Uttar Pradesh

Aligarh

CC/107/2022

M/S SRI RADHA KRISHNA ICE AND COLD STORAGE PVT LTD - Complainant(s)

Versus

CANARA BANK HEAD OFFICE - Opp.Party(s)

03 Apr 2023

ORDER

न्यायालय जिला उपभोक्ता विवाद प्रतितोष आयोग अलीगढ

Complaint Case No. CC/107/2022 ( Date of Filing : 30 May 2022 )   1. M/S SRI RADHA KRISHNA ICE AND COLD STORAGE PVT LTD REGD OFFICE RAMPYARI VIHAR COLONY, MELROSE BYE PASS ROAD ALIGARH 202001 UP THROUGH MANAGING DIRECTOR SHRI SHERPAL SINGH AGED ABOUT 58 YEARS S/O LATE FATEH SINGH ...........Complainant(s) Versus 1. CANARA BANK HEAD OFFICE 6648,112 JC ROAD PB HALSURPETE NAGAR LARGATHPETE BANGALORE KARNATAKA 560001 THROUGH CHAIRMAN 2. CANARA BANK CIRCLE OFFICE RAJENDRA CENTRE SECTOR 12A C-C-1 AWAS VIKAS SIKANDRA AGRA 282007 THROUGH GENERAL MANAGER 3. CANARA BANK REGIONAL OFFICE 5/89 SOOTMIL CHAURAHA IN FRONT OF TVS SHOWROOM BEEMA NAGAR G.T. ROAD ALIGARH THROUGH REGIONAL MANAGER 4. CANARA BANK SME BRANCH GOOLAR ROAD ALIGARH UP ............Opp.Party(s)

BEFORE:     HON'BLE MR. HASNAIN QURESHI PRESIDENT   HON'BLE MR. ALOK UPADHYAYA MEMBER

PRESENT:

