Calcutta High Court (Appellete Side)
Financial Services Ltd. & Anr vs Rajwant Singh on 16 June, 2009
Author: Jyotirmay Bhattacharya
Bench: Jyotirmay Bhattacharya
IN THE HIGH COURT AT CALCUTTA
Civil Revisional Jurisdiction
Present:
The Hon'ble Justice Jyotirmay Bhattacharya
C. O. No. 218 of 2009
The Manager, G.E. Capital Transportation
Financial Services Ltd. & Anr.
-Vs-
Rajwant Singh
For the Petitioners : Mr. Y.J. Dastoor,
Mr. Phiroze Edulji,
Mr. Siddhartha Lahiri.
For the Opposite : Mr. S.P. Roy Chowdhury,
Party. Mr. Kaushik Chanda,
Mr. Debasis Basu,
Mr. Siddhartha Kanjilal.
Judgment On : 16-06-2009.
Several orders are under challenge in this application under Article 227 of the Constitution of India. One of
such orders was passed on 3rd October, 2008 by the State Commission, West Bengal in F.A. No.08/190. The other
order which is under challenge in this application was passed by the learned District Consumer Disputes Redressal
Forum, Hooghly on 15th January, 2009 vide order no.17 in C.D.F. Execution Case No.4 of 2008.
The fate of the order passed by the learned District Consumer Disputes Redressal Forum, Hooghly in the
execution proceeding is dependent upon the fate of the order passed by the learned State Commission, West Bengal on
3rd October, 2008 in the aforesaid appeal. As such, let me first of all consider the merit of the order passed by the
Appellate Forum on 3rd October, 2008 as aforesaid.
For proper appreciation of the dispute involved in this revisional application, the following facts are required
to be taken note of :-
A. Admittedly the petitioner which is a non-banking financial institution granted a loan to the opposite party
herein for purchase of a ten wheeler truck bearing registration no. WB 23A 8541 by entering into a higher purchase
agreement containing an arbitration clause which provides that in case any dispute regarding the subject matter is
cropped up between the parties, such dispute would be referred to the arbitrator at New Delhi.
B. It is also an admitted fact that the opposite party committed default in payment of some of the monthly
installments as per the said higher purchase agreement.
C. It is also an undisputed fact that a sum of Rs.1,07,233/- was paid by the opposite party to the petitioner therein
by bank draft on 6th October, 2007 and after such payment was made only a sum of Rs.33,840/- remained due and
payable by the opposite party to the petitioner herein on account of the said loan transaction.
D. Immediately after receipt of the aforesaid amount, the petitioner herein forcefully took the possession of the
vehicle from the opposite party herein on 11th October, 2007.
E. Since the opposite party's request for return of his vehicle was not adhered to by the petitioner herein, the
opposite party ultimately filed a dispute case being CDF Case No.141 of 2007 before the learned Consumer Disputes
Redressal Forum, Hooghly seeking various reliefs such as return of the vehicle, damages by way of compensation etc.
F. In spite of service of notice upon the petitioner herein, the petitioner did not choose to appear in the said
proceeding for contesting the claim of the opposite party in the said dispute case.
G. Accordingly, the said dispute case was ultimately decided ex parte by the aforesaid forum and following
orders were passed therein on 24th January, 2008:-
"Hence, it is ordered that the complaint petition under Section 12 of the
C.P. Act is allowed ex parte against the OPs with costs. The O.P. are
directed -
(a) To release the vehicle No. WB 23A 8541 along with all documents and loaded goods therein to
the complainant.
(b) To intimate the complainant in writing the actual outstanding dues of EMI as on the date of
seizure i.e. on 11.10.2007 and allow the complainant to repay the said outstanding amount in
three monthly installments.
(c) To supply an authentic copy of loan agreement duly signed by both parties.
(d) To pay Rs.50,000/- to the complainant as compensation for the loss of service and mental
agony and suffering meted to him by O.Ps during this time.
(e) To pay Rs.5,000/- to the complainant for litigation cost.
All such directions above should be complied with by the OPs within 30 days from the date of receipt
of this order, failing which an interest @12% shall be levied upon the total amount as described above till final
payment is made. The complainant is directed to serve the copy of this order upon OPs. Let a copy of this
order be made over to the party free of cost."
