DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION ERNAKULAM

       Dated this the 27^th day of May 2024

[                                                                                             

                             Filed on: 06/09/2018

PRESENT

Shri.D.B.Binu                                                                            President

Shri.V.Ramachandran                                                               Member

Smt.Sreevidhia.T.N                                                                   Member                                                   C C. No. 371/2018

COMPLAINANT

George Justine V., Vettukallumburathu House, Vazhakulam P.O., Kavana,    Muvattupuzha, Pin-686 670

                   (By Adv.Tom Joseph, Court Road, Muvattupuzha-686 661)

Vs.

OPPOSITE PARTY

M/s.Federal Bank, Branch Office, Chakkumpeedika Arcade,

Vazhakkulam P.O., Muvattupuzha, Rep. by its Managing Director.

(Op rep. by Adv.Madhusoodanan K., Syriac Joseph, Mathew Jacob, Vimala Building, Market Road, Ernakulam-35 )

F I N A L    O  R  D  E  R

Sreevidhia T.N., Member

1. A brief statement of facts of this complaint is as stated below:

The complainant had availed an agricultural loan to the tune of Rs.2,60,000/- from the opposite party on 27.07.2017 at the rage of 4% per annum.  The loan amount was credited to the account of the complainant on 27.07.2017.

The complainant had approached the opposite party on 27.07.2018 for closing the loan, they collected Rs.9577/- from the complainant as interest. The complainant states that the opposite party is liable to collect 4% only on the loan amount from the complainant but they collected higher rate of interest from the complainant stating that the agreement was signed on 26.07.2017, one day prior to the transfer of loan amount to the account of the complainant. The complainant states that the reason given for the collection of the excess amount towards interest is not sustainable since the opposite party had not supplied any document showing that the date of loan agreement as 26.07.2017.  The only document available with the complainant is the bank pass book and the entry made by the bank in the bank pass book shows that the loan amount was credited to the account of the complainant on 27.07.2018.  The complainant states that he is only liable to repay the loan amount on 27.07.2018 and he is also eligible to get the interest subsidy.  The complainant states that the act of the opposite party to deny the subsidy benefit to the complainant is an unfair trade practice and deficiency in service from the part of the opposite party.  Hence this complaint.

2. Notice

Notice was issued to the opposite party from this Commission on 30.08.2019.  Upon notice opposite party appeared and filed their version.

3. Version of the opposite party

The complainant along with his wife Smt.Lisamma Justine had availed of an agricultural loan of Rs.2,60,000/- from the opposite party on 26.07.2017 for the purpose of raising crops, promoting its growth etc.  Towards primary security, the complainant and his wife had hypothecated the standing crops in 2.45 acres of land of Muvattupuzha village and Muvattupuzha Taluk by executing an agreement dated 26.07.2017 under interest Subvention scheme.  The complainant had sent a letter dated 27.07.2017 to the opposite party requesting to acknowledge deposit of the title deed made by him on 26.07.2017.  The sanction order cum reporting statement for advance granted by the Branch Manager of the opposite party dated 26.07.2017 containing the terms and conditions is accepted and acknowledged by the complainant and his wife.  In the Annexure attached to the said letter the rate of interest is shown as 9% per annum and the period of loan as 12 months.  The loan has to be repaid in lump sum by 26.07.2018.  The said Annexure is duly signed by the complainant.

The complainant approached the opposite party on 27.07.2018 to close the account and the account was closed on 27.07.2018 and they have taken back the title deed which was deposited for creating Equitable Mortgage.  The opposite party did not collect higher rate of interest as alleged but collected the interest at the rate shown in the sanction letter which was duly acknowledged by the complainant.  The complainant has not suffered any financial loss as alleged.  The opposite party has never stated that it has charged higher rate of interest.

An amount of Rs.5193/- is credited to the account of the complainant as eligible Agricultural interest subvention on 26.07.2018 as specified in clause 12 of the agreement under interest subvention scheme executed by the complainant and his wife and the balance due in the account after adjusting the said agricultural interest subvention remitted by the complainant to close the account. 

The role of the opposite party is only an intermediary to pay the complainant whatever interest subvention amount received from the RBI under the scheme.  The opposite party has accordingly given credit of Rs.5193/- received from the RBI under the scheme.

4. Evidence

Evidence in this case consists of the proof affidavit filed by the complainant and the documentary evidence filed by the complainant which were marked as exbt.A1 to A5.

