KOSHY VARGHESE Vs. HDFC BANK LTD.

JUDGEMENT

(1.) The present First Appeal have been filed against the Order dated 31st Oct., 2016 passed by Kerala State Consumer Disputes Redressal Commission at Thiruvananthapuram (for short, the State Commission') in First Appeal No. 28 of 2009.

(2.) The brief facts of the case as per the Appellant/Complainant are that Appellant purchased 3,000 equity shares of an Offshore Ltd, Originally 500 shares and thereafter 2,500 shares were allotted to him. From the said shares appellant sold 105 shares on 31.12007 and retained the remaining 2,895 shares. In the account maintained in the name of the appellant under the depository services of the bank, the value of the said shares was Rs. 1,48,43,070.25. The Respondent/Opposite party bank had allowed the Appellant to avail loan on the security deposit of the shares. The bank was prepared to provide 50% of the share value amount as existed on the date of such pledge. The bank was not given authorization or power or authority to sell the shares. Only if the appellant gave written permission to do so, the Bank could sell the same. The appellant was always ready to pay the liability due to the bank by diverting funds from other sources if they made demand after giving sufficient time. Though the appellant was entitled to avail loan of Rs. 75,00,000 he had only drawn an amount of Rs. 20,00,000. When the bank demanded payment of loan amounts the appellant paid an amount of Rs. 10,00,000 and he was ready to pay the balance amount. The bank under no circumstance could resort to the sale of shares held by the appellant since in future there would have been spurt in the share value.

(3.) But without giving proper and valid notice or demanding payment of amounts due in respect of the loan and without giving sufficient time to pay off the loan and without the consent and knowledge of the appellant, the respondent bank sold the shares held by the appellant for a price of Rs. 454 per share and later for a price of Rs. 270 per share. After retaining about 100 shares all the remaining shares were sold for pittance. The bank which was carrying out depository services knew very well that the shares of Aban Offshore Ltd. would be reaching a rate exceeding Rs. 1,500 per share within few days. The shares were sold on 29.1.2009 and the present value of the shares was Rs. 1,600 per share. The said price was reached within a couple of days and the appellant was not even informed of the name of the person to whom the shares were sold. The appellant a, customer, was deceived by the bank and taken undue advantage of which amounts to unfair trade practise. Considering the present value of the shares sold it would have fetched a value of Rs. 45,00,000. But the sale price obtained was Rs. 11,41,559. The difference in value is Rs. 35,00,000. The appellant was ready to hold the said shares and to pay off the liability of the bank without difficulty. By the illegal sale of shares severe mental pressure and agony were caused to the appellant. Hence the complaint. The appellant sought a direction to the respondent to pay an amount of Rs. 45,00,000 towards the value of 2789 shares of Aban Offshore Ltd. and claimed a compensation of Rs. 10,00,000 towards the mental agony and distress caused to the appellant by the alleged illegal sale of shares.