Pramod Kumar Bothra vs Ishwar Chand Sharma

THIS First Appeal by Shri Pramod Kumar Bothra, Opposite Party before the State Commission is directed against the order dated 25.3.1994 of the State Commission, Delhi accepting the complaint and directing the Appellant herein to pay Rs. 4,97,000/ - with interest at the rate of 18% per annum from the date of the order till the date of payment and Rs. 20,000/ - as damages besides costs of Rs. 5,000/ -.

THE case set up by the Complainant in the complaint is this. The Complainant holds valid general power of attorney on behalf of his son Shri Arun Sharma, presently employed with the Emirates Airlines, Dubai, U.A.F., as Development Engineer and his wife Smt. Anita Sharma. The Complainant contacted the Appellant Shri Promod Bothra of Bothra Brothers, Stock & Share Broker & Financial Consultants in September, 1991 to arrange for the sale of the shares held in the joint names of Shri Arun Sharma and Smt. Anita Sharma and to discuss the preliminaries before sale of shares. Shri Bothra advised the Complainant that he should obtain the permission of the Reserve Bank of India, Bombay for the sale of the shares under Section 19(5) of the Foreign Exchange Regulation Act, 1973. The Complainant handed over all the share certificates alongwith the signed transfer deeds to Shri Bothra and his office employees on 31st October, 1991 and 7th January, 1991 to effect the sale after obtaining RBIs permission. According to the Complainant Shri Bothra effected the sale of most of the shares without obtaining the permission of Reserve Bank of India particularly those highly valued and known as Blue Chips on 1st October, 4th October, 15th October and 29th October, 1991 well before the receipt of RBIs permission dated 8.11.1991. A total sum of Rs. 9,15,673 / - accrued to Shri Bothra by virtue of the sale of shares in question i.e. Rs. 9,12,586/ - on 15.1.1992 and Rs. 3,087/ - on 29.1.1992 as per the credit notes issued by him. Shri Pramod Bothra did not make the payment to the complainant immediately after the sale and committed a breach of trust and misappropriated the amount, thus depriving the Complainant of the use of that amount. After a number of personal visits by the Complainant and over 100 telephone calls, Shri Bothra issued 9 cheques in between 19th and 25th February, 1992 for about half of the total amount, totalling Rs. 4,70,000/ -. Six cheques for an amount of Rs. ,52,475/ - were dishonoured on presentation. The aforesaid six cheques were again presented to the Bank but one of the cheques for the largest amount for Rs. 1,96,176/ - was again received back unpaid, thus leaving a balance of Rs. 6,34,762/ - still to be paid by the Appellant. For the remaining amount of Rs. 6,34,762/ -, the Appellant issued six cheques amounting to Rs. 4,44,668/ - on 10th March, 1992 but five of these cheques were dishonoured because of insufficiency of funds and only one cheque for Rs. 6,357/ - was cleared by the Bank. The Complainant issued notice to the Appellant under Section 138 of Negotiable Instruments Act. The Appellant issued 4 pay orders amounting to Rs. 4.00 lakhs, thus leaving a balance of Rs. 2,34,762/ - still to be paid. It is further pleaded that because of the delay on the part of the Appellant in transferring the amount of Rs. 5,62,656/ - after devaluation, a loss of Rs. 50,033 / - would be caused to the Complainant on conversion of the balance amount of Rs. 234,762/ - which is yet to be paid by the Appellant at the exchange rate as existed on 19th March, 1994. The Complainant filed the complaint claiming interest on the entire amount of Rs. 9,15,673/ from the dates the payments were received by the Opposite Party till the dates the part payments have been paid and for the balance till the realisation. The Complainant alleged deficiency in service in settling the sale proceeds of the share entrusted for sale on commission basis. 3. The complaint was filed on 29.1.1993. Notice of the filing of the complaint was served on the Appellant on 30.3.1993 calling upon him to file its version of the case within 30 days from the date of receipt of the notice. No reply was filed by the Appellant within the specified time or even thereafter. The State Commission fixed the case for hearing on 29.10.1993 and issued notice to the Appellant who was duly served for the hearing of 29.10.1993. The Appellant failed to enter appearance on 29.10.1993 or on subsequent adjourned date of 1.11.1993 when he was proceeded ex -parte. There was no appearance even on subsequent dates of 24.1.1994, 25.1.1994, 3.2.1994,23.3.1994 and 25.3.1994 when the hearing of the case was concluded and the impugned order passed.

THE main submission of the learned Counsel for the Appellant is that although the Appellant did receive the notice of the filing of the complaint in early April, 1993 and got the written version prepared through Counsel, but in the meantime the Complainant approached the Appellant for out of Court settlement by promising to remove the defects for some shares like Premier Industries & Punjab National Fertiliser and also to rectify the bad deliveries for the remaining shares and also get the power of attorney registered in respect of shares held in Western Electronics, Usha Micro Processor and Western India Enterprises. The submission is that the State Commission erred in proceeding ex -parte against the Appellant, the ex -parte order should be set aside and the case remanded for deno trial or in the alternative the Appellant may be permitted to lead evidence in the appeal before this Commission. There is no merit in this submission.

THE procedure applicable to the State Commission in hearing of the complaints, by virtue of the provisions of Section 18 of the Consumer Protection Act, 1986, is as set out in Section 13. It, inter alia, provides that where the Op site Party on receipt of a complaint omits or fails to take any action to present his case within the time, the Redressal Forum shall proceed to settle the consumer dispute on the basis of evidence brought to its notice by the complainant where the parties omits or fails to present his case within the time given by the Redressal Forum. The Appellant neither entered appearance personally or through an authorised agent or an advocate despite being served of the first notice nor filed the written version of the case either within the time allowed or even thereafter. The Appellant was given a fresh notice of hearing of the case and was served for 29.10.1993 when he again failed to appear. The State Commission did not proceed ex -parte on that date and adjourned the matter to 1.11.1993 when again no one appeared on behalf of the Appellant and consequently ordered to be proceeded against ex -parte. Thereafter the case was adjourned for ex -parte evidence and arguments and yet the Appellant did not make any efforts to find out as to what transpired on 29.10.1993 and even thereafter. The appeal or grounds of appeal are bereft of any explanation as to why no appearance was put in despite notice of hearing on 29.10.1993. The Appellant did not dispute the allegations contained in the complaint by filing its written version before the State Commission. The State Commission was thus fully justified to base its findings on the basis of evidence brought to its notice by the Complainant. If no version has been filed before the State Commission then no amount of evidence or material can be looked upon a plea not put forward. At the appellate stage the Appellant cannot be allowed to refer to its version in the memorandum of appeal to contend that the findings recorded by the State Commission are not correct. We have gone through the material on record before the State Commission as well as Annexure A, B & C before the State Commission and the calculations of the loss suffered by the Complainant due to loss of interest and devaluation of the Indian currency qua U.S. dollars as well as the affidavits of the complainant and documents produced by him before the State Commission. The finding recorded by the State Commission about the balance amount as well as the loss of interest and the loss suffered on account of devaluation has been correctly arrived at. We uphold the findings of the State Commission. There is no merit in this appeal which is dismissed with costs assessed at Rs. 5,000/ -.