BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

SIVASAGAR :::: ASSAM.

Present :- 1. Sri S.K. Poddar, AJS, President,

DCDRF, Sivasagar.
Cum
District Judge, Sivasagar.

2. Sri Rajib Hazarika, Member,

DCDRF, Sivasagar.

3. Vacant

C.P. Case No. 21 of 2009

Sri Dhan Bahadur Chetri,

S/O Bhakta Bahadur,
M/S D & R Enterprise,
B.G. Road, Sivasagar,
P.O., P.S. & Dist. Sivasagar (Assam) ------------------------ Complainant

-VS-

1. TATA MOTORS FINANCE LIMITED,

G.S. Road, Ulubari,
Godrej Building, 1st Floor,
Guwahati, Assam.

2. GARGO MOTORS,
Ranghar Chari-ali,
P.O. Joysagar,
Dist. Sivasagar, Assam. ------------ Opposite Parties

APPEARANCE
For the complainant -------------------- SK. Shamsher, Advocate &
Mr. Uzzal Sarma, Advocate

For the O.P. NO. 1 and 2 ---------------- Mr. Utpal Roy, Advocate

Argument heard on --------------------- 18.12.2017

Judgment pronounced on -------------- 17.01.2018

C.P. Case No. 21 of 2009 Page 1 of 11

 JUDGMENT

1. The instant complaint was filed by the complainant for

compensation of Rs. 8,55,970/- on the alleged illegal and forceful re-possession
of vehicle No. AS-04-E-0226 by the financer OP No. 1 on the plea of default in
payment of EMI by the complainant.

2. Complainant's case, in brief, is that the complainant has

purchased one TATA 407 Truck bearing registration No. AS-04/E-0226 from the
O.P. No.2 GARGO MOTORS with the financial assistance of O.P. No. 1 TATA
MOTORS FINANCE LIMITED under hire purchase agreement No. 40875603
dated 26.07.2005 with repayment schedule of 54 installments. To avail this
facilities, the complainant has paid Rs. 1,09,670/- (Rupees one lac nine
thousand six hundred seventy) as down payment to the O.P. No. 2 and took a
loan of Rs. 3,97,000/- (Rupees three lacs ninety-seven thousand) from O.P.
No.1. After taking the loan in the month of September 2005, till first part of
2008 the complainant regularly paid the installment as per agreement, but
thereafter failed to pay few installments under some exceptional and inevitable
circumstances. He intimated the matter to the opposite parties. However, by
ignoring the genuine approaches of the complainant, the O.P. No. 1 and 2, in
clear violation of the law relating to hire purchase, has forcibly took over the
possession of the complainant's vehicle on 06.08.2008 through some unsocial
aliments. Thereafter the complainant personally met the O.P. and write a letter
to return back the vehicle. On 13.10.2008 a pleader's notice was also served.
Till the date of taking over forcible possession of the vehicle, the complainant
has invested a substantial amount of Rs. 3,55,970/- (Rupees three lacs fifty-five
thousand nine hundred seventy) against the vehicle. On 21.08.2009
complainant came to know that the O.P. has sold the repossessed vehicle
without prior notice of termination of hire purchase agreement and also without
any notice to the complainant of proposed sale. After knowing about the illegal
sale, the complainant on 26.08.2009 served a legal notice on O.P. No. 1 and 2

C.P. Case No. 21 of 2009 Page 2 of 11

demanding immediate action to get back his vehicle. In the reply notice both
the O.P. No. 1 and 2 has put blame on each other and tried to escape from
their liability. The action of the opposite parties to repossess and sell out the
vehicle are arbitrary and amounts to deficiency of service in terms of the hire
purchase agreement and as such both the O.P. No. 1 and 2 are liable to pay
compensation of Rs.8,55,970/- (Rupees eight lacs fifty-five thousand nine
hundred seventy) with up-to date interest.

3. On receipt of the above complaint, the instant case was registered

and accordingly notice were issued to O.P. No.1 and 2.

