DISTRICT CONSUMER DISPUTES REDRESSAL FORUM
SOUTH 24 – PARGANAS , AMANTRAN BAZAR, BARUIPUR,
KOLKATA-700 0144
C.C. CASE NO. __404_ _ OF ___2015
DATE OF FILING : 9.9.2015 DATE OF PASSING JUDGEMENT:12.12 .2018
Present : President : Ananta Kumar Kapri
Member(s) : Subrata Sarker
COMPLAINANT : Laxmi Kanta Das, son of Jagadish Das of 37/6, Brojen Mukherjee Road, P.O & P.S – Behala, Dist. South 24-Parganas, Kolkata-34.
O.P/O.Ps : 1. Managing Director, Indus Ind Bank, 8th Floor, Tower-1, One India Bulls Centre, 841, S.B Marg. Elphinstone Road, Mumbai- 400 013.
2. The Zonal Manager, IndusInd Bank, 41, Shakespeare Sarani, Flat no.2D, 2nd Floor, Duck Back House, Kolkata-17.
3. The Branch Manager, IndusInd Bank, Sarat Bose Road Branch, 85A, Sarat Bose Road, Kolkata-26, P.S Ballygunge.
4. Guha Parking, Prop. R. Guha, Saktigarh Station Road, P.O Saktigarh, Dist. Burdwan.
Proforma O.Ps : 5. Rupak Chakraborty, 42/41, Bhagbati Charan Chatterjee Street, Kamarhati, Belghoria, Kolkata – 56.
6. Shibu Narayan Das, 115, Tollygunge Circular Road, Kolkata- 53.
J U D G M E N T
Sri Ananta Kumar Kapri, President
Levelling allegation of unlawful re-possession of his vehicle, the complainant has filed the instant case ,praying for return of the vehicle and payment of compensation.
The facts leading to the filing of the instant case may be epitomized as follows:
The complainant purchased a Maruti Swift Dezire Tour 1248 Car, having taken loan from the IndusInd Bank i.e O.P nos. 1,2 and 3 of Rs.5,40,000/- on 23.7.2013, to be repaid by him by 60 equal monthly installments of Rs.12, 222/- each. Loan Agreement was executed by him in favour of the Bank. Thereafter, the complainant failed to make regular payment of the installments and, therefore, the O.P nos. 1,2 and 3 i.e the Bank repossessed the vehicle with their musclemen as the vehicle was hypothecated to the Bank until repayment of the loan amount. Therefore, the complainant filed the instant case ,praying for return of the illegally possessed car from the Bank and also for payment of compensation. Hence, arises the instant case.
O.P nos. 1,2 and 3 have been contesting the case by filing written statement, wherein it is submitted that the complainant was granted a loan in the month of July, 2013 of Rs.5,40,000/- for purchasing a Swift Dezire Tour vehicle on its hypothecation to Bank. Loan agreement was also executed by the complainant that day. The complainant defaulted in payment of installments; dues of the bank were not cleared inspite of notice to him and, therefore, the vehicle was repossessed on 14.8.2016 and kept in the custody of O.P-4 ,the authorized Wire House Keeper of them. Bank has every right to repossess all the vehicles in terms of the agreement whenever the loanee becomes a defaulter. There is no deficiency in service on the part of the Bank and, therefore, the case should be dismissed in limini with cost.
O.P-4 has also filed written statement ,wherein it is contended inter alia that he has no liability whatsoever in the matter of repossession of the vehicle of the complainant. He only took the vehicle in the custody under the order of the Bank i.e O.P nos. 1,2 and 3 . He has no deficiency in service and the case is not maintainable against him.
O.P nos. 5 and 6 have not turned up to contest herein inspite of service of summons upon them and, therefore, the case is heard exparte against them.
Upon the averments of the parties, the following points are formulated for consideration.
POINTS FOR DETERMINATION
- Is there any deficiency in service on the part of the Bank as alleged by the complainant?
- Is the complainant entitled to get relief or reliefs as prayed for ?
