State Consumer Disputes Redressal Commission
Vinay Kumar Madeshia vs M/S Karvy Stock Broking Limited on 25 September, 2008
STATE CONSUMER DISPUTES REDRESSAL COMMISSION UTTARAKHAND
DEHRA DUN
FIRST APPEAL NO. 225 / 2007
Sh. Vinay Kumar Madeshia S/o Sh. Kailash Chand
C/o M/s Jai Prakash Associates, Shoultu Camp
Tapri, District Kinnaur, Himachal Pradesh
......Appellant / Complainant
Versus
1. M/s Karvy Stock Broking Limited
Karvy Centre, 8-2-609
Avenue 4, Street No. 1
Banjara Hills, Hyderabad - 500034
2. Sh. Manish Gupta
Branch Manager, Karvy Stock Broking Limited
8 Govindpuri, Opposite Punjab National Bank
Ranipur More, Haridwar
.....Respondent / Opposite Parties
Sh. Surendra Parashar, Learned Counsel for the Appellant
Sh. Sandeep Gupta, Learned Counsel for Respondents
Coram: Hon'ble Justice Irshad Hussain, President
C.C. Pant, Member
Dated: 25.09.2008
ORDER
(Per: C.C. Pant, Member):
This appeal has been filed by Sh. Vinay Kumar Madeshia - complainant against the order dated 12.06.2007 passed by the District Forum, Haridwar in consumer complaint No. 397 / 2006, holding that the consumer complaint is not maintainable under the Consumer Protection Act, 1986.
2. In brief, the facts of the case are that the complainant had 700 shares of M/s Jai Prakash Associates Limited and 7000 shares of M/s Jai Prakash Hydro Power. He had opened a demat account with the opposite party No. 1 - M/s Karvy Stock Broking Limited. Whenever 2 a shareholder having a demat account, wants to transfer his shares, a Delivery Instruction Slip (D.I.S.) is used. The complainant also used one of such slips for transferring 200 shares of M/s Jai Prakash Associates Limited. The slip, duly filled in and signed by the complainant, was received by Sh. Devendra Sharma, an employee of the opposite party No. 1. Sh. Devendra Sharma altered the figure of 200 shares to 600 shares by overwriting and also added 6000 shares of M/s Jai Prakash Hydro Power and got these shares transferred to his own account on 14.07.2006. When the matter was brought to the notice of the opposite parties, an FIR against Sh. Devendra Sharma was lodged with the Kotwali, Jwalapur, District Haridwar on 05.08.2006. Since filing of a criminal case against Sh. Devendra Sharma was not a solution to the problem of the complainant, he filed a consumer complaint before the District Forum, Haridwar.
3. The District Forum dismissed the complaint on the ground that it was not maintainable under the Consumer Protection Act, 1986 because the case is that of fraud, which is to be seen by a court having civil jurisdiction and Consumer Forum is not competent for the trial of such cases. Aggrieved by the order passed by the District Forum, the complainant - appellant has preferred this appeal.
4. We have heard the learned counsel for the parties and perused the material placed on record in the light of the legal aspects of the case.
5. The learned counsel for the appellant argued that even if an FIR alleging cheating has been lodged by the company against its employee Sh. Devendra Sharma, the appellant has nothing to do with it because changing the figure from 200 to 600 and interpolating 6000 shares of M/s Jai Prakash Hydro Power in the D.I.S., is an unfair trade 3 practice and the opposite parties have also made deficiency in service and, therefore, the appellant has a right to file a consumer complaint. Sh. Devendra Sharma was the employee of the opposite party No. 1 and, therefore, whatever had been done by Sh. Devendra Sharma, shall be deemed to have been done by the company. In other words, it turns out to be a case of vicarious liability.
6. Learned counsel for the appellant further argued that a complaint is maintainable before the Consumer Fora even if the complainant has filed a complaint before the police. In support of his contention, he referred to a decision of the Hon'ble National Commission in the case of Yash Pal Marwaha Vs. Pushpa Builders Ltd. and another; II (2006) CPJ 259 (NC). In the reported case, the builder had pressurized the complainant to pay the maintenance charges for an incomplete building. The Hon'ble National Commission held that there is no bar to pursue a remedy under the Consumer Protection Act in any case wherein the complainant had approached the Police Authorities for a temporary relief. Learned counsel cited another decision of the Hon'ble National Commission in the case of P.K. Transport Corporation Vs. Bhilwara Synthetic Ltd.; III (2006) CPJ 445 (NC), wherein the Hon'ble National Commission has held that it is not essential for the complainant to knock the doors of civil court in case of fraud etc. The State Commission is competent to decide the question involving fraud. While deciding the case, the Hon'ble National Commission has relied upon the judgment of the Hon'ble Supreme Court in the case of CCI Chambers Coop. Housing Society Ltd. Vs. Development Credit Bank Ltd.; V (2003) SLT 185 = III (2003) CPJ 9 (SC) = 2003 CTJ 849.
