DOF 30.5.2008

IN THE CONSUMER DISPUTES REDRESSAL FORUM, KANNUR

Present: Sri.K.Gopalan:  President

Smt.K.P.Preethakumari:  Member

Smt.M.D.Jessy:               Member

Dated this, the   4^th day of   June     2010

CC.134/2008

Paramban Rajan,

Valiavelicham,

P.OMooriyad,

Thalassery.                                                                     Complainant

   (Rep. by Adv.P.N.Nambiar)

1. Secretary,

   Thalassery Primary co.op.Agricultural &

   Rural Development Bank

   Town Hall Road, Cherakara,

   Thalassery

   (Rep. by Adv.C.K.Ramachandran)

2. Special Sale Officer

     Thalassery Primary co.op.Agricultural &                        Opposite parties

      Rural Development Bank

     Town Hall Road, Cherakara,

     Thalassery

3. Asst. Registrar/Valuation Officer,

     Thalassery Primary co.op.Agricultural &

     Rural Development Bank

     Town Hall Road, Cherakara,

     Thalassery

O R D E R

Sri.K.Gopalan, President

            This is a complaint fled under sectin12 of consumer protection act for an order directing the opposite parties to refund excess recovery Rs.1,32,079 and to refund the difference of interest with a compenstion of Rs.40,000/- and cost.

            The facts of the case in brief are as follows: - the complainant approached 1^st opposite party for a loan to purchase a lorry for his self employment. An amount of

 Rs.6, 30,000/- was sanctioned on 29.8.00 hypothecating the vehicle along with properties belongs to himself and his sister as collateral security. Repayment period was 5 years. Gehan No. 165/2000 was executed on 18.7.00. He has been repaying loan every month but these occurred few months default. The sale officer of the opposite party surprisingly issued a notice warning that the property would be sold in auction   if an amount of Rs. 6, 27,238/- was not paid within 15 days. As per the agreement there was time up to296.2005 for repayment. Another notice was also issued fixing the auction on30th  January 2004. He got another letter from special sale officer dt.22.3.06 informing that if the principal and simple interest is paid before 30.6.06 the loan account could be closed. In the light of this letter complaint approached the bank but he was asked to pay Rs.3, 98,270/- which included penal interest of Rs.56,709/-.Complainant’s protest and request was not heeded. The complaint has paid Rs.10, 44,319/- towards the loan account but in the release deed dt.14.6.06 only 9, 12,240/- was shown. There is a difference of Rs.1, 32,079/-. The complainant approached the opposite partiers several time to settle the mater. But they were not even listening to complainant. Lawyer notice was therefore issued on 4.10.06 for which no reply was sent. Complainant sent a representation to the valuation officer on 29.10.07 for which a replydt.31.10.07 was received justifying their actions. The amount recovered in excess has not been accounted properly. Complainant requested several time to verify the account but opposite parties were not ready to do so. The ledger posting and interest calculation were wrong. Penal interest has been recovered in violation of existing order. Complainant suffered much mental strain and sufferings. In the loan agreement the amount of interest shown is 15.5% which was further reduced to12% with effect from4/04. But the opposite parties have recovered interest @ 16%. Although the joint Registrar of co-op. societies, Kannur has ordered refund of the excess charged interest the 1^st opposite party has not carried out the orders. This is clearly deficiency of service and unfair trade practice on the part of opposite parties. Hence this complaint.

