Office: Joseph L Renthlei & Associates

ALDRIN ZOTHANMAWIA Residence : D-52/B, Chanmari

Below MAHCO Office ADVOCATE Aizawl, Mizoram
Opposite Venghlui Taxi Stand P.O. Chanmari -796007
Treasury Square, Aizawl

Phone: 9436197334 Email: aldrin.zothan@gmail.com

Dated: 24th May 2023

To

JH Lalremruati
D/o JH Lalthangliana
R/o Champhai, Kahrawt Veng
Mizoram

Through

Lalhriatsangi
Advocate
TJ Law Firm & Consultancy
Treasury Square, Aizawl

Subject: Reply to your Legal Notice Dated 11.05.2023

Madam,

I am writing to you on the instructions of my client Mahindra

Finance, Mahindra & Mahindra Financial Services Limited, having their office
at 2nd Floor, Khatla TBL Building, Aizawl, Mizoram who has received a legal
notice sent by you on 11.05.2023. In your legal notice, you have inter alia
made an averment stating that my client failed to comply with the provisions
of law and failed to discharge their liability intentionally with respect to your
client.

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 The majority of the allegations and averments made in your
legal notice are incorrect, denied and refuted and I am bringing to your kind
attention the following facts and para-wise reply as under:

1. That the averments made in Para 1 of your legal notice are slightly incorrect.
Your client has executed a Hire Purchase Agreement with my client, bearing
Contract No. 7009469 with respect to a Hyundai Creta 1.4 Turbo GDI DCT SX
(O) AUTO bearing Registration No. MZ04A4410, Engine No. G4LDLG015180
and Chassis No. MALPC811VLM036841 as opposed to a ‘Hyundai New Creta’
which was averred in your legal notice. Your client, bearing Customer ID
60006686754, was availed a monthly loan repayment tenure for 60 months,
with the due date of repayment at the 15th day of every month, with respect
to the said asset valuing Rs 17,56,230/- (Rupees Seventeen Lakhs Fifty Six
Thousand and Two Hundred and Thirty) at the time the said agreement was
made. The agreement was also made on 22.09.2020 as opposed to your
averment, stating that the vehicle loan was availed on 28.08.2020.

2. That with respect to Para 2 and 3 of your legal notice, my client has no
comment.

3. That with respect to Para 4 of your legal notice, you have stated that your
client ‘was also making a regular payment as per the agreement terms and
condition’. This averment is incorrect and denied. Your client started to
commit a default with regards to paying her loan, contravening and
dishonouring the Mahindra Finance Used Vehicle Loan Agreement,
hereinafter referred to as the Loan Agreement which was duly signed and
executed in the year 2020 by- your client, your client’s Guarantor Shri JH
Vanlalhruaia and my client, starting from the month of October 2020,
delaying and defaulting to repay the loan repeatedly, ranging between 2 –
120 days.

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4. That the statements made in Para 5 of your legal notice is also incorrect and
denied. It has already been mentioned in the preceding paragraph that your
client had defaulted in repaying her loan, starting from the month of October
2020. Hence, your client’s statement indicating that your client started
defaulting her payment only from the year 2022 is incorrect.

5. That with regards to Para 6 of your legal notice, my client again denies all
the averments made in this paragraph. My client is not aware of your client,
contacting any of the staff of Mahindra Finance regarding ‘collecting’ the
vehicle in the month of October 2022. Further, my client also denies that your
client came to their office on 12.12.2022. In contrast, in the month of August
2022, your client had indeed contacted my client that she wanted to put the
vehicle in the custody of my client without disclosing any logical reason. When
my client company retrieved the vehicle on 23.08.2022, after receiving it from
your client, it was found out that your client had put the vehicle in a
deteriorating condition, to the extent that the said vehicle was incapacitated
and damaged to move/travel in reverse, and the treads of the wheels were
already badly smoothed out to the extent that metal linings in the tread were
exposed. Due to the poor condition your client had put the vehicle in, my
client had to put it in repair at CK Hyundai, an automobile servicing centre
located at Chite Veng, Aizawl. In this same year, your client had consistently
defaulted in repaying her loan for a very long period of time, especially in the
months starting from September 2022, to the extent where in the month of
December 2022, there was a delay of repaying the loan which exceeded 100
days. Hence, after your client was, after a number of times, informed to repay
her loan including late fees immediately through telephone, and after your
client had also persistently avoided phone calls from my client, your client
was able to make some repayments in the month of December 2022.

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6. That pertaining to the consistent and repeated default committed by your
client in repaying her loan, it is pertinent to mention Clause 16 of the Loan
Agreement which reads:

“(16) Cross Liability

The Borrower expressly accepts that if the Borrower fails to pay any
monies when due or which may be declared due prior to the date
when it would otherwise have become due or commits any other
default under any agreement (including this agreement or any other
agreement with any of the Group Company, as defined by the
Companies Act) with the Lender under which the Borrower is
enjoying any financial/creditor/other facility; then in such event the
Lender shall, without prejudice to any of its specific rights under
each of the agreements, be absolutely entitled to exercise all or any
of its rights “Including taking Possession, Disposal and Holding NOC
of the Used Vehicle there of” under any of the Borrower agreement
(including this agreement) with the Lender at the sole discretion of
the Lender.”

