D.D.CHANDAK vs VINOD CHOUDHARY

SHRI D.D. Chandak and his wife Ms. Rama Chandak (first and second applicants hereafter) have filed this applications under Section 12B of the MRTP Act, 1969, alleging that SHRI Vinod Choudhary, Sole Proprietor, Concord Investment (respondent hereafter) has indulged in certain unfair and restrictive trade practices visiting them with loss and damage.

THE respondent claiming to be an investment consultant engaged in the sale/ purchase of stocks and shares has been representing that he has the competence in share marketing. THE applicants induced by such a representation agreed to engage the services of the respondent to sell 100 shares owned by them in Industrial Credit and Investment Corporation of India Limited (ICICI for short). THE respondent confirmed on 3rd June, 1993 that the sale price of each share would be Rs. 1,210/-. However on 5th June, 1993 he informed the second applicant that he had sold the shares at the rate of Rs. 1,069.91 per share and promised to remit an amount of Rs. 1,06,991/- being the sale proceeds in respect of the said 100 shares in ICICI. After repeated reminders, on 15th September, 1993 the respondent paid an amount of Rs. 25,000/- as part payment of the sale proceeds stating that there was some problem with the broker to whom he had sold the shares but promising to pay the balance amount "soon". The applicants came to know that the said 100 shares have been sold and that the sale consideration has been exchanged between the transferee and the person who sold the shares. When this was brought to the notice of the respondent, he issued two crossed cheques for Rs. 10,000/- each in January, 1994 but they were dishonoured by the Bank. The respondent never bothered to pay the remaining amount due to the applicants.

The applicants have alleged that the respondent by making false and incorrect representations regarding the quality and efficiency of his service, has indulged in restrictive and unfair trade practices causing wrongful loss to them. They have claimed compensation towards the amount due to them of Rs.81,991/- plus interest on the same. They have also claimed compensation of Rs. 20,000/- towards the mental agony and pain suffered by them as a consequence of the restrictive and unfair trade practices indulged in by the respondent.

THE respondent furnished his reply to the compensation application. His averments are summarised herein below : 1. THE respondent never represented to the applicants as alleged. He never approached the applicants. It is the applicants who approached him. THE respondent never worked as a broker but worked as buyer/seller of shares. 2. THE respondent never confirmed on 3rd June, 1993 that the price of the each share in question was Rs. 1,210/-. 3. THE price as alleged to have been charged on sale was the price at which the applicants agreed to sell to the respondent. THE respondent did not promise to remit an amount of Rs. 1,06,991/- to the applicants towards the sale of 100 shares in question. He merely informed them that he would pay later and the applicants agreed to the same. 4. THE applicants "happily" received the part payment of Rs. 25,000/- from the respondent. On 28th October, 1993 he made a further payment of Rs. 15,000/- to the applicants in cash. 5. THE cheques were dishonoured as the applicants did not return the cash amount of Rs. 15,000/-.

The applicants are not entitled to any compensation. After the pleadings were completed, the following issues were framed : 1. Whether the respondent has indulged in unfair/restrictive trade practices ? 2. Whether the unfair trade practices/ restrictive trade practices are prejudicial/not prejudicial to consumer, consumers generally or to public interest ? 3. Whether the applicant has suffered any loss due to the above ? 4. Relief as claimed. The applicants filed their evidence in the form of an affidavit of the first applicant alongwith the documents in support. The respondent failed to appear on the day scheduled for cross examination of the first applicant. In fact, the respondent failed to put in appearance after 14th July, 1997. We gave a hearing to Mr. Vijay Zaveri, Advocate for the applicants. 6. The dispute is very simple. The applicants aver that the respondent had promised to remit the sale consideration of Rs. 1,06,991/- in respect of the 100 shares in ICICI held by them. The respondent however, denies that any such assurance was given by him. Exhibit AW 1/1 is the letter written by the respondent to the second applicant on 5th June, 1993 stating that he had sold the shares in question at the rate of Rs. 1,069.91 net per share and that he would be remitting the total sale consideration of Rs. 1,06,991/-. There is no controversion of this document by the respondent. The said exhibit is on the letter head of Concord Investment of which the respondent is the sole proprietor. It is admitted by the respondent that he had paid Rs. 25,000/- as part payment. It is totally incorrect and unacceptable to buy the argument of the respondent that he did not make any promise of payment of the balance amount. Such a promise is explicit in Exhibit AW 1/1.

IN view of this, the first issue is answered in the affirmative that the respondent has indulged in unfair trade practices within the meaning of Section 36A(1)(ii) and restrictive trade practices within the meaning of Section 2(o)(ii) of the Act. By making false representations, the respondent has indulged in the unfair trade practices attracting Section 36A(1)(ii) of the Act. By manipulating the conditions of delivery of service, the respondent has indulged in the restrictive trade practices attracting Section 2(o)(ii) of the Act. The second issue needs no discussion as the said unfair trade practices and restrictive trade practices have been obviously prejudicial to the interest of the applicants. Undoubtedly, the applicants have suffered loss and damage due to the aforesaid unfair and restrictive trade practices. The third issue is answered in the affirmative. Regarding relief, the applicants are entitled to compensation by way of payment of the balance amount due to them on the sale of shares of Rs. 81,991/-. They are also entitled to interest @ 18% per annum on the aforesaid amount of Rs. 81,991/- with effect from 5th June, 1993 upto the date of payment. I allow compensation of Rs. 2,000/- towards mental agony suffered by the applicants. The respondent shall pay the aforesaid amounts within six weeks from the date of this order and file an affidavit in compliance within the same time frame. Application disposed of. _____________