EVIDENCE OF THE PARTIES
Petition of complaint is treated as evidence of the complainant vide his petition dated 6.12.2016. Written statement is also treated as evidence of O.P nos. 1,2 and 3 vide their petition dated 5.6.2017. Questionnaires, replies and BNA filed by the parties are kept in the record after consideration.
DECISION WITH REASONS
Point no.1 & 2 :
Already heard the submissions of Ld. Lawyers ,appearing for the parties. Perused the complaint, written statement and other materials on record. Considered all these.
It is admitted fact that the complainant was granted a loan by the bank and that the said loan was to be repaid by 60 EMIs of Rs.12,222/- each. It stands admitted by the parties that the vehicle which was hypothecated to the bank was repossessed by the Bank on 14.8.2015 , although the vehicle has subsequently been returned to the complainant on 14.10.2016 in accordance with the order passed by this Forum.
The question which arises for consideration now is whether any illegality has been caused by the Bank while proceeding to repossess the vehicle. If it is found that the repossession of the vehicle has not been taken in accordance with the provisions of Law, the Bank must be held guilty of deficiency in service in that case. Repossession of the vehicle is taken by a secured creditor i.e the Bank under section 13(2) of SARFAESI Act, 2002. Section 13(2) of the said Act lays down that a prior notice is to be given to the borrower by the bank before proceeding to repossess the vehicle or any other secured asset. This provision i.e Section 13(2) of the said Act has been given a clear go-bye by the O.P Bank while taking repossession of the vehicle of the complainant. We do not know why the bank is so apathetic to give such notice to borrower. The notice gives an option to the borrower for liquidating his liability and if the liability is not liquidated by the borrower, then the repossession of the asset may be taken by the Bank. No such option is given by the Bank to the complainant. One notice is filed herein by the Bank and a perusal of that repossession notice dated 14.8.2015 reveals that the notice was given to the complainant by the Bank only on 14.8.2015 – the date of repossession of the vehicle. Such notice cannot be said to be in terms of Section 13(2) of the SARFAESI Act, 2002. Repossession of the vehicle has been taken by the Bank in flagrant violation of the aforesaid provision of Law and, therefore, such repossession is done illegally by the Bank.
The practice of repossession of the vehicle by the muscleman of the bank has been deprecated by the Hon’ble Apex Court and also by the Hon’ble National Commission. In City Crp. Maruti Finance Vs. Vijay Laxmi , AIR 2012 SC 509 , It has been held by the Hon’ble Apex Court that repossession of the vehicle can only take place if there is a provision for such repossession in the agreement and it must always be done in accordance with the law. At the same time, the Hon’ble Apex Court deprecated the practice of repossession of the vehicle by muscleman of the Bank.
In the instant case, the repossession of the vehicle has not been done in accordance with the Law. It is not also known to us whether there is any provision for repossession of the vehicle in the agreement executed by the complainant, because the bank has not filed the said agreement before us. We cannot understand why the said agreement which is a vital document has not been filed before the Forum. Is there anything to hide? Be that as it may, we feel nothing sort of hesitation to say that the provisions for repossession of the vehicle is perhaps not there in the agreement and ,therefore, the bank is afraid to produce that document before the Forum. The fact of the vehicle being repossessed by the O.P Bank is a clear instance of deficiency in service on the part of the Bank and the Bank has not acted in accordance with the Law while taking repossession of the vehicle of the complainant.
In M/s Mahendra & Mahendra Financial Services Ltd. Vs. Suresh Kumar Sukla, reported in 2017(3) CPR 658 (NC) ,it has also been held that repossession of the vehicle by the financer by use of muscle power and without due notice to the complainant is a deficiency in service . In the facts and circumstances of the case as discussed above, the O.P Bank has acted illegally in having repossession of the vehicle of the complainant and, therefore, the O.P Bank is guilty of deficiency in service.
