T. ALAMELU vs INTEGRATED FINANCE CO.

THIS is a complaint under Section 17 of the Consumer Protection Act.

THE case of the complainant is that on 16.2.89, she deposited a sum of Rs. 1,00,000/- with the opposite party under a fixed deposit A/c No. 5288 Dr. No. 10/P/5888, dated 16.2.89, for a period of three years bearing interest at 14% per annum. THE opposite party has been paying the interest monthly till June''89 and defaulted thereafter. Inspite of repeated letters there was no response. Finally, the company has issued a notice through its Advocate on 12.2.91 stating that this fixed deposit was offered as security for the loan advanced to M/s. Gajendra Transport Company and the principal and interest have been adjusted against the balance due from M/s. Gajendra Transport Company. According to the Complainant, she never executed any such letter of security. After referring to the details of the transaction between the opposite party and M/s. Gajendra Transport Company, the complainant has alleged that the opposite party has cheated M/s. Gajendra Transport Company also. She has claimed for refund of the fixed deposit of Rs. 1,00,000/-, interest of Rs. 22,880/- and compensation in the sum of Rs. 1,00,000/- to talling in all Rs. 2,22,880/-. The opposite party has filed a counter through its Assistant Manager. It is the contention of the opposite party that M/s. Gajendra Transport Company which is a firm of partnership approached through, its Managing Partner Mr. V. Ramasubramanian for a hire purchase loan of over Rs. 15,00,000/- to purchase five Swaraj Mazda trucks. The opposite party agreed to advance the money on furnishing adequate security agreed to advance the money on furnishing adequate security and deposit Rs. 5,00,000/- under lien for the proposed loan. Therefore Mr. V. Ramasubramanian, Managing Partner of M/s. Gajendra Transport Company produced a cheque for Rs. 5,00,000/- drawn by M/s. Rajiv & Company in favour of the opposite party and filed five applications for issuing fixed deposits of Rs. 1,00,000/- each in the names of 1. Mr. B. Vevekanandan, 2, Mr. B. Dhanasekaran, 3. Mrs. Kokila W/o Mr. V. Ramasubramaniam, 4. Mrs. T. Alamelu, W/o Mr. S. Vivekanandan and 5. Mrs. D. Indumati W/o Mr. B. Dhanasekaran. All these five fixed deposits were lodged with the opposite party along with the lien letters as security for the loan advanced to M/ s. Gajendra Transport Company and photostat copies of the lien letters and fixed deposit receipts were furnished by the opposite party. M/s. Gajendra Transport Company defaulted in the payment of instalments and a huge debt accrued. In terms of the lien letters the deposits were therefore prematurely closed and the amounts were adjusted against the debt due from M/s. Gajendra Transport Company. The fixed deposit for Rs. 1,00,000/- which is the subject-matter of this complaint made by Mrs. T. Alamelu and interest thereon was one of the deposits similarly adjusted. All the allegations levelled against the opposite party of chanting the complainant or M/s. Gajendra Transport Company and denied. The opposite party therefore prayed for the dismissal of this complaint

The complainant has examined herself as PW1 and the Assistant Manager of the opposite party has been examined as RW1. Exhibits A1to A13 and B1 to B16 are marked.

