CC No: 1317/2014

 Filed on 24.07.2015

Disposed on 11.02.2016

BEFORE THE III ADDITIONAL BANGALORE URBAN DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

BANGALORE – 560 052

DATED THIS THE 11^th DAY OF FEBRUARY 2016

CONSUMER COMPLAINT NO.1317/2014

PRESENT:

Sri. H.S.Ramakrishna,  B.Sc., LL.B.

                                    PRESIDENT

                        Smt. L. Mamatha, B.A., (Law), LL.B.

                        MEMBER

                                                        V/S

ORDER 

BY SRI H.S. RAMAKRISHNA, PRESIDENT

1.         This is a complaint filed by the Complainant against the Opposite Party under Section-12 of the Consumer Protection Act, 1986, praying to pass an order directing the Opposite Party to pay the excess amount of Rs.1,37,188/- and also adjust the existing outstanding amount if any in the loan account from the above excess sum and refund the balance amount along with interest at 12% from 24.06.2013.

2.         The brief facts of the Complaint can be stated as under:

The Complainant alleged that on 18.06.2006 the Complainants availed home loan of Rs.12 lakhs from the Opposite Party.  The Complainant have agreed to repay the loan amount with interest at 9% p.a. and base rate at 2.5% below BPLR on monthly EMI of Rs.15,697/- for a period of 10 years.  The Complainants regularly paying the installments in a sum of Rs.16,050/- p.m. loan account No.07640600000352 as against the EMI amount of Rs.15,697/- fixed under the loan approval letter through their Saving Bank Account No.07640100004542 with standing instruction for automatic transfer of monthly installments to the said loan account within due dates except delay of few days in two or three occasions.  The Complainant No.1 personally visiting the bank to deposit loan amount in their account before the due dates of monthly installments.  The Complainant have paid the lump sum payment of Rs.4,75,000/- and Rs.1,75,000/- in the month of March and April 2013 towards the above loan account.  On 19.06.2013 after payment of lump sum amounts, when the Complainant No.2 made an inquiry with the Opposite Party regarding the outstanding loan amount and requested the split up statements containing the payment of interests and principal amounts towards the above loan account from the first date of commencement of loan installments instead of furnishing the said details Opposite Party informed the Complainants that they are still due in a sum ofRs.1,10,000/-.  The Complainant No.1 requested the Opposite Party by letter dt.24.06.2013 to furnish the details about the rates of interest applied to the loan from the date of sanction of loan.  The Opposite Party sent an evasive reply dt.26.06.2013 to the said letter of the Complainant No.1.  The Complainants paid further sum of Rs.50,000/- on 03.07.2013 and Rs.30,000/- on 01.08.2013.  Inspite of several requests personally on many occasions by the Complainant No.1, the Opposite Party has not provided the complete details about the rate of interest applied, different increased rates of interests effected subsequently on various stages and total amounts collected from the Complainants towards interest and principal amount and Opposite Party has avoided Complainants and has not cared and neglected to provide the said details to the Complainants under one pretext or the other.  The Complainants have came to know from the list furnished by the Opposite Party exorbitant increases in the rates of interests applied to the loan of the Complainants without bringing the same at any point of time to the notice of the Complainants despite several personal visits of Complainant No.1 to the Opposite Party and in utter violation of fair Banking Practice and Natural Justice and Banking Rules, Regulations and also Circulars of RBI.  The Opposite Party is aware that the rate of interest at the time of availing the loan by the Complainants as per the loan approval letter was 9% and the said interest was subsequently enhanced up to 13.50% at different stages behind the back of the Complainants at different stages, that too without bringing the fact of exorbitant increase of rate of interest in writing to the knowledge of Complainants even at any one stage, thus keeping the Complainants totally in dark on all those stages for the reasons well known to the Opposite Party.  As per the calculations, Complainants have so far paid in a sum of Rs.6,60,403/- towards the interest on principal amount as against the required amount of interest in a sum of Rs.5,23,215/- and thus Opposite Party unjustly collected an excess sum of Rs.1,37,188/- towards interest from the Complainants even more behind the back of the Complainants and without bringing the same to the notice of the Complainants.  The Opposite Party inform that regarding interest details have already been fed in the computer system and the same cannot be explained and the said details are correct and further avoided the Complainants saying that nobody has made any inquiry with regard to the details as reflected in the computer system, thus totally putting the Complainants in dark.  Hence, this complaint.

