State Consumer Disputes Redressal Commission
1. Joint Registrar/Managing Director, ... vs 1. Smt. Kanadula Anasuya, W/O ... on 23 February, 2010
A
P.
STATE CONSUMER DISPUTES REDRESSAL COMMISSION : AT HYDERABAD
FA
738/2007 against C.D. 117/2004 on
the file of the District Forum, Khammam
Between:
1.
Joint
Registrar/Managing Director, House Fed,
Baghlingampally, Besides Sundarayya Vignan
Kendra
Hyderabad.
2.
Recovery
officer, House Fed.
Baghlingampally, Beside Sundarayya Vignan
Kendra,
Hyderabad Appellants/Opp. Parties 3 and 4.
And
1.
Smt. Kanadula
Anasuya, W/o Venkateswarlu,
Aged
55 years, occ : House hold, R/o 3-6-31,
Pumping
Well Road,
Khammam
Town and District.
..
respondent/complainant
2.
Venkateswarlu, President,
Sri Laxmin
House
Building Co-op. Society Ltd, H.no.3-6-134,
Pumping
Well Road,
Khammam
Town and District.
3.
Sub- Registrar
(M & C ), DRDA office, near DRDA office
Paparthi
nagar, Khammam. Respondents/ OPs
1 & 2
Counsel for the Appellants : Mr.
M. Aravindu.
Counsel for the Respondents : M/s..
A. Jaya Raju for R-1.
R2
served.
G.
P. for R-3.
CORAM :
Sri Syed
Abdullah Honble
Member
And Sri R. Lakshminarasimha Rao Honble Member Tuesday, the Twenty Third Day of February, Two thousand Ten Oral order : ( as per Sri Syed Abdullah, Honble Member ) ****** The appellants are the opposite parties 3 and 4 in CD 117/2004 before the District Forum, Khammam against whom an order was passed directing opposite parties 1 to 4 with joint and several liability to return the title deeds to the complainant after canceling the mortgage bond. Aggrieved by the impugned order this appeal is filed questioning the legality and propriety of it.
The facts of the case are that the complainant is a member of Sri Lashmi House Building Cooperative Society Limited, Khammam, who is OP 1. The complainant deposited Rs.5000/- as her share capital in the said society. Thereafter, the complainant had taken house building loan of Rs.60,000/- for construction of a building. Subsequently, the complainant had repaid the loan instalments including interest to a tune of Rs.1,56,140/- commencing from 4.2.1988 up to 11.5.1996. That on 7.10.93, OP 1 sent a circular to the complainant to remit a sum of Rs. 13,424/- towards the balance of the house building loan amount. So also received a notice from OP 3 dated 1.4.2000 directing the complainant to pay Rs.17,866.48 due towards arrears of the building loan. Final notice dt.18.08.2004 was also served on the complainant to pay a sum of Rs.21,462/- including Rs.19,272/- with interest and also another sum of Rs.1658.88 towards penal interest. In spite of repayment of the entire loan amount, the complainant was surprised to receive the demand as if the loan is outstanding. The complainant sent reply dt.13.09.2004 to the OPs informing that the entire loan amount was discharged and that they may verify the accounts so also asked for refund Rs.17,296/- inclusive of share capital of Rs. 5000/- pain in excess . Though notices were served the respondents 1 to 3 failed to give any response. Therefore prayed to direct the respondents to pay the amount due and also to return the title deed which was deposited as security for repayment of the loan amount.
On behalf of OP. 1 the advocate filed vakalat and thereafter sufficient time was taken for fling counter but no counter was filed.
OP 2 appeared in person and filed counter stating that he contested the elections of Sri Laxmi House Building Society which was held on 14.9.2002 After election of the said society he ceased to act as person in-charge. So also that he is not custodian of any of the records.
OP 4 filed its version and the same was adopted by OP3 in which it is stated that A P Co-operative Housing Societies Federation Limited is called House Fed is a society registered under A.P.C. S. Act 7 of 64. Its apex affairs are subject to the control of the Commissioner for Cooperation and Registrar of A. P. Co-operatives, Hyderabad.
The House-Fed borrows loans from LIC of India on interest on creation of floating charges on all the assets of the A P. House-Fed. It lends loans for construction of houses through its affiliated member societies in the entire State of Andhra Pradesh on a meagre margin just to meets its establishment charges.
