Tamil Nadu

StateCommission

FA/541/2012

THE BRANCH MANAGER, BANK OF INDIA - Complainant(s)

Versus

D. CHANDRASEKARAN - Opp.Party(s)

V. ADHI VARAHAM

11 Dec 2015

ORDER

 

BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI

                 Present: Thiru J. Jayaram,                                PRESIDING JUDICIAL MEMBER

                               Tmt.  P. Bakiyavathi                            MEMBER

 

F.A. No.541 / 2012

 

(Against the Order in C.C. No. 9 / 2011 dated 23-08-2011

on the file of the DCDRF, Perambalur)

Dated this the 11^th day of DECEMBER, 2015

The Branch Manager,                         ]

Bank of India,                                     ]

Arumbavur Branch,                             ]

Veppanthattai Taluk,                           ]  ..  Appellant / 2^nd Opposite

Perambalur District                             ]                        Party

 

                   Vs.

 

1. D. Chandrasekaran,                        ]  ..  Respondent / Complainant

    S/o Mr. Duraisamy,                         ]

    Door No.17, Bajanai Kovil Street,    ]

    Arumbavur Village,                         ]

    Veppanthattai Taluk,                       ]

    Perambalur District                         ]

]

2. The Assistant Director,                    ]

    Khadi & Village Industries Board,     ]  ..  Respondent /

    Trichy                                            ]                  1^st Opposite Party  

 

This Appeal coming up before us for final hearing on 06-10-2015 and on hearing the arguments of both sides and upon perusing the material records, this Commission made the following Order:

Counsel for Appellant/ 2^nd Opposite:     -       M/s V. Adhivarahan

   Party

Counsel for Respondent/ Complainant:  -       M/s C.S. Associates

 

J. JAYARAM, PRESIDING JUDICIAL MEMBER

This appeal is filed by the 2^nd opposite party against the order of the District Forum, Perambalur, in C.C. No.9 / 2011, dated 23-08-2011, allowing the complaint.

The case of the complainant is that he is a graduate and he approached the 1^st opposite party, for loan under self-employment scheme for unemployed graduates, and the 1^st opposite party sponsored him to the 2^nd opposite party bank recommending loan amounting to Rs.22,50,000/-. The 2^nd opposite party obtained the security for a sum of Rs.55,40,000/- in the form of immovable property. It is a subsidy loan and at the final stage before releasing the loan, the 2^nd opposite party demanded 10% commission in the total loan amount which the complainant declined. Refusal of the loan after directing the complainant to open an account in his bank and collecting the documents, the unnecessary delay of several months and not following the correct procedure and rejecting the loan on false reason that he was employed elsewhere and rejecting the loan high-handedly and in arbitrary manner amount to deficiency in service on the part of the 2^nd opposite party, and hence the complaint, claiming compensation of Rs.1,50,000/- for the deficiency in service, mental agony, and sufferings etc. and to pay a sum of Rs.25,000/- towards the expenses incurred by him and damages of Rs.2 Lac.  

2.       According to the 1^st opposite party, the complainant applied for loan under the self-employment scheme of Prime Minister’s Employment Generating Scheme. Task Force Committee headed by the District Collector selected the complainant and sponsored him to the 2^nd opposite party bank to obtain loan amounting to Rs.22,50,000/-

 

3.       According to the 2^nd opposite party, the 1^st opposite party forwarded the application, quotation, etc. of the complainant. On completion of necessary formalities for sanctioning the loan, when the 2^nd opposite party visited the residence of the complainant for the second time, he came to know from the complainant’s father that the complainant was employed as a manager in a pharmaceutical company at Chennai and was getting good salary, and thus he was already employed and so his loan application was rejected, and there is no deficiency in service on their part.

 

4.       The District Forum considered the rival contentions and allowed the complaint holding that there is deficiency in service on the part of the opposite party in not sanctioning the loan.

5.       The order of the District Forum is as follows:

“i)      The 2^nd opposite party to pay Rs.25,000/- for mental agony and frustration caused due to the deficiency in service committed by the 2^nd opposite party and Rs.5000/- for expenses incurred by the complainant for collecting documents

         

ii)       The 2^nd opposite party to release the loan amount of Rs.22,50,000/- to the complainant within three months from the date of this order.

         

iii)      It is left open to the opposite parties, to prosecute the complaint for criminal offence of committing fraud, to part with money on furnishing false statement, if they obtained concrete evidence for his employment during the relevant period”.