4. The O.P. No. 1 and 2 contested the case by filing written

statement separately. In the written statement the O.P. No.1 has submitted
that the complaint petition is not maintainable in law and facts, the case is bad
for mis-joinder of parties, that this Forum has no jurisdiction to try the case as
the O.P. has no place of business at Sivasagar, that the complainant does not
come in the category of consumer within the meaning of C.P. Act. Apart from
above, O.P. No.1 also pleaded that as per the agreement only the Court at
Mumbai has exclusive jurisdiction for adjudication of the any claim, as well as
there is an Arbitration Clause which can be availed by the parties. It is admitted
that the O.P. No.1 has provided loan of Rs. 3,97,000/- to be repaid in 55
installments @ Rs. 9,750/- per month except the first installment. It is also
pleaded that said agreement was assigned in favour of O.P. No. 2 in January
2009. It is further pleaded that complainant is liable to discharge his obligations
in favour of the O.P. No. 2 and as such there is no cause of action against the
O.P. No.1. The O.P. No.1 has denied the allegation of forcible repossession of
the vehicle. It is pleaded that the complainant was a habitual defaulter and an
amount of Rs. 98202/- was due towards installments excluding delayed
payment charges, expenses and future installments. O.P. No.1 has denied that
there is any deficiency of service under hire purchase agreement and as such
prayed for dismissal of the complaint petition.

C.P. Case No. 21 of 2009 Page 3 of 11

5. The O.P. No. 2 has also submitted written statement with more
or less similar pleas as taken by the O.P. No. 1. While the fact of giving loan to
the complainant was admitted, the O.P. No. 2 has also pleaded that the
complainant was a habitual defaulter and it is alleged that complainant has
become defaulter by non-paying the due installments in time and also denied
the allegations of forcible possession over the vehicle.

6. From the above pleadings, it appears that after filing of the

written statement, issues were not framed. However from the above pleadings,
the points for determination emerged as under :

I. Whether the complainant is a consumer under C.P. Act?

II. Whether the vehicle bearing Regd. No.AS-04/E—0226
(TATA 407 Truck) of the complainant was forcibly repossessed by
O.P. No. 1 and was sold?
III. Whether there was any deficiency of service on the part of the
O.P. No. 1 and 2 or any of them?
IV. Whether the case is bad for non-joinder of TATA MOTORS LTD.
and mis-joinder of TATA MOTORS FINANCE LTD.?
V. What relief or reliefs the parties are entitled to?
7. To prove the case, the complainant has adduced his Affidavit
evidence under Order 18 Rule 4 C.P.C. and he was duly cross examined by the
O.P. side. The O.P. has not adduced any evidence in spite of taking few
adjournments and subsequently opposite parties remain absent since last
several dates. We have heard and re-heard arguments of Complainant side only.
Complainant side has also submitted written arguments and on being asked to
submit valuation of the vehicle after adjusting depression, learned advocate for
the complainant has submitted the copy of insurance policy showing Valuation
at the relevant period and another chart showing valuation of the vehicle as per
provisions of Income Tax Act from a Chartered Accountant.

8. In the course of evidence, P.W. 1 Dhan Bahadur Chetri in his

Affidavit evidence deposed that on 30.06.2005 he purchased one TATA 407
Truck from the O.P. No.2 GARGO MOTORS with the financial assistance of O.P.

