National Consumer Disputes Redressal
Puran Chand Wadhwa vs Hamil Era Textiles Ltd. on 26 August, 2003
Equivalent citations: [2003]48SCL59(NCDRC)
ORDER
B.K. Taimni, Member
1. Petitioner was the complainant before the District Forum where he had filed a complaint alleging deficiency in service on the part of the Respondent, Hamil Era Textiles.
2. Briefly, the facts of the case are that in response to an invitation to invest in Debentures, advertised by the Respondent Company, the Petitioner applied for 50 partly convertible Debentures which were allotted to him on 19.6.93. Part A of these Debentures were converted into 100 shares of Rs. 10/- each, Part B was the non convertible Debentures of Rs. 35/- each; they were to mature after 17 1/2 months, i.e., on 9.12.94; six monthly interest @ 18% p.a. was payable on these Debentures. There is no dispute about the issues of shares and payment of two six monthly interest on the debentures. When the Respondent Company allegedly did not pay the principal amount of debenture and the last, i.e., third instalment of instalment after the date of maturity, a complaint was filed before the District Forum seeking following reliefs :-
"(a) To direct the Company to pay the following amounts:
(b) To direct the company to pay interest@18% pa on the total amount of Rs. 1885/- from the date of due, i.e., 9.12.94 till the date of actual payment.
(c) Compensation for unnecessary and uncalled for mental harassment under gone by the complainant."
3. The District Forum after hearing the parties allowed the complaint. On an appeal filed by the Respondent, the State Commission set aside the order of the District Forum and dismissed the complaint on the ground that the District Forum had no territorial jurisdiction to entertain and hear the complaint. Aggrieved by this order, the Petitioner / Complainant filed a revision Petition before this Commission which was dismissed on 17.5.2000 at the stage of admission in terms of order which follows:
"We do not find any illegality or jurisdictional error in the order passed by the State Commission. The Revision Petition is dismissed."
4. On a Civil Appeal filed by the Petitioner before the Hon'ble Supreme Court, it set aside our above order and remanded the case for disposal on merits after giving opportunity of hearing to the Parties.
5. We heard the parties at length.
6. Two issues emerge for our consideration. The question of law is of jurisdiction of the consumer forums at Chandigarh to entertain the complaint against a Respondent company which reportedly has no branch office at Chandigarh and secondly, if the Respondent has been deficient in rendering service to the Petitioner / complainant?
7. On the first point, the argument of the complainant - who argued himself - is that, Section 20 of CPC and Section 11 (1) of CPA 1996 read the same, except that in the case of Consumer Protection Act, wording 'carries on business or has a branch office' has been added. According to him he is protected / covered by Section 11 (2) (C) of CPA which has a common reading with Section 20 (C) of CPC. Hence if the Civil Court has jurisdiction - same shall be the position in the case of consumer forums. For supporting his case, he relies on the case of Morgan Stanley Mutual Fund v. SEBI and Ors.(Civil Appeals Nos. 4584 & 4585 of 1994). According to him, cause of action arose partly in Chandigarh, as he had deposited the money originally at Chandigarh and had also received the interest payment from Punjab & Sindh Bank, Chandigarh who needs to be treated as their agent hence covered by Section 11 (2)(a) and (c) of CPA, 1986. On the other hand it was argued by the learned Counsel for the Respondents, that Section 11(2)(a) does not permit the case to be entertained by the consumer forum at Chandigarh as they have no branch office or any place of business at Chandigarh. Payments through Banks are made to facilitate the share holders receiving the payment quickly, which they do as Bankers, in discharge of their normal functions. They cannot be called their Agent. The case could only be instituted in Bombay, where their Head Office is. For this he relies on judgement of the Hon'ble Supreme Court in H.P. Gupta v. Hira Lal 1970(1) SCC 437 and judgement of this Commission in revision Petition 163 of 1991 GDA v. Smt. Sunita Garg passed on 18.3.92.
