is (Member means a person joining in the application for the registration of a multi State Co-operative Society and includes a person admitted to membership after such registration in accordance with the provisions of this Act, the rules and the byelaws).  As per Section 55 of The Multi State Co-operative Society Act, 2002, A Multi State Co-operative Society shall have a charge on the share or contribution or interest in the capital and on the deposits of a member or past or deceased member and on any dividend, bonus or profits payable to a member or past member or the estate of a deceased member to the society and may set-off any sum credited or payable to a member or past member or the estate of deceased member in or towards payment of any such debt. As per Section 83 of The Multi State Co-operative Society Act, 2002, Central Registrar has power to make an order after inquiry to repay or restore the money or property or any part thereof, with interest at such rate, or to pay contribution and costs or compensation to such extent, as the Central Registrar may consider just and equitable.  The complainant himself violated the rules of the society mentioned in Section 25 (5) of The Multi State Co-operative Society Act, 2002 that it shall be the duty of every member of a multi State Co- operative Society to promote and protect the interests and objects of such society. As per byelaws of the society, it is clearly mentioned that any dispute between the society and its member/ account holder should be decided by the arbitrator. The OPs are always ready to make the payment as per the conditions of scheme but due to enhance demand of interest on maturity amount the payment could not be made to the complainant at that time.  Rest of the averments of the complainant were denied by OPs and prayed for dismissal of the present complaint.
4.           Learned counsel for the complainant tendered affidavit of the complainant as Annexure C-A alongwith documents as Annexure C-1 and closed the evidence on behalf of the complainant. Learned counsel for the OPs has made a statement that written version of OPs be read as evidence of OPs and closed the evidence of the OPs.
5.           We have heard the learned counsel for the parties and have also carefully gone through the case file.
6.           Learned counsel for the complainant submitted that by neither making payment of maturity amount under the certificate in question nor paying interest thereon, the OPs have committed deficiency in providing service.    
7.           On the other hand, learned counsel for the OPs submitted that the complainant being member of the OPs Society did not fall within the definition of consumer and that only an arbitrator can decide the said dispute. He further submitted that since the complainant was seeking enhanced rate of interest, as such, the payment could not be made to him.
8.           The first question that falls for consideration is as to whether, the provisions of the Societies Act  bar the jurisdiction  of Consumer Commissions and that the  complainant falls within the definition of consumer or not? It may be stated here that the Hon’ble Supreme Court of India vide order dated 11.12.2003, in Civil Appeal No. 92 of 1998, Secretary, Thirumurugan Co-operative Agricultural Credit Society Versus M. Lalitha (dead) through L.Rs and other and vide order dated 24.03.2013, in Civil Appeal no.64 of 2010, Virender Jain Versus Alaknanda Co-operative Group Housing Society Limited and others, has clearly held that disputes between the members and their Society can be decided by the Consumer Commission and that the remedy before the Consumer Forum is in addition and not in derogation to the remedy under other Acts, unless there is clear bar to jurisdiction.  Merely because the rights and liabilities are created between the Members and the Management of the Society under the Co-operative Societies Act, it cannot take away or exclude the jurisdiction conferred on the Fora under the CP Act. .
9.           Not only as above, a similar question came for determination before five Members Bench of the Hon’ble National Commission in Revision Petition  Nos. 823 To 826  of  2001, Smt. Kalawati & Ors. Versus M/s. United Vaish Co-operative Thirft  & Credit Society  Ltd. wherein it was held that  the provisions of the Societies Act  does not bar the jurisdiction  of Consumer Foras assuming jurisdiction in the matter. Relevant part of the said order is reproduced hereunder:-

“……..We  are  also not in agreement with the view   of the State Commission that  a member cannot be a consumer vis-a-vis  the society of which he is a member.  As a member he  has certain rights in the society like  attending  its meeting and right to vote.   A member is a separate entity from the Co-operative Society which is just like a shareholder as in the Company registered under the Companies Act, 1986. Here is the society of which the complainants are member which invites deposits and pays interest and   is to refund the amount with interest on maturity.   Society provides facilities in connection with financing and is certainly  rendering  services to its members and here is a member who avails of such services.  When there is a fault  on the part of the society and itself is not paying the amount   on fixed deposit receipts on maturity, there is certainly deficiency in service by the society and a complaint lies against society by the member as a complainant.  A co-operative society under the Societies Act, is a akin to a  company under the companies Act, 1986.   If we refer to Section 35 of the Societies Act, a cooperative society is a body  corporate by the name under which it is registered having perpetual succession and a common seal, and with power to hold property, enter into contract, institute and defend suits and other legal proceedings and to do all things  necessary for the purpose for which it is constituted.  A co-operative society is not bound by the rigors  of the Companies Act.   Under Section 4 of  the Societies Act a society which has its objects the promotion of the economic interests of its members in accordance with  co-operative principles may be registered under the Act.  A member of the society cannot exercise  rights as a member unless he has made  due payment as required by the bylaws  of the society.   A member has a right of one vote in the affairs of the  society.   It is apparent that rights of a member in a society  are   similar to  rights which a shareholder exercises in a company.  Rights of a shareholder are: (i)   to elect directors  and thus to participate in the management  of the affairs of the company, (ii) to vote on resolutions at the meeting of the company and (iii) to enjoy the profits of the company in the  shape of dividends.  A share holder is different  person  than the company of which he is the  shareholder.   Similarly, a member of the society is different from  the society of which he is a member.  He can certainly if occasion arises,  proceed against the  society  raising a dispute.  In the Case of Neela Vasant Raje  vs. Amogh Industries   &Anr. -  1986-95 Consumer  446 this  Commission had taken a view that with reference to Section 2(1)(d)  of CPA   that where a company or a firm  invites deposits from the public  for the purpose  of using money for its business on promise of giving attractive rates of interest with  security  of  investment  and prompt  repayment of the principal after the stipulated term  the transaction of such a nature  would clearly make the depositor a ‘consumer’  under CPA.  This  Commission also observed  that  the definition of  the expression ‘service’  was couched in the widest possible language and it expressly covered ‘service of any description’ other than  any service rendered ‘free of charge’ or ‘under  a contract of personal service’. Thus we hold that complainants were certainly consumers and could maintain their complaints in the District Forum….”

