The crucial point of the appellant's right to repossess the hypothecated vehicle on default of EMI as per Clause 12(1) of the loan agreement was upheld by the court.

ORDER

Narendra Kawde, Member - This appeal takes an exception to an order dated 13.12.2011 passed in consumer complaint No. 101/2011 by District Forum, Nashik. District Forum while allowing the consumer complaint filed by the complainant present respondent was partly allowed and directed the appellant/opponent to pay an amount of Rs. 3,24,171 together with interest @ 9% p.a. with effect from 1.9.2008 with ancillary relief of Rs. 15,000 for mental agony and Rs. 1,000 as costs of litigation.

2. Aggrieved with the impugned order, appellant/opponent filed this appeal on the ground that provisions contained in loan agreement executed between the appellant and the complainant/respondent have not been properly appreciated by the District Forum and more particularly, Clause 12(1) of the loan agreement which empowered the appellant/opponent to seize and repossess the hypothecated vehicle on default of payment of loan amount. Further it is the ground taken by the appellant that appropriate notice dated 20.9.2010 was issued to the complainant/respondent prior to auctioning the vehicle for default of payment of loan amount. However, though sufficient notice was given, the complainant did not come forward to participate in the auction or otherwise with representation till auctioning of said vehicle on 30.11.2010. Vehicle was never repossessed forcefully as alleged by the complainant/respondent, on the contrary the vehicle was surrendered by the complainant/respondent on 21.8.2010 as EMIs on account of repayment of loan were defaulted right from beginning. All these facts averred before the District Forum were altogether ignored and the impugned order came to be passed against the appellant/opponent.

3. We heard Mr. Ashutosh Marathe, Advocate for the appellant. Respondent remained absent. Perused the record.

4. The fact which is not in dispute is that loan agreement for advancement of loan of Rs. 5,40,000 was executed on 1.9.2008 between the parties. Loan was to be repaid in sixty instalments (EMIs). Except first two instalments, repayment was defaulted. The hypothecated vehicle was put to auction on 30.11.2010 and the proceeds of Rs. 3,90,000 were adjusted towards the outstanding loan account of the complainant/respondent.

5. Our attention was drawn by learned Advocate for the appellant to the provisions of Clause 12(1) of the loan agreement, which empowered the appellant to repossess hypothecated vehicle on default of EMI. District Forum unnecessarily went into the role of examining the accuracy and correctness of the signature of the complainant/respondent in token of receipt of pre-sale notice issued by the appellant/opponent and arrived at an erroneous conclusion allowing the consumer complaint though the record does not reveal whether surrender of the vehicle as claimed by the appellant or forcible repossession of the same by the appellant is on record. There is no counter material available on record for theory of surrender or forcible repossession. The facts remained that in consequences of continuous default right from beginning in payment of loan amount i.e. EMIs empowered the appellant under the Loan Agreement to take action including that of seizure/repossession of the hypothecated vehicle. This crucial point was ignored by the learned District Forum while deciding the consumer complaint.

6. Another point of putting auction of the repossessed hypothecated vehicle was considered by the District Forum and observed that for want of public auction, the procedure followed suffered from infirmity. Illegality or validity of the modus operandi of auctioning the seized vehicle or repossessed vehicle is not a question to be decided by the Consumer Fora. There is no supporting material to establish the claim of the complainant/respondent that there was willingness to settle the entire defaulted amount and to take back possession of the vehicle. On the contrary, we find it pertinent that after adjustment of the loan proceeds of Rs. 3,90,000, the