State Consumer Disputes Redressal Commission
Abhaya Kumar Dash, Aged About 45 Years, ... vs H.D.F.C. Bank Limited, Represented By ... on 9 December, 2009
STATE CONSUMER DISPUTES REDRESSAL COMMISSION:ORISSA:CUTTACK STATE CONSUMER DISPUTES REDRESSAL COMMISSION:ORISSA: CUTTACK CONSUMER COMPLAINT NO.106 OF 2007 Abhaya Kumar Dash, aged about 45 years, son of Ghanashyam Dash, At-Bidyadharpur, P.O. Nayabazar, P.S. Chauliaganj, Dist. Cuttack ... Complainant -Versus- H.D.F.C. Bank Limited, Represented by its Manager, Master Canteen Square, Kharvel Nagar, Bhubaneswar, Dist. Khurda ... Opposite Party For the Complainant : Mr. M. Kanungo & Associates For the Opp. Party : Mr. N.K. Dash & Associates P R E S E N T : THE HONBLE SHRI JUSTICE A.K. SAMANTARAY, PRESIDENT SHRI SUBASH MAHTAB, MEMBER AND SHRIMATI BASANTI DEVI, MEMBER O R D E R
DATE:- The 9th December, 2009.
Justice A.K. Samantaray, President.
The Alleging deficiency and unfair trade practice on the part of the opposite party-H.D.F.C. Bank Ltd., Kharvel Nagar Branch, represented by its Manager, the complainant has filed the present consumer complaint with a prayer for award of a sum of Rs.25,54,000/- in his favour on different counts, as enumerated in paragraph-9 of the complaint, along with interest at the rate of 18% per annum and for direction to the opposite party-Bank to return certain cheques given by him to the Bank.
2. Brief facts of the complainants case are that the complainant approached the opposite party-Bank to avail finance for purchase of a 4-wheeler. On such approach being made, the opposite party proposed the complainant to purchase a second hand Totota Qualis vehicle bearing registration number OR-05R-4241 belonging to one Ranjit Keshari Sahoo, which was in excellent running condition. The opposite party also informed the complainant that it had thoroughly scrutinized the documents pertaining to the vehicle from the office of the R.T.O., Cuttack and everything was found to be in order and there would be absolutely no problem for transfer of ownership of the vehicle in the name of the complainant. For purchase of the vehicle, an amount of Rs.3,50,000/- would be approved as loan and a further sum of Rs.98,206.79 from the account of the complainant would be disbursed to the previous owner Ranjit Keshari Sahoo for pre-closure of his account. Accordingly, Ranjit Keshari Sahoo brought the vehicle to the complainants residence, and the complainant, on inspection found it to be in good condition and agreed to purchase the same. Thereafter, the opposite party-Bank issued letter dated 15.12.2004 to the complainant intimating approval of an amount of Rs.3,50,000/- as Used Car Loan and asking the complainant to disburse an amount of Rs.98,206.79 to the previous owner. On 13.01.2005, the Bank issued another letter to the complainant intimating disbursement of Rs.3,50,000/- in his favour as Used Car Loan against Account No.1092881 to be repaid in thirty equal monthly instalments at the rate of Rs.14,180/- per month. The complainant issued thirty blank cheques in favour of the Bank, out of which 23 cheques were honoured. On 17.03.2005, ownership of the vehicle was transferred to the name of the complainant. The complainant was regularly repaying the monthly instalments and there was absolutely no default in payment.
3. While the matter stood thus, all on a sudden on 20.03.2007 Saheed Nagar police seized the vehicle from the residence of the complainant in connection with Saheed Nagar P.S. Case No.79 of 2007 saying that it was a stolen vehicle and had been stolen from Maharashtra. At the time of such seizure, the complainant was not present. As soon as he came to know about the seizure, he intimated the same to the opposite party. But the opposite party, instead of coming to his aid, expressed its inability to help the complainant in any manner. When the complainant asked for refund of the money he had already paid along with interest, the Manager of the Bank abused him and expressed that there was no question of return of any money and that he might do whatever he liked. It is alleged that the opposite party-Bank in connivance with the aforesaid Ranjit Keshari Sahoo had managed to lure the complainant to purchase a stolen vehicle, but now the opposite party-Bank is washing its hands of the entire transaction.
4. By letter dated 17.05.2007, the Bank intimated the complainant to recover possession of the vehicle in the event the complainant fails to pay the whole of the amount due and outstanding under the agreement. It was also intimated that upon such recovery of possession, the vehicle would be sold/transferred/disposed of in the manner as deemed fit by the Bank. It was further intimated that the Bank reserved the right to include the complainants name in the list of defaulters and share the conduct of his loan account with other Banks/Financial Institutions/Credit Information Companies and statutory bodies. After receipt of the letter, the complainant wrote a letter on 19.05.2007 to the opposite party requesting for return of the cheque Nos.449168 and 449169, against which the complainant had deposited cash. He also requested the opposite party to return the unutilized cheques without presenting them to be honoured. Instead of paying any heed to the request of the complainant, the Bank, by letter dated 18.06.2007 reiterated its demands. In such circumstance, the complainant was constrained to approach this Commission.