10.           In Ashish Ramesh Chandra Birla & Ors.Vs Murlidhar Rajdhar Patil & Ors.I (2009) CPJ 200 (NC), also, a Consumer Complaint was filed against Siddhi Vyankatesh Urban Co-operative Credit Society Ltd. Jalgaon, that some amount was invested with it, in a Scheme launched by it, but it failed to pay the same, on maturity. The complaint was, ultimately, accepted by the District Forum. Aggrieved against the order of the District Forum, First Appeal was preferred, before the State Commission, which was dismissed. Dissatisfied with the order of the District Forum and the State Commission, Revision Petition was filed, before the National Commission, taking up an objection, that the Directors of the Society were not personally responsible, for any default of repayment of the maturity amount, by the Society. Ultimately, the National Commission, held that the Directors of the Society were jointly and severally liable to pay the amount of maturity and were rightly held to be deficient, in rendering service, by the Foras below. The principle of law, laid down, in the aforesaid cases, is fully applicable and will also hold field as far as the present case is concerned.  The complainant therefore falls within the definition of consumer. Objection taken by OPs in this regard stands rejected.

Thus, in view of the law laid down by the Hon’ble SupremeCourt in Secretary, Thirumurugan Co-operative Agricultural Credit Society and Virender Jain’s cases (supra), any law laid down contrary to it, by any lower court/fora will not hold the field.

11.           As far as objection taken with regard to Arbitration is concerned, it may be stated here that this issue has already been set at rest by the larger Bench of the Hon’ble National Commission in Aftab Singh  Vs. Emaar MGF Land Limited & Anr., Consumer Case No. 701 of 2015, wherein, vide order dated 13.07.2017, it has been held that an Arbitration Clause in the Agreements/contracts cannot circumscribe the jurisdiction of a Consumer Fora notwithstanding the amendments made to Section 8 of the Arbitration Act. Civil appeal bearing No.23512-23513 of 2017 and  Review Petition (C) Nos.2629-2630 of 2018 filed by the builder, before the Hon’ble Supreme Court of India, also stood dismissed vide orders dated 13.02.2018 and 10.12.2018 respectively. As such, objection taken in this regard also stands rejected.
12.           Now coming to the merits of the case, it may be stated here that it is coming out from the certificate, Annexure C-1 that total amount of Rs.3,02,000/-, stood received by the OPs on 28.02.2019 from the complainant. It is further coming out from the said document that the maturity date of the said certificate was 28.08.2020 and it was agreed to by the OPs that on maturity of the said certificate, the complainant will get an amount of Rs.3,46,394/- in total.  It is significant to mention here that it has been candidly admitted by the OPs in their written version that the maturity amount could not be paid to the complainant because due to enhanced demand of interest sought by the complainant on maturity amount. In our considered opinion, once the OPs have entered into a contract by way of certificate Annexure C-1 and committed to pay amount of Rs.3,46,394/- after expiry of maturity date i.e. 28.08.2020,  but,  later on, by not paying the said amount to the complainant, the OPs have committed deficiency in providing service. The complainant is therefore held entitled to get the maturity amount of amount of Rs.3,46,394/- alongwith interest. He is also entitled to get compensation and litigation expenses.  
13.           In view of the aforesaid discussion, we hereby allow the present complaint against the OPs and direct them, in the following manner:-

1. To pay the maturity amount of Rs.3,46,394/- alongwith interest @6% p.a., w.e.f 28.08.2020 i.e the date of maturity of the certificate, till its realization.  
2. To pay Rs.5,000/-, as compensation for the mental agony and physical harassment, caused to the complainant.
3. To pay Rs.3,000/- as litigation expenses.

 

14.           However, it is significant to mention here that at the time of arguments, counsel for the complainant has provided a copy of order dated 29.03.2023, having been passed by the Hon’ble Supreme Court of India in Writ Petition No.191 of 2022 titled as Pinak Pani Mohanty Vs. Union of India and Ors. wherein, the Hon’ble Supreme Court has directed that out of Rs.500 crores which is to be transferred from SEBI to Central Registrar of Cooperative Societies, thereafter the same can be disbursed to the legitimate depositors of Sahara Group of Cooperative Societies, within a period of nine months from 29.03.2023. In this view of the matter, the complainant is therefore directed to approach the Central Registrar of Cooperative Societies/Authority concerned, as per order dated 29.03.2023 to recover the awarded amount.  A copy of the order dated 29.03.2023, of the Hon’ble Supreme Court of India, New Delhi, be also sent to the parties, alongwith certified copy of this order. File be indexed and consigned to record room.                              

 Announced:- 02.06.2023

(Vinod Kumar Sharma)	(Ruby Sharma)	(Neena Sandhu)
Member	Member	President