State Consumer Disputes Redressal Commission
Escorts Securities Ltd. 11, Scindia ... vs 1. Shri Dilbagh Singh Kadyan S/O Dalip ... on 17 December, 2012
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, HARYANA, PANCHKULA First Appeal No.458 of 2012 Date of Institution: 09.04.2012 Date of Decision: 17.12.2012 Escorts Securities Ltd. 11, Scindia House, Kasturba Gandhi Marg, Connaught Place, New Delhi. Appellant (OP-1) Versus 1. Shri Dilbagh Singh Kadyan s/o Dalip Singh, R/o VPO Sheikhupra Khalsa Tehsil Gharaunda District Karnal (Haryana). Respondent (Complainant) 2. Sh. Jitender Pal, House No.373, Ward No.11, Near Jeeturi Mandir Gharaunda District Karnal (Haryana). Respondent (OP-2) BEFORE: Honble Mr. Justice R.S. Madan, President. Mr. B.M. Bedi, Judicial Member. For the Parties: Shri B.S. Chauhan, Advocate for appellant. Shri Rohit Goswami, Advocate for respondent No.1. Respondent No.2 exparte. O R D E R
Justice R.S. Madan, President:
Challenge in this appeal is to the order dated 22.11.2011 passed by District Consumer Forum, Karnal in complaint No.626/2009.
The brief facts of the present case as emerged from the record are that complainant had opened a trading account with the opposite party No.1 through opposite party No.2 as the opposite party No.2 was working as agent of the opposite party No.1. Complainant deposited Rs.50,000/- in account No.CDK-26 on 20.11.2007. After the end of financial year 2007-2008, the complainant obtained the statement of his aforesaid account and came to know that the opposite party No.1 had done many transaction without complainants consent. According to the complainant the opposite parties had defrauded him (complainant) when he deposited a cheque No.0914622 dated 21.11.2007 of Rs.70,000/- but the said cheque was credited to the account No.CSK-91 of one Satish Kumar. Complainant requested the opposite parties to do needful but the opposite parties refused. Forced by these circumstances, the complainant filed complaint before the District Forum.
Upon notice, the opposite parties appeared and contested the complaint. Opposite Party in its written statement stated that the complaint was not maintainable in view of the Member-Client Agreement and as per Rules, Regulations and Byelaws of National Stock Exchange India Limited (NSEIL) & SEBI, All claims, differences or disputes between trading members and Constituents arising out of or in relation to dealing, contracts and transactions made subjects to the Bye Laws, Rules, Regulations of the exchange or with reference to anything incidental thereto or in pursuance thereof or relating to their validity, construction, interpretation, fulfillment or the rights, obligation and liabilities of the parties thereto and including any question of whether such dealing, transactions and contracts have been entered into or not shall be submitted to arbitration in accordance with the provisions of these Byelaws and Regulation. In case the complainant having any grievances against the opposite parties, should have filed the same before Arbitration Tribunal, National Stock Exchange India Limited (NSEIL, the appropriate forum. It was categorically denied that the opposite party No.2 was the agent of the opposite party No.1. The complainant had credited balance of Rs.9265.75 in his account having client code No.CDK26, however, there was a debit balance of Rs.24060.11 in the said account of brother of the complainant Satish Kumar having client code No.CSK91 and later on the complainant wanted to release the said credit balance of Rs.9265.75 without clearing the debit balance of Rs.24060.11 pending against his brothers account despite giving his instruction/declaration letter duly notarized by the Notary Public on 03.07.2008 for transfer of said credit balance of Rs.9265.75 to his brothers account having client code No.CSK91. Opposite Party No.1 also tendered some documents in support of its written statement and thereafter the opposite parties were proceeded exparte vide order dated 13.06.2011.