C.P. Case No. 21 of 2009 Page 4 of 11

No.1 TATA MOTORS FINANCE LIMITED, and after purchasing the said vehicle
he registered the same in his name bearing Registration No.AS-04/E-0226,
Chassis No.357514DUZ809547 and Engine No.497SPTC35DUZ83391. Exbt.1 is
the original R/C Book, Exbt.2 is the original fitness certificate and Exbt.3 is the
original road permit issued by DTO, Sivasagar. P.W.1 further deposed that the
cost of the said vehicle was Rs. 4,96,285/- (Rupees four lacs ninety-six
thousand two hundred eighty-five) and he has paid Rs.1,09,670/- (Rupees one
lac nine thousand six hundred seventy) as down payment to the O.P. No.2 and
accordingly O.P. No.2 issued the money receipts vide receipts No.3698 dated
28.06.2005, receipt No. 3704 dated 30.06.2005 and receipt No.2813 dated
09.08.2005. Exbt.4, 5 & 6 are the original money receipts issued by O.P. No.2.
After receiving the aforesaid down payment, the O.P. No. 1 TATA MOTORS
FINANCE LIMITED sanctioned a loan of Rs. 3,97,000/- (Rupees three lacs
ninety-seven thousand) for purchasing the said vehicle and accordingly hire
purchase agreement No.40876500 dated 26.07.2005 was executed by the O.P.
No.1 with the complainant. Exbt.7 is the loan sanction letter and Exbt.8 is the
borrower's copy of loan-cum-hypothecation agreement. After taking the loan in
the month of September 2005, till first part of 2008 he paid 25 numbers of
installments amounting to Rs. 2,46,300/-(Rupees two lacs forty-six thousand
three hundred) but failed to pay few installments under some exceptional and
inevitable circumstances and accordingly he intimated the matter to the
opposite parties. Exbt.9 to Exbt.27 are the original money receipts issued by
the O.P. No.1 against payment of monthly installments. P.W.1 further deposed
that the said vehicle was the only source of earning his livelihood, but the O.P.
No.1 and 2, in clear violation of the law relating to hire purchase has forcibly
took over the possession of the complainant's vehicle on 06.08.2008 through
some unsocial aliments. Thereafter complainant (P.W.1) personally met the
O.Ps, and on 11.08.2008 he sent a registered letter to O.P. No.1 & 2 to return
back the vehicle but failed to get back the vehicle due to intentional and
inaction of O.Ps. Exbt.28 is the registered letter. Exbt.29, Exbt.30 and Exbt. 31

C.P. Case No. 21 of 2009 Page 5 of 11

are the original postal receipts. Exbt.32 is the legal notice dated 13.10.2008
served on O.P. Exbt.33 is the original postal receipts. On 21.08.2009, the
complainant came to know that O.P. has sold the repossessed vehicle without
prior notice of termination of hire purchase agreement and also without any
notice to the complainant of proposed sale. After knowing about the illegal sale,
the complainant on 26.08.2009 served a legal notice on O.P. No.1 and 2
demanding immediate action to get back his vehicle. Exbt.34 is the legal notice
in original. Exbt.35, Exbt.36 and Exbt.37 are the postal receipts and Exbt.38
and Exbt.39 are the acknowledgement cards. In the reply notice dated
16.09.2009 and 18.09.2009, both the O.P. No.1 and 2 has put blame on each
other and tried to escape from their liability. Exbt.40 and Exbt.41 are the legal
reply dated 16.09.09 and 18.09.09 in original made by the O.P. The action of
the opposite parties to repossess and sell out the vehicle are arbitrary and
deficiency of service in terms of the hire purchase agreement and as such both
the O.P. No.1 and 2 are liable to pay compensation of Rs.8,55,970/- (Rupees
eight lacs fifty-five thousand nine hundred seventy) with up-to date interest. In
his cross examination by O.P., P.W.1 admitted that he is the proprietor of M/S
D & R Enterprise and the same is situated at B.G. Road, Sivasagar town. He has
claimed compensation regarding TATA 407 Truck, commercial vehicle. He has
employed one driver for plying the said vehicle. As per the Exbt.1, the vehicle
was under hire purchase agreement with TATA MOTORS LTD. Exbt.8 is the
loan agreement with TATA MOTORS LTD. He put his signature on Exbt.8 as
borrower. In para 34 of the Loan Agreement (Exbt.8) there is a Clause of
Arbitration. He has also mentioned in his Affidavit that at some times he has
defaulted in payment of installment and he has informed the same to the O.Ps.
TATA MOTORS FINANCE LIMITED is the O.P. No.1. He has not impleaded the
TATA MOTORS as a party. He denied that he has impleaded TATA MOTORS
FINANCE LIMITED as a party without taking any loan. He further denied that he
is not entitled to get any relief from this Forum. It is further denied by P.W.1
that TATA MOTORS FINANCE LIMITED is not liable to pay any compensation to

C.P. Case No. 21 of 2009 Page 6 of 11

him.

