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Old 6th March 2013, 07:46   #1
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Default Mahindra First Choice dealer dupes customers, police seizes sold cars

Hi guys,

Just saw this in today's paper. Even though MFC is already known to be untrustworthy, this comes as a shock. Imagine paying for a car only to have it seized by the police.

The problem is that these franchisees are run as independent used car dealers, who tend to make a quick buck, and are thoroughly unprofessional in their attitude.

TOI, Delhi, 6 March : Source & Full Article

Quote:
Imagine buying a car from an authorized dealer, only to have the police seize it.

Many were in for a rude shock after buying second-hand Skodas, BMWs, Honda CRVs and Volkswagen Passats and other fancy cars from a Mahindra First Choice franchisee in Lajpat Nagar.

They have had to surrender their cars to the police as the dealer didn't pay the financier who gave him money to buy these vehicles. The customers are in a fix as the original registration certificates of these vehicles are now with the financier.
Mods please post it in the correct forum, if needed.

Best,
Tapish

Last edited by GTO : 6th March 2013 at 13:01. Reason: Keeping fair usage practices in mind, it is best to include an excerpt + link to full article
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Old 6th March 2013, 08:24   #2
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Looking at the state of things with this dealer, it doesn't look like these customers might get their money or cars anytime soon unless MFC steps in. The question is whether they would step in or wash off saying they are not responsible for their dealer actions.

Would it be possible for these customers to file a cheating case against MFC and its dealer as they paid the amount to 'MFC dealer' to buy the car which was subsequently taken away from them?
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Old 6th March 2013, 08:47   #3
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Franchisees and dealers need to be kept on a very tight leash by the organization whose name and brand would be tarnished in case of such eventualities.

People would not remember J.K Motors or Pankaj Nagpal beyond a few days, but they would remember it was a "Mahindra First Choice" for a long time.
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Old 6th March 2013, 11:44   #4
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

This is like the final nail in the coffin for Mahindra First Choice. What is the advantage of the so called manufacturer backed pre-owned car dealers, when they behave exactly the same way as normal 'out-to-rip-you' kinda second hand car dealers.

I firmly believe that big brands shouldn't lend their names to businesses they cannot control/ scrutinize. In the end customers lose faith on the brand and dealers like these open up another shop elsewhere and countinue on their merry way.
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Old 6th March 2013, 13:08   #5
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Did Mahindra pay attention to the warning bells? BHPian Mayankk was cheated by the same dealer.

Thread Link (Mahindra First Choice dealer JK Moto tries to scam. Caught! EDIT : Amount Refunded)

Last edited by GTO : 7th March 2013 at 14:48.
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Old 6th March 2013, 14:28   #6
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

I guess Mahindra has cunningly left out the mileage check so that they get room to alter the mileage. Very sad that a place with a big name resorts to this level. Just imagine how rampant this would be with other not so big name used car dealers in India. This is where knowledge gained from Tbhp and checklists help to not get cheated.
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Old 6th March 2013, 14:44   #7
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Quote:
Originally Posted by funkykar View Post
I guess Mahindra has cunningly left out the mileage check so that they get room to alter the mileage. Very sad that a place with a big name resorts to this level. Just imagine how rampant this would be with other not so big name used car dealers in India. This is where knowledge gained from Tbhp and checklists help to not get cheated.
Delhi Used Car market is particularly notorious here. Any used car 2-15 years old will always have the mileage in the range of 40-60 k. It may have been run 200k for that matter. The same dealers are now taking MFC/ other franchisees, but their way of working remains the same.

Cheers,
Tapish
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Old 6th March 2013, 16:36   #8
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Something is amiss here.

I am not fully aware of the facts. However, it seems that either the financing company is overreaching or the police is acting smart in this case.

If a bank / NBFC extends a loan to any company, it will take fixed assets, inventory and a.c receivables as the collateral. It cannot claim that the goods sold to the end customer as part of collateral (and take them in its possesion to recover the loan).

By extending the same logic, if HUL goes bankrupt tomorrow, police / banks should be seizing toothpastes from customers to recover the loan.

On the face of it, customers are on a strong ground in this case. They should get back their vehicles soon (can't say the same for those who probably bought the vehicles hypothecated to the said financer)
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Old 6th March 2013, 17:10   #9
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

This is where one should insist on examining and ensuring possession of the RC book/card before handing over any payment
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Old 6th March 2013, 17:18   #10
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Instances like this go a long way in eroding the confidence in buying a used car. If this can happen with Mahindra then god save the customers from the other local car dealers. This is the reason I have always insisted in selling or buying a car to only individual buyers/sellers and not to dealers. This way you are sure of getting a better price and the transfer od documents is a smooth process.

What can Mahindra really do in this case. They cant probably meddle in the internal financial structure of every outlet. The owner took money from someone else and basically manages to find himself in a case of cheating and forgery. How can M&M keep a check on this.
Also I read in the report that some of the customers were told that the RC transfer would take 60 days. Didn't they ask why? Generally transfer of ownership is a half a days work. Why did they take the delivery of the car before ensuring that they have the original documents of the car?
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Old 6th March 2013, 17:38   #11
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

Even in a simple online purchase involving only a few thousand rupees, many people want to avail Cash on Delivery just to make sure that they get a product in hand and then only pay money. That the same people do not insist on checking the RC thoroughly and yet make a complete payment worth lakhs to the dealer is beyond my understanding. Atleast here in AP, the status of RC can be checked using the Registration number and any detail of hypothication is clearly mentioned. Wonder if Delhi RTO has the same facility.

I pity the poor souls how would have taken finance for these purchases. They would be hounded by both the cops and the lending bank. And they dont even have the vehicle anymore.
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Old 6th March 2013, 20:46   #12
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

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Originally Posted by ajmat View Post
This is where one should insist on examining and ensuring possession of the RC book/card before handing over any payment
To the best of my knowledge this is not possible with any dealer. You select the vehicle, pay up first and then the registration process follows. The best you could do is to note down the VIN / Chasis / Engine numbers for your records or take a picture at the show room. The RC book/card takes anywhere between 3 days to 3 weeks to reach the owner / financier.
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Old 6th March 2013, 21:38   #13
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

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Originally Posted by shimshumara View Post
To the best of my knowledge this is not possible with any dealer. You select the vehicle, pay up first and then the registration process follows. The best you could do is to note down the VIN / Chasis / Engine numbers for your records or take a picture at the show room. The RC book/card takes anywhere between 3 days to 3 weeks to reach the owner / financier.
That is rubbish. You have every right to verify and take possession of all documentation before parting with your cash
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Old 6th March 2013, 22:46   #14
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

I am a small towner. But all those guys who bought the cars didn't checked the original RC and Insurance before buying.? thats sheer carelessness.

The normal practice to buy any car is to check the following in original
1. registration certificate
2. insurance
3. permit in case of commercial vehicle.

One more thing, in rajasthan, we still have old fashioned normal paper based RC. in that its clearly mentioned if its hypothecated to any banks or private financier.
So my question is there any provision to check that in smart card based registration.
?

If the original owner has cleared all the dues of banks but didn't removed the hypothecation. A form 35( in rajasthan) accompanied with a no due certificate from the bank on its original letterhead with stamps is required.
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Old 6th March 2013, 23:45   #15
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Default Re: Mahindra First Choice dealer dupes customers, police seizes sold cars

How exactly does the financier get hold of the vehicles and why should the cops take the vehicles away from the owners.

As I understand it, the dealer borrowed money from someone and didn't repay him. How did the cars wind up becoming collateral.
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