            Pursuant to the notice opposite parties entered appearance and field version contending as follows: Complainant is a member and the complaint is not maintainable under section 69 of the Kerala co. operative societies Act, since this forum has no jurisdiction. Vehicle loan was granted to complainant for an amount of Rs.6, 30,000/- with 15 ½% of interest. The repayment period was 5 years. 2 acre 93 cents of land belonged to complaint and his sister had been mortgaged as security. The complainant was irregular in re-payment of loan installments. Opposite party had not collected rs.56, 709/- as penal interest. After 31.1.04, the complaint had made payment after 20 months on 13.9.05. After 20.10.05 next instalment paid after 5 months on 24.3.06.  The loan instalment has to be paid every month as stipulated in the Gahan. Naturally 1^st opposite party had initiated required coercive steps to see that the over due has to be cleared off. It is true that the complainant paid Rs.10, 44,319/- as is shown details a to f below. Out of this 1^st opposite party had returned Rs.9046/- as per the order of joint Registrar of co-op. societies, Kannur. The ledger posting was not defective.1/2% interest collected in excess was refunded as per the order of joint registrar. 1^st opposite party is entitled to collect penal interest form the complainant. Hence an amount of Rs.17083/- was collected from the complainant. Therefore the allegation that Rs.56, 709/- charged as penal interest is nothing but false. The release deed is prepared by the complaint to see that the charge on the property had cleared for ever. While preparing the release deed of the complainant omitted to add the correct amount paid to the bank for which the 1^st opposite party is not responsible. If there is any differences in the amount shown in the release deed that may be an clerical mistake committed by the document writer, who prepared the release deed at the instance of the complainant. The amount recovered has been properly accounted. Hence the complaint is devoid of merit isliable to be dismissed.

            On the above pleadings the following issues have been taken for consideration.

1. Whether the complaint is maintainable?

2. Whether there is any deficiency in-service on the part of opposite parties?

3. Whether the complaint is entitled for the remedy as prayed in the complaint?

4. Relief and cost.

            The evidence consists of oral evidence adduced by PW1, DW1, and Ext.A1 to A17 and Ext.B1 to B4.

Issue Nos. 1 to 4

            Admittedly complainant availed a loan of Rs.6, 30,000/-for purchasing a lorry. The vehicle was hypothecated along with the property as collateral security. Gahan was executed on 18.7.00. Period of repayment was5 years. The amount was sanctioned to him vide loan account No. TNSR 005-2000-01 SRTO 24/00 dt.29.8.00.

            The complainant’s case is that he has paid Rs.10, 44,319/- in the loan account but in the release deed dt.14.6.06 only Rs.9, 12,240/- was shown and thus there is difference of Rs.1,32,079/-.Opposite party has also levied penal interest from the complainant. Hence he is entitled for the refund of the amount.

            The first contention of opposite parties is that complainant is a member of the 1^st opposite party bank and hence this complaint is not maintainable under section 69 of the Kerala co-op. societies Act since the Forum has no jurisdiction. So the first question to be answered is nothing but whether the complaint is maintainable or not.            It is a well settled position of law that the  Forum under the CPA have jurisdiction to entertain a complaint despite the fact that other forum/courts would also have jurisdiction to adjudicate up on the lis(2004 CTJ(1)(SC) CP Secretary, Thirumugam Co-op. Agricultural credit society vs. M.Lathika). In the famous case Raju Scharam vs. Sad guru park co.op.Hsg.Soc and others reported in2008 CTJ 593 (C) P (NCDRC) it is held that the remedy under section 3 of CPA is over and above the facilities available under the co-op. society’s act or any other Act in force. Our jurisdiction has not specifically been barred, hence the view of section 3 of CPA, 1986, we are in full agreement that the consumer fora had jurisdiction to deal with the case”. The principles laid down in the above case make clear that the case in hand is undoubtedly maintainable before this Forum. Hence the first issue is favorable to complainant.

            Since the first issue is in favour of complainant we are expected to go ahead to answer other issues. Complainant pleaded that he has been repaying loan every month but there is default of few instalments by which there was some amount outstanding. He alleges that notice dt.9.5.03 was surprisingly issued though there was time till 29.6.06 for repayment. He further alleles that he received another letter fixing the auction on 30.1.04. It is not denied but opposite party contended that after31.1.04 the complainant made payment on13.9.05 which is after 20 months. Any how complainant received another letter from special sale officer dt.22.3.06 informing that if the principal and simple interest is paid before 30.6.06 the loan account could be closed. Complainant’s allegation is that when he approached the bank in the light of the letter of sales officer he  was asked to pay Rs.3,98,270/- which is included penal interest of Rs.56,706/- and it is against offer made in the letter of 22.3.06. Further allegation of the complainant is that complainant has paid Rs.10, 44,319/- towards loan account but in the release deed dated 14.6.06 only Rs.9, 12,240/- was shown. There is a difference of Rs.1, 32,079/’-. Ext.A11 is  the release deed(copy) Ext.A11 shows that the entire loan amount Rs.6,30,000/- repaid and also paid all  sums by way of interest Rs.2,82,240/- due under the said Gehan to the mortgage. Hence it is true that the total amount due under Gahan paid is shown only Rs.9, 12,240/-. The central point of dispute is directly related to the entry of amount in the release deed. Complainant deposed that “Release deed Rm³ AS¨ XpI apgp-h³ ImWn-¨n-«nà sb¶p-f-f-XmWv Fsâ-XÀ¡-T.Complainant has pleaded that he has paid Rs.10, 44,319/- towards loan account. Opposite party admitted in the version itself that the complaint has paid Rs.10, 44,319/- towards loan account. Item wise details of dues have also been given in the version viz.

