Dr Car fined Rs 1.66 lakh for selling encumbered car resulting in seizure, agonising buyer

HYDERABAD: Dr Car Pvt.Ltd, a dealer of used cars in Hyderabad, was fined Rs 1.66 lakh by the District Consumer Disputes Redressal Commission, Hyderabad on August 21, for causing inconvenience and also agony.

The problem faced by the complainant was that Dr Car delivered the car without verifying if the original owner had any encumbrances on the vehicle. As a result, financiers recovered the car from the second buyer through Dr Car.

These orders were issued by the District Consumer Disputes Redressal Commission, Hyderabad, modifying the orders given by the District Consumer Commission-III, Hyderabad.

Ameer Ali Khan, 28, a resident of Asif Nagar in Hyderabad, purchased a Toyota Etios car of 2011-make, a diesel variant, and paid Rs 4.92 lakh to Dr Car Pvt.Ltd, who is the dealer of the used cars.

On July 24, 2014, the car was delivered to Ameer Ali Khan along with a registration certificate from the RTA. They duly transferred the car in his name and the hypothecation was marked in the name of HDFC from which Ameer Ali Khan took finance.

Only a single key for the car was given to Ameer Ali Khan but not a second/duplicate key. Upon insisting for the second key, Dr Car Pvt.Ltd promised Khan that the company would give him the second key in a short time. On August 12, 2014, the car was found missing from the house of Ameer Ali Khan and, the same, was informed to the police.

Ameer Ali Khan came to know that the car was seized to recover its dues by Shriram Finance Pvt.Ltd, which gave a loan to Ranga Hemalatha, the previous owner of the car. When Ameer Ali Khan approached Dr Car Pvt.Ltd, they replied that the matter would be settled and the police would recover the seized vehicle.

Dr Car Pvt. Ltd also told Ameer Ali Khan that they had failed to verify the earlier transactions on record, thereby keeping the vehicle for display on its premises for sale to prospective purchasers.

The actions of Dr Car Pvt.Ltd amounted to lack of proper service and they had sold a title-defective car to Ameer Ali Khan. If the car was with Ameer Ali Khan, he would have earned Rs 2,000 per day. Then, Ameer Ali Khan approached the VI Additional Chief Magistrate Court and got the car back. But the original registration certificate (RC) was retained by the court; Ameer Ali Khan now cannot sell the car.

Ameer Ali Khan sent a legal notice on September 22, 2014 to Dr Car Pvt.Ltd and in spite of receiving the same, there was no reply from them to him.

Dr Car Pvt.Ltd was neither the owner nor the financier of the car purchased from Ranga Hemalatha. In a nutshell, used cars were being displayed on the premises of Dr Car Pvt.Ltd to attract the car purchasers to take a look at the cars on display, thereby informing the public at large, that the cars are for sale.

Dr Car Pvt.Ltd contended that it was only a facilitator between the owner and purchaser of the car and on displaying the cars on its premises, it would charge a commission from both the parties.

There are terms and conditions between Dr Car Pvt. Ltd and prospective purchasers of the car about the liabilities on each side, while making the transaction.

However, Dr Car Pvt.Ltd argued that the quality of the car, its origin, authenticity of documents, price it could fetch and other related aspects were not backed by them.

The Court noted that Ameer Ali Khan purchased the car in the 2014, and was ever since using the car.

No record was filed that the previous financier, M/s Shriram Finance Pvt.Ltd., filed a case against Ameer Ali Khan and recovered any amounts from him.

The Court ruled that Dr Car Pvt.Ltd was negligent and deficient in rendering proper service to Ameer Ali Khan for causing mental agony. Hence, the Court ruled in favour of Ameer Ali Khan and the Commission directed Dr Car Pvt.Ltd to pay Rs 1 lakh as a compensation to Khan for causing mental agony, Rs 56,000 for the inconvenience caused to him as he could not use the car and Rs 10,000 litigation costs to him.