Civil Appeal No. 9711 to 9716 of 2011 (arising out of S. L. P. (C) No. 19314 of 2007 with 3119 of 2008 with 9550, 10544, 11696, 10547 of 2009). Case: Citicorp. Maruti Finance Ltd. Vs S. Vijayalaxmi. Supreme Court

Case Number:Civil Appeal No. 9711 to 9716 of 2011 (arising out of S. L. P. (C) No. 19314 of 2007 with 3119 of 2008 with 9550, 10544, 11696, 10547 of 2009)
Party Name:Citicorp. Maruti Finance Ltd. Vs S. Vijayalaxmi
Counsel:For Petitioner: Chanchal Kumar Ganguli, Adv. and For Respondent: Vishnu Sharma, Adv.
Judges:Altamas Kabir, Cyriac Joseph and Surinder Singh Nijjar, JJ.
Issue:Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; Motor Vehicles Act, 1988 - Section 51
Citation:AIR 2012 SC 509, 2012 (1) AWC 26 SC, 2012 (3) BomCR 110, 2012 (1) CHN 72, 2012 (1)CompLJ 51 (SC), 2011 (IV) CPJ 67 (SC), 2012 (1) JCC 613, 2012 (1) JCR 185 (SC), 2012 (1) LW 153, 2011 (4) RCR 876 (Civil), 2011 (12) SCALE 537, 2012 (1) SCC 1, 2011 (110) SCL 437 (SC), 2011 (6) UJ 3894, 2012 (92) ALR 211, 2011 (2) CGBCLJ 367, 2011 (4) RCR 876 (Civil),
Judgement Date:November 14, 2011
Court:Supreme Court


Altamas Kabir, J.

  1. 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 said order, the National Commission dismissed Revision Petition No. 737 of 2005, filed by the Appellant herein against the judgment and order dated 10th March, 2005, passed by the State Commission, Delhi. By its order dated 27th July, 2007, the National Commission modified the order of the State Commission and set aside the part of the order directing the Appellant to pay Rs. 50,000/- on account of punitive damages and further directed the Appellant to pay Rs. 10,000/- as cost to the complainant Respondent.

  3. From the materials on record, it appears that on 4th April, 2000, at the initiative of the Respondent, a Hire-Purchase Agreement was entered into between the Appellant and the Respondent herein, to enable the Respondent to avail the benefit of hire-purchase in respect of a Maruti Omni Car. In accordance with the terms and conditions of the Agreement, the Appellant granted a hire-purchase facility to the Respondent for a sum of Rs. 1,82,396/-, which was repayable, along with interest, in 60 equal monthly hire charges of Rs. 4,604/- each. Clause 2.1 of the Hire-Purchase Agreement provides for payment of the hire charges in the manner stipulated in the Schedule to the Agreement and it also indicates that timely payment of the hire charges was the essence of the Agreement.

  4. On the failure of the Respondent to pay the hire charges in terms of the repayment schedule, the Appellant sent a legal notice to the Respondent on 10th October, 2002, recalling the entire hire-purchase facility. It further appears that as many as 26 cheques issued by the Respondent towards payment of the hire-charges were dishonoured on presentation. By the said legal notice, the Respondent was informed that she had failed to repay the hire charges according to the payment schedule and had defaulted in honouring her commitments towards repayment. She was requested to make payment of the total amount of Rs. 1,31,299.44p. within 3 days from the date of receipt of the notice.

  5. It appears that subsequently, pursuant to a request made by the Respondent, the Appellant, by its letter dated 10th May, 2003, made a one-time offer of settlement for liquidating the outstanding dues of Rs. 1,26,564.84p. for Rs. 60,000/-, subject to the payment being made by the Respondent by 16th May, 2003, in cash. It was also specifically mentioned in the offer that in the event the Respondent delayed 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 having the same valued by approved valuers and inviting bids from interested parties.

  7. On 31st May, 2003, the Appellant entered into an Agreement for sale of the vehicle with M/s Chin Chin Motors which was the highest bidder, for a sum of Rs. 70,000/-.

  8. Appearing for the Appellant Citi Corporation Maruti Finance Ltd., Mr. Ashok Desai, learned Senior Advocate, submitted that the sale process followed by the Appellant after taking possession of the vehicle was not in violation of the Regulations issued by the Reserve Bank of India. After the vehicle was sold, the Appellant sent a post-sale letter to the Respondent on 9th June, 2003, informing her that the vehicle had been sold for Rs. 70,000/- and that the said amount had been adjusted towards the...

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