a. The principal amount             Rs.6, 30,000/-

b. Interest collected                                    2, 80,000/

C. Over due interest                                   1, 13,005/-

d. Penal interest                                             17,083/-

e. Postage                                                            95/-

f. Miscellaneous                                               3,175/-

                                    Total                       10, 44,319/-

There is no dispute with respect to the payment of amount Rs.10, 44,319/-. The above given details shows that penal interest is Rs. 17,083/-. Complainant has the specific case that as per ext.A1 he was informed that if the principle and simple interest is paid before 30.6.06 the loan account could be closed. Opposite party has admitted that complainant has closed loan account by paying entire amount. DW1 in his evidence byway of chief affidavit has stated that “ apgp-h³_m-[-y-X-bpT ]cm-Xn-¡m-c³Xo-c-¯Xv 24-.3-.06 \p am{X-am-Wv. That means complainant closed the account before the date offered in Ext.A1. Special sales officer send one time settlement offer to complainant in forming that “30.6.2006  \pap³]v apX-epT  km[m-cW ]en-i-bpT am{XT AS-¨v Xm-¦-fpsS hmbv]m IW-¡v-A-h-km-\n-¸n-¡m-hp-¶-Xm-Wv. “ Thus complainant is entitled to close the account by paying principal and simple interest before 30.6.06. Complainant alleges that he has approached the Bank in the light of the above said letter Ext.A1 in order to close the account but at that time he was asked to pay a sum of Rs.3,98,270/- which included penal interest of Rs.56,709/-.

            1stopposite party in his evidence byway of proof affidavit adduced evidence that “Ac-i-X-am-\-T-]-eni A[n-IT hm§n-sb-Sp¯p F¶]-cmXnXoÀ¸v IÂ]n¨ I®qÀ tPmbâv dPn-kv{Sm-dpsS D¯-c-hp-{]-Im-cT 9046 cq] _m¦v ]cm-Xn-¡m-c-¶ÂIn-bXv At±-lT ssI]-än-bn-«p-­v. 31-.3-.04 hsc ]ng ]eni hm§m³ \nb-a-X-S-Ê-ap-­m-bn-cp-¶n-Ã. AXp-sIm­p Xs¶ 31-.3-.04 hsc ]ng ]en-i-bpT aäpT CuSm-¡n-bn-«p-­v.-F-¶m 1.4.04\p tijT ]cm-Xn-¡m-c-\n \n¶p ]ng-]-eni CuSm¡n-bn-«n-Ã.    opposite party has also denied the allegation in the version stating that the bank had collected Rs.56, 709/- from the complainant as penal interest is not correct.

            Complainant in his evidence by way of proof affidavit stated that “c­mT FXnÀI-£n-bn \n¶v 22-U3-U06\p thsdmcp t\m«okv In«n. AXp-{]-Im-cT XpI km[m-cW ]cni kln-XT 30.6.06-\p-ap³]v Xncn-¨-S-¡p-I-bm-sW-¦n tem¬ A¡u­v  Ah-km-\n-¸n-¡m-sa-¶m-bn-cp-¶p.Cu Ah-k-cT D]-tbm-K-s¸Sp¯msa-¶ Dt±-i-s¯-sS-]-e-h-gn-¡pT IST hm§n 22.3.06-\p-I-ST ho«m³  _m¦n sN¶-t¸mÄ BsI 3,96,270/þ AS-¡-W-sa¶p Bh-i-y-s¸-«p.-C-Xp-]n-g-]-eni 56,709 cq] AS-¡-am-bn-cp-¶p. 22.3.06 sâI-¯n\p LS-I-hn-cp-²-am-bn-cp¶p CXv.  “Here arose the question whether the 1st opposite party has received such an amount of Rs.56, 709/- towards penal interest or not? It is true that 1t opposite party stated that it is not correct to say that they have received Rs.56,709/- as penal interest. Admittedly complaint closed the account on 24.3.06 and a cash receipt R.No.2403060024 issued to him by the bank 1^st opposite party. This is the receipt marked as Ext.A2. Ext.A2 shows a payment of Rs.56,709/- towards penal interest. The following particulars re shown in the Ext.A2 receipt

