Complainant by filing this complaint has claimed that having been influenced and misguided by the agent of the op and having been wrongly informed about the interest rate of the personal loan in question took loan and the op no.2 contacted with the complainant for cash loan of Rs.40,000/- and accordingly the complainant entered into a loan agreement with the op no.2 having Loan No.13001486.  But no document was supplied to the complainant after execution of the same nothing was served except loan amount was released after deducting the booking fee service tax etc and as per agreement it was decided that the said land loan agreement would be paid within 48 months.  But actual rate of interest was not disclosed and complainant began to pay Rs.1,800/- as EMI (Easy Monthly Installment) with interest and it was also decided between the parties that it would be cleared by electronics clearing services (ECS) through bankers of the complainant from the saving account of the complainant directly credited to the bank account of the ops.

          As per the terms and conditions of the said loan agreement the complainant started to pay the EMI’s through the bankers of the complainant and accordingly the complainant paid regularly EMI on and from 10.08.2007 to 05.04.2009 of Rs.1,800/- each and there was no delay on the part of the complainant.  But even after payment of the said EMI, rate of interest was not disclosed and there was a gross negligence and deficiency on the part of the op and fact remains that complainant paid EMI’s of Rs.1,800/- each for about 21 months.  But subsequently, complainant realized that as per RBI Rules and Norms, the interest has not been deducted.  So, complainant requested the to settle this account by following the RBI Rules and Norms and further asked the op to settle the matter and it was informed by an Advocate notice.  But op did not take any step and did not pay any heed.  But pressurized to pay more interest ad in the circumstances for negligent and deficient manner of service, this complaint was filed for redressal.

          On the other hand op by filing written statement submitted that op granted official assistance by way of personal loan of Rs. 40,000/- before the agreement No.13001486 on or about 22.08.2007 and after execution of the said loan agreement knowing fully well of the terms and conditions of the agreement, complainant received the said amount after deduction of all charges and net amount of Rs.33,836/- was disbursed and prior to the execution of the agreement terms and conditions were informed and complainant began to pay EMI’s knowing fully well the rate of interest was 29% and so at this stage complainant cannot retreat back from the terms of the agreement and further it is found that complainant has paid 20 installments only.  But it is regularly and as on 03.08.2010 a sum of Rs.50,416.81/- was due which is payable by the complainant and in the above circumstances the present complaint should be dismissed because complainant cannot go behind the terms and conditions of loan and when he has got the loan as per his prayer and only to avoid payment of outstanding dues, complainant has filed this case.

                                         Decision with reasons

          On proper consideration of the complaint and written version, it is found that practically the original agreement is not produced, the xerox copy is produced and from the said copy, it is found that most of the columns are blank and complainant’s signature is there as applicant signature.  But other part i.e. loan amount, mode of installment etc are written by the Bank and another interesting factor is that interest rate is noted 29%.  But it is found that the entire form is written in English and no one read other explained the same to such poor person having no English knowledge because he is a Hindi knowing people and another factor is that in the said agreement, there is no date of execution, place of execution and at the same time it is not noted what would be the deduction out of the total loan.  But fact remains in the year 2007, as per RBI guidelines flat rate of interest for private Bank was 10.50% whereas in case of other banking institution (under taking) interest rate was flat rate only 9%. But under any circumstances, that flat interest of personal loan was not above 10.10% and in the present case, it is found that the 9% was written, subsequently 2% was added and it is true that no copy of original agreement was handed over to the complainant by the op.

          Further considering the argument of the Ld. Lawyer for the complainant and also the present Ld. Lawyer for the complainant, it is found that Ld. Lawyer tried to convince the Forum cannot go beyond the agreement.  But in our view the present agreement is in complete and practically the private banking institutions are squeezing money from the poorer section of people by alluring them to take loan and bank always their acknowledged interest are charged at a heavy rate and in this regard after considering the RBI Rules in the year 2006-08 it is clear that no banking institutions has or had their right to charge extra interest above the flat rate of 10.10% over the personal loan, below Rs.1 lac and in the present loan was below Rs. 1 lac i.e. Rs.40,000/-.  But actual it was disbursed and amount was only Rs.33,836/- and any prudent man cannot believe that against that amount of loan of Rs.40,000/- near about Rs.6,000/- and more was deducted as tax, service charge etc.  Then it is clear that against Rs.40,000/- of loan, complainant actually received Rs.33,836/- and as because in the relevant year 2007 flat rate of interest in respect of personal loan below Rs.1 lac was 10.10% in respect of the private banks.  But it was 9% in respect of the nationalized banks.  So, considering that fact, we find that initially complainant was informed that he shall have to pay interest @ 9% but when the case was filed and when the copy of agreement supplied by the op that 2% was inserted and entire agreement is in complete in view of the fact date, place of agreement is not noted there and this is the common practice of the private bank like ICICI, HDFC, AXIS Bank and more other banks when there is none to control them.  But in this case it is proved that complainant paid Rs.37,800/- though he received only Rs.33,836/- and at best complainant may get interest @ 10.10% but not 29% and the interest as charged by the op is completely illegal, uncalled for and it is unfair trade practice and after calculation, it is found that interest over Rs.40,000/- per year would be Rs.4,000/- and complainant already paid Rs.37,800/- out of total capital, then balance capital amount is Rs.2,200/- and above the same interest of Rs.10,000/- can be charged and total Rs.12,200/- can be realized by the op from the complainant but not more than that and invariably complainant was in complete darkness about the interest rate and op bank adopted unfair trade practice and practically charge as Kabuliwala interests defined the regulations of the RBI of the relevant year.

          In this regard we have gone through some papers of other private banks in respect of the personal loan of that year, wherefrom it is found in between the year 2006-07 other private banks charged 10.10% about the flat rate over personal loan as per RBI guidelines.  But present op did not adopt that guideline and falsely charged 29% which is unethical and against the RBI Rules and for which we are convinced to hold that op cannot claim any interest @ 29% over the loan of amount of Rs.40,000/-.  So, after calculation of the same we are of the view that at best the composite amount of Rs.12,200/- the op is entitled from the complainant without any further interest and complainant may deposit the same and in that case loan account shall be treated as closed.

          Accordingly the case succeeds.

          Hence, it is

                                                 ORDERED

          That the complaint be and the same is allowed on contest but without cost.

          Complainant is directed to deposit Rs.12,200/- to the op Bank at once and invariably within the two months from the date of this order and on payment the personal loan agreement shall be treated as cancelled and op or ops have their no right to claim further interest from the complainant.

          Accordingly, the present complaint is decided finally as per spirit of this order.