Naeem Bhai vs Mohd. Anwar and Ors.

THE revision petitioner in R.P. No. 3644 of 2008 was the complainant before the District Forum. Before the District Forum, Shriram Transport Finance Co. Ltd.''s Manager and Branch Manager were Opposite Party Nos. 1 and 2 and Naeem Bhai was the opposite party No. 3, who is the revision petitioner in R.P. No. 3524 of 2008.

AS both these Revision Petitions emanate from the same order of the State Commission, we propose to pass a common order.

IN this case, Shriram Transport Finance Company had financed a bus to be run by Shri Mohd. Anwar the complainant. Due to default of a few instalments, the vehicle was forcibly seized in an uncivilized manner on 10.6.2005 by the financier and that was given to the custody of Shri Naeem Bhai. It is the case of the complaint that the vehicle was illegally repossessed with a view to sell the same in collusion with Shri Naeem Bhai to earn illegal profits. The complainant also submitted that Shri Naeem Bhai did not release the vehicle when he approached him. Learned Counsel for the petitioner Sri Naeem Bhai submitted that he is not at all responsible for default and repossession of the vehicle, he was only the custodian of the vehicle and he did not release the vehicle to the complainant because the hire charges for parking the vehicle were not paid to him. He further submitted that the complainant was not a consumer vis -a -vis as he has not provided any services to him.

LEARNED Counsel for the complainant Mr. Vishal Bhatnagar submitted that the vehicle was seized by the transport finance company with the help of Shri Naeem Bhai and others illegally by force and was parked at the premises of Naeem Bhai and it was not released by him as he was running the same for profit.

WE are unable to understand that if the complainant is not a consumer of Naeem Bhai, whey did he demand the hire charges from the complainant? The case filed by the complainant in the District Forum due to non -return of the vehicle by the financier and Sri Naeem Bhai resulted in award of compensation to the tune of Rs. 10,000 only though the District Forum held that there was deficiency in service on the part of the financier.

AGGRIEVED by the order of the District Forum, the complainant filed an appeal before the State Commission. The District Forum held that only the financier is liable for deficiency in service, against which the financer had not filed any appeal. Accordingly, it became final, qua the financier.

IN appeal, the State Commission re -apprised the facts and evidence and came to the conclusion that all the three opposite parties were liable for the deficiency in service and they were directed to return the vehicle to the complainant or in lieu thereof pay the compensation to the tune of Rs. 2,50,000 as per the insured declared value as contained in the insurance policy document within one month, failing which, interest @ 9% shall be payable with effect from the date of the State Commission''s Order. The State Commission also directed the opposite parties to pay the complainant Rs. 50,000 as compensation and Rs. 5,000 as costs within a period of one month, failing which, interest @ 9% p.a. shall also be payable with effect from the date of the State Commission''s Order. Aggrieved by this order, Sri Naeem Bhai has filed this revision petition disowning liability of responsibility for the deficiency in service rendered to the complainant. The complainant has filed revision petition for enhancement of compensation.

THE National Commission in Citicorp Maruti Finance Ltd. v. S. Vijayalaxmi, III (2007) CPJ 161 (NC), held as under: "Hire Purchase Agreement - A. 1. When a vehicle is purchased by a person (consumer) by borrowing money from the money lender/financier/banker, the consumer is the owner of the vehicle and not the money lender/financier/banker, unless the ownership is transferred.

In a democratic country having well established independent Judiciary and having various laws it is impermissible for the money lender/financier/banker to take possession of the vehicle for which loan is advanced, by use of force.

Legal or judicial process may be slow but it is no excuse for employing musclemen to repossess the vehicle for which loan is given. Such type of instant justice'' cannot be permitted in a civilized society where there is effective rule of law. Otherwise, it would result in anarchy, that too, when the borrower retorts and uses the force. B. 1. A hire -purchase agreement is a normal one under which owner hires goods to another party called the hirer and further agrees that the hirer shall have an option to purchase the chattel when he has paid a certain sum, or when the hire -rental payments have reached the hire -purchase price stipulated in the agreement.