The societies registered under A.P. Co-operative Societies Act become members of the A P House Fed. OP 1 society is affiliated to A P House Fed ( OP 4) and that the complainant is a member of OP. 1 society. On the application made by OP.1 , the OP. 4 sanctioned loan of Rs.60,000/- to its member ( complainant) on the condition that the loan to be paid within 15 years by paying principal instalment of Rs Rs.4000/- once in a year and interest at 12 pa payable half yearly and penal interest shall be charged 2% p.a in addition to the normal rate of interest on all overdue installments. Aggeeing to the above said conditions the complainant executed an agreement with OP. 1 society on 7.6.88 for assigning property with equitable mortgage by depositing of titled deeds in favour of A P Housed fed and also to abide by terms and conditions stipulated in the assignment deed. Thus, Op1 society executed a registered assignment deed on 4098/98 with OP 4.
As per the loan account of the complainant as on 20.11.2004 a sum of Rs.23,569/- was paid towards principal and interest inclusive of penal interest. It is not correct to state that the complainant had paid the entire loan amount along with interest as alleged. As per Sec. 126 of APCS Act no suit shall be instituted against the Co-operative Society until the expiry of 60 days whereas the complainant filed this complaint on 7.10.2004, 17 days after alleged serving of notice. There is no direct nexus between complainant and OP 4. However, OP 4 willing to return the titled deeds of the complainant after clearance of dues. The relationship between the complainant and OPs is of a debtor and creditor but not a consumer as such the complaint is not maintainable. Hence prayed to dismiss the complaint.
During the enquiry the complainant filed evidence affidavit and Ex A1 consisting of 64 receipts in token of the payment of monthly instalments of loan transactions. The OPs 3 and 4 filed evidence affidavit in support of their version and contentions.
After going through the material on record, the District Forum held that OP.3 and 4 failed to exercise any control over the affairs of OP.1 society and the said society having received the loan amount failed to remit the same to OP 3 and 4 for its adjustment which act or omission amounts to deficiency in service and it cannot be said that there is no nexus between complainant and OP
4. We have gone through factual aspects and evidence on record coupled with the contentions raised by the parties.
The point that arises for consideration are, (1) whether or not the dispute is a consumer dispute ?
(2) whether OP 1 to 4 have committed any deficiency in service to direct them for refund excess loan amount of Rs.17,296/- along with share capital and interest as claimed by the complainant.
Point No .1 :
The complainant being a member of OP 1 society, he is entitled to avail the services available to the members of a society under the provisions of APCS Act and also as per its bye laws. In case, the services are denied to a member of a society he may seek a rederssal from the Registrar of Cooperative Society as laid down under Clause 3 of 22 of APCS Act , 1964. Every Co-operative Society registered under Sec.. 3 of APCS Act shall exercise its powers under the general supervision of the Registrar of CO. Op societies Act. Similarly in case of a dispute in between the members and society, member and member and society and society it is to be resolved by means of section 61 of the Act including the claims per the debts and amounts due. Section 121 of APCS Act bars the jurisdiction of a civil court when the dispute pertains to the business affairs of a society and matters touching the affairs of the society. The Distinct Forum referred to various decisions cited by both sides which are for and against in entertaining the complaint by District Forum pertaining to societies affairs. These decision are not relevant to the facts of the case except to consider whether the complainant is entitled for the reliefs on the ground of deficiency in service. Section 3 of the C P Act is very clear that the provisions of the Aat shall be in addition to and not in derogation of the Act. So in view of the clear cut provision the complaint is maintainable in the event of any deficiency in service by the OPs who failed to discharge their obligation under the contract. Therefore,.held that the complaint is maintainable irrespective of the relief provided under the APCS Act.
Point no.2 : As matter of fact, OP 1 had not at all contested the case. From the version of OP2. it is clear that by the date of filing of the complaint on 08.10.2004 OP 2 person in charge of the society up to 30.09.2004 only and on that day the newly elected body of the society took charge of it. By the date of filing of the complaint on 08.10.2004, the elected body of the society was very much in control of OP 1 societys affairs. Ex A1 receipts show that printed receipts were issued in favour of the complainant on different dates for the loan repayment amount every month from time to time. As per the circular dt.7.10.93 issued by the Registrar of Co-operative Societies the term of the OP 1 society had expired on 25.6.93 so a person-in-charge was appointed who had assumed the charge to manage the affairs of the OP.1 society. As per the version of OP 2 since elections were held to OP 1 society, he had handed over the charge to the newly elected committee and he ceased to have control with effect from 14.09.2002. when OP 2 ceased to have any control he cannot be fastened with any liability.
