BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAS NAGAR, MOHALI
Consumer Complaint No.646 of 2014
Date of institution: 05.11.2014
Date of Decision: 19.05.2015
Uttam Sahay son of Parmod Bihari Sahay having its address at Plot No.C-105, Phase-VII, Industrial Area, Mohali 160055 (Pb.) and r/o #2381, Goodwill Enclave, Sector 49-C, Chandigarh.
……..Complainant
Versus
1. Axis Bank Limited having its Corporate Office at Bombay Dyeing Mills Compound, Pandurang Budhkar Marg, Worli, Mumbai 400025 through its Managing Director/Chairman.
2. Axis Bank Limited having its Registered Office at ‘Trishul’, Third Floor, Opp. Samarthesh Temple, Nr. Law Garden, Ellisbridge, Ahmedabad 380006 through its Managing Director/Chairman.
3. Axis Bank, having its Regional Office at SCO 369 & 370, Sector 34-A, Chandigarh 160022 (U.T.) through its Manager.
4. Asix Bank having its Mohali Branch Office at SCO No.2, Phase-5, SAS Nagar, Mohali 160059 (Punjab) through its Manager.
………. Opposite Parties.
Complaint under Section 12 of the
Consumer Protection Act, 1986.
CORAM
Mrs. Madhu. P. Singh, President.
Mrs. R.K. Aulakh, Member.
Present: Shri Abnash Singh, counsel for the complainant.
Shri Deepak Jain, counsel for the OPs alongwith Shri Amarjit Singh Banga, Sr. Manager of the OPs.
(Mrs. Madhu P. Singh, President)
ORDER
The complainant has filed the present complaint under Section 12 of the Consumer Protection Act, 1986 for issuance of following directions to the Opposite Parties (for short ‘the OPs’):
(a) to refund the illegal charges on account of free usage of Airport Lounge alongwith interest on interest charges already paid and then issue No Objection Certificate for Credit Card.
(b) to pay him Rs.50,000/- as compensation for mental agony and harassment.
(c) to pay him Rs.11,000/- as litigation expenses.
The complainant’s case is that he is availing the services of the OPs through Credit Card No.4111460100045909 for past one year. The complainant was offered/promised various benefits by the OPs which includes free Airport Lounge Services. The complainant availed the Airport Lounge Services on 24th March, 2014. However, despite commitment, the complainant was wrongfully and illegally levied the charges for availing the aforesaid service. The complainant lodged the complaint with the OPs but was not given any satisfactory reply. He then sent e-mail dated 13.08.2014 but the OPs being adamant failed to honour their commitment. Then the complainant requested the OPs to cancel the credit card. The complainant had paid the amount of Rs.1330/- as charges for the aforesaid services under protest. Even after cancellation of the credit card, the OPs had been sending him statements, messages about few dues presumably the interest component. The OPs admitted that benefit of free usage of Airport Lounge was initially there, however later on discontinued. The complainant had to pay all the wrong and illegal charges under duress and protest. Thus, alleging deficiency in service and unfair trade practice on the part of the OPs, the complainant has filed the present complaint.
2. The OPs in the written statement have pleaded in the preliminary objections that Complimentary priority pass card for availing Airport Lounge Services is not covered under the definition of service under Consumer Protection Act. The complainant has not mentioned as to what consideration he has paid for availing complimentary priority card membership. The complainant has failed to show any evidence that offer of free airport services were offered to him at the time of issuance of credit card. In the request for availing complimentary priority pass it was clearly mentioned that the services is not free. On merits, it is denied that the complainant was promised free Airport lounge services. The request Ex.OP-1 clearly shows the applicability of the charges. The charges as per rules have been charged to the complainant. The complainant is a literate person and has himself signed the request form Ex.OP-1. The amount of Rs.1330/- was not illegal and was legally due from the complainant. The complainant requested for cancellation of the card on 09.04.2014, however, since outstanding payment was pending till 25.08.2014 as such statements and messages were sent to him. Thus, denying any deficiency in service and unfair trade practice on their part, the OPs have sought dismissal of the complaint.
3. Evidence of the complainant consists of his affidavit Ex.CW-1/1; copies of documents Ex.C-1 to C-3.
4. Evidence of the OPs consists of affidavit of Amarjit Banga, their Manager Ex.OP-1/1 and copies of documents Ex.OP-1 to OP-2.
5. We have heard learned counsel for the parties and gone through their written arguments.
6. Admittedly the complainant has availed the services of the OPs through Credit Card No.4111460100045909 including Airport Lounge Services. For availing the Airport Lounge Services the complainant has filled up and duly signed the necessary form Ex.OP-1. The Airport Lounge Service is a paid service for which the complainant has agreed to pay India (domestic) US $ 16.50 per Lounge visit. The dispute in the present complaint is, as per the complainant, the said service was earlier free service and without his consent, the OPs have altered the conditions and made this service as a paid service.
7. The plea of the complainant that it was a free service and later changed to a paid service is without any substance as perusal of Ex.OP-1 clearly shows that it is a signed document by the complainant himself wherein he has agreed to pay the agreed rate of US $ 16.50 Per Lounge visit. Further the perusal of Ex.OP-1 reveals that in case of fluctuation in the market rate of the USD on the actual date of incurring such charges, the differential rates/fluctuating rates causing consequential loss or gain to the complainant for which bank is not liable to the complainant meaning thereby that the fluctuating rates/differential rates of USD on the day of actual availing of the service goes to the benefit or loss to the bank and no loss or gain is attritubtable to the complainant as per the agreed terms.
