Mukesh Kumar vs KATEYANI CHIT FUND PVT. LTD

THIS appeal filed under Section 15 of the Consumer Protection Act, 1986 (hereinafter referred to as ''the Act''), is directed against the order of the District Forum-III, dated 3.6.1998, passed in Complaint Case No. 1135/1997 entitled Shri Mukesh Kumar v. Kateyani Chit Fund (Pvt.) Ltd.

THE case of the appellant/complainant before the District Forum was that he was a subscriber of Chit No. K-4/8 for Rs. 1,20,000/- (Rupees one lakh twenty thousand only), floated by the respondent Company and had been paying the instalments of Rs. 3,000/- each, every month regularly from 15.11.1990 upto 9.3.1992, for which the respondent had issued separate receipts. THEreafter, on 29.9.1992 the appellant had bid for Rs. 50,000/- which was duly accepted by the respondent Company. THE appellant had to make the payment of Rs. 70,000/- to the appellant within 30 days of the acceptance of the bid, in terms of the Rules of the Chit Fund. It was stated by the appellant in the complaint filed by him before District Forum that despite having furnished the necessary securities and documents, the respondent failed to make the payment in respect of the Chit to the appellant. THEreupon the appellant approached the Office of the Director, Chit Funds, Delhi Administration, Delhi and realized that the respondent was not even registered with the said authority and had been duping and cheating the subscribers by false representations. As such the appellant after issuing a legal notice to the respondent Company approached the District Forum with his complaint for the redressal of his grievances. The respondent, controverted the above averments of the appellant in its reply written version filed before the District Forum and also raised a preliminary objection that the complaint of the appellant being barred by limitation was liable to be dismissed, on that ground alone.

The District Forum on the basis of material on record held that the complaint of the appellant having been presented beyond the period of limitation as prescribed under Section 24-A of the Act was time barred and accordingly dismissed the complaint of the appellant.

AGGRIEVED by the abovesaid order the appellant has preferred the present appeal before this Commission. A notice of this appeal was sent under registered cover to the respondent Company and since none appeared on its behalf, despite several opportunities being afforded to it for appearance, as well as, filing its reply, the respondent Company was directed to be proceeded ex-parte vide order dated 9.8.1999. We have carefully perused the documents/material on record and have heard the arguments advanced on behalf of the appellant. The short point involved in the present appeal is, as to whether the complaint filed by the appellant, before the District Forum was barred by limitation or not. Vide impugned order, it has been held by the learned District Forum that the cause of action arose on 30.3.1992 (as the respondent was to make the payment of the bid amount to the appellant within 30 days of the acceptance of the bid i.e. 29.2.1992, whereas the appellant filed his complaint on 19.4.1994, i.e. after 2 years and 20 days of the accrual of the cause of action as against 2 years period prescribed under Section 24-A of the Act and as such the same was time barred. In our opinion, the above finding of the District Forum, in the circumstances of the case, is erroneous in view of the fact that Section 24-A was incorporated in the Act by way of amendment w.e.f. 18.6.1993 and as such prior to the said amendment there was no specific period of limitation for preferring a complaint under the Act. In our above views we stand fortified by a decision of the Hon''ble Supreme Court in case France B. Mortins & Anr. v. M/s. Mafalda Maria Teresa Rodrigues, reported as II (1999) CPJ 41 (SC), where in their Lordships have held : "Admittedly, no period of limitation had been prescribed in the Act before insertion of Section 24-A vide amendment made w.e.f. 18th June, 1993. Section 24-A of the Act, for the first time, prescribed that the District Forum, the State Commission or the National Commission shall not admit a complaint unless the same was filed within two years from the date on which the cause of action arose. Sub-section (2) of Section 24-A authorises the Commission to entertain complaint even after the period of limitation on the existence of sufficient cause for not filing the complaint within the statutory period by recording its ''reasons for condoning the delay. It is conceded before us that the provisions of the Limitation Act, 1963 have not been specifically made applicable to the proceedings under the Act. The Limitation Act does not extinguish a right but only bars the remedy after a prescribed period of limitation. Section 2(j) of the Limitation Act defines the "period of limitation" to mean the period of limitation prescribed for any suit, appeal or application by the Schedule attached to the Limitation Act and "prescribed period" means the period of limitation computed in accordance with the provisions of the Act. It is not the case of the appellants that complaint filed by the respondent was either a suit or an appeal or an application within the meaning of the provisions of the Limitation Act. When the Legislature, in its wisdom, thought it appropriate not to prescribe the period of limitation for proceedings under the Act, the Courts cannot apply the provisions by implication. It has to be kept in mind that the Act was made for better protection of interests of consumers and to make provision for the establishment of Consumer Councils and other authorities for the settlement of consumer disputes and matters connected therewith."

(Emphasis supplied)

IN a subsequent decision in case Corporation Bank & Anr. v. Navin J. Shah, reported as I (2000) CPJ 13 (SC), the Hon''ble Supreme Court expressed the view that though no period of limitation was prescribed prior to the amendment w.e.f. 18.6.1993, a claim could be filed within a reasonable period, and three years period prescribed under the Limitation Act was deemed to be the appropriate period within which a person could file a complaint before a Forum established under the Act. The above decision of the Apex Court clinches the issue finally and the appellant, in the given facts could have filed his complaint within three years from the date of accrual of the cause of action, and since the same in the present case arose on 30.3.1992, and the complaint was duly filed by the appellant on 19.4.1994, the same being presented within the period of three years, was not barred by limitation. In view of the above discussion we have no hesitation in holding that the complaint filed by the appellant before the District Forum was not barred by time, the present appeal of the appellant is, therefore, allowed and the impugned order of the District Forum is set aside. The case is, remanded back to the concerned District Forum for deciding the same on merits, in accordance with law, and as expeditiously as possible. There is however, no order as to costs. The present appeal is disposed of in above terms. Appeal disposed of.