OP 4 in its version categorically stated that House-Fed is also a cooperative society constituted under the APCS Act which advances loans to its affiliated societies and its members by taking sufficient security for the loan advanced. In fact, the loan transaction was in between the complainant and the OP 1 society and there was no direct connection between the complainant and OP 4. The loan application of the complainant was processed by OP 1 society after taking immovable property as security for the repayment of the loan.
And the said security was taken by way of mortgage by deposit of title deeds. And thereafter the said security was assigned to OP 4 Housing-Fed for releasing the housing loan to the complainant. Thus, there is no privity of contract between the complainant and OP. 4. As per the arrangement entered into between the complaint as a member of the OP 1 society she had to remit the monthly installments of the loan and on receipt of it the said amount the said payment would be sent to OP. 4 till the loan is discharged.
OP. 4 has filed a copy of the statement Ex B4 showing the payments that were received from OP 1 in connection of the loan repayment by the complainant. It cannot be disputed as incorrect. Ex B4 ledger account was maintained by the OP 4 society in the regular course of business which is a public document. So it is to be presumed that the entries there in are true and correct unless the same are rebutted. Even from the notices Ex. A3 and A4 dated 1.4.2000 and 18.8.2004 OP 4 had reminded the complainant that loan amount is outstanding and the same is to be paid by her. At that stage she did not take any steps to find out from OP 1 whether the loan amount covered by receipts Ex. A1 showing payment of Rs.1,56,140/- was sent to OP 4 or not. The complaint was filed on 8.10.2004 on which date the OP 4 had already issued intimation to the complainant about the non payment of the outstanding loan amount. It is seen from the circular of the Co-operative Sub-Registrar-cum-person-in=charge dt. 7.10.1998 it is alleged that the elected term of Managing Committee of OP 1 society was expired on 07.03..93 and thereby a PIC was appointed who took charge on 28.7.2003. The complainant also mentioned this fact in para 2 of his complaint that she received the said circular that a demand for Rs.13,424/- was sent towards the house building loan amount. Even though the complainant was very much aware that the terms of OP.1s management had expired, still she had paid the installment amounts commencing from 1993 up to 11.5.1996.
The receipts covered by Ex. A1 commencing from 1988 up to 11.5.96 was signed by one V. Ranga Rao as President of the Laxmin Housing Society. The payment as well the collection of the receipts subsequent to 7.3.1993 are invalid since the former president has no authority to issue receipts. The complainant has not reported the matter to the Registrar of Co-operative Societies as to the misappropriation of the loan amount which was collected subsequent to the expiry of his term. When the complainant had paid the amounts to an unauthorized person the amounts cannot be taken into account. OP 4 is justified in issuing demand notices for payment of the outstanding loan with interest thereon and as well for payment of penal interest. OP 4 in its version in para 5 has shown the details of the outstanding loan amount as on 20.11.2004 i.e., the principal is shown at Rs.19,272/- on which interest is worked at 532 and penal interest at Rs..3,765/- in total Rs.23,569/-. Unless the outstanding amount with up to date interest till final settlement is paid the OP 4 need not return the documents or title deeds which were taken by deposit of title deeds under 71 of the Indian contract Act the OP 4 society as creditor has a lien over the documents which were given as surety for discharge of the loan amount borrowed as per the assignment deed. OP.4 society is an independent society registered under the Provisions of APCS Act in which OP 1 society has become a member for borrowing housing society loans for disbursement to its members. The complainant has no privity of contract with OP 4 and she cannot attribute that OP 4 has committed any deficiency in service. However, OP 4 has unequivocally agreed to return the mortgage deed and title deed which was given as immovable property security for repayment of the loan by the complainant to OP 1 society which was in turn assigned for retention of it by OP 4 till the entire loan amount is discharged.
Based on the evidence on record we are of the considered opinion that OP 2 to 4 cannot be attributed with deficiency in service or to fasten with liability In the result, the appeal is allowed by setting aside the order in CD 117/2004 by passing the following order :
The complainant is directed to discharge the outstanding loan amount with up to date interest till date to OP.4 and on payment of the same OP 4 shall return title deed which was given as immovable property security for payment of the loan amount by making necessary endorsement of full and final settlement of the loan transaction. The complainant is entitled to recover the excess payments made by her from OP. 1 society for recovery of the amounts including the amount wrongly collected by the management of the OP.1 society. Each party to bear its own costs.
SD/-
MEMBER SD/-
MEMBER DATED : 23.02.2010