8. Before we go into the question of merits of the case, we would discuss the question of jurisdiction. It is now settled law that while the Consumer Forum has the trappings of a civil court but we are not civil courts. For 'substantive' purpose, Consumer Protection Act is a wholesome and in itself a complete enactment. Section 11 of this Act reads as follows:
"11 Jurisdiction of the District Forum - (1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed [does not exceed rupees twenty lakhs] (2) A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction,-
(a) the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or [carries on business or has a branch office or] personally works for gain, or
(b) any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides, or [carries on business or has a branch office], or personally works for gain, provided that in such case either the permission of the District Forum is given, or the opposite parties who do not reside, or [carry on business or have a branch office], or personally work for gain, as the case may be, acquiesce in such institution; or
(c) the cause of action, wholly or in part, arises."
9. While one may concede that Section 20 of CPC and Section 11 of CPA - 1986 had a common reading - but this was before the amendment made in the Act in June 1983. By an amendment to the CPA - 1986 in June 1983, word "carries on business or has a branch office or" have been added. In our view legislative intent is clear. The amendment is part of the statute and has not been challenged. Consumer Forums cannot go beyond or behind the provisions of the Act. In our view, it is not in dispute that the Respondent neither has any business now any branch office in Chandigarh. The effort by the petitioner to bring in Punjab and Sindh Bank as an Agent of the Respondent with a view to fall within Section 11(2)(c), is too naive to be accepted and dealt in by us. Bank is only a facilitator to accept the money at the time of floating of debentures and encash cheques issued by the Respondent. This is limited service being rendered by them for all aspiring investors - by no stretch of imagination can they be called the Agents of the Respondent. We see no action wholly or the part taking place in Chandigarh - Debentures were issued from Bombay; Two instalments as interest on Debentures were issued from Bombay payable at Chandigarh; Debentures were to be redeemed from Bombay, No action whatsoever could be said to be preformed at Chandigarh. We have seen the judgement of the Hon'ble Supreme Court in the case of Morgan Stanley Mutual Fund v. SEBI & Ors. After going through it we do not find that the present case has anything common with the facts and results of that case as it dealt with situation / cases dealing with injunction. However relying upon the Halsbury's Laws of England the Supreme Court goes on to state that 'As per as Indian is concerned, the residences of the company is where the registered office is located. Normally cases should be filed only Where the registered office of the company is situated. The point at issue was more specifically dealt in the context of Companies Act by Hon'ble Supreme Court in the case of H.P. Gupta v. Hira Lal where in it was held that the cause of action would arise at the place where registered officer of the company is situated. This view was confirmed / reiterated by the Hon'ble Supreme Court in the case of H.v. Jaya Ram v. ICICI and Ors. [1999 (7) Scale - 481]. National Commission in the case of GDA v. Smt. Sunita Garg (supra) had held that 'the very fact that the amount of initial deposit for the flat (in Ghaziabad) was remitted through the Branch of Vijaya Bank at Chandigarh will not entitle the complainant to contend that any part of the cause of action had arisen in Chandigarh. (emphasis supplied) On the point of jurisdiction another point made by the Petitioner is that Consumer Protection Act is a piece of beneficial legislation and the poor small investor could not be expected to run to several places in this case to Bombay for recovery of less than Rs. 2000/-. It also could not be the case of the Petitioner that the Respondents and similarly placed companies could be facing litigation in thousands of courts spread over the country. We have also the Hon'ble Supreme Court warning us of the pit falls when it observed in the case of Morgan Stanley Mutual Fund v. SEBI and Ors.
"There is an increasing tendency on the part of litigants to indulge in speculative and vexatious litigation and adventurism which the fora seem reality to oblige. We think such a tendency should be curbed...."
10. In our view this appears to be the case at the District Forum Level. We wish to reiterate that it is admittedly a beneficial legislation, but forum shall not go out of the boundaries of law provided under the Act to satisfy the desires of anyone. Hence see no merits in the issue - Consumer Forum AT Chandigarh clearly had no jurisdiction under the law to entertain the complaint. The order of the State Commission is as per settled law on the subject.
11. As far as the point on deficiency in service is concerned, two points were made before us. One that the requirement of sending Debentures after 'Discharge' finds no mention in the 'Terms and conditions of Debenture as there is no space for his signatures on it, and secondly, having complied with these provisions, yet there was delay in sending the money, which was sent to him during the pendency of complaint before the District Forum, Chandigarh.