9. In the course of argument hearing, learned Advocate for the

complainant by referring the definition of Section 2(1)(d) of the Consumer
Protection Act and Explanation thereof has submitted that the vehicle was
repossessed by the finance company without due process of law i.e. taking
recourse of Section 9 of Arbitration and Conciliation Act 1996 and thereafter
sold the vehicle is a case of deficiency in service. It is also argued that as the
complainant has purchased the vehicle for the purpose of earning his livelihood
by means of self-employment, he cannot be treated as a consumer for any
commercial purpose. It is also submitted that as the fact of repossession is
illegal as held by Hon'ble Supreme Court of India in the case of ICICI Bank Ltd.
-Vs- Prakash Kaur, reported in AIR 2007 SC 1349 and also the case of
Citicorporation Maruti Finance Ltd. -Vs- S. Vijaya Laxmi, reported in 2012 (1)
SCC 1, the complainant is entitled for the loss and damages suffered by him as
consumer. I have considered the submission and gone through the record.

10. Point No.I On going through the evidence of the complainant it

appears that there is no dispute to the fact that complainant has taken the
vehicle bearing Registration No.AS-04-E/0226 (TATA 407 truck) under higher
purchase agreement from O.P. No.1 and after payment of 25 installments out
of 54 installments, he failed to pay few installments and thereafter on
06.08.2008 the O.P. No.1 got the vehicle repossessed. The Ops though pleaded
that the complainant is not a consumer under C P Act, but from the complaint
petition it is clear that he purchased the vehicle for his livelihood and not for
resale. From the definition of 'consumer' as provided in Section 2 (1) (d) of
the Consumer Protection Act it appears that a person who buys any goods for a
consideration becomes a consumer except when such goods were purchased
for resale. The Explanation given to the above provision makes it more clear
that commercial purpose does not include use by a consumer of goods bought
and used by him exclusively for the purpose of earning his livelihood by means

C.P. Case No. 21 of 2009 Page 7 of 11

of self-employment. In the present case in hand the complainant has pleaded
and proved that he has purchased the vehicle (TATA 407 truck) for earning his
livelihood and for self-employment purpose. This part of evidence remains
unrebutted. There is nothing to show that the complainant has purchased the
vehicle for resale. As such, we hold that the complaint is a consumer under the
provision of Consumer Protection Act, 1986. This point is answered accordingly
in favour of the complainant.

11. Point No. II Now the question falls for determination is whether
repossession of the vehicle No.AS-04-E/0226 (TATA 407 truck) by the O.P. No.
1 was illegal. Before going to fact let me look at the law on this point:

12. Hon’ble Supreme Court of India in the case of ICICI Bank Ltd. v.
Prakash Kaur, (2007) 2 SCC 711 as relied by the counsel for the complainant
has held that :-

“16. Before we part with this matter, we wish to make it clear that we do
not appreciate the procedure adopted by the Bank in removing the
vehicle from the possession of the writ petitioner. The practice of hiring
recovery agents, who are musclemen, is deprecated and needs to be
discouraged. The Bank should resort to procedure recognised by law to
take possession of vehicles in cases where the borrower may have
committed default in payment of the instalments instead of taking resort
to strong-arm tactics.”
13. Hon’ble Supreme Court of India in the case of Citicorp Maruti
Finance Ltd. v. S. Vijayalaxmi, (2012) 1 SCC 1 as relied by complainant, side
has held that

“27. Till such time as the ownership is not transferred to the purchaser,
the hirer normally continues to be the owner of the goods, but that does
not entitle him on the strength of the agreement to take back possession
of the vehicle by use of force.”
14. In the case in hand it an admitted position that the recovery
agents of OP No. 1 forcibly repossessed the vehicle of the complainant on
06.08.2008. Ops have failed to show that while taking repossession they have
taken recourse of law as available to them. From the ratio of the above case

C.P. Case No. 21 of 2009 Page 8 of 11

law and the admitted fact of repossession of the vehicle without taking any
permission from the court or through using powers under section 9 of
Arbitration and Conciliation Act, I have no hesitation to hold that the re-
possession of the vehicle by the O.P. No. 1 on 06.08.2008 is illegal and beyond
jurisdiction. There is no denial to the fact that after repossession the vehicle
was resold. There is nothing on record to show that before repossession and
before sale, the Ops have informed the matter to Complainant. As such this
issue is answered accordingly infavour of the Complainant.

15. Point No.III In view of my findings on Point No. II, it is clear that
by taking forcible repossession of the vehicle, the O.P. No. 1, being a financier
has caused deficiency in service. So far O.P. No. 2 is concerned, from the
pleadings and record it appears that they are the seller of the vehicle only and
they have nothing to do with the finance business of the O.P. No. 1.