            3.         In response to the notice, the Opposite Party put their appearance through their counsel and filed version.  In the version, the Opposite Party pleaded that the complaint is not maintainable in law or on facts.  The complaint consists of mischievous allegations and tailored statements.  These Complainants seems to be some sort of recovery suit, this Hon'ble Forum has no jurisdiction to try.  The allegation in the complaint is that this Opposite Party has collected excess interest upon housing loan is totally false.  Assuming but not admitting that this Opposite Party has collected any excess interests, Complainants ought to have approached the Jurisdictional Civil Court to recover the alleged excess money.  The recovery of monies is exclusive subject matters of the Jurisdictional Civil Court and not this Authority.  The Complainants have not stated anything about deficiency of service on the part of the Opposite Party.  During the usual course of their business, the Complainants have concealed the facts that they have entered into a Term Loan Agreement on 25.10.2006.  They have agreed that computation and calculation of the rate of interest upon their Housing Loan may be determined by the Opposite Party from time to time, which shall be binding on these Complainants.  The Opposite Party denied as per the loan approval letter with tenure of 10 years for repayment of loan amount with the rate of interest at 9% p.a. with monthly interest and base rate at 2.5% below BPLR.  On the contrary, the said loan was sanctioned at floating rate option 2.5% below BPLR at the rate of 9% p.a. monthly rests.  Hence, the loan was approved not at fixed rate of interest, but at the floating rate of interest and denied the other averments made in the complaint and prays to dismiss the complaint.

4.         In support of the complaint, the Complainant No.1 has filed the affidavit by way of evidence.  For the Opposite Party one R. Banumathi has filed the affidavit by way of evidence.  Heard the arguments of both the parties.

5.         Now the points that arise for consideration are:-

1. Whether the Complainants have proved the alleged deficiency in service by the Opposite Party?
2. If so, to what relief the Complainants are entitled?

6.         Our findings on the above points are:-

                        POINT (1):-  Affirmative

                        POINT (2):-As per the final Order

REASONS

7.         POINT NO. 1:-         As seen from the allegations made in the complaint and also version filed by the Opposite Party, it is not in dispute that the Complainants availed the home loan of Rs.12 lakhs from the Opposite Party on 18.06.2006.  It is also not in dispute that the Complainant has agreed to repay the said loan amount in a tenure of 10 years on monthly EMI of Rs.15,697/- and according to the Complainants they agreed to repay the loan amount with interest at 9% p.a. and base rate of 2.5% below the BPLR.  But the Opposite Party denied this fact and contended that the Complainants have agreed to repay the loan amount with interest at 9% + 2.5% above the BPLR and also to pay the floating rate of interest, but not fixed rate of interest.  So now the burden is on the Complainant to prove this fact.  In order to substantiate the Complainants contention, the Complainant No.1 has filed his affidavit and in the sworn testimony he reiterated the same and also produced the terms and conditions of the Opposite Party while sanctioning the home loan of Rs.12 lakhs in favour of the Complainants.  By looking into this, it is very clear that the Opposite Party Bank has sanctioned the home loan of Rs.12 lakhs on 18.10.2006 in favour of the Complainant and the rate of interest is floating option 2.5% below BPLR at 9% p.a. with monthly rests and the total period of repayment is 120 months at the EMI of Rs.15,697/-.  So as looking into the terms and conditions of the loan, the Complainants have agreed to repay the loan amount with interest at 9% p.a. below the BPLR with floating option of 2.5%, but not fixed rate of interest at 9% p.a. as contended by the Complainants.

            8.         On the other hand, at the time of argument, the learned counsel for the Complainants argued that RBI issued a circular in respect of the interest rate of advance on 01.07.2013 and as per the guidelines issued by the RBI, the banks relating to interest rate on advance banks have freedom to offer all the categories of loans on fixed or floating rates, subject to conformity to their Asset-Liability Management guidelines.  The methodology of computing the floating rates should be objective, transparent and mutually acceptable to counter parties.  The base rate could also serve as the reference benchmark rates.  This methodology should be adopted for all new loans.  Incase of existing loans of longer/fixed tenure, banks should reset the floating rates according to the above method at the time of review or renewal of loan accounts, after obtaining the consent of the concerned borrower/s.  So from this guidelines of the RBI, it is very clear that the banks should have charge to all the categories of loan a fixed rate of interest, incase if they charge floating rate of interest for that they have to take consent from the authorities.  But in this case, the Opposite Party Bank has not take consent to charge floating rate of interest.  Therefore, it is proper to accept the argument of the learned counsel for the Complainants that the rate of interest charged by the Opposite Party is against the guidelines of the RBI.

            9.         Further, it is the case of the Complainants that the Complainant were regular in repayment of loan amount against the EMI amount of Rs.15,697/- under loan approval letter through their SB Account No.07640100004542 in the Opposite Party Bank with standing instructions for automatic transfer.  Apart from that the Complainants have paid the lump sum payment of Rs.4,75,000/- and Rs.1,75,000/- in the month of March and April 2013 towards the loan account.  In support of this, the Complainant No.1 in his sworn testimony reiterated the same.  His testimony is also supported by the document produced by the Opposite Parties themselves i.e. Statement of Account No.07640600000352.  As looking into this account statement, it is very clear that the Complainants are regular in repayment of monthly installments from their SB account and monthly EMI was automatically adjusted to the loan account in every month.  Apart from that, on 18.03.2013 the Complainants have paid a lump sum of Rs.4,75,000/-, on 25.05.2013 paid a sum of Rs.1,75,000/-, on 03.07.2013 and 27.09.2013 paid a sum of Rs.50,000/- and Rs.30,000/- respectively.  To discard this evidence of the Complainants, there is no contra evidence therefore, it is proper to accept the contention of the Complainants.

