DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

Udyog Sadan, C-22 & 23, Qutub Institutional Area

(Behind Qutub Hotel), New Delhi- 110016

Case No.291/17

Shri Lekh Raj

S/o Late Shri Nathu Ram

R/o House No.26/3298

Beadonpura, Karol Bagh

New Delhi.                                                                     .…Complainant

                                                VERSUS

The Manager

Citicorp Finance (India) Ltd.

(Formerly Citi Financial Consumer

3, LSC, Pushp Vihar

New Delhi.          

ALSO AT:

3^rd Floor, 27 Centre Market

Western Avenue Road

Punjabi Bagh,

New Delhi-110026.                                                      ….Opposite Party

Coram:

Ms. Monika A Srivastava, President

Ms. Kiran Kaushal, Member

Sh. U.K. Tyagi, Member

ORDER

Date of Institution: 18.08.2017

Date of Order        : 10.04.2023

President, Ms. Monika A Srivastava

The complainant has filed the present complaint seeking return of his original documents/Sale Deed pertaining to Property bearing no. 26/3298,Beadonpura, Karol Bagh .

1. It is stated by the complainant that he took a loan of Rs.1,45,982/- from the OP with the condition that the complainant will pay instalment at Rs.2,240/- per month along with interest @ 13% per annum in 120 EMIs.

2. As per the Agreement complainant deposited the original Sale Deed of his property bearing No.26/3298 Block-P, Gali No. 26-27 Beadonpura, Karol Bagh, New Delhi with the OP as security for mortgage.

3. It is further stated by the complainant that he has paid entire 120 instalments well in time as per Agreement upto 05.06.2016 but OP has deliberately not given ‘No Dues Certificate’ to the complainant and despite reminders from the complainant in this regard sent on 05.09.2016, 21.09.2016 and 10.10.2016, the OP neither replied nor returned original title deed of the property to the complainant mentioned above.

4. It is stated by the complainant that since the complainant has paid the entire amount to the OP, the OP has no right to retain his documents and should return the same to the complainant and in this regard, a notice was also issued by the complainant on 17.05.2017 but the OP failed to reply. It is stated by the complainant that there is negligence on the part of the OP to retain the original title deed which is causing him great mental agony, tension and harassment without any just or reasonable cause.

5. In their reply, it is stated by the OP that the loan Agreement was executed between the complainant and City Financial Consumer Finance India Ltd. (CCFIL). It was earlier known as Citi Corp Finance India Ltd. (CFIL) (a subsidiary to Citi Bank) but later on this loan was assigned to Citi bank. Vide assignment Deed dated 09.11.2015 and the provisions of the loan agreements on 20.10.2015 through loan assigned deed, the complainant’s loan account bearing No.8428674 was changed to Citi Bank Loan A/c No.137859 after the loan was assigned .

6. This transfer was brought to the knowledge of the complainant by a letter dated 09.11.2015 and it is exhibit –C. It is also stated by the OP that the complainant was also informed about the transfer of Loan  from CCFIL to Citi Bank prior to its assignment vide letter dated 20.10.2015 which is exhibit-E.

7. It is further stated by OP that the present complaint is based on false and concocted facts with malafide intent to extract unlawful gains. The OP relies on Clause 10.3 of the loan Agreement which gives unhindered right to the lender to assign the loan without any prior permission of the borrower.

8. It is stated by the OP that the allegation of the complainant regarding payment of 120 instalments towards the loan fails as per the terms and conditions of the Agreement and letter dated 09.11.2015.  It is stated that the interest is variable and would be determined by the OP.  It is further stated that the rate of interest is contractually agreed upon and is not open for adjudication by courts under the Banking Regulation Act.

9. It is further stated by the OP that after the letter dated 09.11.2015 wherein the OP has apprised the complainant about the details of remaining outstanding amount, tenure applicable, interest rate, the complainant did not stick to the said terms and started paying the outstanding amount.

10. It is further stated by the OP that Schedule-1 of the Loan Agreement clearly specifies that the interest is variable at the sole discretion of the lender i.e. OP. The relevant provisions of the letter dated 09.11.2015 are reproduced below as verbatim:-

“(b) the interest rate is linked to the CMPR rate as determined by Citibank from time to time.  The CMPR shall be reset on a monthly basis. The reset date shall be the first date of every month.