Supplementing to other clauses of the Loan Agreement, as per this clause, it

is apparent that my client has the sole discretion to take into possession the
vehicle loaned to your client if your client fails to pay any money when due,
which she failed to do so. However, my client showed mercy and leniency
towards your client even after committing numerous default in repaying her
loan and did not invoke any immediate action against your client.

7. That it is pertinent to also mention that your client should also be well aware
of the terms and conditions of the loan, governed by the Loan Agreement
which she executed. As per Clause 10 of the Loan Agreement, my client has
a lawful discretion of taking into custody the vehicle, without any notice

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 period, from your client if your client is putting the vehicle in a deteriorating
condition or concealing it to any third party. During the time when it was
discovered by my client in the month of August 2022 that your client had
clearly damaged and put the asset in a deteriorated condition, and also taking
into consideration the consistent default in failing to repay her loan within
due time delay, and also your client’s unavailability to be communicated
regarding her loan, my client had every reason and lawful discretion to seize
the vehicle from your client’s possession and retrieve it back into their
custody. However, my client company has extended their hands of
benevolence in favour of your client and had taken the decision not to initiate
the said action against your client.

8. That with regards to your averments in Para 7 of your legal notice, my client
does not have much comments other than stating that your averments should
be put to strict proof. During the time when the said vehicle was taken home
by you as averred in your legal notice, personnel from my client company
had again clearly in person, reiterated to your client that the vehicle could
actually be seized from your possession if you continue to persistently make
a default in repaying the loan, and that your client would no longer be availed
in acquiring it back again in the event it is seized. However, this good gesture
of precaution was still disregarded by your client subsequently.

9. That also with regards to the averments in Para 8 of your legal notice, there
cannot be much comment other than stating that such averments should
also be put to strict proof. Also, the records of your client’s loan repayment
summary has been duly recorded in the database maintained by my client.
Hence, in respect of determining an authentic actual repayment
status/history of your client, I am stating that my client will only rely on what
has been duly maintained in the Repayment Summary data recorded by my
client.

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10. That with respect to Para 9 of your legal notice, all the averments made are
denied and incorrect. It has been stated in the legal notice that my client has
not given you any notice or intimation regarding the apprehension of the
vehicle loaned to your client. This is a false accusation and vehemently
denied. In contrast, other than informing your client through numerous
telephone calls, your client has been told in person that if she constantly and
consistently makes a default in repaying her loan, the vehicle loaned to her
would be seized from her possession. Due to numerous failed attempts in
trying to contact your client through telephone by a number of personnel
from my client company, which your client have almost all the time avoided,
my client was forced to send two Demand Notices to your client and your
client’s guarantor, on 15.04.2023 and 01.05.2023 respectively wherein
personnel from my client company were dispatched on the same date to
deliver the same. In such Demand Notices, it was conveyed that your client
and her guarantor are jointly and severally called upon to make payment of
the arrears of the loan, along with all other charges payable immediately at
my client’s branch office. It was also stipulated in those Demand Notices that
failing to execute the instructions given by my client, would result in my client
initiating a legal action against your client, and in addition, to take possession
of the said vehicle. However, even at the residence provided by your client,
your client was not present and her whereabouts were unknown to my client.
Due to the numerous reasons mentioned above, my client was left with no
other option but to seize from your client’s possession the said vehicle as per
the Loan Agreement. However, to aggravate the situation, my client
discovered that your client had concealed and hid the said vehicle away from
my client to disable my client from seizing the vehicle. After my client looked
and searched for the vehicle with great difficulty, my client recovered the
vehicle from ‘Jai Jahau Workshop’, located at Zuangtui, Aizawl on 03.05.2023
with reliable civilian eyewitnesses. Regardless of the discretion of my client

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 to initiate appropriate legal action against your client for not only breaching
the terms of the Loan Agreement but also for committing a criminal act, my
client remains reserved in taking such action till date and showed leniency
against your client, however not fastened to such decision if the need arises.

11. That with regards to Para 10 of your legal notice, your client is duly reminded
that my client has the lawful authority and discretion in accordance with
Clause 10(b) of the Loan Agreement to sell the vehicle in private of public
auction or by inviting tenders or quotes as deemed fit as your client fails to
respond to the Demand Notices sent by my client. Regardless of this sub-
clause, since your client not only concealed the vehicle away from my client
but also deteriorated the condition of the vehicle, my client had the discretion
of taking into custody the vehicle without any notice period and as per Clause
(16) of the Loan Agreement.

12. That with regards to the averments made in Para 11 of your legal notice, my
client would like to inform your client that my client is open to entertain all
grievances submitted by their customers/stakeholders. However, as in the
case of your client, as long as it concerns your client’s grievances regarding
the seizure of the vehicle, no rectification nor remedy could be extended to
your client due to all of the aforementioned reasons stated above. With
regards to your client’s averments stating that my client has caused ‘great
loss and damage besides mental tension, trauma and inconvenience and loss
of value of money’ my client expresses their condolences due to the
inconvenience caused. However, my client would like to remind your client
that she was well aware of the consequences of breaching the Loan
Agreement while she was executing the said agreement.

