Sudip Ahluwalia, Member
1. This Revision Petition has been filed by the Petitioner/ Opposite Party No. 2 against Respondents /Complainants and Opposite Parties Nos. 1 & 3 challenging the impugned Order dated 09.01.2017 passed by the Consumer Disputes Redressal Commission, Jaipur, Rajasthan, in First Appeal bearing No. 890 of 2016. Vide such order, the State Commission dismissed the Appeal at the stage of admission while upholding the Order dated 30.03.2016 passed by the District Consumer Protection Forum, Ajmer, in Complaint No. 19/2015.
2. The brief facts of the case are that the Complainants had invested Rs. 5,50,000/- with the Opposite Party No.1 through Opposite Party No. 2 in a Fixed Deposit Scheme of 36 months under Cumulative of Fixed Deposit Scheme (B) of the Opposite Party No.1 vide receipt No. 5413 to 5417 on 03.06.2011 and receipt No. 10641 to 10642 on 11.08.2011. The payment of 5 FDRs matured on 02.06.2014 amounting to Rs.4,27,000/- and payment of 2 FDRs matured on 10.08.2014 amounting to Rs.3,56,440/-. The Complainant approached the Opposite Party No. 2 several times for payment of maturity amounts. However, the employees of the Opposite Party No.2 did not give any satisfactory reply and kept lingering the matter. Consequently, the Complainants raised their complaints by Emails with the Opposite Parties No. 1 and 2. The Complainants also informed the Opposite Party No.3 about the conduct of the Opposite Party No.1. However, no proceedings were initiated by them. The Complainants also served a Legal Notice dated 30.09.2014. Thereafter, the Complaint was filed before the District Forum alleging deficiency in service and unfair trade practice by the Opposite Parties in not making payment to the Complainants on time and seeking payment of Rs.4,27,728/- along with interest @18% p.a. from 02.06.2014, and for payment of Rs.3,56,440/- along with interest @18% p.a. from 10.08.2014; apart from Rs.2,00,000/- for mental agony and Rs.10,000/- as cost of notice and suit.
3. The Ld. District Forum in its order dated 30.03.2016 noted that the Opposite Parties neither appeared before the Forum nor replied to the Complaint. Consequently, they were proceeded against Ex-parte on 17.03.2015.
4. Hence, vide Order dated 30.03.2016, the Ld. District Forum allowed the Complaint Ex-parte in view of statements and documents produced by the Complainants before Forum, and in absence of any rebuttal by the Opposite Parties, holding the act of Opposite Parties of non-payment of FDR maturity amount to Complainants as negligence and deficiency in service. The District Forum held that the Complainants are entitled to Rs.7,84,168/- along with interest @ 12% p.a. from the date of maturity till its payment; Rs.2,000/- as compensation and Rs.2,000/- as costs of the Complaint/ Litigation.
5. The Opposite Party No.2 claimed to have come to know about the aforesaid Ex-parte Order on 02.04.2016 only from the Email sent by the Complainants. Consequently an application under Order IX Rule 13 read with Section 151 of the Code of Civil Procedure was filed by the Opposite Party No.2 before the Ld. District Forum for recalling/setting aside of its Orders dated 17.03.2015 and 30.03.2016. However, the said Application was dismissed by the Ld. District Forum vide Order dated 01.06.2016. The grounds raised in the Application were that the Opposite Party never received any information from its Counsel regarding the said case, and the Opposite Party No.2 was of the belief that a positive proceeding is being carried out by its Counsel. The Opposite Party No.2 only got to know about the Order dated 30.03.2016 on 02.04.2016 from the Email of the Complainants.
6. Aggrieved by the above Orders, First Appeal bearing No. 890 of 2016 was filed by Appellant/Opposite Party No. 2 against the Respondents/Complainants and Opposite Parties No. 1 & 3 before the Consumer Disputes Redressal Commission, Jaipur, Rajasthan.
