CHOLAMANDALAM INVESTMENT AND FINANCE CO. LTD Vs. CHAND CHAUSHA

JUDGEMENT

(1.) Aggrieved by the order in C.C.No.51/2006 on the file of District Forum, Mahaboobnagar, opposite party preferred this appeal.

(2.) The brief facts as set out in the complaint are that the complainant obtained a loan of Rs.1,71,000/- vide loan agreement No.MHLN140940 from the opposite party on 5-6-2001 for purchasing Mahindra-475-D1 tractor bearing registration No.AP 22 U 6788 from Srirama Engineering Company, Mahaboobnagar. The opposite party fixed EMIs at Rs.6,250/- per month to be paid in 36 months and the complainant regularly paid 10 instalments i.e. Rs.65,000/-. In December, 2004 the complainant paid a sum of Rs.15,000/- to one Ashok Kumar, Manager of opposite party at Mahaboobnagar and found that the said Ashok Kumar has not credited the said amount to his account and therefore he made a oral complaint to the Head Office on telephone, consequently after due enquiry the said Ashok Kumar was dismissed from services by the opposite party. The complainant submitted that on 20-2-2005 at 6.00 a.m. while the tractor was stationed near State Bank of Hyderabad, the personnel of opposite party took away the tractor of the complainant from the possession of his driver without assigning any reasons. The complainant submitted that he approached the opposite party on 20-2-2005 to make payment of the due instalments and the employees of opposite party refused to receive the same by which time he was unaware of the fact that his tractor was seized. Thereafter also on21-2-2005, the complainant approached opposite party and offered to pay cash of Rs.65,000/- but the Manager refused to receive the said amount. On 13-7-2005, the complainant got issued a legal notice to opposite party requesting not to put the vehicle for auction and further requested to accept the amount and release the tractor. He further submitted that as per the terms of the agreement, the opposite party has to issue a notice U/s.18(1)(ii) of Hire Purchase Act, 1972 on the ground of default but no notice has been given before the seizure of the tractor and hence the seizure made by the opposite party is illegal and liable to be set aside. The complainant further submitted that the tractor worth Rs.3,50,000/- was seized against balance payment of Rs.1,66,424/- without considering the request of the complainant. The complainant submitted that if the opposite party has sold out the tractor to some third persons without affording opportunity to the complainant that he is entitled for the excess sale proceedings of the tractor than the due amount of Rs.1,66,424/-. It is his case that without following the due process laid down under the statute, the tractor was sold contrary to the statute and natural principle of justice. The complainant submitted that he would have earned Rs.1000/- per day if the tractor was in his possession and the opposite party failed to render proper services which tantamount to deficiency in service. Hence the complaint praying compensation of Rs.10,000/- apart from receiving the tractor by paying Rs.1,19,000/- or in the alternative return an amount of Rs.2,00,000/- which is difference amount of the sale proceeds of the tractor.

(3.) Opposite party filed counter admitting that it extended financial assistance to the complainant for the tractor of Mahindra 475D1 vide loan agreement No.MHLN 14094 dated 29-9-2003. The loan amount is Rs.1,71,000/- and the financial charge on the loan amount is Rs.53,865/- for 36 months. As per the terms and conditions of the agreement, the borrower shall pay all the instalments on or before the due date and shall honour all the cheqes and in the event of default in payment of instalment amounts, the borrower shall pay late charges apart from cheque bounce charges. The complainant committed default of cheques from the very next month onwards i.e. cheque No.764479, dated 01-1-2004 for Rs.6,246/-, cheque No.606222, dated 1-4-2004 for Rs.6,246/-, cheque No.606223 dated 01-5-2004 for Rs.6,246/-, cheque No.606225 dated 01-7-2004 for Rs.6,246/-, cheque No.606229 dated 01-11-2004 for Rs.6,246/-, cheque No.606231 dated 1-1-2005 for Rs.6,246, cheque No.606232 dated 1-3-2005 for Rs.6,246 and cheque No.6062333 dated 1-3-2005 for Rs.6,246/-. He has paid 10 instalments out of which eight cheques were returned as dishonoured and subsequently he has not paid those amounts and as there was no other go, they were compelled to repossess the tractor and issued a letter calling upon the complainant to pay the total due amount of Rs.2,73,731/- within 7 days and the complainant did not come forward to pay the said amount. It was further submitted that though the complainant received the notice, he neither paid the amount nor sent any reply and therefore they have a right as per clauses 12, 19 and 23 of the Agreement to repossess the tractor and sell the same. The complainant without disclosing the default in payment of the instalments filed the complaint on vague grounds and as there was no communication from the complainant, the opposite party sold away the tractor on 6-5-2005 nearly after two months from the date of repossession. It was further submitted that as per the terms and conditions of the agreement, i.e. clause 24, the matter be referred to arbitration and as per clause 27 only Chennai courts shall have exclusive jurisdiction to any legal proceedings in respect of any claim or dispute arising out or in any way relating to the agreement. It further submitted that the question whether the complainant paid the amounts due to the opposite party under the agreement cannot be decided by the Forum and that no services are availed within the purview of Consumer Protection Act, 1986 and that the complainant is not a consumer as defined under Section 2(1)(d)(ii) and prayed for dismissal of the complaint.