Consumer Complaint No. 74 of Tajinder Kumar Taneja, S/o Late Sh. Ram Saran Dass, Opposite State

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1 2 nd Additional Bench STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB DAKSHIN MARG, SECTOR 37-A, CHANDIGARH Consumer Complaint No. 74 of 2009 Date of institution: Date of Decision: Tajinder Kumar Taneja, S/o Late Sh. Ram Saran Dass, Opposite State Bank of Patiala, Tanda Road, Jalandhar...Complainant Versus 1. M/s Unique Investments through its Partner Manouti Dhawan, W/o Sandeep Dhawan, 373, Adarsh Nagar, Jalandhar. 2. Manouti Dhawan W/o Sandeep Dhawan, 373, Adarsh Nagar, Jalandhar. 3. Ashu Randhev W/o Ashwani Randhev, R/o 29, Tagore Park, Near Dharam Kanta, GT Road, Jalandhar...Respondents/Opposite Parties Argued By:- For the complainant : Mr. Manoj Dhiman, Advocate for Sh. Vishal Aggarwal, Advocate For the respondents/opposite parties: None. Consumer Complaint under Section 12 of the Consumer Protection Act, Quorum:- Shri Gurcharan Singh Saran, Presiding Judicial Member Shri Piare Lal Garg, Member Shri Jasbir Singh Gill, Member

2 CONSUMER COMPLAINT NO. 74 OF Gurcharan Singh Saran, Presiding Judicial Member The complainant Tajinder Kumar Taneja (hereinafter called the complainant ) has filed the present complaint under the Consumer Protection Act, 1986 (in short the C.P. Act ) on the allegations that he is account holder of opposite parties/respondents whereas respondent No. 1 is partnership firm being run by respondents No. 2 & 3 being its partners with the help of their husband Ashwani Randhev and Sandeep Dhawan. The respondents and their husbands induced him to invest money on assured returns alongwith profits and also assured of providing him with Portfolio Management Service for buying and trading in shares based on the advice given by them with an assured return of 1% per month alongwith 90% of the profit after taxes and brokerage 10% from the profit. Accordingly, the complainant was made to sign various documents to open account with them for trading and then the complainant gave a net sum of Rs. 26,50,000/- by way of different cheques and the said amount included Rs. 1,50,000/- given by Late Smt. Nita Arora. The complainant time and again have been asking the respondents for the demat account number, to which the respondents kept dilly-dallying rather conveyed that there is excellent growth and handsome returns are expected. Though some money was returned but the net balance remained Rs. 26,50,000/- alongwith interest and profits. Then the complainants asked for to return the money as the same is required for some business purposes but respondents No. 2 & 3 with their husband kept dilly-dallying on the pretext that the same has been invested and the complainant should

3 CONSUMER COMPLAINT NO. 74 OF wait for getting attractive returns. He was also shown his portfolio with various shares with projected returns. When finally the complainant asked the respondents to return the entire money but the respondents were reluctant, however, they gave a cheque of Rs. 49 lacs in April, 2007 as full and final payment in the other account of the complainant where he is Karta wherein he had given Rs lacs only. But lateron there was a settlement vide which the complainant returned the said cheque of Rs. 49 lacs with the respondents and two cheques were issued to the complainant(petitioner) to the tune of Rs lacs towards part settlement of HUF account of the complainant and cheque of Rs. 15 lacs towards settlement on the part of the present account of the complainant. However, on presentation of the said cheque it bounced. The complainant called upon the respondents and they assured that the money shall be returned at the earliest but the complainant did not receive anything except the assurances. Seeing no alternative, the complainant served a notice upon the respondents under Section 138 of the Negotiable Instrument Act (for short NIA ) but the respondents failed to make any payment, therefore, there is deficiency in service on the part of the respondents, hence, the complaint with the direction to the respondents to release the payment of Rs lacs alongwith 1% per month alongwith profits in proportion to the profit remained/conveyed to the complainant with any other relief as deem fit by the Hon ble Commission. 2. The complaint was contested by the respondents, who filed the reply taking preliminary objections that the complaint is not

