VIDEOCON INTERNATIONAL LIMITED vs Harnam Singh

THE present appeal has been filed under Section 15 of the Consumer Protection Act, 1986 (hereinafter referred to as ''the Act'') on behalf of M/s. Videocon International Limited, against the order passed by District Forum-VII (Sheikh Sarai), dated 19.7.2000. By the impugned order the learned District Forum found the appellant M/s. Videocon International Limited liable for deficiency in service and directed the appellant to pay Rs. 10,000/- as compensation on account of late despatch of shares along with Rs. 2,000/- as cost of the proceedings.

THE facts of the case, relevant for the disposal of this appeal, are as follows: THE respondents Shri Harnam Singh and Smt. Harbir Kaur were allotted 5000 shares each of the value of Rs. 10/- each. THE respondents paid Rs. 50,000/- each to the appellant by way of Bank Draft. One share certificate for a total of 5000 shares was issued in the name of each respondent which was non-transferable till 10.11.1995 but single share certificate was split to 50 share certificates on 22.6.1993. It is stated that in the year 1997 M/s. Videocon Narmada Electronics Limited merged with the appellant M/s. Videocon International Limited and fresh share certificates were to be issued so that against 1200 shares of M/s. Videocon Narmada Electronics Limited (opposite party No. 1 in the complaint) the holder was entitled to 100 shares of M/s. Videocon International Limited (opposite party No. 2 in the complaint). However, the shares were not received by the respondents till 10.4.1998 and on inquiry they were asked to deposit the original shares so that the converted share certificates could be sent. THE respondents deposited the original shares in the Delhi Office of the appellant company and they were told that the converted share certificate shall be sent to them within 15 days. However, the appellant company did not send the shares in time and instead sent the converted shares to the respondents in August, 1998. According to the respondents on account of delay on the part of the appellant they have suffered losses and on account of this delay they could not sell the shares at a high price available in the market for the period May-June, 1998. Hence the respondents filed a complaint before the District Forum claiming compensation and Rs. 51,000/- for each of the complainant and Rs. 5,000/- each by way of loss on interest and Rs. 21,000/- on account of mental agony. The appellant contested the claim of the respondents in the District Forum mainly on the ground that the respondents failed to surrender the original certificates in time on account of which there was delay in the despatch of converted shares. The appellant also denied that any assurance was given to the respondents regarding the time-frame within which the converted shares will be sent. It was, however, admitted by the appellant company that the converted share certificates were sent in August, 1998.

The learned District Forum after considering the evidence of both the parties found that there was delay in sending the converted shares on the part of the appellant and accordingly found the appellant company liable for deficiency in service. However, the District Forum found no justification for compensation of loss on account of non-despatch of share certificates and accordingly rejected this prayer of the respondents.

IN the present appeal the appellant has challenged the order of the District Forum on the ground that there was no deficiency in service on the part of the appellant as the share holders of M/s. Videocon Narmada Electronics Limited were required to surrender the equity shares at the office of share transfer agent M/s. Videocon Service Limited, Mumbai. However, the respondents submitted the share certificates at the Delhi office which is only a marketing office and it was on this account that the share certificates were not received in time and hence there was delay in despatch of the converted share certificates. It was also argued that the learned District Forum has no territorial jurisdiction to entertain the complaint as the appellant has no business office within the jurisdiction of that Forum and that the marketing office is only dealing with the sales and marketing of the appellant company''s products and cannot be termed as business or branch office of the appellant company. It has further been argued on behalf of the appellant that the company was not rendering any service to the respondents and hence the respondents are not consumers as defined under the Act. Moreover, no consideration was being charged for the service. We have heard both the parties and have also carefully considered the impugned order passed by the learned District Forum. It is not disputed that the respondents were holders of 5000 shares each of M/s. Videocon Narmada electronics Limited which was merged with M/s. Videocon International Limited in the year 1997. It is also not disputed that in response to the advertisement of the appellant company the respondents deposited their shares in the Delhi Office for conversion into the shares of new company on 11.4.1998. However, it is also not disputed that the converted shares were sent by the appellant to the respondents in August, 1998 i.e., after a delay of about four months. It is well known that the prices of shares fluctuates every day and hence the contention of the respondents that the prices of the shares of the appellant company could have been sold at a high price in May-June, 1998 cannot be brushed aside. The learned District Forum has not awarded any compensation on account of the fluctuation in prices of the shares but has only awarded compensation for the delay in despatch of the converted shares which was certainly a deficiency in service on the part of the appellant. The appellant were certainly liable for deficiency in service as they were expected to despatch the converted shares within a reasonable time which has not been done by the appellant in this case. The explanation given for the delay is far from satisfactory. As regards the other contention raised by the appellant, the same are without any force. Admittedly the appellant company has its office in Delhi where the share certificates were deposited by the respondents. If it was only a marketing office and it was not dealing with share certificates, the shares should not have been accepted by the marketing office. Once the shares were accepted by the Delhi Office for conversion, it becomes the duty of the appellant company to send the converted shares within a reasonable time. Hence the contention of the appellant that the District Forum has no territorial jurisdiction is without any substance. As regards the other contention of the appellant that the respondents are not consumers, it cannot be accepted as the appellants were rendering services while converting old shares into the shares of the new company and any delay on the part of the appellant certainly amounts to deficiency in service. The order of the learned District Forum is a well discussed and reasoned order and we do not find any infirmity in the impugned order. The compensation awarded for deficiency in service also cannot be said to be excessive. Accordingly, we do not find any ground to interfere in the order of the learned District Forum. Therefore, the present appeal, filed by the appellant is dismissed with no order as to cost. The aforementioned appeal is disposed of in above terms. Appeal dismissed.