7. The case of the Appellant/Opposite Party No.2 before the State Commission was that the Ld. District Forum lacked jurisdiction; that the Opposite Party No.2 had only acted as a broker and as a separate legal entity and was neither a party nor privity to the contract; no charges or fees was given to the Opposite Party No.2. Hence, the Opposite Party No.2 and the Complainants did not have any relation of a Consumer-Service Provider; the Opposite Party No. 2 without any delay, had timely deposited the documents and the cheque given by the Complainant with the Company which resulted in issuance of the Fixed Deposit and soon after submission and receipt of FDR by the Complainant, the role of the Opposite Party No.2 was over and completed; The Opposite Party No.2 gave complete service every time to the Complainant and after receipt of the original FD Certificate, its responsibility as the broker was over.
8. The Ld. State Commission vide impugned Order dated 09.01.2017 dismissed the Appeal while upholding the Order of Ld. District Forum and observed inter alia:-
“…In view of the above there is no merit in this appeal not worth admission and liable to be rejected on the ground of delay as well as on merits.”
9. Hence, the present Revision Petition has been filed by the Petitioner/ Opposite Party No.2 against the above-mentioned impugned Order of the Ld. State Commission. It is stated by the Petitioner/ Opposite Party No.2 that by 23.06.2014, an amount of Rs.3,00,000/- of the Respondent No.1 & 2/Complainants had already matured but the same was not liquidated to them by the Respondent No.3/Opposite Party No.1 for which they approached the Company Law Board, Mumbai, vide Petition No. 1019/2014 under section 58A(9) of the Companies Act,1956 seeking instructions to the Respondent No.3 for liquidation of their amount. Subsequently, the Respondents No.1 and 2/Complainants approached the Respondent No.3 through Email with a request for liquidation which was duly replied by the Respondent No.3 vide Email dated 28.07.2014 stating that it would be liquidating the due amount in some time. The Company Law Tribunal returned the petition of the Complainants on the ground that it was not maintainable for want of territorial jurisdiction. The Respondent No.2 again wrote an Email dated 22.09.2014 which was replied to by the Respondent No.3 on 25.09.2014 admitting its liability and stating that the matured amount would be remitted back shortly. It is averred that the Complainants concealed the said fact of their earlier petition in the Consumer Complaint. It is also averred that the Ld. State Commission vide Oder dated 03.11.2016 had condoned the delay in filing the Appeal. It is further stated that it is the admitted case of Respondent No.3 that it is their responsibility and liability to refund the due amount.
10. Additionally, it is also stated by the Petitioner that a winding up Petition bearing No. CP 35 of 2013 under Section 433(e), (f) and Sections 434, 439 titled as ‘CitiBank N.A. London Branch v. Plethico Pharmaceuticals Limited’ was admitted by High Court of Madhya Pradesh and on 07.04.2015, Plethico Pharmaceuticals was provisionally liquidated and OL was appointed as provisional Liquidator.
11. Heard the Ld. Counsels for Petitioner and Respondents. Perused the material available on record.
12. As already noted earlier, the complaint was allowed in favour of the Respondents/ Complainants Exparte in the absence of any defence coming forth from the side of the Petitioner/Opposite Party, which however, challenged the decision of the District Forum in its Appeal. The Appeal was then dismissed by the State Commission as it found no merits therein, and in doing so, made the following observations inter alia-
“There is no dispute about the fact that the consumers have obtained cumulative fixed deposit scheme and money was paid to the present appellant. Application forms were collected by the appellant and the contention of the respondents was that the present appellant is the Manager for respondent no. 3 which has not been denied by the appellants. Hence, when fixed deposits have not been honoured, it was also the liability of the present appellant and the Forum below has rightly held so.