H. The petitioner was aggrieved by the said order. Hence, the petitioner filed
an appeal being S.C. Case No.-FA 08/190. In the appeal, several points were
raised by the petitioner for challenging the order passed by the District Forum.
The petitioner contended that service of notice of the dispute case was not
effected upon the petitioner and as a result thereof the petitioner could not
contest the said dispute case before the District Forum at Hooghly. It was
further contended that though the claim of the opposite party was not duly
proved by evidence, still then the District Forum allowed the reliefs claimed by
the opposite party in the said dispute case. It was further contended that since
the vehicle was purchased for a commercial purpose by the opposite party, the
opposite party cannot be regarded as a consumer under the Consumer Protection
Act and as such the reliefs claimed by the opposite party ought not to have been
granted in the said proceeding. It was further contended therein that since the
higher purchase agreement contained an arbitration clause for resolution of such
dispute by way of arbitration in New Delhi, the dispute case ought not to have
been entertained by the Forum. These are the four points on which the propriety
of the order of the District Forum was challenged in the said appeal.
I. Though the learned State Forum, while deciding the said appeal discussed the first two points of challenge as
aforesaid but remained totally silent with regard to the other two points of challenge raised by the petitioner in the said
appeal as aforesaid. The learned State Forum concurred with the finding of the learned District Forum regarding
service of notice upon the petitioner herein. The learned State Forum also held that the claim of the opposite party was
duly proved by the said opposite party before the District Forum and as such, the learned State Forum refused to
interfere with the decision of the District Forum.
J. Being aggrieved by the said judgment and order passed by the learned State Forum in the aforesaid appeal, the
instant application under Article 227 of the Constitution of India has been filed by the petitioner (creditor).
Heard Mr. Dastoor, learned Advocate appearing for the petitioners and Mr. Roy Chowdhury learned Senior
Counsel appearing for the opposite party herein. Considered the materials-on-record and the orders impugned.
Having regard to the admitted facts with regard to the aforesaid loan transaction between the parties as
recorded hereinabove, this Court has no hesitation to hold that the first two grounds of challenge i.e. (i) non-service
of notice of the proceeding upon the petitioner herein and (ii) passing of the order by the District Forum in the absence
of proper proof, practically have lost their significance particularly in the light of the petitioner's admission in this
revisional application to the effect that the vehicle was subsequently returned to the authorized agent of the opposite
party herein as the substantial amount of the arrear dues had already been paid by the opposite party.
Though it is true that the opposite party never admitted the receipt of the said vehicle either by the opposite
party himself or by his agent as claimed by the petitioner herein but still then since such a dispute is not a matter for
consideration before this Court presently and furthermore since such a dispute is now under consideration before the
other forum, this Court does not think it proper either to deal with and/or decide as to whether the said vehicle was
really delivered to the authorized agent of the opposite party by the petitioner on 28th December, 2007, or not but even
without resolving the said dispute this Court can certainly hold that the petitioner cannot wriggle out of its admission
regarding such delivery of vehicle to the authorized agent of the opposite party and such admission really for all
practical purposes amounts to admission of the claim made out by the opposite party in the said dispute case.
In the aforesaid facts this Court holds that the first two points of challenge have lost their significance for all
practical purposes.
Let me now consider the other two points of challenge raised by the petitioner as indicated above.