5. Upon notice, the opposite party appeared and filed written version challenging the maintainability of the complaint on the ground of the complainant not being a consumer under the C.P. Act and on the ground of non-joinder of the previous owner Ranjit Keshari Sahoo as party to this litigation. It is stated that in case of vehicle loans, the Bank has limited role to play, i.e., to advance the loan amount and disburse the same in favour of the vendor. In case of a new vehicle, the customer obtains quotation from the dealer of the vehicle along with other required documents. After the loan documents are processed and the loan is approved, the amount is disbursed to the dealer and the dealer delivers the vehicle in favour of the customer after observing all formalities. In case of a second hand or used vehicle, the customer produces the documents of the concerned vehicle along with a valuation report prepared by the authorized valuer. Thereafter, the Bank disburses the amount in favour of the seller. If the vehicle is hypothecated/pledged with any financial institution, then the amount required to be paid to the previous financier is also paid to such previous financier. In the instant case, the complainant approached the Bank through its authorized source agency, namely, Fortune Capital, and submitted all the relevant documents in support of the genuineness of the vehicle, insurance papers and valuation of the vehicle. Thereafter, the Bank processed the loan documents and sanctioned an amount of Rs.3,50,000/-. Since a sum of Rs.89,120/- was falling short for foreclosure of the loan account of the previous owner of the vehicle, the said amount was adjusted from the loan amount of the complainant and the rest amount was paid to the vendor. Thereafter the complainant got the vehicle re-registered in his name and used it for quite a long time. The opposite party never proposed or suggested or persuaded in any manner the complainant to purchase the vehicle in question. Thus, the opposite party was never deficient in service, nor did it adopt any unfair trade practice. With these assertions, it has been prayed to dismiss the complaint.
6. We have heard learned counsel for the complainant as well as the opposite party-Bank. The complainant, as we have seen, alleges that there was deficiency in service by the opposite party-Bank inasmuch as it refinanced him in respect of the vehicle bearing registration number OR-05R-4241, which was a stolen one. In spite of the complainants notice to the opposite party-Bank, the Bank refused to pay any attention to his grievance and insisted on encashing the post dated cheques given by the complainant. From a reading of the complaint petition as well as the written version, the following admitted facts emanate-
The opposite party-Bank has refinanced the vehicle bearing registration number OR-05R-4241 to the complainant. The said vehicle was previously registered in the name of one Ranjit Keshari Sahoo, who had purchased the same being financed by the opposite party-Bank. The Bank had refinanced the vehicle for Rs.3,50,000/- and out of the same an amount of Rs.98,206.70 was paid to the previous owner for closure of his account. The EMI was fixed at Rs.14,180/- and accordingly the complainant gave 30 blank cheques, out of which 23 cheques were already honoured. This goes to show that the complainant had already paid back an amount of Rs.3,54,000/- to the Bank. On 20.03.2007 the vehicle in question was seized from the complainant by Saheed Nagar police as the same was a stolen vehicle. When the fact of seizure of the vehicle was intimated by the complainant to the opposite party-Bank, and when the complainant demanded refund of the entire amount paid by him to the Bank along with interest at the rate of 15% per annum, the Bank flatly refused to do anything in the matter. The Bank, instead of addressing to the grievance of the complainant and making endeavour for its redressal, issued notices vide Annexures 8 and 9 with threat of legal action against the complainant. In the said notices, the Bank also threatened that it would include the name of the complainant in the list of defaulters and share the conduct of the complainants loan account with other banks/financial institutions/credit information companies and statutory bodies in accordance with the Credit Information Companies (Regulation) Act, 2005.
7. It is vehemently submitted by the learned counsel for the complainant that the Bank could not have financed a stolen vehicle to the complainant as the same would be void from its very inception being hit by section 23 of the Contract Act. The Bank cannot refinance a stolen vehicle as the said refinancing agreement would defeat the provisions of various laws. When the complainant entered into the agreement of refinance, he was not aware that the agreement was void as he had no knowledge of the fact that the vehicle was a stolen one. He only discovered the refinance agreement to be void on 20.03.2007 when the police officials of Saheed Nagar police-station seized the vehicle and apprised him that the vehicle was a stolen one. In this connection, learned counsel for the complainant referred to section 65 of the Indian Contract Act, which reads as under:-
65.
Obligations of person who has received advantate under void agreement or contract that becomes void When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it, to the person from whom he received it.
Learned counsel argued that in the instant matter, the Bank having received Rs.3,54,000/- under a void and fraudulent agreement is bound to refund the same along with interest.
8. Learned counsel for the opposite party-Bank could not convincingly meet the points urged on behalf of the complainant. After hearing learned counsel for both parties and considering the materials available on record, we are of the view that the opposite party-Bank indulged itself in deficiency in service and adoption of unfair trade practice by refinancing a stolen vehicle to the complainant. We, therefore, direct it to refund the amount of Rs.3,54,000/-, which has been collected by it from the complainant, to the complainant along with interest at the rate of 10% per annum in view of the express provisions of section 65 of the Indian Contract Act. We also direct the opposite party-Bank to return the unutilized cheques to the complainant as no amount can be recovered from him in respect of the stolen vehicle. In our considered view, the Bank had sufficient knowledge that it was going to refinance a stolen vehicle to the complainant. We also observe that the opposite party-Bank, instead of redressing the genuine grievance of the complainant, threatened him with legal action under Annexures-8 and 9 causing mental agony to him. Therefore, we have no hesitation to direct the opposite party Bank to pay the complainant an amount of Rs.50,000/- as compensation for causing harassment and mental torture to him. Apart from that, we also direct the opposite party-Bank to pay to the complainant a sum of Rs.5,000-/ towards cost of litigation. This order shall be complied with within a period of 30 days from the date of receipt of the same.
9. In the result, the consumer complaint is allowed to the extent indicated above.
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(Justice A.K. Samantaray) President ........
(Subash Mahtab) Member ...............................
(Basanti Devi) Member SCDRC, Orissa, Cuttack December , 2009/Nayak