ENGINEERING FABRICATORS AND ENTERPRISES vs Hongkong and Shanghai Banking Corporation

THIS is a complaint filed by M/s. Engineering Fabricators and Enterprises, a partnership firm having its office at 571, Block-N, New Alipore, Kolkata - 53 against (1) Hongkong and Shanghai Banking Corpn. Ltd., 31, B.B.D. Bag, GPO Box No. 158, Kolkata-700 001, (II) Devika Marketing, 9/2, Fern Place, Kolkata-19, and (III) Symox Marketing, 8, Mahendra Banerjee Road, Kolkata-700 007. The facts of the case, in brief, are that OP 3 approached the complainant as agent of OP 1 for availing car loan to be financed by OP 1. The complainant thereafter handed over an application to the OP 3 who informed the complainant that the rate of interest would be 6% per annum. Based on the above information the complainant had applied for a car loan of Rs. 2,27,000.00 with OP 1 through its agent OP 3 as well as OP 2. OP 3 thereafter collected a cheque of Rs. 75,746.00 favouring M/s. Machino Techno Sales Ltd. drawn on ABN Amro Bank, Brabourne Road Branch for booking the vehicle No. WB-02M-0602. Stately, OP 3 had assured the complainant that there will be no escalation of price. The complaint contains some allegations of harassment against OPs 1, 2 and 3 at the initial stage of filing the loan application and processing thereof, but satisfactory documentary evidence have not been adduced by the complainant. However, OP 3 accompanied by OP 2 came to the office of the complainant and collected a cheque for Rs. 3,46,300 favouring Machino Techno Sales on ABN Amro, Brabourne Road Branch with the assurance that the car would be delivered on 13.1.2001. However, the car was actually delivered on 17.1.2001. While taking delivery of the car the complainant reportedly found that the car shown to be delivered to the complainant (a 5-seater Maruti Omni Van, Colour Blue) which did not tally with the car delivered to the complainant which was actually a 8-seater Omni (E) and colour S/blue. The complainant while enquiring about the cause of delay in delivering the car with the dealer, i.e. Machino Techno Sales Ltd. came to know that they received necessary papers for booking the car from OP 1 only on 16.1.2001, and also that the car actually booked by OP 1 was the present Maruti Van (8-seater Omni (E), S/Blue). The complainant also alleged that he suffered loss due to escalation in price of the car due to delay in delivery. The complainant also alleged that the signature of one of their partners was forged while booking the car by OP 2. The complainant has further submitted that he had made as many as 4 payments prior to filing the complaint.

