KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION

VAZHUTHACAUD, THIRUVANANTHAPURAM

C.C.No.16/2016

JUDGEMENT DATED: 08.11.2023

PRESENT:

COMPLAINANT:

(by Adv. Bimal V.S.)

Vs.

OPPOSITE PARTY:

(by Adv. Maya R. Mani)

JUDGEMENT

SRI. AJITH KUMAR   D.  :  JUDICIAL MEMBER

          This is a complaint filed by one Ajanthan against the Branch Manager, Federal Bank, Chemboor Branch alleging deficiency in service and unfair trade practice.  The averments contained in the complaint in brief are as follows:

          2.       The complainant had availed gold loan from the opposite party on 20.02.2014 by pledging 119 grams of gold for Rs.2,37,000/-(Rupees Two Lakhs Thirty Seven Thousand).  Complainant could not repay the loan on account of financial constraints due to loss incurred in his business and kidney disease.  On 15.05.2015 a notice was issued by the opposite party requesting the complainant to repay the loan amount with fifteen days failing which the gold ornaments will be sold in auction.  The intimation was sent by the opposite party in English.  As the complainant does not know English, he had contacted a person who is familiar with English and sent a reply on 30.06.2015 which was received by the Branch Manager of the opposite party on 01.07.2015.  Complainant had also received communications sent by the bank in this connection.  The bank on 24.06.2015 had sold the gold ornaments with the knowledge and consent of the complainant for a total sum of Rs.2,54,475/-(Rupees Two Lakhs Fifty Four Thousand Four Hundred and Seventy Five).  The bank had also requested the complainant to pay the balance amount towards the debit amount of Rs.16,031/-(Rupees Sixteen Thousand Thirty One).  The bank did not follow the guidelines issued by the Reserve Bank of India when conducting auction of the gold.  As per the guidelines issued by the Reserve Bank of India, it is obligatory on the part of the bank to issue a notice to the loanee by granting fifteen days’ time in the mother tongue.  It was also obligatory on the part of the bank to provide necessary time for the loanee to remit the dues.  The guidelines further stipulates that the auction notice have to be published in the notice board of the bank with necessary description of the gold ornaments.  The value of the gold ornaments has to be fixed on the basis of average rate prevailing in the market for a period of thirty days and the value shall not be lesser than 85% of the value so fixed.  The complainant had suffered mental agony as the Thali chain was one among the gold ornaments pledged with the opposite party which was auctioned by the opposite party without following the mandatory requirement.  Hence the complaint.

          3.       On admitting the complaint notice was issued to the opposite party.  Opposite party entered appearance and filed version with the following contentions:

                   The complaint lacks bonafides.  Complaint is not maintainable either in facts or in law.  The relief claimed is Rs.1,00,00,000/-(Rupees One Crore) which exceeds the pecuniary jurisdiction of this Commission.  In the complaint itself it is stated that the complainant does not know how to read or write English.  But the letter dated 02.07.2015 sent by the complainant is drafted in English and signed by himself.  So the plea of the complainant that he does not know English is a false averment.  After receiving the notice, complainant took more than forty five days to sent a reply.  Even if the complainant does not know how to read or write English he could have visited the opposite party for clarification.  The intention of the complainant is to make undue monetary benefit for evading the payment of balance amount owing to the realisation of the amount received by selling the gold items pledged.  No circular was issued by the Reserve Bank of India on 13.05.2013 as stated in the complaint.

          4.       The gold loan accounts of the complainant became overdue as on 20.02.2015 and the opposite party had sent registered notice of sale of the gold ornaments pledged on 15.05.2015 to the complainant which was received by him on 23.05.2015.  But the complainant had failed to respond to the register notice.  Thereafter, the auction notice was published in Kerala Kaumudi newspaper on 18.06.2015.  The officials of opposite party had visited the house and business place of the complainant and requested to close down the loan account.  The notice was published in the notice board of the bank.  The allegations that complaint regarding the fixation of the amount is only applicable to non-banking financial companies and not to Schedule Banks.  The gold ornaments were sold after complying with all prescribed formalities.  In spite of receipt of notices, the complainant did not turn up to repay the overdue amount.  Hence, opposite party was constrained to auction the gold ornaments pledged.  There is no deficiency in service or unfair trade practice.  Opposite party would seek for the dismissal of the complaint.

          5.       Evidence consists of the testimony of PW1.  Exhibits P1 to P9 were also marked subject to objection regarding P7 and P9.  Opposite party has filed proof affidavit and marked Exhibits B1 to B5.  No oral evidence was tendered by the opposite party.  Both sides filed written notes of argument.  Complainant had conducted the case by appearing in person. 

