ADINATH FINANCE And SERVICES vs RAJINDER PARSHAD

BRIEF facts of the case are that Mr. Rajinder Parshad, complainant for short, placed an order with M/s. Adinath Finance and Services, sole proprietorship concern of Mr. Rajinder Prashad Jain for purchase of 50 shares of Dr. Reddy''s Laboratory on 1.2.1993 (wrongly written as 1.2.1994 in the impugned order) @ Rs. 515/- per share. The opposite party confirmed the order in writing and the complainant issued a cheque for Rs. 6,500/- on account of 25% price of the shares to be purchased. The cheque was encashed by the opposite party on 3.2.1993. The case of the complainant was that he had been assured delivery of the shares within one week but the opposite party failed to do so. The complainant accordingly approached the District Forum. The plea of the opposite party was that he was a stock broker carrying on this business only in Delhi where the shares ordered by the complainant were not being listed by the local exchanges. The opposite party accordingly placed an order with M/s. Siraj & Co. who have a branch in Madras and gave them cheque dated 6.2.1993, for Rs. 6,000/- as advance. M/s. Siraj & Co. assured the opposite party to deliver the shares within a week but failed to do so. They also failed to refund the advance amount of Rs. 6,000/- paid by the opposite party to them. On a consideration of the matter, the District, Forum held that the confirmation slip issued by the opposite party proved the fact that the complainant had placed order and paid the advance amount as alleged by him. It was further held that there was no privity of contract between the complainant and Siraj & Co. The complainant was not concerned if Siraj & Co. had ditched the opposite party. The complaint was accordingly allowed and the opposite party directed to refund the amount of advance alongwith interest @ 18% per annum from 1.2.1993 till date of payment and Rs. 1,000/- as compensation/costs.

AGGRIEVED by the order, the opposite party has preferred this appeal. We have heard Mr. P.K. Jain for the appellant and Mrs. J. Ghosh, Advocate for the respondent and have carefully gone through the records. The mere fact that the appellant was not dealing in shares quoted in Madras Exchange and therefore had placed an order on Siraj & Co. which had an office at Madras, does not bring about privity of contract between the complainant and the Siraj & Co. The order placed by the complainant was clear and categorical. He wanted to buy Dr. Roddy''s Laboratory shares @ Rs. 515/- per share. The fact that those shares were not quoted in Delhi Exchange was known to the opposite party and yet he undertook to purchase the shares for the complainant and received the advance payment of 25% of the price. The opposite party may not have accepted the order on the ground that he was not working at Madras Exchange. It was opposite party''s own decision to obtain the shares from Madras and earn commission on the transaction. In the absence of privity of contract between the complainant and Siraj & Co., there was no question of impleading the said company as a party to the complaint. The contention of the appellant is that the price of Dr. Reddy''s shares fell and the complainant cancelled the order. The appellant is unable to place on record any writing cancelling the order. One would expect a writing for cancelling the order as the original order itself had been confirmed in writing by the opposite party. After careful consideration, we find ourselves in agreement with the reasoning and conclusion of the District Forum and dismiss the appeal being without merit. A copy of the order be conveyed to the parties as well as DF-II. Appeal dismissed.