 

6.       Three additional documents were filed by the appellant / 2^nd opposite party and marked as Ex.B3 to B5:

Ex.B3 is CBIL Consumer Credit Information Report;

Ex.B4 is Guidelines on Prime Minister’s Employment Generation Programme (PMEGP);

Ex.B5 is Master Circular on KYC Norms.

 

7.       It is contended by the complainant / respondent, that he is a graduate and he approached the 1^st opposite party for loan under the unemployment scheme and the 1^st opposite party sponsored his name to the 2^nd opposite party recommending a loan of Rs.22,50,000/- and the application was submitted on 18-08-2010. He was required to submit certain documents which were submitted to the 2^nd opposite party, and when all formalities were over, the 2^nd opposite party demanded 10% commission on the loan amount for sanctioning the loan which was declined by the complainant and hence the loan was rejected by the 2^nd opposite party falsely stating that the complainant’s father told the 2^nd opposite party that his son / complainant was already employed as a manager in a pharmaceutical company in Chennai and so the complainant cannot engage himself in the unemployment scheme and that the loan was meant for his 2^nd son.

8.       The 2^nd opposite party insisted on collateral security for the loan and the complainant’s father agreed to give security by way of equitable mortgage of his property and then the 2^nd opposite party required legal scrutiny report about the validity of title of the property offered for mortgage and the valuation report from the bank’s panel lawyer and panel engineer and completed all the remaining formalities by obtaining loan application in bank’s formalities and other documents from the complainant and the guarantor.

9.       It is contended by the appellant /2^nd opposite party that during his subsequent visit to the complainant’s house, the complainant was not available at his residence and he came to know from the complainant’s father that the complainant was already employed as manager in a pharmaceutical company at Chennai and was getting substantial salary, and so the 2^nd opposite party expressed his inability to the complainant’s father to sanction loan to an employed person under the PMEGP Scheme and the complainant’s father further told the 2^nd opposite party that the complainant was not in a position to go to Arumbavur, the proposed factory site and that he wanted to apply for the loan in his second son’s name and got back the entire records submitted by the complainant to the bank, and there is no deficiency in service on the part of the 2^nd opposite party.  

 

10.     Admittedly, all the necessary formalities for sanctioning the loan were completed, and at the final stage of sanctioning the loan, his loan was rejected on the pretext that the complainant’s father informed him that his son was employed as a manager in a pharmaceutical company at Chennai, and that the loan may be sanctioned to his second son.

 

11.     It is pertinent to note that no statement has been recorded from the complainant’s father, or from any third person regarding the employment of the complainant, to substantiate that he was actually employed, and therefore, a casual and baseless assertion made by the 2^nd opposite party that the complainant is employed somewhere, cannot be accepted.  

 

12.     On considering the entire materials on record, we are of the view that the appellant / 2^nd opposite party has deliberately and with some ulterior motive rejected the loan application of the complainant. Discretion should not be exercised in arbitrary manner.

 

13.     At the same time, we cannot direct the 2^nd opposite party / appellant to sanction the loan to the complainant, since it is not within our purview; but, however, the prolonged delay in processing the application and disposing of the loan application without verifying the real position viz. of the employment of the complainant and without conducting any enquiry with the complainant first, and returning the documents to the complainant, and the avoidable delay in processing and disposing of the loan application, thereby causing unnecessary expenses, loss of precious time, mental agony and sufferings and harassment to the complainant; all these amount to deficiency in service on the part of the appellant which warrants award of compensation. We feel that award of Rs.25,000/- as total compensation would be just and reasonable.

 

14.     In the result, the appeal is partly allowed, and the order of the District Forum is set aside, and directing the appellant / 2^nd opposite party to pay a sum of Rs.25,000/- (Rupees Twenty Five Thousand only) to the complainant as compensation for mental agony, and sufferings caused due to the deficiency in service on the part of the appellant.

No order as to costs in the appeal.

 

 P. BAKIYAVATHI                                J. JAYARAM         

          MEMBER                              PRESIDING JUDICIAL MEMBER     

 

List of Additional documents filed by the Appellant / 2nd Opposite Party

Ex.B3 - is CBIL Consumer Credit Information Report;

Ex.B4 - is Guidelines on Prime Minister’s Employment Generation

             Programme (PMEGP);

Ex.B5 - Master Circular on KYC Norms.

 

 P. BAKIYAVATHI                      J. JAYARAM         

           MEMBER                         PRESIDING JUDICIAL MEMBER