Now the points that arise for determination are:

Point Nos. 1 & 2

1. Is there any deficiency in service or unfair trade practice on the part of opposite parties as alleged?
2. Reliefs and costs?

6.       Heard both sides.  Perused the case records.  Exhibit P1 is the gold pledged token issued by opposite party in favour of the complainant.  Complainant would allege that he does not know English and he pretends ignorance in the contents in Exhibits P1 which is written in English.  As per Exhibit P1 it could be seen that one bangle, one chain and one ring and another four bangles were pledged by the complainant on 20.02.2014 and the due date of closure is also shown in the same as 20.02.2015.  Exhibit P2 is a letter issued by the opposite party to the complainant dated 15.05.2015 requesting him to remit the entire dues and other charges and redeem the items pledged.  Exhibit P3 series are the copy of reply notice dated 30.06.2015 send by the complainant and the acknowledgement card.  Exhibit P4 is the copy of the letter dated 27.06.2015 issued by the opposite party informing the complainant that the gold ornaments were sold on 24.06.2015, as the complainant did not respond to the notice issued by the bank on 25.05.2015.  Exhibit P5 another letter dated 08.07.2015 issued by the complainant to the opposite party expressing his intention to initiate legal action against them for the illegal proceedings initiated in selling the gold ornaments.  Exhibit P6 is the reply sent by the opposite party describing the various steps taken in their way before conducting the auction.  Complainant had caused production of Exhibit P7 which is a print out taken from the website regarding the auction policy for gold loans.  Complainant had applied for the details of the accounts and the guidelines issued by Reserve Bank of India to be followed while conducting the auction.  The above request was rejected by the bank for the reason that, the matter is pending before the State Consumer Commission.  The reply and the letter received in this regard are exhibited as Exhibit P8 series.  Exhibit P9 is the circular issued by the Reserve Bank of India in respect of NPA pertaining to NBFC.

7.       Branch Manager of the opposite party had sworn an affidavit in support of the pleadings contained in the version filed by them.  Exhibit D1 is the original of Exhibit P5.  Exhibit D2 is the acknowledgement card pertaining to Exhibit D1.  Exhibit D3 is the copy of the auction notice published in a daily.  Exhibit D4 is the original of Exhibit P6.  Exhibit D5 is the acknowledgement card pertaining to Exhibit D4.

8.       The complainant has no case that he had remitted any amount towards the gold loan.  He had also no case that the bank had sold the gold in public auction without informing him.  The documents produced by the complainant itself would reveal that the bank had issued a notice on 15.05.2015 requesting the complainant to remit the entire dues and redeem the gold ornaments pledged within a period of fifteen days.  He neither sent a reply nor repay the amount.  He waited till 30.06.2006 to send a reply to the notice issued by the bank.  The complainant had caused production of Exhibit P9 which is the circular issued by the Reserve Bank of India in respect of non-banking financial companies regarding the Non Performing Assets.  Opposite party is a Schedule Bank.  The circular pertaining to a non-banking financial company is not applicable to a Schedule Bank.  So the alleged failure in Exhibit P9 cannot be construed as deficiency in service.  Complainant was duly informed by the bank with the intimation to sell the property in auction if the complainant fails to remit the entire arrears within fifteen days.  Complainant pretends ignorance about the recitals contained in the notice by stating that he does not know English.  But it could be seen that all the letters sent by him were drafted in English.  Complainant had subscribed his signature in English.  Even after receiving the notice, complainant remained silent till 30.06.2015 and in the meantime the opposite parties had conducted the auction and sold the gold ornaments.  Complainant would allege that his gold ornaments were sold at a lower price but he never made any enquiries at the bank even after receiving notice.  He never furnished any data regarding the rate of gold prevailing at that time.  He had caused production of a circular of the Reserve Bank of India in respect of a non banking financial company is not applicable to a Schedule Bank.  On a careful consideration of the entire materials on record it could be seen that the bank had conducted the auction strictly in accordance with the procedural formality and even after conducting the sale, amount is outstanding towards the loan availed by the complainant.  Since the bank had conducted the auction sale after giving due notice to the complainant with sufficient time and the complainant had declined to close the dues.  There is no deficiency in service on the part of the opposite party as the bank had taken legal measures for getting back the loan availed by the complainant.  Complaint lacks bonafides and hence, it is liable to be dismissed.   Points are found against the complainant.

In the result, complaint is dismissed.  No costs.

Dictated to my Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Court, this the 8^th day of November, 2023.

SL

C.C.No.16/2016

APPENDIX

1. COMPLAINANT’S WITNESS

2. COMPLAINANT’S DOCUMENTS

3. OPPOSITE PARTY’S WITNESS

4. OPPOSITE PARTY’S DOCUMENTS

5. COURT EXHIBITS

JUDICIAL MEMEBER