The appeal was against an order dates 2nd August 2018 passed by the National Consumer Disputes Redressed Commission, dismissing Revision Petition no. 5 of 2018, filed by the appellant, under Section 21(b) of the Consumer Protection Act, 1986, against an order dates 31st August 2017 passed by the State Consumer Disputes Redressed Commission, Uttar Pradesh, dismissing appeal No. 2017 of 2008 filed by the financier and affirming the order dates 22nd August 2018 passed by the District Consumer Disputes Redressed Forum , Ambedkar nagar, Uttar Pradesh whereby the District Forum allowed Complaint Case no. 105/2005 filed by the Respondent, Rajesh Kumar Tiwari and directed the financier to pay Rs. 2,23,335/- to the Complaint along with interest at 10% per annum Rs. 10,000/- as litigation expenses.

On 2nd August 2002, the Complainant entered into the hire-purchase agreement with the financier, then known as Magma Leasing Ltd. For hire purchase of a Mahindra Marshal Economic Jeep, which is hereinafter referred to as the vehicle the cost where of was Rs.4, 21,121/- of which the complainant made an initial payment of Rs. 1, 06,121/- According to the financier an amount of Rs. 1.04, 000/- from out of the initial payment of Rs. 1.06,121/- was paid by the complainant to the dealer directly. The balance amount of Rs. 3, 15,000/- was paid by the Financier.

The Complainant agreed to repay a sum of rs. 4, 38,585/- which was inclusive of finance charges of Rs. 83,650/- to the financier in 35 monthly installments of Rs.12, 531/- commencing from 1st August 2002. The monthly installments were to be paid till 1st June 2005. The complainant apparently deposited postdated cheques of Rs. 12,531/-

By an order dated 22nd August 2008, the District Forum allowed the complaint and directed the financier to pay Rs. 2, 23,335/- to the complainant along with simple interest at 10% per annum from the date of filing of the complaint till payment as also Rs.10, 000 towards damages for physical and mental agony and Rs.1000/- as litigation expenses, within 45 days from the date of the order.

Being aggrieved by the order of the District Forum allowing the complainant, and directing the Financier to pay the complainant the entire amount paid by the complainant to the Financier towards installment and other charges as well as the sum of Rs.1,04,00/- paid by the complainant directly to the dealer , along with interest at 105 the Financier filed an appeal before the State Commission. The financier contended that the vehicle had to be sold since the complainant had not paid an outstanding amount of Rs. 2, 80,132/-

By a judgment and order dated 31st August 2017 the state commission dismissed the appeal. The Financier filed a revisional Application before the national Commission under Section 21(b) of the Consumer protection act, which has been dismissed by the judgment and order under appeal.

A forum constituted under the Consumer protection Act has, has observed, the power to award punitive damages. Punitive damages should, however, be granted only in exceptional circumstances, where the action of the Financier is so reprehensible that punishment is warranted. To cite an example, where a financier erroneously and wrongfully invokes the power to repossess without notice to the hirer, causing thereby extensive pecuniary loss to the hirer or loss of goodwill and repute a forum constituted under the Consumer Protection Act may award punitive damages.

In the instant case, there is no evidence of any loss suffered by the complainant by reason of non-receipt of notice. Admittedly, several installments remained unpaid. After repossession the complainant contracted the financier and was informed of the reasons for the repossession. He only made an offer to pay outstanding installments and gave an assurance to pay future installments in time. If the financier was not agreeable to accept the offer, the Financier was within its right under the hire purchase agreement. This is not a case where payment had been tendered by the hirer but not accepted by the Financier. The complainant had not tendered payment.

The Financier admittedly paid Rs. 3, 15,000/- for accusation of the vehicle, out of which the Financier had been able to realize Rs. 1, 19,000/- inclusive of all charges. There was depreciation in the value of the vehicle by reason of usage by the complainant for about a year. The District Forum did not even notionally assess the depreciation in the value of the vehicle.

The District Forum was not justified in directing the Financier to pay the Complainant Rs.2.23.335/- being the entire amount paid by the complainant to the Financier from the inception as well as the payment of Rs.1, 04, 000/- made by the complainant to the dealer along with damage of Rs.10, 000/- and litigation cost of Rs.1000/- after the complainant had held and used the vehicle for almost the year. The complainant admittedly a defaulter has in effect been allowed free use of the vehicle for about a year, plus damage, for an error in the notice of repossession, without considering the prejudice, if any, caused to the complainant by the error and consequential non receipt of the notice, and without making any assessment of the loss, if at all, to the complainant by reason of the error.

For the reasons discussed, the impugned orders of the National Commission the state Commission and the District Forum under the consumer  protection act cannot be sustained and the same are set aside.

The appeal is accordingly allowed. The financier shall, however, pay a composite sum of Rs.15,000/- to the complainant towards damages for deficiency in service and costs for omission to give the complaint a proper notice before taking repossession of the vehicle.

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