Consumer Commission Slams Mahindra Finance for Illegal Car Seizure and Sale
The District Consumer Disputes Redressal Commission (DCDRC) in Noida has delivered a significant verdict against Mahindra and Mahindra Financial Services Limited. In a ruling that underscores consumer protection rights, the commission has ordered the financial giant to return a substantial sum of ₹8.5 lakh to Jitendra Singh, a resident of Dadri. This decision comes after a prolonged legal battle where Singh's financed vehicle was illegally confiscated and subsequently sold by the company.
A Decade-Long Financial Agreement Turns Sour
Jitendra Singh entered into a financing agreement with Mahindra and Mahindra Financial Services in 2012 to purchase a Mahindra Verito car. The total financed amount was ₹8.5 lakh, with Singh committing to a monthly instalment of ₹13,050. According to his testimony before the commission, Singh diligently paid all instalments on time, adhering strictly to the company's terms and conditions throughout the repayment period.
The Shocking Incident of Illegal Confiscation
The situation took a dramatic and distressing turn on August 26, 2017. Singh's friend had borrowed the vehicle and was traveling to Ghaziabad when, near Shahberi, employees of Mahindra Finance intercepted the car. In a shocking development, Singh alleged that the company's personnel stopped the vehicle and, at gunpoint, forcibly seized the car from his friend. Shortly after this incident, Singh received a call from the financier informing him that the car had been confiscated due to alleged outstanding instalments.
Singh vehemently contested this claim, maintaining that he had paid all instalments in full and was even willing to settle any additional charges if they existed. He made repeated requests for the vehicle's return and undertook numerous visits to both the head office and various branches of Mahindra Finance in an attempt to deposit any purported outstanding amount and retrieve his car. Despite these efforts, the company took no action to resolve the matter.
Discovery of Unauthorized Sale and Legal Proceedings
The situation worsened when Singh later discovered that his car had been sold to another individual without his knowledge or consent. This revelation prompted him to file a formal complaint in 2018, arguing that Mahindra Finance's actions constituted a clear deficiency in service and unfair trade practices under the Consumer Protection Act.
The legal journey faced initial hurdles when the district commission rejected Singh's application in 2022. Undeterred, he approached the state commission, which on September 2, 2024, issued an order directing the DCDRC to re-examine the case on its merits. When the matter returned to the district commission, notices were issued to Mahindra Finance. However, in the absence of any response from the company, the commission proceeded to hear the case ex parte.
Commission's Observations and Final Ruling
The commission carefully examined Singh's sworn statements, which remained uncontested by Mahindra Finance. The panel observed that despite the complainant's repeated requests, the opposite party had neither returned the vehicle nor refunded the deposited amount. This conduct, the commission ruled, demonstrated that Mahindra Finance had engaged in unfair business practices and committed fraud in its service delivery.
In its final order, the commission disposed of the matter and issued a comprehensive directive to Mahindra and Mahindra Financial Services Limited:
- Return the entire financed amount of ₹8.5 lakh to Jitendra Singh
- Pay interest calculated at 6% per annum from the date the complaint was filed in 2018
- Complete the payment within one month of the order
- Additionally, pay ₹5,000 towards litigation costs incurred by Singh
This ruling serves as a powerful reminder of consumer rights and the legal recourse available against corporate misconduct in financial services. The commission's decision emphasizes that financial institutions must adhere to ethical practices and cannot arbitrarily seize assets without proper justification, especially when consumers have fulfilled their financial obligations.
