1993 (10) TMI 235 - Commission - Companies Law

National Commission - Jurisdiction of - Whether a case, wherein elaborate evidence would have to be taken regarding purchase/sale of shares, their prevailing prices in market, etc., as also regarding precise instructions given by complainant on telephone to opposite party, as in instant case, and wherein allegations of fraud and manipulation of accounts were made which could not be decided on basis of affidavits, would be a fit case to be dealt with by consumer forums - Held, no

Summary

Issues:
1. Allegation of unfair trade practice, deficiency in service, and overcharging by the share and stock broker.
2. Transfer of complaints to National Consumer Disputes Redressal Commission based on monetary jurisdiction.
3. Dispute regarding the rendering of accounts for share transactions and withholding of the Chopri book.
4. Failure to provide margins for share transactions and the speculative nature of the transactions.
5. Suitability of the complaint under the Consumer Protection Act and the need for elaborate evidence in the case.

Analysis:
1. The complainant alleged unfair trade practice, deficiency in service, and overcharging by the share and stock broker, claiming compensation, refund, and interest. The complainant accused the broker of fraudulent dealings and collecting charges without providing accurate statements of account for share transactions. The complainant sought redress for the alleged wrongs done during share purchases and sales on behalf of the complainant and family members.

2. The complaints were transferred to the National Consumer Disputes Redressal Commission due to the claim amount exceeding the monetary jurisdiction of the State Commission. The Commission observed that the real valuation of the complaints would exceed the threshold for the State Commission, justifying the transfer of complaints for adjudication.

3. The main controversy revolved around the rendering of accounts for share transactions and the withholding of the Chopri book by the respondent. The complainant insisted on examining the Chopri book to support the transactions made on behalf of the complainant. The respondent claimed that transactions were done based on telephonic instructions and highlighted the complainant's failure to provide margins for the transactions.

4. The respondent contended that the transactions were speculative in nature and aimed at making profits. The respondent provided contract notes, bills, and statements of accounts to the complainant. Allegations of the complainant owing money and attempting to manufacture a dispute to avoid payments were raised by the respondent.

5. After reviewing the evidence and hearing both parties, the Commission expressed doubts about the complaint's maintainability under the Consumer Protection Act. The Commission noted the need for elaborate evidence regarding share transactions, prices, and instructions given for transactions. The Commission concluded that the case was not suitable for Consumer Forums and dismissed the petitions, advising the complainants to seek redress in a Civil Court if desired.