4 CONSUMER COMPLAINT NO. 74 OF maintainable in the present form; the complaint is without jurisdiction as it arises out of sale transaction, which is done through Exchange and the same is to be adjudicated by way of Arbitration; but the complaint is hopelessly time barred; the complainant has not approached the Hon ble Commission/ Court with clean hands and suppressed the material facts; the complainant approached the respondents for opening a Trading account and according to the request and desire of the complainant a Trading account was opened on and since then several transactions had taken place with regard to sale and purchase of the shares conducted by the complainant himself in the account of respondent No. 1 till As per statement of account, a sum of Rs. 88 lacs is due from the complainant for which the complainant is fully aware and was legally bound to pay the same to the respondents. However, with malafide intention and ulterior motive, the complainant was able to lay hand over the cheques of the respondents, which were duly signed. It is further mentioned that the business of the respondents was looked for by their husband, therefore, their husband Sandeep Dhawan used to keep in their hand some signed cheques and he used to get in their custody few signed cheques of the partners so that the partners may not be called for time and again during the daily course of transaction. When the respondents were renovating their office and in the meantime brother-in-law of Sandeep Dhawan was admitted in D.M.C., who had died unfortunately, therefore, Sandeep Dhawan lost strict control over the said cheques. The complainant taking benefit of the given circumstances, lay hands on the said cheques and used it

5 CONSUMER COMPLAINT NO. 74 OF by putting concocted and false story. The matter was also referred to the Police. Lateron, the complainant return the cheques to the respondents and accepted his fault and apologized for the same, as such, no criminal action was taken. However, the complainant after a few days filed two complaints under Section 138 of the NIA in the Court of Jalandhar and two complaints were filed before the Hon ble Commission. The respondents have no liability against the complainant. The complainant used to collect the statement of account regularly and used to pay the sale and purchase or viceversa, which is known as mark to mark difference of the Exchange. Payments were made to the complainant at regular intervals. On merits, it has been denied that the respondents cheated the complainants. It has been admitted that respondent No. 1 is a Partnership firm and that respondents No. 2 & 3 its partners. It has been denied that the complainant was directed to invest money on ensured returns of profit and was assured portfolio management 1% per month. No such commitment was ever made by the respondents, rather, the complainant was trading himself in the account of respondent No. 1 and was clearing his liability arising out of the said trading. It has been stated that the payment was made by the respondents by cheque and even by cash as mentioned in the statement of account. The complainant cannot keep silent for the period of three years particularly for the circumstances for making good his lossess in accordance to the bills of the respondents. In fact the complainant has mis-used cheque of Sandeep Dhawan as stated above. The statement of account was prepared by the respondents in

6 CONSUMER COMPLAINT NO. 74 OF accordance with the bills/ledgers prepared in accordance with the trading committed by the complainant. No money is due as alleged by the complainant. There was no lack of deficiency on the part of the respondents as the respondents had been providing of the details of statement of account from time to time in accordance with the demand, rules and regulations and ultimately, it was stated that there was no merit in the complaint and the same be dismissed. 3. The parties were allowed to lead their evidence. 4. In support of his allegations, the complainant had tendered into evidence affidavit of Tajinder Kumar Taneja Ex. CW-1, statement of account Ex. C-1, item copy request Ex. C-2, notice dated Ex. C-3 and judgment dated Ex. C-4. On the other hand, the respondents had tendered into evidence affidavit of Minoti Dhawan Ex. OP-A, copies of statement of account Ex. OP-1 to OP-3, copy of complaint Ex. OP-4, copy of complaint Ex. OP-5 and OP We have heard the counsel for the complainant Sh. Manoj Dhiman, Advocate for Sh. Vishal Aggarwal, Advocate and none for the respondents and also gone through the written arguments submitted by the counsel for the complainant as well as respondents. 6. According to the averments in the complaint and written arguments filed by the counsel for the complainant, the complainant had given a sum of Rs. 26,50,000/- by way of different cheques from to The respondent firm is a share broker being a sub-broker of some Integrated Market Securities Ltd. and that the

7 CONSUMER COMPLAINT NO. 74 OF respondents had assured the complainant providing with the Portfolio Management Service for buying and trading in shares based on advice given by them with an assured return of 1% per month but it was not done. In April 2007, a cheque of Rs. 49 lacs was given, the same has been placed on the record as Ex. C-2 but lateron the same was given back to the respondent on the promise of settlement and lateron two cheques of Rs. 6,50,000/- and Rs. 15 lacs were given, which was dishonoured. A notice was given then complaint under Section 138 of NIA was filed, which was dismissed by the Ld. First Class Magistrate. However, its appeal was filed before the Ld. Sessions Judge, Jalandhar, a copy of the judgment is Ex. C Whereas the respondents have placed on the record statement of account of the complainant firm trading with the respondent firm as Exs. OP-1 to OP-3. Ex. OP-4 is proceedings before the Police on the complaint filed in which it was observed that the matter is already pending with the Court, therefore, no action was taken by the Police. 8. There is no agreement between the complainant and the respondents placed on the record vide which the respondents had agreed that the complainant will be provided with Portfolio Management Services for buying and trading of shares based on the advice given by them with an assured return of 1% per month alongwith 90% of the profit after taxes and brokerage 10% and they were made to sign various documents to open an account with them for trading. No such documents have come on the record. Whereas, the case of the respondents is that the complainant had