As against this, when a person desires to purchase vehicle/goods and not having sufficient money on hand, borrows the amount needed from a money lender/financier/banker and pays it over to the vender of the vehicle, the transaction between the consumer and the money lender will unquestionably be a loan transaction. In such a case the vehicle purchased by the consumer is registered in the name of the consumer and remains at all material times so registered in his name. The consumer remains qua the world at large the owner and remains in possession of the vehicle. By an agreement the vehicle can be given as security for the loan advanced. In such a case, the right to seize the vehicle is merely a licence to ensure compliance with the terms of the so -called hire -purchase agreement (Re. AIR 1966 SC 1178). C. It is to be stated that many financiers/banks are in race for giving loan for purchase of vehicles or various articles. After giving loan and taking interest in advance, the polite behaviour changes because of the documents which are signed on the dotted lines by the borrower. On occasions, borrower suffers harassment, torture, or abuses at the hands of the musclemen of the money lender. Such a behaviour is required to be prohibited and the process of repossession is required to be streamlined so as to fit in cultural civilized society. Let the rule of law prevail and not that of jungle where might is right.

The Commission, inter alia, held that the entire action of the appellant, Citicorp Maruti Finance Ltd. "was illegal, arbitrary and criminal in nature and requires to be visited with punitive damages besides refunding the market value of the vehicle with interest. We dismiss the appeal and impose a punitive damages of Rs. 50,000 which shall be paid to the respondent for the mental agony, harassment and humiliation she suffered before her neighbours, friends and relatives at the hands of such an unscrupulous and uncouth provider of service. In the result appeal is dismissed with aforesaid order. Payment shall be made within one month."

The Hon''ble Apex Court in a landmark judgment ICICI Bank v. Prakash Kaur and Ors., 138 (2007) DLT 248 (SC)=III (2007) SLT 1=I (2007) DLT (Crl.) 865 (SC)=I (2007) CCR 538 (SC)=(2007) 2 SCC 771, has held as under: "Now the bank is the aggressor and the public is the victim. The first step to recover of the money due is through the so -called recovery/ collection agents. A very dignified term used for paid recovery agents who are individual and independent contractors hired by the banks both to trace the defaulters and to physically, mentally and emotionally torture and force them into submitting their dues.

A man''s self -respect, stature in society are all immaterial to the agent who is only primed at recovery. This is the modernized version of Shylock''s pound of flesh. No explanation is given regarding the interest charge and the bank takes cover under the guise of the holder of the card or loan having signed the agreement whose fine print is never read or explained to the owner."

THE ratio of these judgments are squarely applicable to the case under consideration. Therefore, we do not hold that compensation awarded by the Fora below is either exorbitant or unjust.

LEARNED Counsel for the petitioner submitted that he has deposited Rs. 50,000 in the District Forum as directed by this Commission. After hearing both the learned Counsel for the parties, we came to the conclusion that the primary responsibility of illegal repossession of the vehicle is that of the financier and his henchmen and the secondary responsibility is of the revision petitioner Shri Naeem Bhai. Therefore, we cannot make Shri Naeem Bhai liable for payment of damages, compensation and costs to the same extent as that of the financier. It is difficult to believe that when the complainant was willing to pay Rs. 35,000 to clear his dues, he would have not paid 1/10th of the amount as parking charges. Further, there is a letter from the complainant addressed to the R.T.O., Police authorities and Transport Minister, wherein it is mentioned that the financier through Naeem Bhai took away the aforesaid vehicle and though he has paid all the instalments, the financier and Naeem Bhai have not handed over the vehicle to him. This has not been controverted by the opposite parties.Though the complainant has asked for enhancement of compensation, we do not see any merit in the same, because the State Commission has awarded the insured declared value of the vehicle and also a compensation of Rs. 50,000. In the facts and circumstances of the case, the liability of the Naeem Bhai to be limited to Rs. 50,000 and hence this amount deposited by him in the District Forum may be released to the complainant by the District Forum after proper verification. Rest of the amount awarded by the State Commission shall be directly paid by the opposite parties 1 and 2 before the District Forum i.e., financier. However, there shall be no order as to costs. R.P. disposed of.