MAGMA FINCORP LTD vs Subhankar Singh

THERE has been delay of 60 days in preferring the revision petition beyond the prescribed period of limitation, for which an application for condonation of delay has also been filed ''Having gone through the reasonings assigned therein, we hereby condone the delay.

THE brief facts germane to the above said revision petition are these. The respondent/complainant, Subhankar Singh entered into a Hire Purchase Agreement with M/s. Magma Fincorp Limited, the petitioner. A loan amount of Rs. 6,39,000 was sanctioned by the petitioner and disbursed to the respondent for purchasing of commercial vehicle, i.e., Truck, bearing registration No. WB/1735. The said loan amount was to be repaid by the respondent in 47 EMIs for a sum of Rs. 19,200 each, commencing from 10.3.2008 till 10.1.2012. It is an undisputed fact that the respondent waddled out of the above said commitments and did not pay off the instalments regularly. On 16.6.2009 and 11.7.2009, the petitioner Company sent legal notices to the respondent asking him to adhere to the payment schedule and pay the outstanding amount towards EMIs. In between, on 27.7.2009, the respondent paid instalment of one month only, along with penalty and interest. Since the previous notices were not complied with fully, therefore, the petitioner company took the possession of the commercial vehicle, in accordance with the terms of the Agreement, on 18.8.2009.

A Pre-Sale Notice was sent to the respondent or in the alternative, he was asked to pay a sum of Rs. 5,54,026, within 7 (seven) days from the date of notice, i.e. 20.8.2009. The respondent did not pay heed to the said notice and the above said vehicle was sold to third-party on 16.9.2009, for a sum of Rs. 5,51,000. At that time, a sum of Rs. 6,41,954 was due and payable by the respondent. After the adjustment of sale proceeds, an amount of Rs. 90,954 was still due and payable by the respondent to the petitioner company.

IN the meantime, the respondent/complainant filed a complaint against the petitioner company before the District Forum, wherein the following averments were made that the vehicle was forcibly taken away from the driver of the complainant Sh. Phani Singha while it was going from Islampur side towards Ghoshpukur, five culprits, musclemen, engaged by the petitioner stopped the said truck near the Islampur Old Bus Stand on National Highway and informed him that they were hired by M/s. Magma Financial Corporation Ltd. He was asked to handover the vehicle and on his refusal, they assaulted the driver mercilessly and injured him severely. They snatched away the key of the truck and pulled down the driver from the truck. They also assaulted and injured the companion of the driver Ikram Nag The District Forum, vide its order dated 31.5.2010, partly allowed the complaint and granted a sum of Rs. 7,52,025 to the complainant with interest @ 6% p.a. from the date of filing of the complaint till its realization, towards the price of the vehicle, within one month from the date of the order, failing which, the law was to take its own course.

AGGRIEVED by that order, M/s. Magma Financial Corporation preferred an appeal before the State Commission, which passed the following order : Having regard to the contentions put forward by the learned Advocate for the parties and considering the earlier decision taken by this State Commission in SC Case No. FA/121/2010 on 5.10.2010, we are of the view that the complainant would not be entitled to refund of the price of the vehicle, particularly when the complainant had not paid the entire amount of loan to the O.P. Appellant by way of stipulated instalments. In the aforesaid decision, the State Commission directed refund of the particular amount by the Financing Company to the complainant that was received by it towards payment of instalments and delayed payment charges till the date of last payment made by the complainant. In this case, it appears from the complaint itself that the complainant had paid altogether a sum of Rs. 2,68,800 by way of 14 instalments, after obtaining financial loan of Rs. 6,39,000 from the O.P. Appellant. We are, therefore, of the view that in the facts and circumstances as above, the complainant would be entitled to the aforesaid amount of Rs. 2,68,800 along with interest @ 10% per annum from the date of filing of the complaint till the date of realization. The complainant shall further be entitled to a sum of Rs. 10,000 by way of compensation for the harassment and mental agony suffered by the Appellant because of forceful seizure of the vehicle in question. Both the aforesaid amounts shall carry the aforesaid rate of interest from the date of filing of the complaint till the date of realization. Complainant will also receive a sum of Rs. 5,000 by way of litigation cost. The impugned judgment is modified as indicated above. The appeal is thus disposed of.