The appellant has submitted that the matter is pending before the National Company Law Tribunal. Be that may be the case still the Consumer Forums have jurisdiction in view of section 3 of the Consumer Protection Act. Further reliance has been placed on III (1995) CPJ 44 (NC) A.S. Pai Vs. Deluxe Roadlines, I (2009) CPJ 187 (NC) Overseas Marine & Transport Co. Vs. Gupta Carpet Palace, III (2001) CPJ 398 Banka Finance and Investment Service Vs. Sucha Singh Bhati, I (1999) CPJ 687 Bajaj Capitals & Investment Centre Vs. Peeyush Sharma and judgment passed by the Chandigarh State Commission in Appeal No. 140 of 2009 Bajaj Capital Ltd. Vs. Brig. Jasbir Singh and judgment passed by the District Consumer Forum, Indore M.P. In complaint case no. 385/2006 Ramavatar Sharma Vs. Bajaj Capital but here in the present case applications were accepted by the present appellant and money was also paid to them. Hence, they cannot absolve from the liability.”
13. It is, thus, seen that the State Commission was of the opinion that the Petitioner/Opposite Party was liable to pay up the claim of the Complainants since it was the “MANAGER FOR RESPONDENT NO. 3” i.e. the “PLETHICO PHARMACEUTICAL LIMITED” in whose favour the deposits had been made by the Complainants.
14. Contention of the Petitioner however is that it was never such Manager, but only the broker for the concerned Company, and its limited role was to collect the Fixed Deposit amounts from the concerned Subscribers including the Complainants, and to remit the same to the Respondent/Opposite Party No.3. Furthermore, it has been contended that even as per settled law, no Manager/Agent of any defending Company or establishment can be held liable for the default/actionable omission of his Principal, in his personal capacity.
15. The Respondents/Complainants have countered this contention by drawing attention to the original Brochure pertaining to the Fixed Deposit Schemes issued by the Opposite Party/Respondent No. 3- “Plethico Pharmaceutical Limited”, which is Annexure-C 1 to the response filed by the Complainants. The first page of the said Brochure goes to show that the nomenclature given to the Petitioner, Bajaj Capital Limited as “MANAGER TO THE FIXED DEPOSIT SCHEME”, and further perusal of the same goes to show that the Subscribers were required to submit their applications for the fixed deposits in the prescribed Form at the Branches of either HDFC Ltd. (wholesale Banking Operations), or at any of the Branch of the Petitioner-Bajaj Capital Limited. The list of several such Branches of the Petitioner located all over India has also been given under the caption “MANAGER TO THE FIXED DEPOSIT SCHEME”. Furthermore, it is again seen from page 1 of the Brochure that the other entity where the applicants had the option to submit their applications namely HDFC Ltd. has been given the nomenclature “BANKER TO THE FIXED DEPOSIT SCHEME” and the third entity namely “LINK INTIME INDIA PVT. LTD.” has been described as “REGISTRAR TO THE FIXED DEPOSIT SCHEMES”. It has also been specified in the Column “HOW TO APPLY” that the applications forms are available either on the website of the concerned Company i.e. Plethico Pharmaceutical Limited, or on the website of the Petitioner. But, the important aspect to be noted is that the amounts actually deposited by the Complainants were not in favour of either the Petitioner in its capacity as “MANAGER” or HDFC Ltd. (“BANKER”), or “LINK INTIME INDIA PVT. LTD.” (i.e. “REGISTRAR TO THE FIXED DEPOSIT SCHEMES”). It is nobody’s case that being described as “MANAGER TO THE FIXED DEPOSIT SCHEMES”, the Petitioner at any time had issued the Applications Form or accepted the deposits against its own liability. The position is clear that the Scheme regarding receipt of the Fixed Deposit amounts from various Subscribers had been outsourced to no less than three independent entities including the Petitioner, but liability of such re-payment still would have continued with only that juristic person, in whose name the deposit had been made. In other words, even though the nomenclature of “MANAGER TO THE FIXED DEPOSIT SCHEME” had been given to the Petitioner in the original Brochure, but that would in no way mean that the Fixed Deposit amounts were collected or taken by the Petitioner on its own account.
