SANTOSH KUMARI Vs. CHAIRMAN ISPAT ALLOYS LTD

JUDGEMENT

(1.) The present appeal has been filed against the orders of the District Forum-I dated the 9th January, 1995, passed in Complaint Case No.3186/93 entitled Smt. Santosh Kumari V/s. The Chairman, M/s. Ispat Alloys Ltd. and Ors.

(2.) In brief, the facts, relevant, are that the appellant had filed a complaint under Sec.12 of the Consumer Protection Act, 1986 (hereinafter referred to as 'the Act'), stating therein that the appellant/complainant was the holder of 100 Part B secured fully Convertible Debentures of M/s. Ispat Alloys Limited (respondent) @ Rs.160/- each. In the month of December, 1992, the appellant received a letter of option dated 24.12.1992 alongwith Consent Form, from the respondents for conveying her consent for conversion of Part B 14% Convertible Debentures either into non-convertible 14% secured Debentures or equity shares. The appellant, as per requirements, sent the said Consent Form alongwith 100 Part B Convertible Debentures to the respondent No.4 on 4.2.1993 under registered cover vide Postal Receipt No.295 alongwith forwarding letter indicating the appellant's option for conversion of Part B 14% Convertible Debentures into 14% secured Non-convertible Debentures. However, respondents 1 to 3 instead of converting the Debentures of appellant into Non-convertible Debentures as per appellant's option, sent 640 equity shares of Rs.10/- each vide their letter dated 22.2.1993. The said shares of Rs.10/- were supplied to the appellant @ Rs.25/- per share whereas, the rate of the share in the Calcutta Stock Exchange, was only Rs.15/- or so. It was the case of the appellant that she had been cheated by the respondents by converting her 100 Part B Convertible Debentures of Rs.160/- each into 640 equity shares of Rs.10/- each and thus, had incurred a loss of Rs.9,600/- being the difference in the price of the 14% Part B Convertible Debentures worth Rs.16,000/- and the price of the equity shares amounting to Rs.6,400/-. It was, therefore, prayed by the appellant in her complaint that the respondents be directed to refund the price of 100 Debentures alongwith interest and damages to the appellant.

(3.) The defence of the respondents, in the written version/reply filed before the District Forum, was that the Convertible Debentures of respondent No.1, were convertible subject to the exercise of option by the concerned holder to that effect either into Non-convertible Debentures or equity shares and that the exercise of option was subject to the condition that it should reach the hands of the office of M/s. Computech International Limited (respondent No.4) by 10.2.1993. It was also stated that mere exercise of option was not enough and that it was clearly mentioned in the option form that unless the same is delivered at or reaches the correct address within the appointed time, the Company would proceed to allot equity shares in lieu of Convertible Debentures. It was further stated by the respondent Nos.1 to 3 that the option form of the appellant did not reach the respondents by the due date, i. e.10.2.1993 and as such, the respondents had converted the same into equity shares and, therefore, there was no malafide intention on their part.