On appraisal of the pleadings of the parties and the evidence adduced on the record, District Consumer Forum accepted complaint and issued following direction:-
.The OP is directed to credit the amount of Rs.70000/- in the account of the complainant. The complainant shall also be entitled to Rs.3000/- for the harassment caused to him. The present complaint is accepted accordingly. The OP shall make the compliance of this order within a period of 30 days from the date of receipt of copy of this order.
Aggrieved against the order of the District Consumer Forum, the opposite party No.1 has come up in appeal.
Arguments heard. File perused.
There is delay of 102 days in filing of the instant appeal the condonation of which has been sought by moving an application under Section 5 of the Limitation Act. The application is supported with an affidavit of Shri Bhuvnesh Singh Chauhan, authorised representative of M/s Escorts Securities Limited, 11, Scindia House, Connaught, Circus, New Delhi. While dealing with the application for condonation of delay, it is not disputed that the delay cannot be condoned on the ground of equity and generosity, but at the same time it is to be taken into consideration that in case of any legal infirmity is committed by the District Consumer Forum while passing the impugned order which is apparent on record, the same cannot be allowed to continue as it would amount to no order in the eyes of law. Reference is made to the observation made by the Honble Supreme wherein it has been held that when the substantial justice and technical approach are pitted against each other, the former has to be performed. It has further been held that the words Sufficient Cause have to be interpreted to advance the cause of justice. The Honble Apex Court in case cited as State of Nagaland Vs. Lipok A.O. and others, 2005(3) SCC 752 has held as under:-
11.What constitutes sufficient cause cannot be held down by hard and fast rules. In New India Assurance Co. Ltd. Vs. Shanti Misra (1975)(2) SCC (840) this Court held that discretion given by Section 5 should not be defined or crystallized so as to convert a discretionary matter into a rigid rule of law. The expression sufficient cause should receive a liberal construction. In Brij Inder Singh Vs. Kanshi Ram (ILR) (1918) 45 Cal. 94 (PC) it was observed that true guide for a court to exercise the discretion under Section 5 is whether the appellant acted with reasonable diligence in prosecuting the appeal. In Shakuntala Devi Jain Vs. Kuntal Kumari (AIR 1969 SC 575) a Bench of three-Judges had held that unless want of bona fides of such inaction or negligence as would deprive a party of the protection of Section 5 is proved, the application must not be thrown out or any delay cannot be refused to be condoned.
In the instant case the District Consumer Forum has passed the impugned order without appreciating the facts of the case and therefore, we think it a fit case to condone the delay. Hence, the delay of 102 days in filing of the present appeal is condoned.
While assailing the order of the District Forum, learned counsel for the appellant has argued that the provisions of Member-Client Agreement and Rules, Regulations & Byelaws of National Stock Exchange India Limited (NSEIL) & SEBI, clearly provide that all claims, differences or disputes between a broker/member and its client shall be submitted to arbitration and therefore the complaint before the District Forum was not maintainable and the dispute was to be referred to the Arbitration.
The contention raised on behalf of the appellant is without any force because by now it is well settled principle of law that the provisions of the Consumer Protection Act, 1986 are in addition to and not in derogation of the Arbitration & Conciliation Act, 1996 and for that reason the remedy as available to the complainant under the Act is absolute and cannot be taken away under the provisions of the Arbitration & Conciliation Act. Reference is made to case law cited as FAIR AIR ENGINEERS PVT. LTD. AND ANOTHER versus N.K. MODI, (1996) 6 Supreme Court Cases 385 wherein the Honble Apex Court has held that:-
16. It would, therefore, be clear that the legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the Code of Civil Procedure. Thereby, as seen, Section 34 of the Act does not confer an automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act. It is a matter of discretion.
Considered from this perspective, we hold that though the District Forum, State Commission and National Commission are judicial authorities, for the purpose of Section 34 of the Arbitration Act, in view of the object of the Act and by operation of Section 3 thereof, we are of the considered view that it would be appropriate that these forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that the Act intends to relieve the consumers of the cumbersome arbitration proceedings or civil action unless the forums on their own and on the peculiar facts and circumstances of a particular case, come to the conclusion that the appropriate forum for adjudication of the disputes would be otherwise those given in the Act.
