MAGAN VERMA vs MODERN SYNTEX (INDIA) LTD.

THIS appeal has been filed by Mrs. Magan Verma against the order dated 3.4.2001 in Complaint Case No. 1 of 2000 passed by the District Consumer Disputes Redressal Forum-I, U.T., Chandigarh [for short hereinafter to be referred as the District Forum-I].

THE facts stated briefly are as under : THE appellant/complainant, Mrs. Magan Verma, r/o H. No. 3938, Sector 47-D, Chandigarh was allotted 10 Secured Redeemable Non Convertible Debentures vide Allotment No. 001454 dated 30.11.1996 bearing Folio No. 0001182 of respondent No. 1, M/s. Modern Syntex (India) Ltd. with its Regd. Office A-4, Vijay Path, Tilak Nagar, Jaipur - 302004 and Branch Office, 143-B, Mittal Court, Nariman Point, Mumbai. THE local branch of the Company M/s. R.R. Stock and Share Brokers Ltd., SCO 22-23, 2nd Floor, Sector 9-D, Chandigarh termed as arranger has been impleaded as respondent No. 2/opposite party No. 2. As per the terms and conditions of the allotment an interest @ 19% was payable half yearly and the maturity period of these Non Convertible and Secured Redeemable Debentures was 18 months from the date of allotment. As per the averments made by the appellant/complainant, the above mentioned NCDS duly discharged after the date of redemption i.e. 31.5.1998 were sent to the respondent/opposite party Company on 6.5.1998 by registered post. However, the appellant/complainant was informed by the respondent No. 1/opposite party No. 1 vide letter dated 25.11.1998 that the schedule of redemption of above mentioned debentures stands revised and accordingly the deposited amount was proposed to be paid in three instalments spread over the period of two years, and 50% of the interest amount from the cut-off date of 31.8.1998 was to be paid along with instalments of deposit and 50% was shelved which was to be paid by the Company in three equated instalments on 31st May, 2000; 31st August, 2000 and 30th November, 2000. Further no interest was to be paid by the respondent/opposite party Company on the shelved amount of interest. The appellant/respondent was paid Rs. 3,000/- in December, 1998 and Rs. 1,500/- in December, 1999. The balance of Rs. 5,500/- was left with the respondent No. 1/opposite party No. 1. 50% of the interest on the amount of Rs. 950/- for the period from 1.12.1997 to 30.11.1998 was paid in March, 1999 to the appellant/complainant. Further on 26.10.1999, the Company communicated to appellant/complainant regarding another rescheduling of the balance in five instalments to be spread over four and a half years. The interest on this amount from cut-off date i.e. 30.11.1998 was reduced to 14% and same was shelved 50% of interest upto 30.11.1998 already shelved was proposed to be paid in three equal instalments after four and a half years on 31st May, 2003, 31st August, 2003 and 30th November, 2003; No further interest was to be paid on the interest amount so shelved. The main grievance of the appellant/complainant, inter alia, is that re-scheduling is not acceptable as it runs contrary to the terms and conditions of the allotment. The appellant/complainant has further averred that Debenture Certificate No. 1454 dated 31.12.1998 incorporating the revised terms of payment of principal and interest received in February, 1999, is unacceptable on the plea of same being against the initial agreed terms and conditions. No revised debentures incorporating further rescheduling etc. have been received. The appellant/complainant has alleged that the respondents/opposite parties have constantly violated the provisions of the allotment as incorporated in the Information Memorandum, copy of which has been brought on record. The appellant/complainant has further averred that the respondents/opposite parties are violating the terms and conditions repeatedly and an amount of Rs. 5,500/- in addition to a staggering amount of Rs. 4,500/- in two instalments and interest due from 1.12.1998 till date besides the shelved amount of Rs. 950/- upto 30.11.1998 constitute clear deficiency in service for which she has prayed the Commission to direct the opposite parties to compensate for the loss suffered by her. The appellant/complainant has also prayed that the respondents/opposite parties may be directed to pay balance amount of Rs. 5,500/- together with the amount of shelved interest of Rs. 950/- and be directed to pay interest @ 19% from 1.12.1998 till date. The appellant/complainant has also prayed to be compensated with Rs. 2,000/- for the above mentioned deficient services due to rescheduling which is detrimental to his financial interest and Rs. 1,000/- for litigation expenses which he is compelled to incur due to above mentioned deficiency in service by the respondent/opposite party.

