SIMRAN MACKER vs DCM Financial Services Ltd.

THE complainant is a resident of Chandigarh and she invested a sum of Rs. 3.00 lacs through one FOR and another sum of Rs. 2.75 lacs through another FOR, both dated 30.9.1996 in favour of M/s. DCM Financial Services Ltd., New Delhi through their local agent, respondent No. 3. THE interest payable was @ 16.08% as published in DCM Convenient Deposit Scheme, Annexure-I. THE complainant received a sum of Rs. 10,254/- as the last quarterly interest on 30.9.1997 and thereafter the respondent failed to pay the interest and even the principal. THE sum due on 2.12.1997 was Rs. 5,85,254/- as detailed in para 13 of the complaint and it is in these circumstances that the present complaint has been instituted.

THERE was a preliminary objection that the Commission at Chandigarh had no territorial jurisdiction because there was Clause 12 in the aforesaid scheme that the disputes, if any, were to remain under the jurisdiction of the Delhi High Court. This preliminary objection was rejected by this Commission on 30.9.1998. Now there is an application that there is an order of the Company Law Board dated 17.7.1998 where by the amount of interest payable to the depositors of the DCM Financial Services Limited has been revised and interest at the agreed rate at the time of the investment was not recoverable. Besides this, the Company Law Board has set up a scheme as to when the depositors shall receive repayments from DCM Financial Services Ltd. We have now also to examine whether the interim order of the Company Law Board, Northern Region, New Delhi dated 17.7.1998 shall forbid this Commission to proceed further.

Mr. J.S. Narang, Senior Advocate for the respondent has pointed out that the non-banking Financial Corporations could be dealt with by the Company Law Board because in this regard the Board has been empowered by virtue of Section 45QA of the Reserve Bank of India Act. It shall be useful to refer to Section 45QA(2) of the RBI Act and it is reproduced as under : "45QA. Power of Company Law Board to offer repayment of deposit - (2) Where a non-banking financial company has failed to repay and deposit or part thereof in accordance with the terms and conditions of such deposit, the Company Law Board constituted under Section 10E of the Companies Act, 1956, (1 of 1956) may, if it is satisfied, either on its own motion or on an application of the depositor, that it is necessary so to do to safeguard the interests of the company, the depositors or in the public interest, direct, by order, the non-banking financial company to make repayment of such deposit or part thereof forthwith or within such time and subject to such conditions as may be specified in the order : Provided that the Company Law Board may, before making any order under this sub-section, give a reasonable opportunity of being heard to the non-banking financial company and the other persons interested in the matter."

THE learned Counsel for the respondent has stressed that keeping in view the entire assets and liabilities of respondent No. 1, which find mention in the proceedings dated 17.7.1998, a statutory body has laid down a scheme for repayment of deposits especially those which exceed Rs. 5,000/-. This, however, is an interim order because the respondent was required to elucidate its position on 1.1.1999. Neither of the parties has been able to inform as to what was the position of proceedings held on 1.1.1999 and thereafter. Mr. R.S. Dass, learned Counsel for the complainant, has stressed that notwithstanding the provisions of any other Act or law, the Consumer Commission has the jurisdiction to deal with complaints and it could proceed and not that the borrower should successfully pretend a kind of disability to cheat the depositors. The complainant has specifically averred in para 4 of the complaint that two FDRs bearing Nos. 40840 for Rs. 3.00 lacs and 40841 for Rs. 2.75 lacs were issued by the respondent in response to the cheque described in para 3 of the complaint. In paras 4,5 and 6 of the reply, the corresponding contents of complaint have been described as correct and admitted. Thus, in this case, the factum of deposits stands admitted and established after perusal of the photocopy of the acknowledgement and receipt dated 2.9.1997. However, after institution of the complaint, the respondents have paid a sum of Rs. 25,000/- and Rs. 50,000/- totalling Rs. 75,000/- in the month of December, 1997 which finds mention in para 4 of the rejoinder. Thus, it is held that now Rs. 5.00 lacs is outstanding out of the capital investment and besides this interest is also recoverable @ 15% p.a. Since the complainant was not given an opportunity of hearing, the proviso to Section 45QA of the Reserve Bank of India Act, 1934, which required a reasonable opportunity of being heard not only to the non- banking financial companies even to the other persons interested in the matter; the position between the complainant and the respondents continues to be the same notwithstanding a kind of interim proceedings held by the Vice Chairman of the Company Law Board. In Gyan Singh & Ors. v. Carry on Savings & Investment Co. Ltd, & Ors., III (1994) CPJ 9, it has also been observed that under Section 3 of the Consumer Protection Act, 1986, by way of additional remedy, the complainant could approach the Commission, as pointed out by the learned Counsel for the complainant.

THE conclusion is that the complaint succeeds and it is ordered that after taking into consideration, the part payment of Rs. 75,000/- as seen above, the outstanding balance of Rs. 5.00 lacs together with the outstanding amount of interest @ 15% and cost Rs. 3,000/- is henceforth payable by the respondent No. 1 to the complainant. Complaint succeeds with costs.