Lender can’t seize vehicle of defaulter without notice

09 Apr 2018

Lender can’t seize vehicle of defaulter without notice

 

The National Consumer Disputes Redressal Commission (NCRDC) on Friday ordered a private finance company to pay Rs 80,000 to the borrower whose tractor was seized by the company in January, 2011 for alleged nonpayment of dues.

Directing Shriram Transport Finance Company to refund the amount, which the borrower had paid to the company, with 9% interest within four weeks, single-member bench of M Sreesha said, “In my opinion, a seizure of the vehicle in such circumstances violating the principles of natural justice without giving an opportunity to the borrower to show his bona fides, amounts not only to unfair trade practice but also deficiency of service for which the financier is liable to compensate the complainant.”

The NCDRC relied on the “vehicle repossession notice” by the company to the borrower, which showed that the notice was issued 10 days after the actual date of repossession of the tractor and the Commission observed that this “cannot be stated to be a notice prior to repossession which is in contravention of the principle of natural justice

 
Law Updates