Date of Filing:14/07/2017

Date of Order:09/01/2019

BEFORE THE BANGALORE I ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SHANTHINAGAR BANGALORE -  27.

Dated:09^th DAY OF JANUARY 2019

PRESENT

SRI.H.R. SRINIVAS, B.Sc., LL.B. (Rtd. Prl. District & Sessions Judge) And PRESIDENT

SRI D.SURESH, B.Com., LL.B., MEMBER

COMPLAINT NO.1997/2017

V/s

ORDER

BY SRI.H.R. SRINIVAS, PRESIDENT

1.  This is the complaint filed by the complainant against the Opposite Party (hereinafter referred to as O.P) under Section 12 of the Consumer Protection Act, 1986 praying this Forum to direct the O.P to pay damages of Rs.50,000/- as mental harassment and litigation expenses and to refund the already chargedand collected service charge, direct O.P to receive Rs.6437/- only as agreed and not to charge anything in respect of the said amount andother reliefs as this forum deems fit under circumstances of this complaint.

2.     The case of the complainant in brief is that: the complainant is having credit card facility with OP. O.P offered loan on phone.  On 25.01.2014 O.P offered Rs.2,40,000/-as loan with interest rate of 14% per annum (on reducing rate) to be payable in 48 monthly installments of Rs.6,558/- per month. O.P. also collected Rs.2,400/- towards transaction fee. It was agreed by O.P that they will not charge anything extra.  O.P also offered a top up loan of Rs.31,000/- on the same rate of interest to be payable in 48 EMI’s  at Rs.6,437/- per month.  Transaction fee of Rs.310/- was also collected from him. On 22.11.2016 while going through the accounts statement, he found that the O.P has charged service tax at 14% and Swatch Bharath Cess at 0.5% and Krushi Kalyana Cess at 0.5%. The above service tax was already included in the EMI’s i.e. Rs.6437/- He contacted the CITI Bank customer care and also its head regarding charging of extra amount.  He was informed by the head of the customer care that they are charging the service tax extra as per the order of the Government on the interest amount only.He has paid entire installment in time without becoming default. Inspite of request O.P. has not reversed the charges collected from him regarding the service charges.  The act of O.P in charging the service charges has caused him mental harassment and it is also practicing of unfairness in the trade and violation of the oral agreement. There is also deficiency in service in not responding and clarifying the extra charge collected from him and hence the complaint.

3.   Upon the service of the notice, O.P. appeared before the Forum,filed its version denying all the allegations made against it in each and every para of the complaint. It is contended that the complainant availed credit facility of Rs.2,40,000/- on 06.02.2014 agreeing to repay the same in 48 EMI’s of Rs.6,558/- with interest at 14% per annum. The said loan was enhanced and further Rs31,000/- was taken on loan on 27.01.2017 repayable with interest at 15 % per annum in 48 months. There was no service tax at the time of sanctioning and disbursing the loan.During November 2016,The Government of India made service tax to be collected on credit card facilities. The said service tax including Swatch Bharath Cess and Krushi Kalyan Cess.  Hence they had to collect the same from the complainant.

4.     As on the date of filing of this version i.e. 3.10.2017 it is stated that the complainant was due Rs.77,225.79 towards the principle amount to be payable in 13 EMI’s. It is further contended that at the time of obtaining the credit card,complainant had agreed to the terms and conditions of the credit facilities and the loan facilities.  Citi Bank i.e. O.P has registered with the tax authorities and its tax registration No. is AAA CC0462 FST 001. It is bound to collect the tax as per the directions of the Govt. of India and they have acted in accordance with and hence there is no deficiency on their part in rendering the service and collecting the taxes. Hence prayed the forum to dismiss the complaint.

4.     In order to prove the case, both the parties filed their affidavit evidence and produced documents. Heard the arguments. The following points arise for our consideration:-

1)       Whether the complainant has proved

deficiency in service on the part of the

Opposite Party?

2)  Whether the complainant is entitled to

the relief prayed for in the complaint?

5.     Our answers to the above points are:-

POINT NO.1:    In the Negative.

POINT NO.2:    In the Negative

                        For the following.

REASONS

POINT No.1 & 2:-

6.    On perusing the evidence and documents it becomes clear thatthe complainant obtained loan on the basis of the credit card facility and agreed to pay the same in 48 EMI’s.  It is the specific case of the complainant that from November2016 onwards, he has been charged with service taxes whereas it was agreed that no extra amount would be collected from him at the time of granting /sanctioning / disbursing the loan. 

7.       It is admitted by O.P that the complainant is a credit card holder and obtained loan of Rs.2,40,000/- initially and Rs.31,000/- was obtained by him afterwards.  Both the loans are to be cleared by the complainant in 48 EMI’s. It is also the case of the O.P that the terms and conditions agreed by the complainant and as per the directions, order and guidelines by the Government of India, they started collecting service charges on the interest payable on the loan granted through credit card.

8.    O.P has produced the terms and conditions with which the complainant has obtained the loan. It is very clear from it that goods and service tax as notified by the Government of India is applicable on the interest component of the EMI. All fees and other charges and is subject to change as per relevant regulations of the Government of India.As per the documents produced particularly the account statement it has started collecting the service tax at 14%, SBC 0.5% and KKC 0.5% from 19.11.2016 onwards.  Even goods and service taxes at 18% has been collected. When the Govt. of India has ordered and directed the banks and financial institutions to collect the Service Tax/GST/VAT/Swatch Bharath Cess and Krishi Kalyan Cess, as per the notifications issued by Central board of Excise and Customer in Notification No.22/2015 dated 06.11.2015 and also notification issued by Ministry of Finance, Department of Revenue in Circular No.194/04/2016-ST, dated 26.05.2016, it is the bounden duty of the said institutions to collect the same, failing which they will be penalized.   Further it is the bounden duty of each citizen of India to abide by the order of the Government and also adhere to the terms and conditions. In view of this, we are of the opinion that there is no deficiency in recovering the service tax or unfair trade practice in collecting the interest on the credit amount due. Hence we answer POINT NO.1 IN THE NEGATIVE and in the result complainant is not entitle for any of the relief claimed in the complaint and answer POINT NO.2 ALSO IN  THE NEGATIVE and in the result pass the following:-

ORDER

1. The Complaint is hereby dismissed. Parties are directed to bear their own cost.

2. Send a copy of this order to both parties free of cost.

Note:You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open Forum on this 9^th JANUARY 2019)

MEMBER                        PRESIDENT

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

CW-1:Sri Kishore Kumar.S - Complainant.

Copies of Documents produced on behalf of Complainant/s:

Annexure-1: Copy of the City Bank Loan on Phone offer.

Annexure-2: Copy of the City Bank Lona on phone offer with Top up.

Annexure-3: Copy of the November month bill

Annexure-4: Copy of the Notice and communication details.

Annxure-5: Copy of the June Month bill.

Annxure-6: Copy of the August Month bill.

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

RW-1: Mr. Nandish Prabhakar – Manager of OP.

Copies of Documents produced on behalf of Opposite Party/s

Annexure-A: Copy of the Application form

Annexure-B: Copy of the terms and conditions of the bank.

Annexure-C: Copy of the email correspondences.

MEMBER                        PRESIDENT

A*