12. On the first point of 'Discharge' we have seen that 'conditions' printed on the back of the Part 'B' Debenture Certificate Clause 3 reads as follows:
"The letter of allotment should be retained intact and lodged for exchange with the Debenture Certificate(s). The date of such exchange will intended by the company to the Registered Debenture holder(s) to enable him / them to surrender the letter of Allotment duly discharged"
13. Hence it will be clear that while sending instrument for reclaim of amounts, letter of Allotment Part B in the case - had to be surrendered duly discharged. We saw on record the Letter of Allotment, Part 'B' and find there is no specific place for discharge but in our view, this discharge could be done by affixing a revenue stamp or otherwise and a signature by the Debenture holder. Petitioner / Complainant is a retired senior official of the Government and has reported to be registered as a lawyer with the High Court / Hon'ble Supreme Court. The word 'discharge' and performing it by endorsing a signature should not be unknown to him. Conditions are the terms of contract and it says that instrument had to be surrendered duly discharged. He cannot find escape from the word; failure on his part to do so, has to have its consequences, for which he has to carry full blame.
14. Admittedly the Debentures were redeemable after expiry of 17 1/2 months on 9.12.94. As per the Respondent Payment option Circular was sent to all debenture holders on 1.8.94; on 1.11.94 individual circular was sent to all Debenture holders to surrender Debentures duly discharged, an advertisement to the same effect published in Indian Express on 3.12.94 and 6.4.95. It is only circular dated 16.10.95 issued by Respondent, which is received by the Petitioner, compliance of which is admittedly done by the Petitioner on 6.11.95; Petitioner receives a letter on 6.12.95 stating that the debentures have not been 'Discharged' - hence returned, to comply with the condition 3 of the condition of Allotment. Petitioner files a complaint on 31.1.97 before the District Forum. Letter dated 27.5.97 which has not been disputed, reads as follows:
"HETL/F. No. 99279/105633 May 27, 1997
Mr. P.C. Wadhwa
H.No. 100
Sector No. 28-A
Chandigarh
Dear Sir,
Ref.:- Folio No. 99279 / 105633
Sub:- Debenture Redemption Payment.
This is in continuation of our previous correspondence on the above subject.
We have received today Two Debenture Documents (Letter of Allotment - Part B) re-submitted by you duly discharged and after finding them in order the necessary action for payment will be taken at the earliest.
Thanking you, Your faithfully, For HANIL ERA TEXTILES LTD sd/ AUTHORISED SIGNATIORY"
15. It is interesting to note that there is no reference to this letter in the list of date given by the Petitioner. It is immediately after receipt of the letter that due amount of Rs. 1889/- is paid to the Petitioner / received by him on 25.7.97. As per material on record, it is only sometime in May 1997 that Debenture Certificates duly discharged as per requirement of conditions of allotment are received by the Respondent, Payment is made thereafter. We see that there is not a word about receipt or otherwise of the circular sent to the Respondent to all the debenture holders. As per settled law in Jaya Ram v. ICICI Ltd. and Ors.
"A document is to be served either personally or by sending it by post at registered address within India.....Hence. Once there is a statutory mode of delivering the document by post and deeming provision of such delivery, the place where such posting is done is the place of performances of statutory duty and the same stands discharged as soon as the document is posted."
16. In view of this and there being no rebuttal of earlier letters / circular not being posted, presumption is that they were posted and the Respondent had discharged his statutory duty. Failure to perform is that of complainant's alone had he sent the Letter of Allotment in time, duly discharged - and then and not that no-receipt of payment would certainly have amounted to deficiency in service on the part of the Respondent - not in the present circumstances as the sequence of events enumerate above shall reveal.
17. It may be relevant to refer to the fact that the Petitioner had also filed a civil suit before Civil Judge Chandigarh on 1.6.2000 for the same cause of action and praying for some reliefs which the Petitioner explains was done as a back-up after dismissal of Revision Petition by us on 17.5.2000.
18. Be that as it may in our view the Petitioner has completely failed to prove any deficiency of service on the part of the Respondent. This Revision Petition is devoid of merits and is dismissed. In the fact and circumstances of the case, parties to bear their own costs.