17. Considered from this perspective, we hold that this dispute need not be referred to arbitration under clause (12) of the agreement and the matter could be decided on merits by the State Commission itself.
In view of the above settled law it is not necessary for the Consumer Fora to refer the matter to arbitrator and therefore the contention raised on behalf of the appellant has no legs to stand.
The other contention raised on behalf of the appellant is that the relationship of Broker and Client for carrying out transactions at the Stock Exchange is beyond the purview of the provisions of the Consumer Protection Act, 1986 as the complainant was carrying out transactions through the appellant-opposite party No.1 for commercial purposes and therefore, cannot be held to be a consumer as defined under the provisions of the Consumer Protection Act, 1986.
We find force in the contention raised on behalf of the appellant in view of judgment rendered by Honble Supreme Court in case law cited as Birla Technologies Ltd versus Neutral Glass and Allied Industries Ltd, 2011(1) CPR 1 (SC) wherein the services for commercial purpose have been held not a consumer dispute as under:-
(i) Consumer Protection Act, 1986 Section 2(1)(d)(i) A person purchasing goods for commercial purposes is not a consumer.
( Para 6)
(ii) Consumer Protection Act, 1986 Section 2(1)(d)(ii), after amendment-A person availing services for any commercial purpose is not a consumer. ( Para
8)
(iii) Consumer Protection Act, 1986 Section 2(1)(d)(i) and (ii) The complaint filed after amendment of the Act-Goods purchased for commercial purposes-Services were hired or availed of for commercial purposes-Complaint not maintainable. ( Para 9)
(iv) Limitation Act, 1963 Section 14 Period spent in prosecuting proceedings before wrong forum-To be excluded while determining limitation.
( Para 10) Admittedly, the complainant had opened trading account with the opposite party No.1 and therefore he cannot be termed as a consumer of the opposite party No.1 as defined in Section 2(1)(d)(ii) of the Consumer Protection Act, 1986. Even the perusal of the legal notice Annexure A-6 shows that the complainant had opened the account with the appellant-opposite party No.1 for transaction of shares which is not a consumer transaction and therefore the complainant not being a consumer of the opposite parties, is not entitled for any relief. Support can be taken from the judgment rendered in case cited as Ramendra Nath Basu Versus Sanjeev Kapoor, 1(2009) Consumer Protection Judgments, 412, wherein the State Consumer Commission of West Bengal has held as under:-
Consumer Protection Act, 1986 Section 2(1) (g)-Securities Share trading-Fixed return of share trading profit assured Alleged amount agreed between parties not paid No negligence on part of O.P. proved Transaction between parties not comes under purview of Consumer Protection Act Investors investing money in share trading with expectancy of earning profits, also undertake huge risk of loss, for which no one could be held responsible No relief entitled.
Similar view has been taken in judgment cited as Anand Rathi Securities Ltd and others v Smt. Rajshri Verma and another, 2010 CTJ 1194 (Chhattisgarh SCDRC).
The facts of the present case are fully attracted to Ramendra Nath Basus case (Supra) and Anand Rathis case (Supra). Thus, as the account of the complainant was for commercial transaction, therefore the services availed by the complainant from the opposite parties cannot be termed as a consumer dispute. Hence, the impugned order cannot be allowed to sustain.
For the reasons recorded above, this appeal is accepted, the impugned order is set aside and the complaint is dismissed.
The statutory amount of Rs.25,000/-
deposited at the time of filing the appeal be refunded to the appellant against proper receipt and identification in accordance with rules, after the expiry of period of appeal and revision, if any filed in this case.
Announced: Justice R.S. Madan 17.12.2012 President B.M. Bedi Judicial Member