DATE OF FILING: 08.06.2011
BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, IDUKKI
Dated this the 29th day of December, 2011
Present:
SRI.LAIJU RAMAKRISHNAN PRESIDENT
SMT.BINDU SOMAN MEMBER
C.C No. 127/2011
Between
Complainants : 1. Sony Kurian,
Thekkevayalil House,
Karimkunnam P.O,
Nellappara,
Idukki District.
2. Indu W/o Sony,
Thekkevayalil House,
Karimkunnam P.O,
Nellappara,
Idukki District.
(Both by Adv: K.M.Sanu)
And
Opposite Parties : 1. The Manager,
Sreegokulam Chit & Finance Company (P) Limited,
Pala Road,
Thodupuzha, Idukki District.
2. The Managing Director,
Sreegokulam Chit & Finance Company (P) Limited,
Sreegokulam Tower, No.66,
Arcot Road,
Chennai – 600 024.
(Both by Adv: V.K.Beena)
O R D E R
SRI. LAIJU RAMAKRISHNAN(PRESIDENT)
The complainants joined in 6 number of chits conducted by the opposite party, on 4.12.2007 with a sala of Rs.5 lakhs. The termination period was after 20 months of the joining. Out of the 6 numbers, 3 numbers were auctioned by the complainants and the amount was also received by them. At the time of disbursing the money, the opposite party received 3 blank cheque leaves, signed white papers and signed prescribed forms from the complainants. Both of the complainants were mutually signed as sureties of the chits. They were promptly paying the monthly instalments upto 9, so that an amount of Rs.1,95,750/- has been paid in each number of chits. But unfortunately because of the financial crisis, the complainants were not able to continue with the payment and the chit instalments became due. So they directly contacted the opposite parties and arrived in a settlement that the amount paid in 3 number of chits which were not auctioned should be accounted in the auctioned chits and the accounts can be closed. But while accounting the amount paid in the non-auctioned chits to the auctioned chits, the opposite parties received a commission of Rs.25,000/- each in 3 number of chits so a total amount of Rs.75,000/- has been deducted as commission. The opposite parties are not entitled to receive the commission of the non-auctioned chits. At the time of closing the account, the total amount was Rs.1,85,934/-. If the commission amount Rs.75,000/- was deducted from the same, while closing the chits the amount would be Rs.1,10,934/- and the complainants were ready to remit that amount. But Rs.75,000/- has been calculated as excess from the complainants stating that it is the commission amount. So a demand notice has received on 28.05.2011 for an amount of Rs.2,57,558/- due from the complainant. Hence this petition is filed for getting back the commission amount received by the opposite party with 24% interest and also for directing the opposite parties to close the chit account as per the settlement.
2. As per the written version filed by the Ist and 2nd opposite parties, it is stated that the complainants should approach the Arbitration proceedings for the dispute regarding the chits and this Forum is not having any jurisdiction to trial this case. As per the Central Chitties Act and Kerala Chitties Act, the Foreman of the chitty are liable for 5% commission and that was only obtained from the chits of the complainants. The matter was also convinced to the complainants while they joined the chit and it was fully agreed and signed by the complainants at the time of joining the chits. The complainant who is having financial crisis filed this petition and got an interim order without any basis and the opposite party never received any excess amount from the complainants. So there is no deficiency in service happened from the part of the opposite parties.
3. The point for consideration is whether there was any deficiency in service on the part of the opposite parties, and if so, for what relief the complainants are entitled to ?
4. The evidence consists of the oral testimony of PW1 and Exts.P1 to P3(series) marked on the side of the complainants and Ext.R1(series) marked on the side of the opposite parties.
5. The POINT :-The Ist complainant produced evidence as PW1 and produced a notice issued by the opposite party to the petitioners dated 4.08.2010 demanding Rs.1,85,934/- along with its future interest, which is marked as Ext.P1. Another notice issued by the opposite party on 28.05.2011 demanding an amount of Rs.2,57,558/-, which is marked as Ext.P2. Copy of the pass books issued by the opposite party also produced and marked as Ext.P3(series). On cross examination of the learned counsel for the opposite parties, PW1 admitted that prior to this transaction, the complainants were having chitty transaction with the opposite party. The opposite parties produced ledger account of 3 number of chits of the complainants, in which the complainants paid Rs.1,66,500/- and dividend Rs.33,500/-, which is produced and marked as Ext.R1(series).
As per the complainants, they joined in 6 number of chits at the opposite party and 3 numbers were auctioned in the name of the complainants and the amount also received for the same. But they were not able to pay the instalments continuously so that the chits became due and a settlement talk was arrived between the complainants and the opposite parties. As per the settlement the amount paid in 3 number of chits which were not auctioned should be accounted in the auctioned chits so that 2 number of chits were completely closed. But while closing the 3 number of auctioned chits, the opposite parties charged Rs.75,000/- as commission from the complainants for the chits which were not auctioned by them and arrived an amount of Rs.1,85,934/- including the commission. The complainant is liable to pay only Rs.1,10,934/- and the opposite party is not entitled to get commission.
