Videocon International Ltd. vs PRAKASH KAUR

BRIEFLY stated the material facts of the case are that Mrs. Prakash Kaur and Mrs. Harbir Kaur, complainants applied for 100 shares each of M/s. Videocon International Ltd., opp. party-1 in 1992. They submitted application forms alongwith a cheque of Rs. 6,000/- each. They received allotment letter dated 17.2.1993 asking them to send call money amounting to Rs. 6,000/- each on or before 25.3.1993. It was made clear that late payment with interest @ 18% w.e.f. 26.3.1993 was acceptable. The complainant, who had been made firm allotment sent two cheques dated 24.3.1993 of Rs. 6,000/- each drawn on Bank of Rajasthan. Towards the end of April, 1997 the complainants came to know that the said cheques had been returned on the ground of insufficient funds. Without waiting for any further letter from the opposite party, the complainants sent two Bank drafts on account of the call money as well as Rs. 130/- as interest. Admittedly, the said Bank drafts were encashed by the opposite party on 10.7.1993. The complainants, however, failed to receive the share certificates and, accordingly, approached District Forum for compensation amounting to Rs. 50,198/-.

THE opposite parties failed to appear inspite of service. No reply was filed on their behalf. On a consideration of the matter, the District Forum observed that the complainants failed to place on record evidence regarding the market price of the shares and that it could not be said with certainty that the complainants would have off-loaded the shares on a particular day when certain rates were prevailing in the market. However, the fact that the opposite party failed to send the share certificates within a reasonable time, amounted to deficiency in service and, accordingly, awarded interest @ 18% p.a. on the sum invested namely Rs. 12.000/- each w.e.f. 10.7.1993 when the proceeds of the draft were collected by the opposite party till date of payment. Rs. 5,000/- was granted to each of the complainants on account of damages for the harassment caused to them. THE opposite parties have filed this appeal. We have heard Mr. K.K. Bhatia, Advocate for the appellants and Mr. Harnam Singh, A/ Rep. of the respondents and have carefully gone through the records.

The first contention of Mr. Bhatia is that the Head-office of the opposite party was at Ahmed Nagar and the department dealing with shares was situated at Bombay and the District Forum at Delhi had no territorial jurisdiction. He placed reliance on I (1996) CPJ 233 (NC). Mr. Harnam Singh, on the other hand, contended that the appellant had a branch office at 429, 4th Floor, Bhikaji Cama Place, New Delhi which was dealing in the shares of the Company. In support of his contention, Mr. Singh placed on record a letter dated 11.4.1998 submitted by Mrs. Hardeep Kaur and reply thereto bearing the same date issued by the aforesaid branch of opposite party - 1. In view of the above material, it cannot be said that the opposite party has no branch office in Delhi. In view of the ammended provisions of Section 11 of the Consumer Protection Act, the District Forum did have territorial jurisdiction. The decision in Raja Ram Corporation Products relied on by the learned Counsel for the appellant is distinguishable on the ground that in the facts of that case the Company concerned had no branch office within the territorial jurisdiction of the FORA where the complaint had been instituted.

MR. Bhatia next contended that the complainants were not ''consumers'' in view of the law laid-down by the Supreme Court in Morgan Stanley Mutual Fund v. Kartick Das, II (1994) CPJ 7 (SC). The contention is altogether misconceived. In the facts of the present case, it is not disputed that the complainants had been allotted shares on the basis of the applications made together with the application money. The facts set-out in the earlier part of this order further show that the call-money were also sent to the Company. Even though initially the call- money was paid by cheques, the cheques having been returned on account of insufficient funds, the complainants sent Bank drafts in lieu of the cheques. In addition to the call-money, the complainants also sent interest for the period of delay. Admittedly, the amount of the drafts was received by the Company. The share certificates had not, however, been issued till the present appeal was heard. It was rightly pointed out by MR. Singh that in the absence of the share certificates, the complainants were prevented from off-loading the shares at the appropriate time. The correspondence which had to be carried on and the fact that the complainants were obliged to initiate proceedings before the District Forum, resulted in harassment, expense and mental agony. We find force in these submissions. The last contention of Mr. Bhatia is that the award of Rs. 5,000/- each as compensation/ costs when the investment made by each of the complainants was Rs. 12,000/- was in the higher side and the same should be suitably modified. In this behalf, we notice that the District Forum has allowed interest @ 18% on the amount invested by each of the complainants from the date the Company received the proceeds of the Bank drafts on 10.7.1993. We feel that the amount of compensation granted is on the higher side. We, accordingly, reduce the amount to Rs. 2.500/- in each case. The remaining order of the District Forum is affirmed. The appeal is disposed of in these terms. A copy of the order be furnished to the parties and sent to District Forum-II. Appeal disposed of. __________________