SOM NATH JAIN vs R.C. GOENKA

ORIGINALLY the complainant had filed a complaint before the State Consumer Disputes Redressal Commission, Union Territory of Chandigarh alleging unfair trade practice, deficiency in service and charging more than the actual price in the purchase of shares by the Opposite Party, a share & stock broker, on behalf of the complainant.

ACCORDING to the complainant, the opposite party had undertaken to purchase shares on his behalf and on behalf of his nine family members (who are complainants in Petition Nos.19 to 27) at the commission specified for shares of certain companies and undertook to submit accounts showing the purchases made, actual purchase price and the sale price of shares and his commission there for. The complainant remitted a sum of Rs. 7 lacs to the opposite party through two drafts for purchasing the shares in his name and in the names of his nine family members. The opposite party did not submit genuine documents regarding the purchase and sale of shares on behalf of the complainant and his family members. ACCORDING to the complainant, after a visit to Bombay, he discovered that the opposite party respondent has made a fraudulent deal and an unfair trade practice in that he had collected the charge on account of "Badla Transaction" without furnishing the correct statement of account of the sales and purchase of the shares. He claimed a compensation of Rs. 8,21,050/-, refund of Rs. 70,000/- paid as advance and interest of 24% interest on the above amounts and compensation of Rs. 50,000/- for the strain and expenses of going to Bombay in connection with the deals for purchase and sale of shares made by the opposite party ostensibly on his behalf & on behalf of his family members. The opposite party had approached this Commission for transfer of these complaints from the State Commission to the National Commission on the ground of monetary jurisdiction inasmuch as the claim of the complaint before the State Commission was in excess of Rs. 10 lacs. According to the respondent''s calcula tions the complainant''s claim would be over Rs. 13.71 lacs. We in our order of 7th December, 1992 had observed that "From a mere reading of the complaint petition, it becomes manifest that the real valuation of the main complaint petition will exceed Rs. 10 lacs with the result that the State Commission is not the appropriate forum before which the complaint can be instituted". Hence all the complaints were withdrawn from the State Commission and were treated as Original Complaints on the file of this Commission.

According to the version of the complainant himself, the main controversy in this petition is that the opposite party respondent was acting on behalf of the petitioner for the purchase and sale of shares and were therefore, bound to render accounts of transactions and documents in support to the petitioners. For this purpose the complainant requested the examination of the Chopri book required to be maintained under rules of the Stock Exchange and other connected account books. According to the complainant the Chopri book contains deals of every Transaction including the name of the share, number of shares, the rate and the name of the broker, rules and regulations for the purchase or sale of shares are being entered into. But the respondent has withheld the Chopri Book.

ACCORDING to the opposite party the deals were done on telephone and telegraphic instructions. The complainant had failed to provide the margins (30 per cent of the value of the shares to be purchased) viz. thus the appellant had failed to provide margins resulting in a debit balance of Rs. 19.82 lacs in one account and a credit balance of Rs. 10.26 lacs in nine such accounts. More importantly, the opposite party respondent has also pointed out that the complainant had issued instructions to the opposite party for buying or selling shares listed on the Bombay Stock Exchange, that he never actually took delivery of these shares and that these same transactions were speculative in character for commercial purpose, i.e., the primary object was to make profits, that he had supplied to the complainant all contract Notes, Bills & Statement of Accounts. ACCORDING to the respondent the complainant owes monies to him and that he has sought to manufacture a dispute to delay and/or avoid making payments to him. Having gone through the record and hearing the parties, we have serious doubts as to whether this is a complaint maintainable under the Consumer Protection Act. In any case, it is evident from narration of facts stated above that elaborate evidence will have to be taken regarding purchases/sale of shares, their prevailing prices in the market. Again, the transactions of sale and purchase were made on telephonic instructions. So elaborate evidence will have to be taken to establish what were the precise instructions given by the complainant to the respondent broker etc. Further allegations of fraud and manipulation of accounts cannot be decided on the basis of affidavits. This is, therefore, not a fit case to be dealt with by the Consumer Forums. These Original Petitions are, therefore, dismissed reserving liberty to the complainants to seek redress for the alleged wrong done to him by the opposite party/respondent in a Civil Court, if so advised. Petition dismissed.