Account closed.

Principal                                               2, 98,072

Interest                                                    43,489

Interest after due date penal interest      56,709

OTS (Golden Jubilee) 3,142.

                                                             --- -- ------

                                    Total                3, 98,270

                                                             ------------

            There is no doubt that as per the above A2 receipt R.No.2403060024 the 1^st opposite party bank has received an amount of Rs.56, 709/- towards penal interest, which is against offer of Ext.A1 letter of OTS (Golden Jubilee) Complainant is entitled to settle the account on the basis of Ext.A1 by paying principal and simple interest. Complainant’s allegation that he was compelled to pay penal interest when he went to clear the account on the basis of Ext.A1 is proved to be true by Ext.A2 itself. Opposite party though denied that no penal interest has been taken from complaint they failed to explain why did the amount Rs.56, 709/- shown in the Ext.a1 as penal interest. This is undoubtedly a typical form of unfair traded practice. The complainant’s further case is that he has altogether paid Rs.10, 44,319/- for closing the account and the same is admitted by opposite parties, but not entered this amount in Ext.A1 release deed. Complainant has specifically deposed in cross examination that ‘Bank ‘F¶nÂ\n-¶pT CuSm-t-¡-­-Xp-I-tb-¡mÄ- Cu-Sm¡n F¶p F\n-¡v]-cm-Xn-bp-­v. _m¦v A[n-I-am-bn 1,32,219- cq-]-bmWv Ft¶mSv hm§n-b-Xv. cioXn {]Im-c-ap-f-f-XpI dneokv UoUn ImWm-¯-Xp-sIm-­m-Wv _m¦vv Cu XpI A[n-IT hm§n F¶p ]d-bm³ Imc-WT. Opposite party did not give any satisfactory answer to this point. What is explained by the opposite party byway of proof affidavit is that “ Xsâ hkvXp-hn³ta-ep-ff ]W-b-hpT _m[-y-X-bpT Hgn-hmbn F¶p- sX-fn-bn-¡p-¶-Xn\p th­n ]cm-Xn-¡m-c³ Xs¶-X-¿m-dm-¡nb dneokv UoUn Fs´-¦n-epT ]ni-IvkT-`-h-ns¨-¦n AXn\p D¯-c-hmZn ]cm-Xn-¡m-c³ Xs¶-bm-Wv. sk{¡-«-dn-bpT km£n-I-fpT ]Wb _m[-yX Hgn-hmn-bn-cp¶p F¶ Imc-yT km£-y-s¸-Sp-¯pI am{X-amWv sN¿p-¶-Xv.    “The indication of this explanation is nothing but the bank is not responsible for the entry of data in the release deed as if they are mechanically putting their signature without bothering about the contents of the deed. Copy of the Gehan Release deed executed by the bank in favour of the complainant. On 14.6.06 reveals that the mortgagor paid a total amount of Rs.9, 12,240/- as alleged by the complainant. The stand taken by the 1^st opposite party bank that they are not responsible for the reliability of the contents entered in the documents cannot be accepted since  service bank is an institution very much responsible to public and is having everyday experiences of executing various types’ documents assisted by legally competent persons in the panel. Opposite parties have no case that there is such release deed?

