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Suresh Kumar Agarwal v/s M/s. Reliance Industries Ltd. Karvy Computer Shares Pvt. Ltd.

    First Appeal No. FA/1008 of 2014
    Decided On, 21 January 2016
    At, West Bengal State Consumer Disputes Redressal Commission Kolkata
    By, MEMBER
    For the Appellant: Debesh Halder, Advocate. For the Respondent: Prasanta Banerjee, Advocate.

Judgment Text
Jagannath Bag, Member:

1. The present appeal is directed against the Order, dated 21.08.2014 , passed by the Ld. District Consumer Disputes Redressal Forum, Unit-1, Kolkata, in CDF/Unit-1/Case No. 26/2012, whereby the complaint was dismissed on contest against OP No. 1 and ex parte against OP No. 2 without costs.

2. The Complainants case, in brief, was as follows:

The Complainant applied for allotment of shares @ Rs. 10/- each for cash premium of Rs. 50/- per share on Rights Issue basis and deposited application money. OP No. 1 issued 45 Equity Shares to the Complainant under Certificate No. 07764522, Distinctive Nos. 150160432 to 150160436 and 437 to 476 and Folio No. 36721928. The certificates were issued on 15.02.1988 and received by the Complainant at his registered address, i.e., C/o Urvashi, 109 Cotton Street, Kolkata 700007 showing the name of the Complainant as S.K. Agarwal. As the Complainant did not receive any bonus and other corporal benefits relating to the shares for the period from 1988 onward, several letters were sent to the OP. The OP in reply stated that the address of the Complainant was recorded as 11, Arya Nagar, Near U.I.T, Alwar, Rajasthan - 301001. The Complainant was holding 45 shares of the OP No. 1 and he had never sold and/or transferred the shares to any body. The OP was illegally withholding the benefits of the shares which was an unfair trade practice. Accordingly, the Complainant filed a consumer complaint before the Ld. Forum below and prayed for direction upon OP to pay compensation of Rs. 9,50,000/- and litigation cost of Rs. 10,000/-.

3. The petition of complaint was contested by the OP by filing W.V. , whereby it was contended that the Complainant was not a consumer in so far as he neither bought any goods from the OPs for consideration nor hired or availed of any service from the OPs for consideration. It was also contended that no unfair or restrictive trade practice has been adopted as the OPs did not do any trade in their own shares. Further, it was contended that the Complainant, being allotted 40 Rights Issue in the year 1987, was served a notice during the period of September 1998 with a request to make payment of allotment money together with interest on or before 20.10.1998. No payment was made and the said 40 equity shares got forfeited during the year 1990 . After a belated period of 22 years which is beyond the period of limitation, the same is liable to be dismissed. OP by their letter dated 28 July 1990 informed the Complainant about the forfeiture of 40 Equity Shares. The Complainant, being allotted 5 RIL Right Equity shares bearing Distinctive No. 150160432-436 under the Folio No. 36721928 in the year 1988, was allotted 5 bonus shares under the Distinctive Nos. 1160783782-786. However, the said shares were inadvertently sent to a person with an identical name of the Complainant, i.e., Mr. S.K. Agarwal, 11, Arya Nagar, Alwar Rajasthan and the OPs were taking necessary steps for retrieving the said 5 shares and redressing the grievance of the Complainant in respect of the said shares. It was also submitted that the Complainant has approached the court of the Ld. Additional Chief Metropolitan Magistrate at Kolkata by filing a complaint being complaint No. C/915 of 11, which is still pending. Again, the OPs submitted that the Ld. Forum below did not have territorial jurisdiction to try and entertain the complaint as the OP Company's registered office is situated at Mumbai and accordingly, the complaint was liable to be dismissed.

4. Ld. Forum below after having gone through the pleadings of the parties, evidence and documents, in particular, observed that the Complainant failed to substantiate and prove his case and as such dismissed the complain without cost.

5. Being aggrieved by and dissatisfied with the order of the Ld. Forum below the Complainant -turned-Appellant has come up before this Commission with prayer for direction to set aside the impugned order.

6. The memorandum of appeal has been gone through together with the documents including the impugned order, the petition of complaint, the share certificate and correspondences between the Complainant/Appellant and OPs and also the W.V. and legal notice.