Dated : 03 Apr 2023

Final Order / Judgement The present complaint has been filed by the complainant before this commission for  the following reliefs- The Op be directed to reimburse the complainant against penal interest amounting Rs.1063011/ in loan account 2375773001417 with interest @9% per annum from 21.11.2019 till the date of payment. Compensation for harassment Rs.100000/ and litigation expenses Rs.25000.  The Complainant has stated that complainant is a private Ltd Company and carries on the business of storage of the agriculture produce. Complainant borrowed the loan on 27.1.2011 as  the term loan liability of Rs. 140.57 in account no. 2375773001417.  The loan was granted under the agriculture sector bearing product code 886 for term loan account but the account was opened and maintained in product code 773 relating to the sector other than agriculture. It was the negligent act of the bank staff. The rate of interest in agriculture sector is less than the rate of interest in other sector. On 28.3.2013 the amount of interest was wrongly calculated due to wrong code which was reversed on 30.3.2013.On 4.7.2013 the excess amount of interest was again charged .On 30.9.2013 op bank accumulated the dues with the higher rate of interest which was not applicable and the account was classified as NPA. Bank issued notice dated 14.2.2014 under section 13(2) of the SARFASIE Act. Op moved U/s 14 of the SARFASIE Act but later on proceedings were withdrawn. Complainant sent a letter dated 5.8.2019 to the bank with request to revise liability after reducing excess interest and penal interest. Complainant was informed by letter dated 23.9.2019 by the OP no.4 that the competent authority permitted restructuring package since the  cutoff date 31.7.2019 . Complainant responded to restructuring package by its letter dated 24.9.2019 and requested to waive the penal interest and to reduce the interest rate by the limit of rate applicable for agriculture sector. Op no. 4 informed the complainant vide letter dated 23.9.2019 permitting the concession in the rate of interest. On 4.12.2019 OP no.2 having its office at Lucknow at that time communicated to the complainant that the proposal of waiver /reimbursement of penal interest admitting the fact that the loan account was opened in wrong product code 773 instead of correct code 886 thereby CBS system charged the wrong interest. In the said letter interest was recalculated and penal interest was recommended for waiver /reimbursement. Op no.4 did not act upon the recommendation. Complainant reminded the OP no.4 by its letter dated 17.7.2021 to return the penal interest.     Ops have not denied to sanction the loan to the complainant and stated that the loan was advanced to the complainant in the year 2011 and account was opened in wrong code as the banking system is updated from time to time and bank officials needed  sometime to understand the system. When the complaint was made by the complainant the excess amount of interest was returned. Complainant failed to make the payment of the installment on time and therefore the penal was imposed. The excess interest has been withdrawn and penal interest cannot be withdrawn. The case is barred by limitation and principle of estoppel and acquiescence.  Complainant has filed his affidavit and papers in support of his pleadings. Ops have also filed affidavit in support of their pleadings. We have perused the material available on record and heard the parties counsel. The first question of consideration before us is whether the bank is liable to return the penal interest to the complainant?    It is not disputed that the complainant was advanced loan for cold Storage which is covered under the agriculture sector. The Product code for agriculture sector in case of term loan is 886 but the account was opened and maintained in code 773. Rate of interest in loan for agriculture sector code 886 is less than the sector 773. The interest was charged at the higher rate applicable to the sector code 773. The excess amount of interest was reversed and then again charged. Op bank accumulated dues because of charging the interest at higher rate not applicable to the complainant along with the penal interest and the account was classified as NPA. Complainant was served with the notice under the SARFASIE Act having classified the loan as NPA but later on proceedings under the SARFASIE Act were withdrawn. Complainant had challenged the imposition of interest at higher rate with penal interest and submitted to pay outstanding dues excluding excess interest and penal interest vide its letter dated 5.8.2019 (annexure 11). Loan account was restructured reducing the liability of excess amount of interest but the penal interest was not waived. Ops have not denied that the loan account was opened and maintained in wrong code and thereby higher rate of  interest was charged by the bank staff. OPs have raised the plea that the bank employee take time to understand the CBS system which is changed from time to time. It is the liability of the bank to maintain the account properly and if there is any fault in maintaining the account due to inability of the bank employees, the account holder cannot be made liable to suffer and the bank itself is liable for the acts or omissions and negligence on the part of the bank employees. Surprisingly, Ops did not act upon the recommendation of waiver/ reimbursement made by OP no.4 vide its letter dated 4.12.2019(annexure 17) wherein it is clearly mentioned that the term loan was wrongly opened in product code 773 instead of 886 and at the last page of the letter the penal interest paid by the complainant has been shown at Rs. 1047290/.In the end of this page it is mentioned as “in view of above we recommend for waiver/ reimbursement of penal interest.” Thus, Ops are estopped from denying the liability to waive/reimburse the penal interest amounting Rs.1047290/. Accordingly, ops bank is liable to reimburse the amount Rs.1047290/ with interest to the complainant.          The question formulated above is decided in favour of the complainant. The second question of consideration before us is whether the case is time barred? The penal interest was not reversed while reducing the excess interest and the penal interest was recommended for waiver /reimbursement vide letter  dated 4.12.2019. As per provisions of law the complaint could be filed within 2 years i.e. by 04.12.2021 but the Honb’le Supreme Court extended the period of limitation by 30.5.2022 in Suo Moto writ petition due to pandemic Covid-19. Complaint has been filed on 30.5.2022 and is clearly within the period of limitation. The question formulated above is decided in favour of the complainant. The third question of consideration before us is whether the case is barred by the principle of estoppel and acquiescence ? Complainant has challenged the imposition of penal interest and has never admitted the liability to make the payment of penal interest. The amount of the penal interest paid by the complainant is under protest and cannot be said to be barred by the principle of estoppel and acquiescence. The question formulated above is decided in favour of the complainant.  Keeping in view the facts and circumstances of the case we hereby direct to Ops to pay complainant Rs 1047290/ with pendente lite and future interest at the rate 9% per annum and Rs.10000/ as litigation expenses. Op shall comply with the direction within a month failing which OPs shall be prosecuted for non-compliance in accordance with section 72 of the Act for awarding punishment against him. A copy of this judgment be provided to all the parties as per rule as mandated by Consumer Protection Act, 2019. The judgment be uploaded as per rule on the website of the commission for the perusal of the parties. File be consigned to record room along with a copy of this judgment.

[HON'BLE MR. HASNAIN QURESHI] PRESIDENT     [HON'BLE MR. ALOK UPADHYAYA] MEMBER