As per the opposite party, it is admitted that the complainants paid an amount of Rs.1,66,500/- in 3 number of the chits as Nos.J2H/1024/JMM/03, J2H/1024/JMM/04 and J2H/1025/JMM/04 and a dividend of Rs.33,500/- has been received as on 23.07.2009 as per Ext.R1 ledger account. So a demand notice has been issued for Rs.1,85,934/- with interest on 4.08.2010 as per Ext.P1 and another demand notice was issued for Rs.2,57,558/- on 28.05.2011 which is Ext.P2. The opposite parties are entitled to get commission of the chits eventhough they are not auctioned and Rs.25,000/- has been received in each number of chits so that the complainants should pay the same.
The only dispute regarding the same is whether the opposite parties are entitled to receive commission in the non-auctioned chits.
In three number of chits the opposite party already disbursed the amount. But in the non-auctioned chits the complainants promptly paid 9 instalments and that amount is with the opposite party. One instalment of chit is about 20,000/- rupees and the complainants were promptly paying each instalments upto 9 to the opposite party for the non-auctioned chits also. So that amount has been accounted in the opposite parties' account and the opposite parties were receiving interest for the same. Nothing has been gained by the complainants in the non-auctioned chits. So a huge amount has been paid to the opposite parties while they paid 9 instalments. While the chits instalments became due, the complainants and the opposite parties arrived in a settlement and the opposite parties assured that the complainants can close the auctioned chits by accounting the amount in the non-auctioned chits.
As per the Kerala Chitties Act, 1975, Section 16 – Rights of Foreman -(1) The foreman shall be entitled – (b) to such commission or remuneration not exceeding five percent of the chitty amount as may be fixed in the variola for the conduct of the chitty.
But it is not at all mentioned that whether the foreman is liable to get commission before the non-auctioned chits.
As per Clause (e), the foreman has right to substitute subscribers in the place of defaulters subject to the provisions hereinafter contained.
So if the subscribers are not paying the chits amount and it is defaulted, the opposite parties can replace the subscribers subject to the portions of the conditions. So we think that the commission is charging at the time of disbursing the chit amount so that if a subscriber defaulted the chit instalments, the defaulted member can be replaced by another member and the commission can be obtained from the newly entered member who receives the entire amount of the chitty. So a person who discontinue the chit and that person is removed by another person the opposite party cannot receive commission from both the persons. It means that the commission can be obtained only at the time of receiving the chit amount and it is not proper to charge a huge amount as commission from the complainants even without disbursing the chit amount. Here the complainants already paid a huge amount to the opposite party in 3 number of chits without disbursing the money in favour of them and that amount is with the opposite party for 9 months and the benefit of the amount goes to the opposite party only. The act of the opposite party that even again charging the commission is not at all proper.
In the Kerala Chitties Act Section 16 itself, it is clearly stated that " commission or remuneration not exceeding five percent of the chitty amount as may be fixed in the variola for the conduct of the chitty".
But the variola of the chitty has not at all produced by the opposite party as evidence to substantiate their pleadings. The complainants were ready to settle the three number of chits by paying the entire amount, if the opposite parties were not deducting Rs.75,000/- also on the day on which the balance accounts were closed. The opposite party also never challenged the same. So we think that charge of huge amount as commission without disbursing the chit amount is a gross unfair trade practice and we find deficiency on the part of the opposite parties. So the opposite parties should settle the chit account of the complainants without charging Rs.75,000/- as commission from the complainants.
Hence the petition allowed. The opposite parties are directed to settle the chit account of the complainants in Ticket No.J2H/1024/03 by calculating the interest for the due instalments as 9% per annum for the due period, which is from the date of termination of the chitty period or on the day of the settlement of the accounts of the balance chits, upto the date of filing of this case. The opposite parties are also restrained from receiving commission for the non-auctioned three number of chits. The complainants are directed to approach the opposite party for settling the same within 30 days of receipt of this order, if not the opposite party can charge 12% interest for the defaulted instalments from that day onwards.
Pronounced in the Open Forum on this the 29th day of December, 2011
Sd/-
SRI.LAIJU RAMAKRISHNAN(PRESIDENT)
Sd/-
SMT.BINDU SOMAN(MEMBER)
APPENDIX
Depositions : Forwarded by Order,
On the side of Complainant :
PW1 - Sony Kurian
On the side of Opposite Parties :
Nil SENIOR SUPERINTENDENT
Exhibits:
On the side of Complainant:
Ext.P1 - Notice dated 4.08.2010 issued by the opposite parties to the
complainants, demanding Rs.1,895,934/-
Ext.P2 - Notice dated 28.05.2011 issued by the opposite parties to the
Ist complainant, demanding Rs. 2,57,558/-
Ext.P3(series) - Photocopy of Pass Books of the complainants
On the side of Opposite Parties :
Ext.R1(series) - Ledger account of 3 number of chits of the complainants