7. Learned counsel for the appellant cited another decision of the Hon'ble National Commission in the case of Powerware India Pvt.
4Ltd. Vs. Economic Transport Organization & Anr.; II (2006) CPJ 269 (NC). In the reported case, the complainant purchased raw materials from Steel Authority of India, Rourkela, which was booked for transportation on 08.03.1995 through opposite party No. 1. The gross weight of booked raw materials was 10 MTs. It was alleged that when the raw material was unloaded at the works site on 11.03.1995, its weight was found to be 8670 kgs. There was shortage of 1330 kgs valuing Rs. 46,845/-. On not settling claim for shortage, the complainant filed a consumer complaint, which was contested by the opposite parties and it was alleged that they had hired a private truck, who had misappropriated the raw material during transportation. So, an FIR was lodged with the police and after investigation, charge-sheet under Section 407 IPC had been submitted. It was contended on behalf of the opposite parties that in view of the pendency of the criminal case, the complaint was not maintainable. The Hon'ble National Commission held that the criminal case is for prosecution of the accused under Section 407 IPC. Value etc. of the missing raw material in the case was sought to be recovered based on deficiency in service on the part of opposite parties. Nature of two proceedings being different, the pendency of criminal case, would not come in the way of Consumer Fora in granting the relief in the complaint.
8. The learned counsel for the respondents submitted that the appellant, who is a demat account holder, had not taken necessary precautions, which he was required to take, at the time of handing over the Delivery Instruction Slip to the office of the respondent. It is alleged that the appellant had given to Sh. Devendra Sharma, pre-signed D.I.S. without filling up all the fields specified in the D.I.S. This probably allowed Sh. Devendra Sharma to transfer the shares to his own account. However, respondent No.2 has filed an FIR against 5 Sh. Devendra Sharma with the Police Station, Haridwar. It was argued that since the matter is subjudice, the District Forum has rightly held that the complaint is not maintainable.
9. We considered the submissions raised by the learned counsel for the parties.
10. On the point of maintainability of the complaint before the Consumer Fora, we are in agreement with the learned counsel for the appellant. In view of the various decisions of the Hon'ble National Commission, as cited above, particularly the decision of the Hon'ble National Commission in the case of Powerware India Pvt. Ltd. (supra), the impugned order is liable to be set aside and it is to be held that the Consumer Fora is competent to decide the consumer complaint even if the matter is subjudice.
11. On facts, we find that the appellant had submitted the D.I.S. for the transfer of 200 shares of M/s Jai Prakash Associates Limited. The number of shares and signature of the appellant are in the same ink and an overwriting on "200 shares" is quite apparent. We also find that the signatures of the appellant are similar to that he has put on the Vakalatnama of his counsel. The initials put near the overwritten words and figures are different from the appellant's signatures. The respondents, after preliminary enquiry at their level, also found that Sh. Devendra Sharma had played such a trick in some other cases also. Whatsoever be the reason, so far as the appellant is concerned, the respondent have made deficiency in service and they are liable to compensate the loss suffered by the appellant.
12. As submitted by the appellant, on 14.07.2006, value of a share of M/s Jai Prakash Associates Limited was Rs. 368.25/- and that of M/ 6 s Jai Prakash Hydro Power was Rs. 25.80/-. The respondents have not controverted this fact. Therefore, the appellant had suffered a loss of Rs. 3,75,750/-. We are of the view that the respondent No. 1 is liable to pay a sum of Rs. 3,75,750/- to the appellant together with interest @9% p.a. from 14.07.2006 till payment. We also feel that an award of Rs. 2,000/- as cost of litigation, would meet the ends of justice.
13. For the reasons aforesaid, the appeal succeed and is to be allowed accordingly.
14. Appeal is allowed. Order dated 12.06.2007 of the District Forum is set aside. Consumer complaint is allowed and the respondent No. 1 is directed to pay a sum of Rs. 3,75,750/- to the appellant within a period of 30 days from the date of this order together with interest @9% p.a. from 14.07.2006 till payment and Rs. 2,000/- as cost of litigation.
(C.C. PANT) (JUSTICE IRSHAD HUSSAIN) Kawal