RAJIV SARDA Vs. AUTOLITE INDIA LTD

JUDGEMENT

(1.) Complainant No.1 was shareholder of the opponent company. The opponent offered right enquity shares to the shareholders. According to the complainants, the opponent had sent two letters of offer to the complainants. Under Folio No. R-0365, 1500 right shares and under Folio No. V-0318, 100 right equity shares were offered. Equity share of Rs.10/- was offered at premium of Rs.60/-. Thus, the complainants had to pay Rs.70/- per share for the right shares offered to them and the payment was to be made through bankers named in the letters of offer. One of the bankers mentioned was Punjab National Bank, Ashram Road Branch, Ahmedabad as collecting bank. Both the letters of offer were presented to the said bank alongwith cheques for the requisite amount drawn on Kalupur Commercial Co-op. Bank Ltd. It is stated that 1500 right shares offered to complainant No.1 were renounced in favour of complainant No.2, father of complainant No.1. In the statement of accounts received from Kalupur Commercial Co-op. Bank Ltd. Only Rs.1,400/- for 100 right equity shares were debited. Rs.21,000/- for 1500 right shares were not debited in the said account although there was sufficient balance in the account. It appears that the right equity shares for which complainant No.2 had made application were allotted. However, 1500 shares renounced in favour of complainant No.2 were not allotted as the cheque for Rs.21,000/- was dishonoured by the bank. The complainants, therefore, sent demand draft for Rs.43,312/- which included call money and interest @ 15% p. a. for allotment of 1500 shares. The opponent however, did not accept the demand draft stating to the effect that the allotment process was complete. The complainants, alleging deficiency in service on the part of the opponent, has filed this complaint for recovery of Rs.6,37,500/- as compensation for loss suffered by them @ Rs.425/- per share and Rs.3,00,000/- as compensation for harassment and mental agony. Opponent has not appeared, though duly served.

(2.) It does appear from the statements made in the complaint and the documents produced on record that complainant No.1 was offered Rs.1500 right equity shares which he renounced in favour of complainant No.2. Application for allotment of shares alongwith cheque of Rs.21,000/- was sent to the opponent for allotment of 1,500 shares. There is no dispute regarding 100 shares offered to complainant No.2 as these shares have been allotted. The question is whether the complainant can claim compensation from the opponent for failure to allot 1500 right equity shares to complainant No.2. It is not disputed that cheque for Rs.21,000/- was dishonoured by the bank on which it was drawn. Unless the cheque was honoured, the opponent was not bound to allot shares to complainant No.2. It was the complainant's bank viz. Kalupur Commercial Co-op. Bank which had dishonoured the cheque and the opponent cannot be blamed for such dishonour. It was submitted that the opponent should have given intimation to the complainants that the cheque was dishonoured. In our opinion, there was no such obligation on the opponent. If the cheque was wrongly dishonoured by Kalupur Commercial Co-op. Bank, the complainants should have taken action against that bank. In any case, the opponent cannot be blamed for not allotting 1,500 right equity shares. It is stated that subsequently the complainants sent amount payable for the said shares together with interest by demand draft to the opponent. Opponent, however, refused to accept the demand draft. Now, the opponent has stated in its letter dated January 29, 1994 addressed to complainant No.2 that since all the formalities relating to allotment have been completed, request to allot shares could not be considered. The opponent, therefore, returned the demand draft. In our opinion, since demand draft was received by the opponent after all the formalities for allotment of shares were over, the opponent could not be held responsible for not allotting the shares to complainant No.2. The opponent could not be held guilty of negligence or deficiency in service. In our opinion, therefore, this complaint deserves to be dismissed.

(3.) In the result, we dismiss the complaint, with no order as to costs.