2001 (1) TMI 909 - Commission - Companies Law

Issues Involved:
1. Whether the complainant is a consumer under the Consumer Protection Act, 1986.
2. Whether there was a deficiency in service by the opposite parties.
3. Whether the complaint was filed within the period of limitation.
4. Whether the complainant had the locus standi to file the complaint.
5. Whether the Forum had the power to order the return of the shares.

Issue-wise Detailed Analysis:

1. Whether the complainant is a consumer under the Consumer Protection Act, 1986:
The opposite parties contended that the complainant was not a consumer under the Act. However, the court noted that the shares were entrusted to the opposite parties for sale at a specified rate, and the complainant utilized the services of the share brokers for consideration. The court held that the complainant was indeed a consumer within the purview of the Act, as defined under section 2(1)(d)(ii).

2. Whether there was a deficiency in service by the opposite parties:
The complainant alleged that the opposite parties agreed to sell the shares at Rs. 195 per share but later sold them at Rs. 123.75 per share and failed to pay the amount due. The court found that the opposite parties had indeed sold the shares at the lower rate and agreed to pay Rs. 24,750, which they did not. This act was deemed as a deficiency in service by the opposite parties.

3. Whether the complaint was filed within the period of limitation:
The opposite parties argued that the complaint was barred by limitation as it was filed more than two years after the cause of action arose. The court noted that section 24A of the Act, which prescribes a two-year limitation period, came into force on 18-6-1996, whereas the cause of action in this case arose on 25-1-1993. Referring to a precedent, the court held that the complaint was filed within the original three-year limitation period applicable before the amendment, and thus, was not barred by limitation.

4. Whether the complainant had the locus standi to file the complaint:
The opposite parties contended that the complainant had no locus standi as the shares were in the name of the complainant's mother. The court held that the complainant, having been entrusted with the shares by his mother and having utilized the services of the opposite parties for selling the shares, had the locus standi to file the complaint.

5. Whether the Forum had the power to order the return of the shares:
The opposite parties argued that the Forum did not have the power to order the return of the shares and that such relief should be sought through specific performance. The court clarified that while the Forum has the power to order the replacement of defective goods or refund the price under section 14 of the Act, the specific relief of returning the shares was not feasible in this case as the shares had already been sold to a third party. Therefore, the court modified the Forum's order, directing the opposite parties to pay the value of the shares with interest, rather than returning the shares.

Conclusion:
The appeal was dismissed with a modification to the Forum's order. The opposite parties were directed to pay Rs. 24,750 with interest at 18% per annum from 25-1-1993 till the date of payment, along with Rs. 2,500 as compensation for mental agony, harassment, and inconvenience, and costs of Rs. 1,000. The direction to return the shares was removed as it was not feasible.

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