(Delivered on 25/03/2019)
Per Smt. Jayshree Yengal, Hon’ble Member.
1. This appeal challenges the order dated 16/04/2012 passed by the District Consumer Forum, Nagpur partly allowing the consumer complaint bearing No. CC/485/2011 and thereby directing the opposite party (for short O.P.) No. 1 Kotak Mahindra Bank appellant herein to return the complainant’s vehicle in good condition to the complainant within 30 days from the date of receipt of this order or in the alternative directing the O.P.No. 1 to pay damages at the rate of Rs. 500/- per day and the O.P.No. 1 to pay Rs. 50,000/- and Rs. 2000/- more to the complainant as compensation for mental and physical harassment and litigation expenses respectively. Respondent No. 1- Venkatesh Yellayya Yalkondawar is referred as complainant and appellant Kotak Mahindra Bank through its Deputy Manager is referred as O.P.No. 1, for the sake of convenience. Original O.P.No. 2- Jayaka Motors Ltd. was a party in the original complaint. However, perusal of the complaint shows that there was neither any prayer is made nor there is any pleading against it. The dispute mainly revalues around the original complainant and O.P.No. 1.
2. Facts in brief as set out by the complainant in his consumer complaint are as follows.
a. The complainant Venkatesh Yellayya Yalkondawar purchased a ten wheeler truck for earning his livelihood by availing loan of Rs. 10,51,427/- on 29/11/2007 from O.P.No. 1- Kotak Mahindra Bank. The said loan was to be repaid in 45 monthly installments of Rs. 32,946/- each. The period for repayment of loan was from December 2007 to Sept. 2011. The complainant therefore started paying the monthly installment of Rs. 32,946/- towards repayment of loan from the month of December-2007. The complainant thus regularly paid the monthly installments from December-2007 to July-2011. Only last two monthly installments for the month of August and September 2011 remained to be paid . The complainant was ready and willing to pay them as per his regular practice.
b. On 16/08/2011 some unknown person forcibly took away the complainant’s vehicle though he had regularly paid the monthly installments. The complainant was shocked due to such illegal and coercive action on the part of the O.P.No. 1. He immediately sought to lodge a complaint with the concerned Police Station. The complainant was advised by the concerned official of the Police Station to approach the bank for negotiations and did not register the complainant’s complaint. It is the contention of the complainant that although he had paid 43 installments out of the scheduled 45 installments from the month of December-2007 to July 2011, the O.P. repossessed his vehicle without issuing any notice to him.
c. The complainant therefore, alleging unfair trade practice and deficiency in service against O.P. filed a consumer complaint and sought for directions to return his vehicle in good and proper condition after accepting monthly installments for the current month or in the alternative the O.P. to pay Rs. 50,000/- per month towards damages till the date of realization. The O.P.No. No. 1 be also directed to pay Rs. 2,00,000/- as compensation for mental and physical harassment and Rs. 25,000/- more to the complainant towards litigation expenses.
3. The O.P.No. 1- Kotak Mahindra Bank Ltd. resisted the complaint by filing its written version and denied all the adverse allegations of the complainant. The O.P.No. 1 has specifically submitted that the complainant had executed a loan agreement bearing No. SA184616 whereby the complainant had availed financial assistance from respondent No. 1 to purchase a vehicle. In addition the complainant had also signed another agreement bearing No. SA 240900 in the capacity of a guarantor. The said agreement was executed by Vikram Rampal Bahuria and Hemlata Rampal Bahuria who were the borrower and co-borrower respectively, and had availed loan of Rs. 7,54,992/- to be repaid in 47 equal monthly installments. The borrower and co-borrower of the said agreement had failed to repay the loan and as the complainant had signed the agreement as guarantor he was liable to repay the same under clause 5.1 (0), clause 7.1, clause 7.12 of the agreement executed between the O.P.No. 1 bank and Vikram Bahuria and Hemlata Bahuria.