THE main complaint regarding the deficiency in service against OP 1 is that OP 1 had illegally seized the Car No. WB-02M-0602 by driving out the driver with criminal force on Durgapur Bridge and taken up to Fancy Market leaving behind goods and materials inside the car when the car was on its way to deliver goods to M/s. SarbamangalaTrading Co. at 32, Ezra Street, Kolkata-700 001. It has been further stated that three officers of the OP''s bank had visited and assured him to take corrective steps against the wrongs done to him but no action was taken ultimately in this regard. THE complainant had served a lawyer''s notice on 22.10.2001 and 11.12.2001 on OP 1 to release the seized car along with the goods and materials lying inside the said car. THE value of the goods and materials seized had been estimated at Rs. 2,00,176.00 as noted above but no action was taken thereon by OP 1. THE complainant submits that due to harassment caused to him by OPs 1, 2 and 3 under instruction from OP-1 they had suffered loss of business and goodwill amounting to Rs. 5,04,858.00 and the complainant had, therefore, come up with the prayer that OP 1 be directed (I) to release the car No. WB-02M-0602 along with the material worth Rs. 2,00,176.00 as detailed in Annexure-P, (II) to direct OP 1 to pay compensation @ Rs. 600.00 per day for hiring charges on account of car aggregating Rs. 63,600.00, (III) to direct to pay compensation of Rs. 41,182.00 due to loss suffered by them due to increase in the rate of interest on loan, and also price of the car owing to delay and misrepresentation of facts by the OPs, and (IV) to direct OP 1 to pay compensation of Rs. 2 lakhs on account of loss of goodwill and reputation. We have gone through the complaint and the written objection of OP 1 and also heard the learned Advocates for the complainant and OPs. The learned Advocate for the complainant submitted before the Commission that while the order was placed for a 5-seater Maruti Van Omni, Colour Blue with OP 1, the car actually delivered differed from what was originally ordered. He also submitted that OP 2, who is an agent of OP 1 which is also not denied by OP 1, had misrepresented various facts as a result of which the complainant had suffered substantial financial loss in the shape of price hike and increase in the rate of interest. This actually happened due to delay in delivering the van by OPs 1 and 2. Learned Advocate further submitted that seizure of the car by musclemen of OP 1 on 17.10.2001 was unwarranted and unjustified as there was no substantial default in payment of due instalments. The various officers of OP 1 had been carried on confusing dialogue with the complainant to the ultimate detriment of the complainant. They further contended that the OP 1 is legally required to issue notice prior to seizure of the car but this was not done in the present case. He referred to certain decisions of the Hon"ble High Court at Kolkata where the Hon''ble Court had issued orders in several cases against such seizure. Learned Advocate further said that the equated instalment @ Rs. 6,643.00 had been paid to the OP 1 from January regularly and there was no default on the part of the complainant justifying the seizure of the vehicle. He further contended that the present case was not subject matter for Consumer Forum as some criminal action like forgery is involved.

The learned Advocate of OP 1 submitted that the loan was sanctioned by the Bank on an application filed by the complainant and the complainant had taken delivery of the car on 16.1.2001. Though the complainant had been paying instalment regularly at the initial stage, after payment of some 7 instalments he started defaulting as a result of which the OP bank was compelled to take possession of the vehicle because the respondent did not react even after getting a strong reminder from the OP : bank. In its letter dated 11.7.2001 the car was seized on 17.10.2001, i.e., almost after ''3 months after issuing such reminder and he contended that in view of the above letter of the bank the complainant could not say that he was not served with a prior notice. On the point of forgery of signature of one of the partners of the complainant O.P. No. 1 submitted that even though such an incident might have taken place the complainant had ultimately availed himself of the loan and had taken delivery of the car on the basis of the said faulty document if it is so called and, therefore, they should not raise any objection in this regard at this stage since their interest was not prejudiced in any way. The learned Advocate contended that the vehicle was hypothecated to the bank and therefore the bank had every right to seize it as per terms and conditions of the agreement between the complainant and the OP bank. He relied on the decision Orix Auto Finance (I) Ltd. v. Jagmander Singh & Anr., II (2006) SLT 166=II (2006) BC 108 (SC). dated 10.2.2006 in Civil Appeal No. 1070 of 2006 of the Apex Court wherein Hon''ble Court had observed that "essentially these are matters for contract and unless the party succeeded in showing that the contract is unconscionable or opposed to public policy the scope of interference in Writ Petitions of such contractual matter is practically non-existent. If agreement permits the financier to take possession of the financed vehicle there is no legal impediment on such possession being taken. Of course, the hirer can avail such statutory remedy as may be available".