13. That all the averments made in Para 12 of your legal notice is denied and
uninformed. There was no lack of professionalism committed by my client in

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 handling the business with your client. The only reason why your client fell
into this situation is due to her negligence, failure to honour the loan
agreement, and failure to comply with the numerous instructions and advice
extended by my client to yours. In spite of this, my client showed leniency to
your client by not immediately invoking their authority against your client.
Further, my client directing yours that she could approach the court for
seeking a remedy, on the contrary, shows that my client has professionally
dealt with the situation and rather shows their receptiveness and impartiality
towards your client.

14. That with regards to the averments made in Para 13 of your legal notice, my
client states that your client was and have been made well aware of her fault.
Hence, the averments made against my client, stating that they have kept
your client in ambiguity is incorrect. My client also states that if your client
thinks that she is still kept in the dark regarding her fault and liabilities, even
after inter alia all those communications made to your client, then this reply
to your legal notice may serve to remove her ambiguities.

15. That the averments made in Para 14 is denied and is deemed baseless.

16. That the averments made in Para 15 of your legal notice stating that your
client ‘has been repaying dutifully and she comply readily with whatever the
consequences it brought by her irregular repayment’ is also denied and
incorrect. Apparently, the outcome of your client’s non-compliance to the
Loan Agreement results in seizing the said vehicle from your client.

17. That with regards to your first demand made in Para 16 of your legal notice,
may this reply to your legal notice serve as a sufficient explanation as to why
my client has taken an action against your client. With regards to your second
demand, your client is informed that the said vehicle had already been
auctioned as per the Loan Agreement and had already been purchased by

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 another customer. Hence, the said vehicle can no longer be acquired by your
client. With regards to your alternative demand, your client is informed that
she is also well aware that her demand could not be made possible as there
are no provisions of refunding her loan repayment amount to my client, even
in the Loan Agreement.

18. That with regards to the concluding paragraphs of your legal notice, you are
duly informed to take into consideration the following provisions of the Loan
Agreement reproduced here for ready reference:

“ Clause (17) Arbitration:

All disputes, differences and/or claim arising out of these presents or in

any way touching or concerning the same or as to constructions, meaning
or effect hereof or as to the right and liabilities of the parties hereunder
shall be settled by arbitration to be held in accordance with the provision
of the Arbitration and Conciliation Act, 1996 or any statutory amendments
thereof and shall be referred to the sole arbitrator to be nominated by the
Lender. In the event of death, refusal, neglect, inability or incapability of
a person so appointed to act as an arbitrator, the Lender may appoint a
new arbitrator. The arbitrator shall not be required to give any reasons
for the award and the award of the arbitrator shall be final and binding
on all parties concerned. The arbitration proceeding shall be held in
Chennai.

Clause (18) Jurisdiction:

It is agreed by and between the parties hereto that the Courts at Chennai
alone shall have exclusive jurisdiction in respect of any matter, claims or
dispute arising out of or in any way relating to these presents or to
anything to be done under and pursuant to these presents or of any clause

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or provision thereof, notwithstanding that the whole or substantial
part of the cause of action may not have arisen at Chennai. “

Hence, you are informed that if this reply to your legal notice, in spite of
all the facts disclosed, according to you, fails to sufficiently establish that
my client does not have any liability towards your client nor establish that
your client does not have any remedy to be claimed against my client, you
are directed to approach the Courts at Chennai for an arbitration
proceeding as per Clause (17) & (18) of the Loan Agreement which have
been duly signed and accepted by your client while executing the
aforesaid Loan Agreement.

In addition to this, I would like to bring your attention towards the last
paragraph of Clause 10 of the Loan Agreement which is reproduced here
for ready reference:

(10) Consequences upon event of default

“... It is agreed and understood by the Borrower(s) that the right of

the Lender to recover the amount payable and/or repayable or
reimbursable to the satisfaction of the Lender shall survive any
such Cancellation of Loan and/or termination of the Agreement
as the case may be. The Lender shall be entitled to take all or
any of the steps to recover the dues payable by the Borrower
and shall have unqualified right to disclose or publish Borrower’s
default in such manner and through such medium as the Lender
may in its absolute discretion may deem fit.”

This provision/clause clearly gives my client the discretion to recover the

remaining amount of loan payable by your client to mine regardless of the
cancellation of the loan of your client. Hence, you are also informed that

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my client can still initiate a counter claim against your client for recovery
of the remaining balance of loan your client owed against my client.

In view of the above, you are hereby called upon to withdraw your
legal notice Dated 11.05.2023 immediately. In case you initiate any legal
proceedings against my client, based on the facts stated in your legal
notice, the same may be at the peril and cost of your client and shall be
dealt with by my client. Please take notice and advise your client
accordingly.

(NOTICE GIVER)

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