            10.      It is the further case of the Complainants that the Opposite Party Bank has charged excessive rate of interest since the Complainants have agreed only interest at the rate of 9% p.a.  In support of this, in the sworn testimony, reiterated the same.  On the other hand, this fact is denied by the Opposite Party Bank and take a defence that the Complainants have agreed to pay the floating rate of interest.  In support of their defence, the Opposite Party Bank filed affidavit of R. Banumathi and reiterated the same and also produced the Interest Detail Inquiry Rates of the Account No. No.07640600000352.  By looking into this, it is clear that the Opposite Party Bank charging interest at 9% p.a. in 2006 and 12.25% on 01.08.2011.  So from this material evidence, it is very clear that the Opposite Party Bank has charging varied rate of interest from 9% to 12.25%.  As argued by the learned counsel for the Complainants that there is a specific guidelines issued by the RBI for all the loans fixed rate of interest shall be charged on base rate in the case of bank charging floating rate of interest before renewal of rate of interest banks ought to have take consent from the parties.  But the Opposite Party Bank have not placed any material evidence to show that when they are changing the rate of interest, they obtained the consent from the Complainants, thereby it evidence that Opposite Party Bank was charging more than the agreed rate of interest i.e. even up to 12.25% that too without the consent of the Complainants and these varied rate of interest will amount to collecting the excessive amount of Rs.1,37,188/- as contended by the Complainants.  So from the evidence available on record and the material placed by the parties, it is very clear that the Opposite Party Bank have collected excess amount of Rs.1,37,188/-.

            11.      After the Complainants came to know about the same, the Complainants by addressing a letter to the Opposite Party Bank requesting for refund of the said amount.  Even though the Opposite Party Bank received the notice, but fails to comply with the notice.  This is also supported by the sworn testimony of the Complainants as the notice issued by the Complainants, thereby, the excessive amount collected by the Opposite Party Bank is evident by the relevant material evidence placed by the parties.  This clearly established that there is a deficiency of service on the part of the Opposite Party Bank.  Thereby, there is a deficiency of service on the part of Opposite Party Bank.  Hence, this point is held in the affirmative.

            12.      POINT NO.2:-          In view of the finding on Point No.1, we proceed to pass the following;

ORDER

The Complaint is allowed holding that there is deficiency of service by the Opposite Party.  The Opposite Party is directed to pay a sum of Rs.1,37,188/- to the Complainants.  The said amount is excess interest amount.  The Opposite Party is directed to pay a sum of Rs.30,000/- as compensation.  The Opposite Party is also directed to pay Rs.3,000/- towards costs of this litigation.  The Opposite Party is directed to pay the aforesaid amount within 30 days from the date of this Order.  Failing which, the aforesaid amount shall carry interest at 12% p.a. from the date of this Order, till the date of realization.   

Supply free copy of this order to both the parties. 

(Dictated to the Stenographer, got it transcribed, typed by her/him and corrected by me, then pronounced in the Open Forum on 11^th day of February 2016).

       MEMBER                                                                               PRESIDENT

CC. NO.1317/2014

LIST OF WITNESSES AND DOCUMENTS

Witnesses not examined, but affidavit of the witnesses is filed, as follows;

1. Sri A. Rafiulla Khan has filed affidavit for the Complainants.
2. R. Banumathi has filed affidavit for the Opposite Party.

List of documents filed by the Complainant :

1. Copy of the loan approval letter dt.18.10.2006.
2. Copy of the letter dt.24.06.2013.
3. Copy of the reply letter dt.26.06.2013.
4. Copy of the letter dt.14.12.2013.
5. Copy of the legal notice dt.12.02.2014.
6. Copy of the reply dt.26.02.2014 to the legal notice.

List of documents filed by the Opposite Parties :

1. Copy of the loan agreement.
2. Copy of the stamp as on agreement plus power of attorney.
3. Copy of the memorandum of deposit of title deeds.
4. Copy of the general power of attorney.
5. Copy of the stamp paper dt.11.10.2006.
6. Copy of the Declaration-cum-Undertaking-cum-Authority.
7. Copy of the letter of undertaking.
8. Copy of the statement of loan account.
9. Copy of the legal notice dt.11.11.2006.
10. Copy of the Application Form.

MEMBER                                                                               PRESIDENT