UTI Infrastructure Technology And Services Ltd. vs M.K.Hara Prasad

THE factual matrix of this case are that the complainants late father M.B.G. Shastri had made several investments in UTI under the US 64 Scheme. Later on, the UTI announced closure of US 64 Scheme and as per Special Package Scheme announced by the Government, the investor was allowed to redeem first 5000 units held by him in respect of his investment certificate at a price fixed by the UTI. THE complainant is in possession of certificate no.304000010000801 holding 36630.037 US 64 units with his name as the second holder under the certificate alongwith his late father. In July 2002, the complainant surrendered the said certificate and submitted redemption application form along with death certificate and other documents. THE first 5000 units of the said certificate were to be redeemed at the rate of Rs.11 per unit and the balance 31630.037 units were to be converted to tax free bond certificates. THE complainant received a redemption warrant by post for Rs.30,350/- calculated at Rs.6.07 paisa per unit instead of Rs.11 per unit. THE complainant, therefore, gave a written complaint on 7.9.2002 to opposite party no.2 for which he received a reply dated 22.10.2002 stating that late father of the complainant had availed special package along with another letter under the title dispatch payment details showing a cheque that had remained unpaid and pertaining to the account of a sister Smt. K. Bhagayasree. THE complainant thereupon sent another representation dated 30.10.2002 for which he received a reply in November 2002 stating that the difference in amount cannot be given because the eligible units under the special package in 10905012 have been exhausted. On 27.12.2002, the complainant filed a transfer form for 31630.037 units. In the first week of January 2003, the complainant received a transaction statement confirming the nomination along with the statement of account. He received another letter in March 2003 requesting him to give his option with regard to the repurchase or conversion into 6.75% tax free bonds in respect of 31630.037 units. THE complainant opted for repurchase. Following this in the second week of June 2004, he received payment of Rs.3,16,300.37 paisa calculated at Rs.10 per unit applicable in B category units and in July 2004, he received Rs.10,000/- against difference in amount with respect to the first 5000 units of category A . THE grievance of the complainant is that the receipt of amount of Rs.3,16,300.37 is with respect to the lost certificate and the balance payment with respect to certificate no.304000010000801 is still pending with UTI and the claim should have been settled as 5000 numbers of A category units and 26,630.037 numbers of B category units as under:- (i) Rs.60,000/- towards 5000 A category units. (ii) Rs.2,66,300.037 paisa towards B category units. (iii) Rs.24,650 as difference in payments with respect to the repurchase of 5000 A category units made earlier in July 2002. (iv) Rs.3,16,300.37 paisa towards balance B category units.

THE complainant served two legal notices on 6.2.2004 and 9.3.2004 to which he received replies but the complainant was not satisfied with the replies received from the petitioner Company. According to him, since the UTI received only one option form for repurchase, the other of the said two investments having 31630.037 units should have been treated as automatically converted to 6.75 tax free US 64 bonds. THE complainant, therefore, filed a consumer complaint with the District Forum, which was accepted by the District Forum vide its order dated 09.03.2006 giving substantial relief to the complainant. On the matter being carried to the State Commission in appeal, the order of the District Forum was confirmed and the appeal was dismissed. Challenge in the present revision petition is to this impugned order of the State Commission passed on 30.06.2010. We have heard learned counsel for the petitioners and have also carefully gone through the orders of the fora below. It is to be noted that on appraisal of the issues and the evidence adduced before it, the District Forum accepted the complaint. The order passed by the District Forum is a well-reasoned order based on documentary evidence. It is noted by the District Forum in para 19 of its order that the OPs have filed an affidavit and written arguments reiterating the facts in the counter but there is no documentation filed by the OPs (emphasis provided). In this context, we consider it appropriate to reproduce the following observations of the District Forum in its detailed order:- 21. A scrutiny of the documents submitted reveals as follows:- Ex. A-23 is a letter from U.T.I. dated 4.5.2005. The letter states explicitly the distinctive investments holdings of Mr. M.B.G. Sastry and the names of the joint holders and the status of the same respectively. It is evident that certificate Number bearing 304000010000801 and 304000010000797 declare the complainant M.K. Hara Prasad as the joint holder. The first certificate is for 36,630.037 units wherein it is stated that redemption amount has already been encashed and with reference to the balance units which are converted it says please check if details of any other holdings (apart from US 64) in the name of late M.B.G. Sastry may be available at your end . This suggests that the balance 31,630.037 units are not traced by the U.T.I. This appears to be an act of negligence on the part of the U.T.I.

The second investment certificate No. 304000010000797 holding 31,630.037 units is said to have been settled in favour of M.K. Hara Prasad (I.D. No. 71614093). 23. Ex. A-23 also reveals that different investments were held under different I.D. Numbers. Therefore, the contention of the opposite parties that all the investments were consolidated under I.D. No. 716141069 has no relevance and cannot be maintained.

We are of the view that each distinctive investment was eligible for repurchase with respect to the first 5000 units in each at the special package price announced by U.T.I. By the opposite parties own submission, units surrendered in July, 2002 were eligible to be repurchased as the rate of Rs.11/- per unit. Therefore, the complainant is eligible to receive Rs.55,000/- for the first 5000 units in respect of certificate no. bearing 304000010000801 categorized as A category units. The balance 31,630.037 units are categorized under B category units. These are to be converted into 3163 bonds. Therefore the opposite parties are liable to issue 3163 tax free bonds and to pay installment of interest at 6.75% payable half yearly from December, 2003.

It is evident from the exhibits submitted that there is no mention of respective certificate numbers in their letters. This led to a lot of confusion amounting to a deficiency in service by the opposite parties. It is the bounden duty of the opposite party to clarify investment holdings of the deceased Mr. M.B. Sastry with respective of his investments to his successor on furnishing the requisite death claim certificate and other formalities. 26. Therefore a deficiency in service is established by the opposite parties. The complainant is entitled to his claim.

Perusal of the impugned order of the State Commission shows that while considering the appeal of the petitioner Company, the State Commission has again gone into the details of the units in question and the related documents produced before it and confirmed the findings of the District Forum. The orders of both the fora below accepting the complaint and unsuiting the claim of the OPs are based on concurrent finding of facts. We do not find any material irregularity, illegality or jurisdictional error in the same, which would justify our interference with the concurrent orders. We do not agree with the plea of the petitioners that the State Commission exercised jurisdiction not vested in it by law. The revision petition of the petitioners devoid of merits is, therefore, liable for dismissal and the same is dismissed at the threshold but with no order as to costs.