IT is the case of the complainant, who has been examined as PW1 that she deposited a sum of Rs. 1,00,000/- with the opposite party on 16.2.89 under the original of Exhibit A1, fixed deposite receipt, and interest was being paid regularly till the month of June''89. Her claim is that the opposite party failed to pay the interest subsequent to June''89, inspite of repeated reminders, and this complaint is for recovery of the principal amount of Rs. 1,00,000/- with interest thereon and for damages. The case of the opposite party is that M/s. Gajendra Transport Company which is a registered firm consisting of Mr. V. Ramasubramaniam as Managing Partner and two partners Mr. B. Vivekanandan and Mr. B. Dhanasekaran applied to the opposite party for a loan of Rs. 15,00,000/- for the purpose of purchasing five Swaraj Mazda trucks. The opposite party agreed to advance the amount, if sufficient security was furnished and a deposit of Rs. 5,00,000/- was made with a lien for the proposed advance. Accordingly Mr. V. Ramasubranamian, Managing Partner of M/s. Gajendra Transport Company produced a cheque for Rs. 5,00,000/- drawn by M/s. Rajiv & Company in favour of the opposite party and applied for the issue of fixed deposits of Rs. 1,00,000/- each in the names of 1. Mr. Vivekanandan, 2. Mr. Dhanasekaran, 3. Mrs. Kokila, W/o Mr. Ramasubramaniam, 4. Mrs. Dhanasekaran. It may be mentioned here and now that Mr. S. Vivekanandan and Mr. B. Dhanasekaran are the two partners of M/s. Gajendra Transport Company, while Mrs. R. Kokila is the W/o Mr. V. Ramasubramaniam, the Managing Partner, while Mr. T. Alamelu is the W/o Mr. S. Vivekanandan the other partner and while Mrs. D. Indumati is the W/o the third partner and while Mrs. D. Indumati is the W/o the third partner Mr. B. Dhanasekaran. It is the further case of the opposite party that all these five fixed deposit were offered a security for the loan and lien letters were got from all these five depositors, and endorsements of discharge were also obtained on the back of the five fixed deposits. Exhibit B16 is the file produced by the opposite party which contains the original five fixed deposit receipts with discharges and lien letters. The hire purchase agreements entered into between the opposite party and the promissory notes executed by the Managing Partner, Mr. Ramasubramaniam on behalf of M/s. Gajendra Transport Company are marked as Exhibit B1 to B5.

IT follows from the contentions raised by the opposite party that the amount covered by the fixed deposit under Exhibit A1 in the name of the complainant as well as the other four deposits in the names of the other two partners namely Mr. Vivekanandan and Mr. Dhanasekaran of M/s. Gajendra Transport Company, the wife of the Managing Partner Mrs. Kokila, wife of the other Partner Mrs. Indumati were provided by the cheque issued by M/s. Rajiv and Company in favour of the opposite party for Rs. 5 lakhs. The photostat copy of the cheque has been marked as Exhibit B14 dated 14.2.89. But it is needless for the purpose of this enquiry to go into the question of the source of the fixed deposits in favour of the complainant under Exhibit A1 and others especially in the absence of M/s. Gajendra Transport Company and M/s. Rajiv and Company which has issued the cheque. IT seems that M/s. Rajiv Company has already filed a suit in the Court of the Subordinate Judge, Coimbatore in O.S. 561/90 against the opposite party claiming the amount of Rs. 5,00,000/- covered by Exhibit B14 cheque as its and for recovery of the same with interest. B16 is the copy of the complaint in the said suit. According to the learned Counsel for the opposite party they are moving the Subordinate Judge in the aforesaid suit for impleading the aforesaid depositors in whose names the fixed deposit receipts were issued as parties for a final complete the determination of the source of this amount. IT is for the Civil Court to render a decision in the matter. For the purpose of our enquiry, it is sufficient to find out whether Exhibit Al, fixed deposite receipt in favour of the complainant is true and whether the opposite party is entitled to adjust the amount due on the fixed deposit against the debt due from M/s. Gajendra Transport Company. Exhibit B10 is the photostat copy of the letter of lien executed by the complainant. It is a printed form in which the name of M/s. Gajendra Transport Company, the borrower, the date of the hire purchase agreement and the name of the complainant and the amount of fixed deposit are entered. It reads as follows. "M/s. Gajendra Transport Company has entered into a Hire Purchase Agreement dated 1.3.89. Under the agreement they are/she/he is bound to pay the Hire Purchase instalments on the stipulated dates as well as Additional Finance Charges for delayed payments and incidentals like Bank charges etc., and repossession charges. As additional security for the due fulfilment of their/his/her obligations and covenants under the Hire Purchase Agreement as Hirer. I/We T. Alamelu hereby deposit a sum of Rs. 1,00,000/- in your Fixed Deposit Scheme and I/We agree that in case there is default in their/ his/her payment of Hire Purchase instalments of the other amounts due under the agreement you and entitled to recover such arrears from out of the Fixed Deposit amount and the balance of Fixed Deposit amount, if any, only will rank for further interest. On the said Fixed Deposit amount you will have a first charge till their/his/her obligations under the Hire Purchase Agreements are completely discharged".