16. Even otherwise, it is settled law that an Agent/Manager of a defaulting Institution cannot be held liable for the default or omission to a complaint in his/its “personal capacity”. This view was taken by this Commission in the case of “Overseas Marine & Transport Company Vs. Gupta Carpet Palace and Others, First Appeal No. 197 of 2002, I (2009) CPJ 187 (NC)” and observed inter alia that –
“15. This case is squarely covered by the ratio of the decision of this Commission dated 20.12.2002 in First Appeal No. 133 of 2001, Overseas Marine & Transport Co. V. Gupta Carpet Palace & Ors. Hence, we are tempted to quote the relevant portion of the decision in extenso:
“As we see the role of forwarding agent is to ‘push/move forward’ goods from hinterland to port, put it at board at ship and to hand back the Bill of lading to the principal. After that it is between the principals who remain the ‘players’ and no room is left for the forwarding Agent. The forwarding agent could be responsible only if anything happens to the goods before loading on o the ship or the Bill of Lading reflects any change against the shipping instructions. In receiving and forwarding goods, the agent is liable for his personal faults only. He must be proved to be at fault. None of this happened in the case, hence, we do not see any liability falling on the forwarding agent. He is neither the owner of the vessel nor has he any control over him as to how does he conduct himself in a foreign country where the Agent has neither the presence nor any control or for that matter locus standi.
Even in the citations given by the learned Counsel for the Respondent in 1995 (1) JCR 608, S.V.N.R. Exports V. Air India, I (1999) CPJ 675; M/s. Sunbright Exporters v. M/s. Air France, I (1997) CPJ 36. Bhilwara Synthetics Ltd. v. P.K. Transport Corporation & Ors. It is the carrier alone who have been held accountable for deficiency in service and not their agents. It is amazing that neither the carrier nor his Agent in India namely Om Shipping Agency were made parties before the State Commission and the State Commission merrily went ahead to deal with in case in their absence. The State Commission in our view, for want of proper appreciation of law on the subject arrived at a wrong conclusion by fixing responsibility on the Agent at the cost of the Principal, which cannot be sustained. Hence order of the State Commission is set aside against the Appellant.
In the light of above, both the appeals are allowed and the order of the State Commission is set aside. Complaint is dismissed against the Appellants. Parties to bear their own costs.”
16. This view is fortified by the decision of this Commission in York Knitwears Ltd. & Anr. V. Lufthansa German Airlines & Ors., III (2007) CPJ 256 (NC), wherein it was clearly held that the responsibility of the Clearing and Forwarding Agent (in short CFA) ceases when the goods loaded in the carrier (Lufthansa Airways) and the airway bill is issued. The CFA is not responsible for the delayed delivery of the cargo. The relevant paragraph of this decision is quoted below:
In this connection, it is worthwhile to go through judgment of the Apex Court in (1998) 3 SCC 247, Marine Container Services South Pvt. Ltd. v. Go Go Garments, wherein it has held that “we are not a little surprised to read that the Contract Act does not apply to complaints filed under the Consumer Protection Act. The Contract Act applies to all the litigants before the Commission under the Consumer Protection Act. Whether in proceedings before the Commission or otherwise, an agent is entitled to invoke the provisions of Section 230 of the Contract Act and if the facts found support him, his defence based thereon cannot be brushed away. Accordingly, in view of the aforesaid judgment of the Supreme Court and also the provisions of the Indian Contract Act, the Agent namely Sun Rise Freight Forwarders (P) Ltd. (in short, the “Sun Rise”) is not liable for the delayed delivery of the goods at the destination by the Lufthansa. The responsibility of Sun Rise ceases when it had got the custom clearance for the booked goods and arranged the delivery of the goods to Lufthansa. In fact, Sun Rise had taken pains to remind the Lufthansa to ensure prompt delivery of the goods. Hence, the agent cannot be held liable for delayed delivery.”