(c ) interest shall be computed at Citibank’s discretion on actual daily outstanding balance of the Loan on the basis of actual number of days in a year.

(e) the specified interest rate revision from time to time, will be binding on the borrower and the borrower hereby agrees to and grants consent to the same. The borrower hereby further confirms that such rate notified by the bank shall not be challenged or repudiated by the borrower at any time.”

11. It is stated by the OP that the complainant has failed to adhere to the financial discipline of the repayment of the loan and that several cheques issued by the complainant towards repayment of the loan were dishonoured/returned with remarks “refer to borrower/ insufficient fund”. It is also stated by the OP that the complainant has time and again failed to honour his commitment and has not made the property available for inspection to the officials of the OP in consonance with the loan agreement.

12. It is next stated by the OP that in this regard the OP has initiated arbitration which is pending and reserved for order.  It is also stated that a loan recall notice dated 13.03.2018 was issued to the complainant and is marked as exhibit-D but the complainant has not replied nor has made any efforts to repay the outstanding amount. 

13. It is stated by the OP that the complainant has still to pay Rs.1,31,748/- as the loan tenure was increased from 120 months to 171 months. The relevant clauses of the Loan Agreement which enunciates the right of the lender to modify the interest rate of the loan is reproduced below:-

“2.2 (b) “The Lender shall review and, if considered necessary, revise the Rate of interest on 1^st Feb. and 1^st Aug. each year or at any time and from time to time as per its policy, market conditions and/or applicable laws and regulations, if any, during the tenor of the loan at its sole discretion. The lender will endeavour to inform the borrower about the variation in the interest in the due course”.

14. It is stated by the OP that in accordance with the terms of the agreement, the rate of interest revised from time to time and in this regard, four such letters dated 26.09.2006, 25.01.2007, 18.07.2008, 27.08.2008 were sent to the complainant wherein it was informed to the complainant that the rate of interest has been revised to 13.5 % per annum and thereafter increased further.  These letters are annexed as Exhibit-F.  It is also stated that complainant did not complain about the revised tenor to the loan and that there has been no deficiency in services on the part of the OP.

15. In their rejoinder, the complainant has mostly denied the averments made by the OP in their reply.

This Commission has gone through the entire material on record and the documents. It is noted that the Loan Agreement has blank entries at the time of obtaining signatures of the complainant and his wife which were not filled up before signing and also have not been filled up before filing the documents in the commission. Schedule-1 filed along with the agreement bears details of the loan which is given as 1,50,000/- @ 13% however, the agreement does not clarify whether it is fixed or variable or whether it can be changed at the sole discretion of the lender. The OP has failed to exercise the option of changing the rate of interest. The tenor of the loan is provided as 120 number of EMIs and the amount of the EMI is Rs.2240/-. Description of the property is also provided which is same as described above.  It is established principle that when there is no consensus ad idem when the agreement has been signed while blank, there is no agreement in the eyes of law.

It is also seen that other documents also had blank entries before those were signed by the borrowers i.e. the complainant.  In this regard, a query was also put to the counsel of the OP at the time of the final arguments but no answer was forthcoming as to why the documents filed on record are blank.

   This Commission is of the view that the OP is deficient in its services in not filling up the agreement before obtaining signatures. The complainant had agreed to the initial terms of the loan as 120 instalments of Rs.2,240/- and as stated by the complainant has been paid and this fact has not been denied by the OP.

It is seen from the record that though the OP has averred that the complainant was not financially disciplined in paying his loan but the OP has not been able to place on record any evidence to show that EMIs had bounced/has not been honoured. The contention of the OP is limited to the non- payment of the EMIs after the increase in rate of interest however, that too stands not proved by the OP as the OP has not placed on record any postal receipt evidencing that the letters intimating change in rate of interest were duly received by the complainants.

Keeping the above facts in mind, this Commission is of the view that the the OP is duty bound to return the original title documents of the complainant within two months from the date of receipt of this order failing which the OP would be liable to pay Rs. 1,00,000/- as compensation to the complainant.

File be consigned to the record room after giving copy of the order to the parties as per rules.