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Cholamandalam Investment & Finance Company Limited & Others v/s Sunil Kumar

    First Appeal No. 988 of 2013

    Decided On, 16 December 2013

    At, Punjab State Consumer Disputes Redressal Commission Chandigarh

    By, MEMBER

    For the Appellants: Sandeep Chopra, Advocate. For the Respondent: ----.

Judgment Text

Gurdev Singh, President:

1. This appeal has been preferred by the appellants/opposite parties against the order dated 11.7.2013 passed by the District Consumer Disputes Redressal Forum, Gurdaspur (in short, 'District Forum'), vide which the complaint filed by the respondent/complainant, Sunil Kumar, under Section 12 of the Consumer Protection Act, 1986, was allowed and they were directed to deliver the vehicle, which was repossessed by them, in the same condition and to pay compensation of Rs.20,000/- and litigation costs of Rs.5,000/- and in the event of their failure to pay those amounts within 30 days of the receipt of the copy of the order to pay interest at the rate of 9% per annum from the date of filing of the complaint till the realization thereof and delivery of the vehicle.

2. As per the averments made in the complaint, on the allurement of the opposite parties the complainant availed of the loan from them for purchasing the vehicle. The loan so availed of by him was of Rs.7,00,000/- and monthly instalments were settled to the tune of Rs.20,321/- each. He paid Rs.2,06,000/-, as per the instructions of the opposite parties, to the dealer of the vehicle, which was purchased by him for earning his livelihood by way of selfemployment. He purchased the truck make Eicher bearing registration No.PB-06L-9631 on 5.8.2010 from the dealer; named, Gagan Automobiles. He had employed Sudesh Singh as Driver and Pritam Singh as Cleaner on the truck. The same was forcibly repossessed by the opposite parties on 16.5.2012 through their musclemen/gundas and uncivilized persons, while the same was brought back after unloading the material at Pathankot. The information about the same was given to him by his Driver, upon which he visited the office of opposite party No.3 and was told that few instalments were due from him and, as such, the vehicle was got snatched. He asked that opposite party to give him reasonable time for the repayment of the loan amount and to deliver back the truck to him but it threatened to sell the same at throw away price. He had been making efforts by visiting the office of that opposite party to pay the due balance amount and to take the possession of the truck but he was misbehaved, mal-treated and threatened by the officials of the opposite parties. He was deprived to earn his livelihood as a result of the snatching of the truck and on that account he remained under grave stress and tension. This act of the opposite parties amounts to deficiency in service and unfair trade practice for which he is entitled to compensation of Rs.2,00,000/-. He prayed for the issuance of directions accordingly to the opposite parties, besides the direction to deliver back the truck to him or to make payment of Rs.6,91,292/- spent by him towards the price thereof, insurance premium, registration etc.

3. The complaint was contested by the opposite parties. In their written reply they averred that towards the loan of Rs.7,00,000/- only Rs.3,65,292/- were paid by the complainant whereas he was supposed to return Rs.4,29,370/- till 30.4.2012 and, as such, he was a defaulter. He was asked, vide registered letters dated 15.5.2012 and 19.5.2012, to deposit that balance amount and otherwise the truck would be confiscated but he did not bother to act upon those letters. At the time of the advancement of the loan, the truck was hypothecated in the name of the Finance Company and as per the terms thereof, they could have sold this vehicle after getting the same removed from the possession of the complainant. The truck was taken in possession after giving proper information to the complainant and that too with the help of the police, as per the terms and conditions of the agreement. The truck is still in their possession and the complainant can take back the same after making the payment of the balance amount. They did not commit any such illegality as alleged in the complaint. No cause of action has arisen in favour of the complainant to file the complaint and the District Forum at Gurdaspur has no jurisdiction to entertain and try the same as only the Courts at Chennai have the exclusive jurisdiction in respect of the matter in dispute. There was no deficiency or mal-practice on their part and, as such, the complaint is not maintainable. They prayed for the dismissal thereof.

4. Both the sides produced evidence in support of their respective averments before the District Forum, which after going through the same and hearing learned counsel on their behalf allowed the complaint, vide aforesaid order.

5. We have heard learned counsel for the opposite parties and have carefully gone through the records of the District Forum, which were called at the time of admission of the appeal.

6. It was submitted by the learned counsel for the opposite parties that from the evidence produced before the District Forum, it stands proved that due procedure was adopted by the opposite parties before taking into possession the truck in question. The same had been hypothecated in favour of the opposite parties and in case of the non-payment of instalments they had the right to take the possession thereof. After the complainant became a defaulter, notice was duly served upon him to pay the balance due amount within 7 days and it was only thereafter that the truck was repossessed after giving due information to the complainant and to the police. Therefore, the findings recorded by the District Forum cannot be sustained and the appeal is liable to be admitted on merits.

7. The loan agreement was produced before the District Forum and as per clause 8 thereof, the truck was hypothecated in favour of the opposite parties-Finance Company. The events of default were mentioned in clause 10 and non-performance of the obligations and repayment of the loan or any of the instalment by the complainant was to constitute an event of default. By virtue of Clause 11, on occurrence of that default the right of the complainant over the truck stood void ipso facto and was bound to deliver the same to the Finance Company and in the event of his failure to deliver the same, the Finance Company had the right to take the possession thereof and for that purpose it could have entered into any place or places where the truck was or likely to be and the complainant was not to prevent or obstruct the Finance Company from exercising its right to repossess the truck.

8. It was not disputed before the District Forum by the complainant that he had failed to pay some of the instalments. Thus, by virtue of the above said clause, his right in the truck stood determined and he was to deliver the possession thereof to the opposite parties. In the event of his failure to do so, the Company had the right to repossess the truck. Now, it has been well settled by the catena of judgments of the Hon’ble Supreme Court that even if the hypothecation agreement contained such a condition, the assets cannot be repossessed forcibly by taking help of the musclemen or gundas. The opposite parties themselves proved on record the Final Call Letter Ex.R-4. Vide that letter dated 15.5.2012, they gave an opportunity to the complainant to make the payment of the amount mentioned therein within 7 days and in the event of his failure to do so, they reserved their right to take recourse to their rights as conferred under the agreement of loan. Thus, they had given 7 days clear notice to the complainant to make the payment of the balance amount and they should have waited for that period before repossessing the truck. However, they had taken the possession before the expiry of that period as is clear from the Pre-Seizure intimation to the Police Station Ex.R-8 and Post-Seizure intimation to the Police Station Ex.R-9; which are dated 16.5.2012.

9. From the documents proved on the record by the opposite parties, it appears that they did only the paper work in order to show that the truck was repossessed by them lawfully/peacefully and no force was used through some other agency. They proved on record the authorization letter to repossess the vehicle Ex.R-2. Vide that letter, they authorized one Surinder Punia of Punia FINCAP Consultants Pvt. Ltd. to repossess the truck in a peacef

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ul manner but from the above said Pre-Seizure Intimation and Post Seizure Intimation to the Police Station, it stands proved that the opposite parties themselves had taken the possession. The column in those documents that they had authorized someone as their agent to repossess the vehicle is lying blank. In these circumstances, we do not find that any illegality or infirmity was committed by the District Forum, while recording the findings against the appellants. We do not find any ground to admit the appeal to be heard on merits and the same is hereby dismissed in limine. 10. The sum of Rs.12,500/- deposited at the time of filing of the appeal along with interest which has accrued thereon, if any, shall be remitted by the registry to the respondent/complainant by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the District Forum and the appellants/opposite parties.