Consumer Complaint Cannot Be Dismissed Due To Non-Joinder Of Party: NCDRC Remands Petion Filed By Cholamandalam Finance

Brief facts:

The complainant took a loan from Cholamandalam Investment & Finance Ltd. (Appellant) for the purchase of a vehicle. However, after the repayment of loan the finance company failed to issue a No Objection Certificate to the complainant. Additionally, the complainant wanted adjustment of Rs.1 lakh that was paid directly to M/s Shree Motors (dealer) by the finance company.

Aggrieved, the complainant filed a complaint in the District Commission alleging deficiency in service against the finance company. Through an order dated 07.01.2015, the District Commission directed the finance company to issue a No Objection Certificate and pay Rs.20,000/- along with Rs.3,000/- as litigation cost. Further, the dealer was ordered to deposit Rs.10,000/- as damages.

Dissatisfied by the order, the finance company filed an appeal before the State Commission. The dealer had paid the damages so it did not contest the order.

The State Commission through its order dated 09.08.2016, upheld the decision of the District Commission and dismissed the appeal on the ground of non-joinder of dealer as necessary party and imposed Rs.10,000/- as costs on the appellant.

Feeling aggrieved, the finance company filed a revision petition in the National Commission. As the complainant and the dealer didn't appear, the matter was proceeded ex parte.

Contentions of the Finance Company:

The finance company contended that dismissal of the Appeal was unjustified on the ground of non-joinder of dealer as necessary party. Further, the case could be disposed in his absence as the dealer has satisfied the order and no relief was claimed against him.

Observation by the National Commission:

The Commission noted that the dealer was originally a party to the complaint and should not be directly removed from the appeal. Instead, the dealer could be included as a Performa respondent as he was not directly involved in the appeal and there was no claim against him.

The commission stated that the appeal should not be dismissed due to procedural technicality as non-joinder of dealer would cause no major effect on the final decision.

Reliance was placed on Udit Narain Singh Malpaharia vs Additional Member, Board of Revenue, AIR 1963 Supreme Court 786, wherein it was held that an effective order can be passed in the absence of proper party but not without the necessary party. Following the doctrine of 'dominus litus', the complainant is the master of the suit and he cannot be forced to litigate against a person from whom no relief is sought.

The consumer forums should focus on fairness of the case and should not dismiss the complaint on the basis of non-joinder of party without whom an effective order can be passed.

Further, in Savita Garg v. Director, National Heart Institute, (2004) 8 SCC 56 it was held that the consumer commission is not bound by Order 1 Rule 9 of the Civil Procedure Code that states that "no suit shall fail because of misjoinder or non-joinder of parties."

Nonetheless, the provisions of CPC cannot be invoked in consumer cases but the principles of the code can be referred as it embodies underlying concepts of natural justice.

The Commission held that the appeal could not be dismissed merely due to non-joinder of M/s Shree Motors as it caused no prejudice to either of the parties. Further, the commission directed to add the dealer as a Performa respondent.The revision petition was allowed and the case was remanded to the State Commission.

Case Title: Cholamandalam Investment & Finance Ltd. Vs. Uttam Rao Pawade & Anr.

Case No: Revision Petition No. 3169 OF 2016

Date of Pronouncement: 27.08.2024

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