8 CONSUMER COMPLAINT NO. 74 OF requested the respondents to open a trading account and accordingly, their trading account was opened with respondent No. 1 on and then several transactions was made by the complainant with respondents firm till Otherwise, the amount so alleged by the complainant was received by the respondents. According to the statement of the respondents Exs. OP- 1 to OP-3, a sum of Rs. 88 lacs was due to the respondent firm and that they had been taking the money orally of the trading for loss and profit. 9. The next question arises whether the complainant, who is doing the business of trading falls within the definition of consumer? 10. On this point, there is latest judgment of the Hon ble National Commission Vimal Raosaheb Chougule, Raosaheb Sidhapa Chougule (Dr.) versus Stock Holding Corporation of India Ltd. & Ors., IV (2013) CPJ 34 NC that in case of transfer of shares an allegations of forgery, fraudulent as well as misappropriation against respondent No. 1, it was held that the same dispute is not a consumer dispute. Consumer Fora has no jurisdiction. The Apex Court in another judgment Economic Transport Organization v. Charan Spinning Mills Pvt. Ltd., 2010 CTJ 361 (SC) (CP) in which the appellant who provided Depository facilities to the investors within the meaning of the Depositories Act, 1996 and for that purpose is registered as a Depository Participant of National Securities Depository Ltd. and Central Depository Service Ltd.. It was held that dematerialization is process by which a person who is holding security certificates converted into electronic balances

9 CONSUMER COMPLAINT NO. 74 OF and held the same in his/ its account with a D.P. This particular nature of services offered by the appellant company is not in dispute and the complainant also did not claim anything beyond hiring of such services from the appellant. Thus, it could be seen that the nature of services hired from the appellant and for which deficiency in service is alleged, relates to a commercial transaction. 11. In the present case also the complainant himself in para No. 3 of the complaint mentioned that the respondent firm hold a licence of share broker being a sub-broker of M/s Integrated Market Securities Ltd. and that they had invested their amounts in the trading business as is clear from the complaint and documents perused on the record. Certainly, trading is for commercial purpose, therefore, the complainant does not come within the definition of consumer as defined under Section 2(d)(ii) of the C.P. Act specifically in view of the judgment referred above in which the judgment of the Hon ble Apex Court referred above was affirmed. No contrary judgment was cited by the counsel for the complainant how he comes under the definition of consumer to file a complaint with the Consumer Fora. 12. Then the complainant in his complaint has stated that he had deposited various amounts from to whereas the respondents in his reply has referred that a complainant had deposited lastly with respondent No. 1 on and had opened the account on in his individual account and HUF and the document Ex. C-1 also shows that the last amount was deposited by the complainant on In case he was investing with respondent No. 1 since 2004, it is improbable that he did not settle

10 CONSUMER COMPLAINT NO. 74 OF his account with respondent No. 1 for his loss and profit whereas the respondents has placed on the record statement of accounts Exs. OP-1 to Ex. OP-3 and their plea is that the complainant had been taking the amount according to their trading transaction from time to time. Rather from statement of account Exs. OP-1 to OP-3 a sum of Rs. 88,27,281.64p is outstanding against the complainant. In case upto when the complainant lastly made the payment and account was not settled then he was to file the complaint within a period of two years from when dispute arose between the parties whereas the present complaint was filed on after a gap of more than two years and the complainant does not disclose in any paragraph as to when the cause of action has accrued to the complainant to file the complaint. Therefore, the complaint filed by the complainant is also barred by limitation. 13. In case the cheques issued by the respondents dishonoured, the cheques may be for any purpose because there were pleading of the complainant and respondent No. 1 firm and for that cognizance will be taken by the Criminal Court. In case they have accounting problem with each other, their claim lies with the Civil Court and the transaction between the parties is of commercial nature, the complaint before the Consumer Fora is not maintainable. 14. No other point has been argued. 15. In view of the above findings, we are of the opinion that the complaint filed by the complainant is without any merit and the same is dismissed without any order as to costs.

11 CONSUMER COMPLAINT NO. 74 OF The arguments in this Consumer Complaint were heard on and the order was reserved. Now the order be communicated to the parties as per rules. 17. The Consumer Complaint could not be decided within the statutory period due to heavy pendency of Court cases. (Gurcharan Singh Saran) Presiding Judicial Member (Piare Lal Garg) Member November 1, as (Jasbir Singh Gill) Member