It is no doubt true that if the opposite party is not a consumer within the meaning of the "consumer" as defined
under Section 2(d) of the Consumer Protection Act, then the opposite party cannot seek any remedy before any of the
forums created under the Consumer Protection Act, 1986. For ascertaining as to whether the petitioner is a "consumer"
or not, the definition of "consumer" under the said Act is required to be considered. Accordingly, Section 2(d) of the
said Act is set out hereunder:-
2 (d) "Consumer" means any person who-
(i) buys and goods for a consideration which has been paid or promised to partly paid and partly
promised, or under any system of deferred payment and includes any user of such goods other
than the person who buys such goods for consideration paid or promised, or under any system
of deferred payment when such use is made with the approval of such person, but does not
include a person who obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any services for a consideration which has been paid or promised or partly
paid and partly promised, or under any system of deferred payment and includes any
beneficiary of such services other than the person who hires or avails of the services for
consideration paid or promised, or partly paid and partly promised, or under any system of
deferred payment, when such services are availed of with the approval of the first mentioned
person (but does not include a person who avails of such services for any commercial purpose);
(Explanation- For the purposes of this clause "commercial purpose" does not include use by a person of goods
bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by
means of self-employment;)"
Here the petitioner claims that he purchased the said vehicle for
commercial purpose for earning his livelihood. In fact, a certificate issued by the
Pradhan of the concerned Gram Panchayat has also been produced by the
opposite party before the District Forum showing that the said vehicle is utilized
by the opposite party for commercial purpose for earning his livelihood. There is
no denial of such claim of the opposite party from the side of the petitioner either
in its pleading or in its evidence. In view of such uncontroverted claim of the
opposite party, this Court has no hesitation to hold that in view of the
explanation added to the provision contained in Section 2(d) of the said Act, the
opposite party is a consumer within the meaning of the consumer as defined in
the said Act. In fact, in a similar set of facts the Hon'ble Supreme Court has held
in the case of Lakshmi Engineering Works -Vs- PSG Industrial Institute reported
in AIR 1995 SC 1428 that when a person buys goods and uses them himself
exclusively for purpose of earning his livelihood by means of self-employment is a
consumer within the definition of expression consumer under the said Act.
Mr. Dastoor submitted that the pleadings of utilising the vehicle for
commercial purpose for earning his livelihood is absent in the petition of
complaint. As such, according to him, the Forum should have held that the
opposite party is not a consumer within the meaning of the consumer under the
said Act.
Though Mr. Dastoor is correct in his submission about the inadequacy of
the pleading in this regard, but if the pleading coupled with the documents filed
in support of his pleading, are taken into consideration as a whole, then there
will be no difficulty in holding that the petitioner is consumer as he utilises the
said vehicle for earning his livelihood.
Trial of such proceeding is not conducted by applying the provisions of the
Evidence Act, strictly. Trial of such proceeding is conducted on the basis of the
principles of natural justice. As such, this Court does not find much substance
in the submission of Mr. Dastoor in this regard.
Thus, this Court holds that the learned District Forum did not commit any illegality in entertaining the said
complaint case of the opposite party and/or in deciding the same on its own merit.
Let me now consider the other point which was raised by the petitioner in this application regarding the
entertainability of such a dispute case by the District Forum by ignoring the arbitration agreement entered into between
the parties concerning the subject dispute. The petitioner claims that the jurisdiction of the District Forum for resolving
such dispute by way of arbitration in New Delhi was practically excluded by such arbitration agreement entered into
between the parties.
In my view, the said contention of the petitioner has no substance at all in view of the provision contained in
Section 8 of the Arbitration and Conciliation Act, 1996 which provides as follows :-
Section 8. "Power to refer parties to arbitration where there is an arbitration agreement.-
1.A judicial authority before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so applies not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration.
2. The application referred to in sub-section (1) shall not be entertained unless it is accompanied by the original arbitration agreement or a duly certified copy thereof.
3. Notwithstanding that an application has been made under sub-section(1) and that the issue is pending before the judicial authority, an arbitration may be commenced or continued and an arbitral award made."
The said provision thus makes it clear that the jurisdiction of a judicial authority to decide any dispute between the parties covered by an arbitration agreement is not as such ousted under the provision of the said Act and it is only when a party applies for such reference before submitting his first statement on the substance of the dispute, before such judicial authority, a reference will be made to the Arbitrator for arbitration of the said dispute between the parties and in that event the judicial authority will not proceed further to decide the said dispute between the parties. Here is the case where neither the petitioner appeared in the proceeding before the District Forum nor applied for reference to arbitrator for arbitration of the dispute between the parties and as such this Court cannot hold that the District Forum had no jurisdiction to entertain and/or to decide the said dispute case.
Thus, this Court holds that there is no substance even in this contention of the petitioner. Under such circumstances, this Court holds that the said impugned order does not require any interference in the facts of the instance case.
Since the order of the Appellate forum is maintained by this Court, no interference with the orders passed by the execution forum, which are impugned in this revisional application, can be called for.
Accordingly, the revisional application stands rejected. The interim order which was passed earlier, thus, stands vacated. Urgent xerox certified copy of this order, if applied for, be supplied expeditiously after complying with all formalities.
( Jyotirmay Bhattacharya, J. )