            It is pertinent to note that Ext.A2 has been proved beyond doubt that penal interest Rs.56, 709/- was received by the 1^st opposite party and complainant has the case that the excluded amount Rs.1, 32,219/- includes this penal interest also. The actual amount admittedly paid by the complainant Rs.10,44,319/- has not been found place in Ext.A4 Gehan Release Deed but entered an amount of rs.9,12,240/- only less than Rs.1,32,219/- that of the actual admitted amount Rs.10,44,319/- paid by  the complainant. Opposite party has no case that it was happened due to any sort of mistake taken place out of their part. Complainant sent legal notice to refund the amount Rs.1, 32,219/- as excess amount paid by him. Complainant alleged that an excess amount of Rs.1, 32,079/- is received by1st opposite party and kept it with unauthorized. Opposite party was called upon either to pay the excess amount of Rs.1, 32,079/- or to give statement of accounts of loan. But this lawyer notice Ext.A12 was not replied by1st opposite party. Non responding to this lawyer notice is a clear deficiency in-service on the part of 1st opposite party. There is no justification for non entry of actual amount in release deed as well as non reply of lawyer notice. If there was no such release deed with those entries opposite party should have been sent reply telling that such release deed was false. No sending of reply is in a way admission that the alleged release deed was existed. Hence we have no hesitation to hold that there is deficiency in service on the part of 1^st opposite party bank.

            It is seen that the excess amount Rs.1,32,219/- includes the amount Rs.56,709/- unless and until if there is justifiable explanation on the part of 1^st opposite party why the entire amount Rs.10,44,319/- has not been shown in release deed, 1^st opposite party bank is liable to refund the amount over and above shown as due in Ext.A11. But unfortunately complainant could not produce the original of release deed and prove it. Marking of Ext.A11 was objected by opposite party and it was subject to proof, complainant has not explained where the original is. Hence we are not in a position to make the opposite party liable to refund the entire amount Rs.1,37,219/- over and above shown due in the release deed, though opposite party has  no case that there is no such release deed. But opposite party is liable to refund Rs.56, 709/- which is proved by Ext.A2 as penal interest and of the reason that the complainant is entitled to clear the account on the basis of ExtA1. It is a fact that complainant approached the opposite parties many times in various ways and at last by lawyer notice but 1^st opposite party has taken an adamant stand for giving a satisfactory reply. Hence it is quite natural that complainant might have suffered physical and mental pain. We are also of opinion that the  complainant is entitled for an amount of

Rs. 5000/- as compensation and a sum of Rs.1000/- as cost of this proceedings. Thus issues 1 to 4 are found in favour of complainant and order passed accordingly.

            In the result, the complaint is allowed directing 1^st opposite party-bank to refund Rs.56, 709/- (Rupees Fifty six thousand seven hundred and nine only) and to pay Rs.5000/- (Rupees Five thousand only) as compensation and a sum of Rs.1000/- (Rupees One thousand only) as cost of this proceedings to the complainant within one month from the date of receipt of this order, failing which the amount of Rs.56, 709/- shall be attracted interest @ 15.5% from the date of Ext.A1 i.e.  24.3.06 till  the date of payment. Complainant is also at liberty to execute the order against 1st opposite party as per the provisions of consumer protection Act after the expiry of 30 days.

  Sd/-President         Sd/-Member        Sd/-Member

APPENDIX

Exhibits for the complainant

A1.Copy of the letter dt.22.3.06 issued by OP

A2.Receipt  dt.24.3.06 issued by OP

A3.Copy of the letter dt.31.10.07sent by OP3 to Registrar of co.op. societies

A4.Copy of loan sanctioning order

A5 & 6.Foreclose notice issued by OP dt.30.9.02 & 3.1.03

A7.Notice issued by sale officer

A8 & 9.Auction notice

A10.Copy of the letter sent by OP

A11.Copy of the release deed

A12.Copy of the lawyer notice sent to OP

A13.Copy of the letter sent to 3^rd OPdt.29.10.07.

A14.Share receipts issued by OP

A15.Notice issued by OP

A16 & 17.Demand notice issued by OP.

Exhibits for the opposite parties

B1Copy of the ledger for remittance of loan.

B2.Copy of the  auction diary issued by sale officer

B3.Copy of the letter submitted by complainant dt.1.9.05.

B4.Copy of ledger extract

Wit ness examined for the complainant

PW1.Complainant

Witness examined for the opposite parties

DW1.Sukumaran Othayoth

                                                /forwarded by order/

Senior Superintendent

Consumer Disputes Redressal Forum, Kannur