4. The O.P.No. 1 has further submitted that as the above mentioned borrower and co-borrower failed to repay the outstanding loan amount and the complainant is duty bound to repay the same as guarantor, the O.P.No. 1 issued a notice date 23/07/2011 to the borrower and co-borrower and complainant calling upon them to pay the outstanding amount of Rs. 7,34,820/- . The complainant was also served with notice dated 01/07/2011 whereby the complainant was called upon to repay the loan or else clause 11.16 of the agreement bearing No. 240900 would be invoked. The said dispute was proceeded for arbitration for recovery of outstanding loan amount. The arbitrator in the arbitration proceeding passed an award dated 08/011/2011 and thereby granted permission to sell the truck owned by the complainant with a view to recover the loan amount in the agreement bearing No. SA 240900. The O.P.No. 1 therefore was required to repossess the complainant ‘s vehicle to be sold for recovery of the loan amount.
5. The O.P.No. 1 therefore denied to have adopted any unfair trade practice or rendered deficiency in service and therefore sought for dismissal of the complaint.
6. The Forum after hearing both the sides partly allowed the complaint as aforesaid. The Forum has specifically observed that the O.P.No. 1 has adopted unfair trade practice and rendered deficiency in service as the O.P.No. 1 itself has conceded that they had forcefully repossessed the complainant’s vehicle without issuing any notice.
7. Being aggrieved by the same the O.P.No.1 has preferred this appeal and challenged the impugned order on the ground that the complainant’s vehicle was repossessed in pursuance to the award passed by the arbitrator and the appellant has repossessed the vehicle under the various clauses of the agreement executed between the parties.
8. We heard advocate Ms. Archana Narad for the appellant and Adv. Mr. Kasture for the respondent. We also perused the written notes of arguments filed by both the parties. We also perused copies of the complaint, written version and documents filed on record.
9. The only issue that deserves to be considered is whether the appellant is justified in repossessing the complainant’s vehicle towards recovery of the loan under an agreement wherein he has signed as a guarantor. We perused the copy of the agreement bearing No. SA240900 and the clauses bearing No. 5.1(0), 7.1, 7.12, 11.16 on which the appellant has placed its reliance. Clause No. 5.1, clause No. 7.1, and clause No. 7.12 broadly saddles the liability on the guarantor to repay the loan in case the borrower or the co-borrower fails to repay the same. We also perused the clause 11.16 of the said agreement which reads as “ unless the same falls within the jurisdiction of the Debts Recovery Tribunal established under the Recovery of Debts Due to Banks and Financial Institutions Act 1993, any and all claims and disputes arising out of or in connection with this agreement or its performance shall be settled by Arbitration by a single Arbitrator to be appointed by the bank. The Arbitration shall be held in Chennai, in accordance with the provisions of the Arbitration and Conciliation Act, 1996.”
10. The only inference or interpretation that can be attributed to this clause is to assess the outstanding loan amount that deserves to be recovered from the borrower or co borrower or guarantor. By no stretch of imagination can it be accepted that vehicle of guarantor can be repossessed by a financer for recovering the loan outstanding against principal borrower. We perused the notice issued by the appellant to the respondent. The same cannot be accepted as a notice of repossession of vehicle because the said notice is issued to the complainant as a guarantor and not as a borrower. The appellant has nowhere denied that the complainant has repaid the loan availed by him in regular installments. Thus the Forum below has passed legal, correct & proper order. For the forgoing reason we find no irregularity and infirmity in the impugned order and does not warrant any interference. The appeal therefore deserves to be dismissed being devoid of merit.
ORDER
i. The appeal is dismissed.
ii. The impugned order dated 16/04/2012 passed by the District Consumer Forum, Nagpur in consumer complaint No. CC/485/2011 is confirmed.
iii. Parties to bear their own cost.
iv. Copy of order be furnished to both parties, free of cost.