17. Similarly, in Virender Khullar Vs. American Consolidation Services Limited and Others, (2016) 15 SCC 308; the Hon’ble Apex Court dismissed the Appeal of the Complainant and upheld the order of this Commission by observing inter alia that –
“4. Respondent 1 contested the complaints and pleaded that Respondent 1 received the complainants’ goods on behalf of the buyer/consignee i.e. Zip Code Inc. which was part of Coronet Group Inc. as its agent. It is further pleaded that there was no payment made by the appellant complainants for the service provided by Respondent 1, nor was there any contract between the complainants and Respondent 1 for the shipment of the goods. The receipt, custody and forwarding of the goods of the complainants were governed by the provisions of bailment agreement as mentioned in the cargo receipts. The bailment agreement provided that from and after the delivery by Respondent 1 to a carrier in accordance with the instructions of the consignee or other cargo owner, the sole responsibility and liability for the care, custody, carriage and delivery of goods was that of the carrier concerned. Respondent 1 was under no liability whatsoever in respect of any failure on the part of the consignee or any other party. According to Respondent 1, complainants’ claim, if any, can lie only as against the principal i.e. buyer/consignee who appears to have not made payment to the complainants for the value of the cargo. Since Respondent 1 acted only as an agent of the consignee i.e. Zip Code Inc., a subsidiary of Coronet Group Inc., and acted only as a consolidator and forwarder (not a carrier), it has no liability as provided in Section 230 of the Indian Contract Act, 19872, on behalf of the principal. The carrier of the goods in question was Respondent 4 Hoegh Lines/ American President Line Ltd., who issued the relevant Bills of Lading covering the goods……..”
12. Admittedly, the goods in question were handed over by the appellants to Respondent 1 as pleaded. But there is neither any pleading nor proof that the appellants paid any sum for transportation or any other service to Respondent 1 at the time the goods were handed over to it or subsequent thereto. It has been shown on behalf of Respondent 1 that Respondent 1was simply an agent of the buyer with whom the appellants had entered into contract. It is nobody’s case that the goods were lost in transit. Rather it is a case where it has come on record that the consignment was received by Respondent 3 Zip Code Inc., a part of Coronet Group Inc……..”
15. As far as liability of Respondent 2 Central Fidelity Bank and that of Respondent 4 is concerned, we agree with NCDRC that Respondent 4 had carried the consignment and delivered the same as per Bill of Lading and there is no contract between the appellants and Respondent 4. Also Respondent 2 Bank cannot be held liable for the deficiency of service, as the amount was not collected from the consignee, as such there was no question of remitting it to the appellant complainants by the Bank. In the circumstances, Respondent 3 Zip Code Inc., which is subsidiary to Coronet Group Inc., the consignee named in the cargo slips, is the only party which can be held liable for taking delivery without depositing the price of the goods with the Bank….”
18. In spite of being granted opportunity, Shri Vijay Tak, Complainant/Respondent No. 2 who has filed a detailed response in the form of a reply to the Revision Petition, could not cite any case law or precedent to the effect that the Agent of a defaulting Institution is liable in his/its personal capacity towards the Complainants.
19. For the aforesaid reasons, we are of the opinion that both the Ld. Fora below had erroneously found the Petitioner responsible to compensate the claimants, even though the actual Fixed Deposit amounts were given by the Complainants to the actual Respondent/Opposite Party No. 3-“Plethico Pharmaceutical Limited”, and the role of the Petitioner was only that of an Agent who had been authorized to issue the Application Forms, to collect and forward the requisite payments to the said Respondent Company. Consequently, the Revision Petition is allowed after setting aside the orders passed by both the Ld. Fora below. The complaint therefore stands dismissed. The Petitioner is permitted to withdraw the amount deposited by it with the District Forum in compliance of the earlier Order dated 2.3.2017.
Parties to bear their own costs.
20. Pending application(s), if any, also stand disposed off as having been rendered infructuous.
