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TMI Blog2012 (7) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, Delhi. By its order, the State Commission, Delhi, affirmed the order of the District Forum and directed payment of a further sum of Rs. 50,000/- on account of punitive damages. In the instant case, the situation is a little different, since after the vehicle had been seized, the same was also sold and third party rights have accrued over the vehicle. It is possibly on such account that the Appellant Bank chose to comply with the directions of the District Forum notwithstanding the pendency of this case. Since the Appellant Bank has already accepted the decision of the District Forum and has paid the amounts as directed, no relief can be granted to the Appellant. - CIVIL APPEAL NOS. 9711 TO 9716 OF 2011 - - - Dated:- 14-11-2011 - ALTAMAS KABIR, CYRIAC JOSEPH AND SURINDER SINGH NIJJAR, JJ. JUDGMENT Altamas Kabir, J - Leave granted. 2. SLP(C)No. 19314 of 2007, which is being heard along with SLP(C)No. 3119 of 2008, SLP(C)Nos. 9550, 10544, 11696 and 10547 of 2009, is directed against the judgment and order dated 27th July, 2007, passed by the National Consumer Disputes Redressal Commission, hereinafter referred to as the "National Commission". By the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in making payment of the said sum of Rs. 60,000/- for whatever reason, the offer would stand voided and the Appellant would be entitled to claim from the Respondent the total dues as on date. 6. Thereafter, in keeping with the terms and conditions of the Hire-Purchase Agreement, the Appellant took possession of the financed vehicle and informed the concerned Police Station before and after taking possession thereof from the residence of the Respondent. According to the Appellant, an inventory sheet was also prepared, which was duly countersigned by the husband of the Respondent. It is the Appellant's case that at the time of taking possession of the vehicle, six monthly instalments were overdue. On the same day, the Respondent's husband wrote to the Appellant to extend the time for paying the amount which had been settled at Rs. 60,000/- by way of a One-Time Settlement. It is also the Appellant's case that subsequent thereto, the date of the settlement offer was extended as a special case, but despite the same, the Respondent failed to pay the amount even within the extended period. It is on account of such default that the Appellant was constrained to sell the vehicle after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... followed the letter and spirit of the Hire-Purchase Agreement and had re-possessed the vehicle in terms of the default clause in the Agreement. On 27th July, 2007, the National Commission, while dismissing the Revision Petition modified the order of the State Commission by setting aside that part of the judgment directing the Appellant to pay Rs. 50,000/-on account of punitive damages. Instead, the Commission directed the Appellant to pay a sum of Rs. 10,000/- to the Complainant/Respondent by way of cost. 12. Appearing in support of the Appeal, Mr. Ashok Desai, learned Senior Advocate, began his submissions by posing a question as to whether the High Court was justified in coming to a finding in observing that the hire-purchase system or leasing system was contrary to the interest of the society. Referring to Clause 25 of the Hire-Purchase Agreement dealing with events of default, Mr. Desai submitted that Sub-Clause 25.1.1 provides that nonpayment of any monthly hire charges on the due date as per terms of the Agreement, would amount to an event of default and the consequences thereof were set out in Clause 26 dealing with the Owner's Rights On Default By Hirer. Since the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entitled to recover from the Hirer all expenses (including legal costs on full indemnity basis) incurred by or on behalf of the Owner in ascertaining the whereabouts, of taking possession, insuring, transporting and selling the vehicle and of any legal proceedings that may be filed by or on behalf of the Owner to enforce the provisions of this agreement. It is expressly clarified that the remedies referred to hereinabove shall be in addition to and without prejudice to any other remedy available to the Owner either under this agreement or under any other Agreement or in law. 26.6 Without prejudice to the generality of the foregoing words, the Hirer hereby consents to the Owner disseminating to and sharing with third parties (including banks, financing entities, credit bureaus of which the Owner is a member or any statutory body or regulatory authority) all information within the knowledge of the Owner and pertaining to Hirer (including credit history and credit status of the Hirer) at any time as the Owner may consider necessary or be requested or directed to do." 13. Mr. Desai contended that in order to act in accordance with the aforesaid clause, the Appellant had framed it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nforceable. In order to ensure transparency, the terms and conditions of the contract/loan Agreement should also contain provisions regarding notice period before taking possession; circumstances under which the notice could be waived; the procedure for taking possession of the security and provision providing for a final chance to be given to the borrower for repayment of the loan, before proceeding with the sale or auction of the property. Mr. Desai submitted that the said guidelines had been duly embodied in the Hire-Purchase Agreement and that the Appellant was, in fact, taking steps, in accordance with such provisions, to recover the hypothecated properties in case of default. 16. Mr. Desai lastly contended that the Tribunal was not entitled to modify the terms of the Agreement which had been arrived at between the parties and that when there was an acute dispute relating to facts, the Tribunal, in this case the National Commission, ought not to have gone behind the terms of the Contract and should have instead referred the parties to the Civil Court. It was also observed that only in an appropriate case was the Tribunal entitled to enter into the validity of the terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions of the SARFAESI Act, 2002, could be applied in similar cases, the same would not apply as far as the present cases were concerned, since they constituted loan agreements in respect of which either the normal civil or the arbitration law would have application. It was further submitted that if a loan had been taken against a mortgage, the remedy on account of recovery would be with the Civil Court in regard to the mortgaged properties. In this regard, reliance was placed on the decision of this Court in Sundram Finance Ltd. v. State of Kerala AIR 1966 SC 1178. Reliance was also placed on a decision of this Court in Civil Appeal No.5993 (SC) of 2007 CCE v. Baiai Auto Finance Ltd. , where similar views have been expressed. 19. Reference was also made to Section 51 of the Motor Vehicles Act, 1988, which makes special provision in regard to motor vehicle which was subject to a Hire-Purchase Agreement in cases covered under a Hire-Purchase Agreement. In cases covered under Hire-Purchase Agreements, provision has been made for the Registering Authority to make an entry in the Certificate of Registration regarding the existence of such agreement. Clause ( b ) of Section 51 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf, in fact, support and make a virtue of such conduct. If any action is taken for recovery in violation of such guidelines or the principles as laid down by this Court, such an action cannot but be struck down. 22. In the instant case, the situation is a little different, since after the vehicle had been seized, the same was also sold and third party rights have accrued over the vehicle. It is possibly on such account that the Appellant Bank chose to comply with the directions of the District Forum notwithstanding the pendency of this case. 23. Since the Appellant Bank has already accepted the decision of the District Forum and has paid the amounts as directed, no relief can be granted to the Appellant and the Appeals are disposed of in the light of the observations made hereinabove. 24. The application filed in Special Leave Petition (Civil) No.10547 of 2009 on 26th August, 2011, for bringing on record the legal heirs of the sole respondent Shiv Nath Sareen is no longer relevant on account of the aforesaid decision and the same is, therefore, dismissed. The Appeals are also disposed of in terms of the observations made hereinabove. 25. There shall, however, be no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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