Full Judgment
Oral Order: (R. Lakshminarasimha Rao, Member)
1. The complainant is the appellant. He filed complaint claiming return of demand draft for Rs.25,800/- with interest @24% p.a. and a sum of Rs.30,000/- towards compensation and an amount of Rs.10,000/- towards costs.
2. The appellant applied for 60 shares of Reliance Power IPO for a sum of Rs.25,800/-through account of ICICI securities Ltd on 18.01.2008 and the appellant had sent a demand draft dated 18.01.2008. The respondent listed the same and the appellant did not receive intimation of allotment or non-allotment of shares. The respondent received the amount through demand draft. The appellant learnt that the respondent did process the application. The respondent intimated the appellant that demand draft was not found which was sent by the appellant. The appellant had learnt that the respondent encashed the demand draft sent by him and he had requested the respondent to return the demand draft. The appellant lodged complaint with SEBI and the respondent requested the appellant to give the details fo the demand draft. The respondent failed to return the demand draft sent by the appellant and the appellant got issued notice on 7.9.2009 through email demanding for return of the demand draft.
3. The respondent resisted the claim on the premise that the appellant had not sent any application and that the Reliance Power Limited came with public issue of Reliance Power Limited of Rs.44/- per equity share. The Reliance Company released information about its public issue in news papers and neither the Reliance Company or the respondent company offered to the appellant or any other person directly that he will be allotted shares. The appellant applied with an intention to earn profit and there is no privity of contract between the appellant and the respondent. The respondent is a registrar and share transfer agent of the M/s Reliance Company and its job is to make allotment of shares as per the guidelines of SEBI and adjust or refund the money.
4. M/s Reliance Power Limited deposits the money received from the applicants in escrow account and till allotment process is not completed M/s Reliance Power Limited cannot utilize the amount. The appellants application was not processed as it did not reach the respondent. The appellant did not furnish the details of the demand draft to the respondent. M/s ICICI Securities Ltd through which the application is said to have been processed is necessary party to the complaint. There is no deficiency in service on the part of the respondent and as such the respondent prayed for dismissal of the complaint.
5. The appellant filed his affidavit and the documents, Exs.A1 to A9. On behalf of the respondent, its authorized signatory filed his affidavit and no documents have been marked.
6. The District Forum dismissed the complaint and the complainant has filed appeal contending that the District Forum dismissed the complaint event after recording finding that the appellant is entitled to refund of the amount covered under the demand draft.
7. The learned counsel for the respondent has filed written submissions.
8. The point for consideration is whether the order of the District Forum suffers from misappreciation of facts or law?
9. The appellant claimed refund of the amount of Rs.25,800/- on the premise that the respondent failed to process his application whereas the respondent denied filing of application by the appellant. The appellant filed voucher dated 18.01.2008 issued by the State Bank of India on 18.01.2008 in support of his contention that he paid the amount to M/s Reliance Power Ltd and ICIC Securities Ltd issued receipt acknowledging receipt of the amount from the appellant for allotment of 60 shares of M/s Reliance Power Limited. On the appellant approaching the SEBI, the respondent addressed letter to the appellant seeking for details of the demand draft. The letter dated 9.09.2008 reads as under:
“ In this regard, we regret to inform that despite through verification of records, we are unable to locate the details fo your application. Kindly furnish the following information to us.
1. Application number
2. Name of the applicant as mentioned in the application form
3. Number of shares appled
4. Cheque/demand draft no. and date
5. Name and branch of the bank wehre the application was deposited
6. Bank serial no. under which your application has been listed by the bankers in the bank schedule
7. Present Address
8. Client ID and DPID
This is for your kind information”
10. The respondent issued reminder on 1.10.2008 with the same request which was made in the letter dated 9.09.2008. The appellant furnished through email the application number and details of bank as under:
Applicants name Ravi Darsi
Application number 18269636
Bank serial number 560
Bank address ICICI Bank
Gulmohar Park, Plot 1 A
ITI Road, Aundh, Pune
PUNE-411007
Demat Account details 35035290
Share applied details
No. Of shares Applied : 60
Amount paid : 25800/-
DD Number : 468414
Bank : SBI dated 18/01/08
11. Through email dated 23.02.2010 the appellant informed the respondent that he was not residing at Pune and he did put the following questions to the respondent;
1. Is my application available with karvy and was it processed for bidding in IPO?
2. If it has been processed then what is the bidding reference number for my application?
3. If that has not been processed then why my application has not been processed and I need a justification from karvy for not processing my application?
4. Also please let me know the bidding date of IPO?
Please answer the above questions ASAP.
12. The bank statement sought for by the respondent and the appellant informed the respondent that he was not at Pune and as such he could not submit his bank statement to the respondent at the time which was submitted by him later to the respondent which acknowledged receipt of the statement of account of the appellant by its email dated 4.09.2011. The email reads as under:
“ As per the personal discussion with you I acknowledged the receipt of the documents such as Bank statement and Ipo acknoweldgement copy.
Bank statement period from 1/01/2008 to 01/10/2009”
13. The District Forum held the appellant entitled to refund of the amount covered under the demand draft and without assigning any reason the District Forum dismissed the complaint. The following paragraphs of the order would show how the District Forum holding the appellants claim proved and finding him entitled to the amount of Rs.25,800/- with interest and costs and holding him not entitled to compensation, dismissed the complaint.
“13. As per the ExA5 and A6, the opposite party requested, the complainant to send the relevant information with regard to Ex.A2 Application and Ex.A1 Demand Draft so that they can pursue the application and resolve the grievances. Viewing Ex.A7/E-mails, Ex.A8 Demand Notice dt.7.09.2009 along with Ex.A9 letter dt.04.09.2011 issued by the opposite party to the complainant, as the opposite party has misplaced the application of the complainant along with Demand Draft No.468140 dt.18.01.2008 there is deficiency of service on the part of the opposite party.”
14. Thus, there has been manifest irregularity committed by the District Forum dismissing the complaint though holding that there was deficiency in service on the part of the respondent-company and even after coming to conclusion that the appellant is entitled to refund of the amount of Rs.25,800/- with interest and costs. We are of the view that the appellant is entitled to refund of the amount with interest and costs.
15. In the result, the appeal is allowed setting aside the order of the District Forum. The respondent directed to pay an amount of Rs.25,800/- with interest @ 9% p.a. from 18.01.2008 till payment and costs of Rs.4,000/- throughout the proceedings. Time for compliance four weeks.