16. Point No.IV In the written statement though the O.P. has taken
the plea regarding non-joinder of TATA Motors Ltd. and mis-joinder of TATA
Motors Finance Ltd., but from the record it appears that the O.P. No.1 has filed
the written statement by taking all the pleas regarding loan etc. and signed
through authorized signatory for TATA Motors Finance Ltd. with an Affidavit
that the signatory was well conversant with all the facts and circumstances of
the instant case. However no plea was taken that TATA Motors Finance Ltd.
was no way involved in this case. They have submitted their written statement
by replying on all the materials points on the pleadings by admitting granting of
loan under Loan-cum-Hypothecation Agreement No. 40876503, dated
26.07.2005, amount of down payment and amount of loan, amount received
during down payment etc. As such, though the money receipts were issued
under the banners of TATA Motors Ltd. But in fact said money receipts also
bear the name of TATA Motors Finance. Thus it appears that the plea raised by
O.P. regarding non-joinder of TATA MOTORS LTD. and mis-joinder of TATA
MOTORS FINANCE Ltd. is misconceived. This point is answered in negative.

C.P. Case No. 21 of 2009 Page 9 of 11

17. Point No.V Regarding the reliefs, in the claim petition the
complainant has prayed for a compensation of Rs. 3,55,970/- towards the
investment made by the complainant in the vehicle, Rs. 4,00,000/- towards
unauthorized retention of the vehicle and loss of income and further amount of
Rs.1,00,000/- towards mental agony. However from the pleadings it appears
that while taking the vehicle, the complainant has paid Rs. 1,09,670/- and
thereafter paid Rs. 2,46,300/- vide Exbt. 9 to 27 (II). However the complainant
remains silent regarding earning of the vehicle from the date of purchase, i.e.
on 02.07.2005 till repossession on 06.08.2008. Admittedly the complainant has
used the vehicle for about three years and if we calculate the value of the
vehicle IDV as per the formula of Insurance companies while fixing the IDV for
taking out the value of vehicle to be insured, it comes as follows:- Value of the
vehicle while issuing insurance policy on 26.07.2005 was Rs. 496285/- as per
insurance Policy No. 200400/31/05/6300001263 isued by National Ins. Co.Ltd.
After first year the IDV was fixed at 3,97,028/- vide Insurance Policy No.
200400/31/06/630000780 issued on 26.07.2006. The depreciated value of the
vehicle on 26.07.2007 will be 277920/- [Rs. 397028/- – 119108/- (Rs. 30% of
Rs. 397028/-)]. The depreciated value of the vehicle on 26.07.2008 will be
166752/- [Rs. 277920/- – 111168/- (Rs. 40% of Rs. 277920/-)]. Thus it can
safely be held that the value of the vehicle on the date repossession would
have been Rs. 166752/- which is direct loss to the complainant. Apart from this,
the complainant has certainly suffered loss of income as well as mental agony
and expenses on proceedings for which he is certainly entitled certain amount,
which I assessed as follows –

Value of the vehicle:- Rs. 1,66,752/-

Loss of Income for next 2 years Rs. 2,00,000/-
Damaged for mental agony etc. Rs. 50,000/-
Cost of litigation Rs. 10,000/-
Total Rs. 4,26,752/-
(less amount of Installment due Rs. 98,202/-
Net amount Rs. 3,28,550/-

C.P. Case No. 21 of 2009 Page 10 of 11

 ORDER

18. Complainant is entitled to recovery of Rs. 3,28,550/- (Rupees

three lakhs twenty eight thousand five hundred fifty) only along with interest
thereon at the rate of 7.5% (seven point five) per annum from the date of filing
the claim petition before this Forum, i.e. on 15.12.2009 till recovery from the
O.P. No. 1 TATA MOTORS FINANCE LTD.

19. The O.P. No.1 is directed to pay the awarded amount to the
complainant within six weeks from the date of passing order.

Given under the hand & Seal of this Forum on this the, 17th day of
January, 2018.

(Sri Rajib Hazarika) (Sri S.K. Poddar)

Member, President,
DCDRF, DCDRF,

C.P. Case No. 21 of 2009 Page 11 of 11