7. Ld. Advocates appearing for both parties have been heard.

8. Ld. Advocate appearing for the Appellant submitted that the there was no denial on the part of the OPs in their written version that 40 equity shares were issued in the year 1988 to the Complainant/Appellant but no benefit including bonus has been released after issue of the shares. Further, the OP allotted 5 RIL Rights Equity Shares and though the company declared bonus shares at the ratio of 1:1 in the year 1997, no such bonus shares were dispatched to the Appellant/Complainant which is a gross negligence and deficiency in service on the part of the OP. In submitting several judgments/orders of the Hon'ble Supreme Court/Hon'ble National Consumer Disputes Redressal Commission as reported - III( 2015) CPJ 219 (NC), IV (2005) CPJ 16 (NC), III (2014) CPJ 621 (NC), I (2008) CPJ 341 (NC), IV (2014) CPJ 604 (NC), 2001 (1) CPR 7 (SC) (1994) 4 Supreme Court Cases 225, I (2008) CPJ 341 (NC), I (2008) CPJ 43 (NC), I (1994) CPJ 304, IV (2005) CPJ 24, II (2013) CPJ 32, IV (2004) CPJ 289, and also the order of this Commission passed in SC Case No. FA/509/2009 dated 19.03.2010, Ld. Advocate asserted that the Complainant was a consumer as he was not engaged in trading of shares but only invested his heard earned money for supplementing his income for livelihood. Again, it was submitted that admittedly the OP sent the RIL Bonus Shares to a wrong person for which the Appellant/Complainant was not responsible. Ld. Forum below passed the order without taking into consideration the material facts of non-payment of benefits arising out of holding of shares by the Complainant/Appellant. No specific reason was recorded for dismissal of the complaint and therefore the impugned order was liable to the set aside.

9. Ld. Advocate appearing for the Respondent/OP submitted that though allotment of 40 shares was made to the Complainant/Appellant, the said shares were forfeited for non-payment of due allotment money in spite of communication in that regard to the Complainant/Appellant. The address of the Complainant/Appellant was recorded otherwise than C/O Urbashi, 109, Cotton Street, Kolkata. The said certificates were inadvertently sent to 11, Arya Nagar, Alwar, Rajasthan. The Complainant/Appellant was requested vide letters of OP No. 2 dated 19.03.2008, 28.06.2008 and 03.07.2009 to forward the original proof of allotment letter and the original share certificates bearing No. 07764522, for investigation but that was not complied as a result of which no investigation could be done. Again the complaint was filed long after the alleged cause of action arose and as per provision of the Consumer Protection Act, the complaint was barred by limitation. Ld. Forum below rightly adjudicated the complaint, keeping in view all material facts and legal aspects of the case. The appeal does not have any merit and deserves to be dismissed.

10. The point for consideration is whether the impugned order suffers from legal infirmity or material irregularity.

Decision with Reasons

11. It is a fact that the Complainant applied for allotment of shares and deposited application money for such allotment. While the OP in their letter dated 28 July, 1990 mentioned that 40th partly paid share certificates, Distinctive Nos. 150160437 to 150160476 were forfeited for non-payment of allotment money, the RIL shares (5) were not of that category. The settled principle of law (Morgan Stanley Mutual Fund v. Kartick Das reported in 1994 (2) CPJ 7) is that after allotment of shares those are to be considered as goods. There is no allegation by the OP/Respondents that the Complainant/Appellant was engaged in share trading activity which is commercial in nature. Accordingly, the Complainant/Appellant was to be treated as a consumer.

12. It is also a fact that the address of the Complainant was C/o Urvashi 109, Cotton Street, Kolkata-700 007 and that has been noted in their correspondences with the Complainant/Appellant.

13. It is an admitted fact that Five Bonus RIL Shares were sent to a wrong person inadvertently for which the OPs are manifestly responsible. Regarding other 40 shares, the allegation of the Complainant/Appellant does not stand substantiated as the said certificates were forfeited for non-payment of allotment money. After allotment, the Complainant/Appellant was required to deposit the allotment money which he failed to do.

14. The law is settled that a consumer is entitled to maintain a complaint before a Forum/Commission even if he has relief under another statute before any other authority.

15. The order of this Commission as referred to by the Ld. Advocate of the Appellant in SC Case No. FA/509/2009 has already decided that the Consumer Protection Act provides for an additional Forum for relief and therefore mere availability of a Forum under another statute is no bar against maintainability of the proceeding before

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a Forum under the Consumer Protection Act. 16. The Complainant appears to have preferred his claim for relief from 2008 and there has been a continuous cause and as such the law of limitation does not affect his right to seek redressal. 17. Ld. Forum should have dealt with the case with some more explanations as to dismissal of the complaint. It would be prudent on the basis of the foregoing discussion to modify the order allowing the appeal in part. 18. Hence, Ordered That the appeal be and the same is allowed in part with modification of the impugned order to the effect that the OP No. 1 shall release all benefits as admissible in respect of 5 RIL Rights Equity Shares over the entire period beginning from the date of issue with a compensation of Rs. 5,000/- to the Appellant/Complainant within a period of 40 days, in default, the Appellant/Complainant will be at liberty to take recourse to such action as permissible under law. Appeal is allowed in part.