In her evidence as PW1 the complainant has admitted her signature in Exhibit B10. According to the complainant at the time of the issue of fixed deposit receipt, several signatures were obtained from her in blank forms and Exhibit B10 is one such form which has been signed by her without reading or knowing the contents. The complainant (PW1) is a English knowing witness and is working as teacher. She has affixed the signature in Exhibit B10 and in the complaint in a beautiful hand which would clearly show that she can read and write English with consummate skill. We are not therefore prepared to accept her evidence that she signed Ex. B10 letter of lien without knowing the contents. No doubt the opposite party has not promptly replied to her letters, but in the notice issued through the advocate under Exhibit A3 dated 12.2.91, all these facts have been clearly set out. We have therefore no reason to doubt the genuineness of Exhibit B10.

IT is also pertinent to point out that M/s. Gajendra Transport Company has borrowed a loan over Rs. 15,00,000/- from the opposite party for the purchase of Swaraj Mazda Trucks and executed hire purchase agreements and promissory notes under Exhibit B1 to B5. The Managing Partner of the firm is the complainants'' son Mr. V. Ramasubramaniam. Her husband is one of the two other partners, the remaining partner Mr. B. Dhanasekaran is said to be her relation. This is what the complainant herself stated in her evidence as PW1 about this company. xxx xxx xxx xxx xxx IT is also significant that all the fixed deposit receipts in the name of five persons i.e. in the name of the complainant, her husband Mr. Vivekanandan, her daughter-in-law Mrs. Kokila, the other partner Mr. Dhanasekaran and his wife Mrs. Indumati have all been issued on the same date on 16.2.89 and all these five depositors have issued letters of credit. Taking all these factors into consideration, the conclusion is irresistable that all these fixed deposits have been offered as security for the loan advanced to M/s. Gajendra Transport Company by the opposite party.

THE fixed deposit receipt in favour of the complainant under Exhibit A1 bears an endorsement of the discharge on the reverse. That is the case in respect of the other four Fixed Deposit receipts which are found in Exhibit B15, file. If a person deposits amount with a company or a public financial institution for the purpose of earning interest, there is no need for the depositor to sign an endorsement of discharge in the fixed deposit receipt, even on the date of the issue of the receipt or allow the original receipt to be kept by the depositor. It is only when the deposit is given as a security for any loan, the deposit receiving Bank or institution obtains such discharge receipts and keeps the original receipts also. This again would indicate that the deposit by the complainant has been made as a security for the loan as is the case with the other deposits. Exhibit B13 is the letter written by Mr. Dhanasekaran one of the three partners of M/s. Gajendra Transport Company on 21.8.89 to the opposite party alleging that the other partners namely Mr. Vivekanandan and Mr. Ramasubramaniam have not conducted the business properly and have involved the company in heavy loss and that he has filed a suit for dissolution of the partnership in the Court of Subordinate Judge of Srivilliputhur in O.S. 146/89. A copy of the plaint has also been annexed to the letter. It is obvious therefore that the company has landed itself in deep troubled waters and with a view to salvaging something, this complainant has been filed through the complainant, who is the mother of the Managing Partner and wife of another partner and it seems to be speculative in nature.

In view of our finding that the latter of lien is true, it follows that the opposite party is entitled to adjust the amount due on fixed deposit against the loan due from M/s. Gajendra Transport Company. It is not seriously in dispute that M/s. Gajendra Transport Company has failed to remit the monthly instalments and according to the opposite party over 9 lakhs of rupees is due from M/s. Gajendra Transport Company. The opposite party is therefore entitled to adjust the amount of the fixed deposit in the name of the complainant against the debt due to it from M/s. Gajendra Transport Company.

IN the result the complaint fails and is dismissed with cost of Rs. 2000/- to the opposite party. Complaint dismissed with costs.