8. The complainant has raised another plea that on the day when he availed of the service on 24.03.2014 he has been charged Rs.913.95 as per the credit card statement issued by the OPs as has been attached with Ex.OP-1. As per the complainant the amount calculated is not as per the USD rate prevalent on the date when such service has been availed. In order to prove his case the complainant during course of arguments has produced the prevalent rate of USD as on 24.03.2014 as Rs.60.786 which is equivalent to US $ 15 and this rate is 1.50 less as per USD and, therefore, the complainant has been charged more by 1.50 USD. It should have been charged 15 USD and not 16.50 USD. The plea of the complainant in this regard is again ill founded as the perusal of Ex.OP-1 duly signed and agreed terms document by the complainant is binding upon him wherein he himself has agreed that any fluctuation or differential in the rate of USD on the date of usage other than the agreed rate of 16.50 USD the consequential loss/gain shall be the benefit or loss of the bank. Therefore, the complainant cannot seek any relief of differential of rate of USD as prevalent on the date i.e. 24.03.2014 when he had availed the services and he had been charged Rs.913.95 as per credit card statement attached with Ex.OP-1.
9. Admittedly the complainant has not paid the charged amount of Rs.913.95 and thereafter due to the default subsequent credit card statements have been issued to the complainant by the OPs by charging debit interest @ of 40% per annum and the last statement of account is showing the recoverable amount as Rs.1330/- as on 25.08.2014. The complainant has already made a request for cancellation of the card and deactivating the services vide his request dated 09.04.2014 and this request has been duly acknowledged by the OPs. Despite the fact of registered request for cancellation of the facility, the OPs continued to levy the debit interest @ 40% per annum on an amount of Rs.913.95 from 24.03.2014 to 25.08.2014. The grievance of the complainant that the debit interest rate charge is very exorbitant and is against the law laid down by the Hon’ble National Commission in this regard. Further as per the complainant no rate of interest in the event of default of payment has been pre-agreed by the complainant and the OPs have charged interest over interest on the defaulted amount of Rs.913.95 which amounts to unfair trade practice.
10. Perusal of the credit card statement issued by the OPs and exhibited as Ex.OP-2 clearly shows that besides the service tax, debit interest has been charged as debit interest. Perusal of the statement shows that the OPs have not revealed the calculation of the debited interest as the rate of interest either as per RBI or agreed rate of interest. In this regard, the law is settled as has been held by the Hon’ble National Commission in Awaz & others Vs. Reserve Bank of India and others 2008 CPJ 98 (NC) that charging of usurious rate of interest in the event of default of payment of credit card and further penal interest on the defaulted amount cannot be capitalized. Any banking or financial institution indulging in such activities are indulging into unfair trade practice. In the case Awaz & others Vs. Reserve Bank of India and others (supra) the bank had been charging 36% to 49% per annum on the defaulted amount and the Hon’ble National Commission has issued the direction that charging of interest at the rate in excess of 36% per annum from the credit card holder by the banks for the credit card holder failure to make the full payment on the due date or paying the minimum amount due, is an unfair trade practice. Further the penal interest can be charged only once for one period of default and shall not be capitalized meaning thereby that the bank maximum can charge interest @ 36% from the credit card holder in the event of default in making the payment on the due date and further the penal interest can be charged only once for one period of default. It is admitted fact that the complainant has paid the total outstanding amount and lodged the protest regarding unnecessary interest being levied on the transaction as is evident from his e-mail dated 13.08.2013 Ex.C-3. Still the Ops have not issued him the No objection certificate. The said grievance of the complainant remained unaddressed by the OPs. As stated above the perusal of credit card statements shows the levy exorbitant rate of interest which comes to the tune of almost 40% and levy of such charge is an act of unfair trade practice on the part of the OPs. Further once the OPs have received the full amount, non issuance of No objection certificate for credit card on the part of the Ops is again an act of unfair trade practice and deficiency in services. Therefore, the complaint deserves to be allowed on these scores and complainant deserves to be compensated.
11. Therefore, the complaint is allowed with the following direction to the OPs to:
(a) recalculate the outstanding amount of Rs.913.56 w.e.f. 24.03.2014 by charging 30% flat rate of interest for one month of default and thereafter no interest is to be charged till the final payment made by the complainant on 25.08.2014. After recalculating the total recoverable amount plus interest, refund the excess amount received from the complainant alongwith interest @ 9% per annum till realisation.
(b) issue the No Objection Certificate for the credit card.
(c ) pay a lump sum compensation of Rs. 25,000/- (Rs. Twenty five thousand only) for mental agony, harassment and costs of litigation.
Compliance of this order be made within a period of one month from the date of receipt of a certified copy of this order. Certified copies of the order be furnished to the parties forthwith free of cost and thereafter the file be consigned to the record room.
Pronounced.
May 19, 2015.
(Mrs. Madhu P. Singh)
President
(Mrs. R.K. Aulakh)
Member