The respondent No. 1/opposite party No. 1 through a registered letter dated 31st May, 2000 addressed to the District Forum-I informed that though a notice of complaint has been received by them but the copy of the complaint was not enclosed along with the notice hence they prayed for some time to file their reply before the District Forum-I. However, no reply was received by the Forum in spite of being given sufficient time and hence the opposite party No. 1 was proceeded against ex-parte. There is another letter dated 5th June, 2000 from respondent No. 2/opposite party No. 2, M/s. Harjeet Arora & Co. to the effect of authorising Mr. N. Mohan to appear before the Forum in this complaint but no reply filed or any appearance put in by opposite party No. 2 on the record.

IN evidence, the appellant/complainant filed the copy of allotment letter of the above mentioned debentures. Also brought on record are the various communications addressed through registered A.D. to respondent No. 1/opposite party No. 1 the appellant/complainant, the legal notice sent to the respondent No. 1/opposite party No. 1 and her duly signed affidavit deposing all the relevant facts. The District Forum-I after hearing the complainant and perusing the record of the case directed the opposite party No. 1 to pay the balance redemption amount of Rs. 5,500/- and interest amount of Rs. 950/- which was shelved along with interest @ 12% p.a. w.e.f. 31.5.1998 till the date of payment. The costs of the complaint quantified at Rs. 800/- were also granted to the complainant and opposite party No. 1 was directed to comply with the order within three months from the receipt of the copy of the order.

AGGRIEVED against the order of the District Forum-I, Mrs. Magan Verma, appellant, has invoked the appellate jurisdiction of this Commission. The main grounds of appeal on which the contention of the appellant is based are that the District Forum-I after holding the opposite party No. 1 now respondent No. 1 guilty of deficiency in services and ordering the opposite party No. 1 to pay the amount of Rs. 5,500/-, the shelved interest of Rs. 950/- @ 12% as against the agreed rate of 19% p.a from 31.5.1998 instead of 1.12.1998 along with costs of Rs. 800/-. The main grievance of the appellant is that the rate of interest agreed upon was 19% p.a. and the interest has been partly paid upto 31.11.1998 during March, 1999. The appellant has prayed that the agreed interest @ 19% p.a. payable from 1.12.1998 may be allowed. We have perused the entire record of the case and heard Mr. R.N. Verma, husband of the appellant, Mrs. Magan Verma in person. After going through the letter No. NSIL/AG/99/FOLIO/1182 dated 12th March, 1999 by respondent No. 2, M/s. Modern Syntex (India) Ltd. wherein it has been clearly mentioned that the rate of interest payable on the above mentioned Non Convertible Debentures is 19% p.a. and the same is clearly in consonance with information memorandum copy of which has been placed on record which also mentions the rate of interest to 19% p.a. After going through the copies of these two documents and hearing the appellant''s representative, this Commission is of the considered view that the order of the District Forum-I is erroneous to the extent of granting 12% interest instead of the agreed rate of 19% to which the appellant/complainant is legally entitled under the terms and conditions of Information Memorandum. The order of the District Forum-I is accordingly modified to the effect that 19% interest will be payable on the balance amount of Rs. 5,500/- and on shelved interest amount of Rs. 950/- w.e.f. 1.12.1998. The costs of litigation quantified at Rs. 800/- (Rupees eight hundred) awarded by the District Forum-I are upheld. The order be complied with, within three months of its receipt. Copies of the order be sent to the parties free of charges. Appeal partly allowed.