BEFORE THE PRESIDENT, DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, SAMBALPUR

C.C NO- 33/2020

Present-Sri Dipak Kumar Mahapatra, President, Smt. Smita Tripathy, Member (W).

Rabindra Prasad Nanda, aged about 60 years

S/O- Amal Kumar Nanda, Occupation- Advocate

R/O- Bhatra, Ps/Po- Dhanupali,

Dist:- Sambalpur, PIN-768005, Odisha                                                       ………..Complainant

Versus

Branch Manager, Bank of Baroda,

V.S.S. Marg, Sambalpur, Eestwhile Vijaya Bank Sambalpur,

Indsore Complex, V.S.S. Marg, Sambalpur,

P.O.- Sambalpur, P.S.- Town,

Dist- Sambalpur, PIN-768001, Odisha                  

                                                                                                                        …………Opp.Parties

Counsels:-

1.  Complainant             :-          Sri. R.P. Nanda

                                                            (Benefiaciary Jagannath ATV Nanda)        

2. For the O.P.                :-          Sri. A.K.Pattanik, Advocate & Associates    

DATE OF HEARING : 08.02.2021, DATE OF ORDER : 22.03.2021

SRI DIPAK KUMAR MAHAPATRA, PRESIDENT:-Brief facts of the case is that the Beneficiary Jagannath ATV Nanda has appeared before this Commission and conducted hearing the Complainant is the Co- borrower in an Education Loan vide No-740607111000013 of Vijaya Bank, Sambalpur wherein his Son Jagannath ATV Nanda is the beneficiary/borrower. On dtd. 26.09.2013 the O.P sanctioned the loan amounting to Rs.3,80,000/- to be disbursed in four equal instalments covering 4(four) academic years starting from 2013 to 2017. The Complainant has withdrawn Rs.2,78,500/- in phases from dtd. 27.09.2013 to 29.01.2018 and rest of Rs1,01,500/ was not withdrawn by the beneficiary. As per the terms and conditions of the Education Loan the beneficiary is eligible for 100% interest subsidy on the above loan amount during Moratorium Period/Repayment Holiday means the entire study period and till earlier of one year after the Completion of study or six months of joining services as per RBI notification. After the moratorium period was over, the interest on the outstanding loan amount was to be paid. Loan was sanctioned in favour of the complainants under the category of economically weaker sections with Annual Gross Parental/Family Income with upper limit of Rs.4.5 lac per year. The beneficiary completed his study in June 2017 and joined in employment on 1^st August-2017. So he is entitled to benefit of Interest Subsidy till the end of January 2018 and liable to pay interest from February-2018 and the payment of EMI will have to start from 1^st March-2018. The beneficiary making repayment of loan from dtd.16.09.2017 during Moratorium Period/Repayment Holiday for which he is entitled to 1-2% interest exemption on the amount paid which amounts to Rs 53,114/-. The beneficiary claimed Interest Subsidy for the year 2013-14 and availed the same as he became eligible for 100% Interest subsidy. In spite of payment of Rs.53,114/-, on dtd.19.01.2018 the O.P demanded  arrear of instalments of Rs.63,026/- with a warning to 2% penal interest on the default amount from the due date of instalment till the date of actual realisation where the interest was calculated as general term loan on monthly and compounding basis which needs to be calculated on quarterly basis. The O.P has not claimed the interest subsidy for the years 2014-15,2015-16, 2016-2017 & 2017-18 though the beneficiary is entitled to the same. But according to the O.P, the Beneficiary is eligible to get 100% interest subsidy only on submission of annual income proof certificate from competent authority every year before the O.P. He is not agreed that the beneficiary will get 100% interest subsidy for extra one year after study period or six months from the date of joining service which is purely the discretion on the borrower/beneficiary. The Complainant demand lawful recalibrations of demand schedule and demanded rectification of error to the O.P for which the credit score of the beneficiary is affected. The O.P contends that as the EMI was not paid for 3 months along with arrear of Rs.63,026/- for which the letter on dtd. 19.01.2018 was issued to the Complainant. The objected to the arrear calculated for three months i.e Rs. 21,009/-per month which is surprising for loan of Rs 2,78,500/-.  On dtd. 21.01.2020 a letter was wrote the Banking Ombudsman Bhubaneswar, Orissa, a complaint was registered accordingly. The Complainant submitted that the O.P has violated the schedule for repayment fixed by the RBI. Again the O.P relied on the purported computerised system which has overridden the RBI notification and other guidelines of education loan. On answering the question of non disbursement of subsidy the O.P replied that as the Income proof of the Complainant was not submitted for those financial years as per the circular for which the O.P did not pay the interest subsidy. But the Beneficiary claims that according to the HOC circular it is the duty of the branches to sent Registry AD letter to the borrowers asking to submit required documents keeping the AD in the loan file. Thereafter the Ombudsman closed the case on dtd.17.06.2020 with discharging the O.P from all allegations and remarked as “the O.P bank has not committed any deficiency in service”. Here the Complainant states that the Ombudsman has skipped some material issues like non-claiming of interest subsidy before Nodal Bank, non-adherence to the guidelines of RBI, Indian Bank Associations etc. Hence the Complainant has prayed for certain relief from this commission as he has harassed by the O.P and undergone unnecessary financial loss, mental pain and agony and prayed in the complaint petition. Again he submitted that the Beneficiary had not opted for the benefit of extra one year at time of sanction of the loan. According to the O.P the Complainant has to pay interest on the loan from June-2017 but he is not entitled to interest subsidy till the end of January-2018. Though the Beneficiary has started repayment from dtd.16.09.2017 it was not during the moratorium period/ repayment holiday for which he is entitled to get 1-2% interest exemption on the amount paid during moratorium period. The amount of Rs.53,114 which was paid by the Beneficiary was not an advance payment but it was the payment towards arrear of interest.  Though the beneficiary is eligible for interest subsidy but could not get the benefit for the years 2014-15, 2015-16, 2016-2017 & 2017-18 due to non submission of annual income proof certificate from the competent authority with the O.P. It is due to the own negligence of the beneficiary. The arrear payment notice sent by the O.P is not illegal because after deducting an amount of Rs.5,221/- paid by the beneficiary and for the payment of rest of Rs.63,026/- the O.P has sent demand notice for the arrear amount but not for the instalment(EMI). The O.P replied that the interest were calculated on simple interest basis and explained the calculation procedure in his written statements. The O.P clarifies about the issue of sanction letter that, the document is prepared by the head office of the O.P bank according to the RBI notifications, law of banking regulations etc. The Complainant/ beneficiary after going through the same put their signatures and they are well acquainted with the content of the same. Hence it is denied that they have no knowledge regarding the sanction letter. On dtd. 19.01 2018 the O.P has sent notice for payment of EMI for three months along with arrear of interest of Rs.63.026/-. As the beneficiary has not paid the interest for the respective interest calculated months, he is not eligible to 1% rebate on the amount of Rs.53,114/-. The O.P claims that he has not tried to mislead the Ombudsman but the contents of letter dtd.14.05.2020 are all correct. The O.P has complied all the directions and guidelines of RBI as well as the office circular of the Bank rather the Complainant has tried to mislead the Court by showing old notification regarding the Education loan. The Banking Ombudsman is a well versed person appointed by RBI to redress consumer complaints against deficiency in service against banking services. After scrutinising all the documents and after quarries the ombudsman has rightly passed against the Complaint of the Complaint.