It has been alleged by the complainant that no copy of agreement concluded between him and the Bank was supplied to him by the Bank. According to him, he has also demanded the supply of copy of such agreement by letter; still the bank has turned a deaf ear to his request. A guideline of Reserves Bank of India dated 22.8.2007 has been filed on record on behalf of the complainant and the said guideline is quoted herein below for clarity of our discussion:
RBI/2007-08/119 August 22, 2007
DBOD. No. Leg.BC.28/09.07.005/2007-08
All Scheduled Commercial Banks/All India Financial Institutions (Excluding RRBs)
Dear Sir,
Guidelines on Fair Practices Code for Lenders.
Furnishing copy of loan agreement
“1. Please refer to our Circular DBOD Leg. No.BC.104/09.07.007/2002-03 dated May , 2003 wherein guidelines were issued to Banks/Fis for framing the Fair Practices Code for Lenders.
2. In terms of Para 2(ii) ( c ) of the above Circular banks/Fis were advised that terms and conditions and other caveats governing credit facilities given by banks/financial institutions arrived after negotiation by lending institution and the borrower should be reduced in writing and duly certified by the authorized official, Banks/Fis were further advised that a copy of the loan agreement along with copy each of all enclosures quoted in the loan agreement should be furnished to the borrower.
3. It is understood that some banks are furnishing a copy of the loan agreement only on request made by the borrowers. In this connection, we advise that not furnishing a copy of the loan agreement or enclosures quoted in the loan agreement is an unfair practice and this could lead to disputes between the bank and the borrower with regard to the terms and conditions on which the loan is granted.
4. Banks/Fis are therefore advised to invariably furnish a copy of the loan agreement along with a copy each of all enclosures quoted in the loan agreement to all the borrowers at the time of sanction/disbursement of loans.”
It is the guidelines of Reserve Bank of India dated 22.8.2007 issued to all Financial Institutions to furnish a copy of loan agreement to the borrower, whether the borrower does make any request for such agreement or not. This RBI guideline has also been flouted by the O.P Bank.
The complainant issued a letter to the O.P Bank on 10.5.2016 and thereby he demanded a copy of the loan agreement. A copy of the said letter has been placed on record by the complainant and in reply to that letter, the bank also issued another letter to the complainant on 13.5.2016 and thereby the Bank informed the complainant that they were unable to furnish copy of loan agreement as the complainant had already filed a complaint case vide C.C no. 404 of 2015 before the Consumer Forum. These two letters i.e the letter of the complainant and also the letter of the Bank go a long way to establish that the copy of loan agreement was never supplied to the complainant by the Bank. Non supply of the copy of loan agreement to the complainant is a clear violation of the RBI guidelines by the O.P Bank and, therefore, this is a glaring instance of deficiency in service and unfair trade practice caused on the part of the O.P Bank.
There is also want of transparency in the activities of the O.P Bank. The O.P Bank has not followed the direction of Law i.e section 13(2) of SARFAESI Act, while taking over possession of the vehicle from the complainant. They have not furnished copy of loan agreement to the complainant inspite of his demand. God knows why they are so reluctant to follow the guidelines . Regards being had to this conduct of the bank in particular, we feel no hesitation to say that there is lack of transparency in the conduct of the O.P Bank . Be that as it may, the O.P Bank is found guilty of deficiency in service. It is also guilty of unfair trade practice. The complainant is, therefore, entitled to get the relief or reliefs a prayed for.
There is no cause of action against other O.Ps and, therefore, the case should be dismissed against them.
In the result, the case succeeds.
Hence,
ORDERED
That the complaint case be and the same is decreed on contest against the O.P nos. 1,2 and 3 with cost of Rs.10,000/- and dismissed on contest against O.P-4 and exparte against the rest of the O.Ps without cost.
The O.P nos. 1,2 and 3 are directed to pay a sum of Rs.50,000/- as compensation to the complainant for causing harassment and mental agony to him within a month of this order, failing which, the compensation amount and the cost amount will bear interest @8% p.a till full realization thereof.
Let a free copy of this order be given to the parties concerned at once.
President
I / We agree
Member Member
Dictated and corrected by me
President
