Chandigarh: Dealer fined ₹25k for not steering exchanged car's transfer

Hindustan Times

3 days ago

For failing to transfer the ownership of a city resident's old car, exchanged for a new one, which led to a speeding challan landing at his address, a car dealership will be coughing up ₹25,000 as compensation.
Terming them guilty of deficiency in service, the District Consumer Disputes Redressal Commission-DF 1 has directed the dealership, Lally Motors, to pay the complainant ₹15,000 for mental agony and ₹10,000 as costs of litigation.
Further, the dealership has also been told to clear the pending challan and transfer the exchanged car's ownership to either themselves or the new owner to whom they have sold the vehicle.
In 2019, the complainant, Dr Swaran Singh, a resident of Sector 18, had walked into Lally Motors in Industrial Area to purchase a Volkswagen Vento car.
Under a scheme, he agreed to exchange his old vehicle, valued around ₹2 lakh, which was adjusted against the price of the new vehicle.
After the deal, the dealership had issued a delivery letter-cum-undertaking, dated October 23, 2019, promising that they will be responsible for all future taxes, challans and accidents related to the old car.
But three years later, Dr Singh received a challan from the Chandigarh Traffic Police in December 2022, much to his surprise.
The photograph attached to the challan showed his old car, which had supposedly been sold to someone else by the dealership. On inspecting further, to his shock, Dr Singh learned that the dealership had failed to transfer the car's ownership to its new owner after the exchange.
Approaching the consumer commission, the complainant alleged that the car dealership sold his old car further without transferring its ownership, a violation of the Motor Vehicles Act.
The dealership was summoned by the commission but they didn't turn up and were proceeded against ex parte on October 21 2024.
Skoda Auto Volkswagen India contested the complaint, taking preliminary objections of maintainability, cause of action, jurisdiction and non-joinder of the necessary party. They alleged that so far as selling of the car went, they had nothing to do with it, and it was a matter between the dealership and the complainant.
The commission accepted that the company had no role in the dispute and dismissed the complaint against them.
However, it observed that the complainant had submitted documentary proof against the dealership, which was not rebutted in any way. Disposing of the complaint, the commission slapped a ₹25,000 penalty on the dealership, including the compensation and litigation costs.