WE have heard the Counsel for the parties. The learned Counsel for the respondent vehemently argued that the petitioner had no right to re-possess the vehicle, which was illegally re-possessed, the petitioner indulged in criminality by assaulting his driver and his companion. It was submitted that the complainant is an unemployed person, after receipt of notices, he made payment on 27.7.2009, in respect of the first instalment. He, however, admitted that the respondent is a defaulter, but it does not mean that he should not be given time to pay the instalments. It is apparent that the learned Counsel for the respondent has raised copious objections merely for the sake of cavil. Notice dated 16.6.2009 has been placed on record. It is clear that he did not pay the instalments for the months of April, May and June. He also did not pay delay payment charges, total being Rs. 59,246. Notice dated 11.7.2009, reveals that the said amount stood enhanced to Rs. 80,050. Payment of one instalment in the month of July is no compliance of the terms and conditions of the agreement, placed before this Commission. There was no need to give the notice. The petitioner Company could have no moto taken the possession of the vehicle. The relevant extracts of the agreement reads, as under: 4. Events of default rights and remedies Thereon: (i) In case the Hirer/s shall during the continuance of this Agreement do or suffer one or more of the following: (a) Fail to pay in time any of the hire instalments or part thereof herein reserved or any other sum of money payable under this agreement, (b) to (p) xxxxxxx (ii). (a) xxxxx (b) MAGMA SHRACHI shall be entitled to take possession of the said asset(s)/vehicle(s) and sell and/or cause to be sold or otherwise dispose of all or any part of the said asset(s)/vehicle(s) or any fittings thereof in such manner and/or made as prescribed more fully and particularly in appendix hereto and apply the net sale proceeds of such sale in or towards liquidation of the amount outstanding due to MAGMA SHRACHI from the said hirer(s) as on the date of such sale It, therefore, means that there was no need to give notice, however, the petitioner gave two notices in this respect.

IT is also noteworthy that the driver of the complainant did not lodge the FIR immediately. It was lodged 45 days after the alleged occurrence. Inordinate delay in lodging the FIR is itself fatal. Such like stories can be created, at any time. Police report was lodged but the police did not take any action. No Medical Certificate was produced to embolden the case of the complainant.

THE National Commission, in case reported in Surendra Kumar Agarwal v. Telco Finance Ltd. and Anr., II (2010) CPJ 163 (NC), Hon ''ble Mr. Justice Ashok Bhan, President, was pleased to hold as under: Aggrieved by the order passed by the District Forum petitioner filed the Appeal before the State Commission. The State Commission relying upon the judgment of Hon ''ble Supreme Court of India in Managing Director, Orix Auto Finance (India) Ltd. v. Sh. Jagmandar Singh and Anr., reported in II (2007) CPJ 45 (SC)=II (2006) SLT 166=127 (2006) DLT 278 (SC), dismissed the Appeal. It was held that no statement of account showing details of repayment of loan instalments is filed by the petitioner/complainant. That the petitioner had defaulted several times. That the said judgment of the Apex Court has clearly endorsed the rights of the finance in respect of repossessing the vehicles in case of default by the hirer. 7. xxxxx 8. xxxxx 9. It is not disputed before us that the petitioner had raised a loan of Rs. 6,15,000 to purchase the truck. No statement of account showing repayment of loan instalments has been filed by the petitioner. It was admitted before the State Commission that the petitioner had defaulted several times in making the payment on the dates when it was due. Further it is not disputed that as per Hire Purchase Agreement the financier was authorized to repossess the vehicle in case of default in repayment of loan instalments. Supreme Court of India in Managing Director Orix Auto Finance (India) Limited case (supra), has held that the financier can repossess the vehicle if the agreement permits the financier to take possession of the financed vehicle. There is nothing to show that the vehicle was repossessed forcibly. Mere fact that possession was taken by the respondents cannot be the ground to contend that the hirer is prejudiced. We agree with the view taken by the State Commission.

The National Commission also took the same view in case reference, Parameswari v. The General Manager, V.S.T. Service Station and 2 Ors., II (2010) CPJ 45 (NC)=decided on 11.2.2010.

UNDER the circumstances, it is clear that the respondent is having the benefit of both the worlds. He has used the vehicle for one-and-a-half years. He has been the defaulter and wants the award as well. He has failed to prove that the vehicle was forcibly repossessed. The statement advanced by him does not just stack up.

CONSEQUENTLY , we set aside the orders passed by the Fora below and dismiss the complaint. No order as to cost. Revision Petition dismissed.