POINTS OF DETERMINATION:-

1. Whether the Complainant is comes under the purview of Consumer Protection Act.2019?
2. Whether the O.Ps has committed any Deficiency in Service to the Complainant?

From the above discussion and materials available on records we inferred that the Complainant comes under the purview of Consumers as he has availed education loan for his son (beneficiary)from the O.P. It is observed that as per the " Central Scheme to provide Interest Subsidy (CSIS)” the Government of lndia has approved the scheme to provide full interest subsidy during the period of moratorium i.e., Course Period plus one year or six months after getting job, whichever is earlier, on loans taken by students. The beneficiary has fulfilled all the terms and conditions prescribed in the Circular. The complainant could not avail the interest subsidy  due to the negligence of the O.P. on the ground of non-submission the annual income certificate which is not mandatory as per guidelines to submit is every year and there is no clause available in this regard. As such clause is not incorporated, the Beneficiary could not have known that certificate of income status proof annually required to be submitted for availing interest subsidy under scheme in question.  According to the HOC circular it is the obligation of the O.P to ask for required documents from the borrower by Registered A.D letter and keep the A.D in the loan file. So the O.P has ignored the clause and overacted as per his own will.     Again it is inferred that the O.P has calculated interest in moratorium period and demanded of EMI for Rs.63,026/- is illegal which lowered the CIBIL Score rating leading to defamation on the part of the beneficiary which amounts to unfair trade practice. The plea of the O.P that the arrear was calculated and generated by the Computer system is purely superficial as the computer generates only those data which were fed in to it by the data entry operator. The error in data feeding lead to incorrect output and the mistake cannot be attributed to the computer system. It is the practice of the O.P to escape from the liabilities. The O.P has also made false representation by submitting wrong data and information before the Ombudsman, thus misguided by the O.P the Ombudsman has overlooked and skipped the material points of consideration and closed the case discharging the O.P from all allegations made. The above matter has been well settled in the case of “The Chief Manager, Central Bank Of ... vs Sri. Ratan Datta on 21 February, 2017 by Tripura State Consumer Disputes Redressal Commission, Agartala”. Hence we order as under:-

ORDER

The O.P is directed to recalibrate the interest on the loan amount of Rs.2,78,000/- on simple interest basis from March-2018 and refund the excess amount of interest charged and paid by the beneficiary along with interest @9% per annum till the date of realisation. The O.P is further directed to pay compensation of Rs,50,000/- towards lowering the credit score of the beneficiary and causing financial defamation, Rs.30,000/- towards harassment and mental agony, Rs.10,000/- towards litigation expenses.  All the orders are to be carried out within 60(sixty) days from receiving this order , failing which the OP shall pay interest @ 9% per annum on this amount from the date of filing the complaint till its realisation.

Order pronounced in the open Court today i.e, on 22^nd day of March 2021 under my hand and seal of this Commission.

Office is directed to supply copies of the Order to the parties free of costs receiving acknowledgement of the delivery thereof.

I agree,

-sd/-                                                                                                                                   -sd/-

MEMBER(W)                                                                                                            PRESIDENT  

                                                            Dictated and Corrected

                                                                             by me.

                                                                               -sd/-

                      PRESIDENT