THE OP No. 1 contended that the 1st default took place on 15.5.2001 in the matter of delay in delivery and sanctioning the loan. THE learned Advocate contended that the relation between the customer and the bank is established only after the loan is sanctioned and not before that. Bank is at liberty to take its own time to sanction a loan which cannot be challenged before a Court. He further cited the letter dated 23.5.2001 of the complainant addressed to the respondent No. 1 in which what is stated is a clear admission on the part of the complainant regarding their default in payment of instalment within the scheduled date. He further contended that though the complainant had raised the issue that no prior notice was served he has failed to adduce any documentary evidence in support of his statement but on the contrary O.P. No. 1 had drawn the complainant''s pointed attention towards the defaulting position their letter dt..........He also added that though the learned Advocate for the complainant had raised the point of unfair trade practice not a whisper is there in the complaint itself. On the point of fraud he added that Hon''ble Apex Court had long back given its decision that fraud is not within the jurisdiction of Consumer Court, hence the matter should not be raised at this Forum. He, therefore, prays that the complaint is vexatious and frivolous in nature and, therefore, it should be dismissed. The learned Advocate for respondent No. 3, stated that they were not involved in any way in the present case as they are not authorized agent of the bank, nor there is any agreement between the complainant and respondent No. 3 in the matter of rendering any service.

THE complainant had filed a Writ Petition before the Hon''ble High Court at Kolkata in the Court of Hon''ble Justice Pranab Kumar Chattopadhyay. It was ordered therein that the Court did not decide validity of the hire-purchase agreement and/or actual amount of out-standing dues payable by the petitioner. In his above Order it was also directed that disposal of the Writ Petition would not prevent the authorities of the HSBC Ltd. from initiating proper legal proceedings against the petitioner for recovering the outstanding dues and/or taking possession of the vehicle in question. An appeal was filed also by the complainant -against the said order MAT 1641 of 2003 in the Division Bench constituted by Hon''ble Justice, Mr. Ashoke Kumar Mathur and Hon''ble Justice, Mr. Ashin Kumar Banerjee. It was ordered that the respondent/writ petitioner shall give an undertaking before the Court that in case he fails to commit breach of any of the aforesaid conditions he will surrender the vehicle to the bank. THE respondent/writ petitioner was also directed not to alienate the car in any manner. After going through the complaint and written objection filed by the respondents and submissions made by the learned Advocates we have reasons to believe that there were some minor lapses either on the part of the bank, OP 1 and also on the part of OP 3 in course of chanelising of the loan application, processing thereof and ultimately sanctioning the loan. We are not very satisfied about the allegation of the complainant that there was substantial delay on the part of OP 1 as a result of which he had to incur loss on account of price hike and rise in the rate of interest. However, no convincing document has been filed by the complainant to support his argument that unwarranted delay took place at any particular level. The complaint regarding delivery of a car of different model is also admitted by OP1 but the complainant had not approached this Commission or any other Forum when such deficiency took place. The complainant had approached this Forum only when no material relief was available at other Forums, viz., the Civil Court particularly after the vehicle was seized. The complainant had filed Writ Petition with the Hon''ble High Court against seizure but perhaps he was not satisfied or did not get the desired relief from the Orders passed by the Hon''ble High Court. The complaint was thus filed only after the incident of seizure of OP 1 and exhausting the Civil Procedure. The allegation of the complainant that such seizure by the musclemen of the OP 1 is a criminal offence is not within the purview of this Forum. We are concerned with the issue whether there had been any incidence of deficiency in terms of Section 2(1)(g) of the C.P. Act, 1986. We find that in view of the terms of agreement contained in the Hire-Purchase Agreement the learned High Court at Kolkata had given full liberty to the bank. OP 1 to take necessary step for realization of its dues. We also find from the decision of the Apex Court in Civil Appeal 1070 of 2006 dated 10.2.2006 that the Court had observed that in case there is a contract between the parties, the parties are expected to act according to the terms of contract unless such contract is unconscionable or opposed to public policy. The order also gives liberty to the financier to take possession of the financed vehicle in case of infringement of the terms and conditions and has categorically stated that there is no legal impediment in taking such action. Under such circumstances, the act of seizure of the vehicle by OP 1 owing to the default in payment of instalment by the complainant appears to be quite in unison with the terms of agreement made between the parties in respect of the hire purchase scheme under which the vehicle was financed. In view of the above position the complaint fails and it is ordered that the complaint be dismissed on contest without any order as to cost. Complaint dismissed.