Opposite party also filed proof affidavit and Exbt.B1 to B5 were also marked from the side of the opposite party.  Evidence closed.  Both parties filed argument notes.  Heard.

5. The issues came up for consideration in this case are as follows.

1. Whether any deficiency in service or unfair trade practice is proved from the side of the opposite party towards the complainant?

2. If so, reliefs and costs?

For the sake of convenience, we have considered issue No. (1) and (2) together.

Exbt.A1 produced by the complainant is a copy of the pass book of the complainant’s cash credit account which is maintained at Federal Bank, Vazhakulam, Muvattupuzha. 

Exbt.A2 is a copy of the email sent by the complainant to the opposite party narrating the grievance of the complainant dated 27.07.2018.

Exbt.A3 is the sanction letter issued by the opposite party to the complainant on 26.07.2017.

Exbt.A4 is the loan account pass book of the complainant at Canara Bank Vazhakulam.

Exbt.A5 is a copy of the sanction memorandum.

Opposite party’s documents

Exbt.B1- A copy of the agreement dated 26.07.2017 executed by the complainant.

Exbt.B2- A copy of the letter dated 27.07.2017 sent by the complainant to the opposite party regarding he mortgage of the property.

Exbt.B3-  A copy of the sanction order dated 26.07.2017 containing the pre-disbursal conditions.

Exbt.B4- A copy of the sanction order letter dated 26.07.2017.

Exbt. B5- Account statement of the complainant’s bank account at Federal bank Vazhakulam Branch.

We have verified the facts of the case with the version filed by the opposite party and the documentary evidence filed from both sides. The instant complaint is regarding the collection of excess interest than the agreed 4% for agricultural loan. The contention of the opposite party is that the complainant had executed the loan amount on 26/07/2017 and hence he has to repay the loan amount in lump sum within 26/07/2018 so as to get the interest subsidy benefit.

          As per Exbt. A1 pass book the loan amount was transferred to the account of the complainant on 27/07/2017. We have perused Exbt. B4 sanction letter dated 26/07/2017. The annexure to the sanction letter contains the terms and conditions to the complainant and his wife Lisamma Justine and they have acknowledged the receipt of the terms and conditions contained in the sanction letter. As per the sanction letter CC interest subvention FKCC are sanctioned at the sole discretion of the Bank and disbursal will be subjected to full and complete compliance of the terms and conditions issued in Annexure. As per Exbt. B4, the rate of interest is shown as 9%. Repayment of the loan will be in LUMPSUM. The period of the loan was 12 months. As per Exbt. B3 also period of the repayment of loan is shown as 12 months. As per Clause 4 of the Exbt. B1 agreement, eligible farmers are entitled for an interest subvention of 2% per annum on the normal interest applicable to the facility and the borrower shall pay interest at the rate of 7% per annum with monthly/quarterly/half yearly rates or such other rates as may be specified by RBI/bank under the scheme from time to time. The interest subvention amount will be calculated on the facility amount from the date of disbursement/drawn to the date of actual repayment of the facility by the borrower or upto the date of demand, whichever is earlier , subject to a maximum period of one year at a time.

The complainant had availed the loan of Rs.2,60,000/- from the opposite party. The loan amount was credited to the account of complainant on 27/07/2018. The period of loan was 12 months. The opposite party in their version states that the time limit to close the loan expired on 26/07/2018 and hence the complainant is not eligible for the 3% additional interest subvention. As per the Exbt. A1 pass book, interest at 9% is calculated on the loan account as Rs.23,369/-. 2% interest subvention amount Rs.5,193/- was credited to the account of the complainant on 26/07/2018. 3% interest subvention amount of Rs.7,790/- was also credited to the account of the complainant on 26/07/2018. It is seen that this amount (Rs.7,790/-) was reversed on the same date. Opposite party argued that the complainant was not eligible for 3% interest subvention as per the scheme and hence the bank has reversed the amount. As per the terms and conditions of the agreement and as per sanction order to the Branch dated 26/07/2017 and sanction letter to the complainant dated 26/07/2017 the period for repayment of the loan is shown as ‘12 months’ and repayment will be made in ‘Lumpsum’. The complainant has repaid the loan in Lumspum on 27/07/2018. Since the time limit for repayment is shown as ‘12 months, the complainant is eligible for 3% interest subvention. There is no mention in the agreement dated 26/07/2017 that the “loan will be repaid on or before 26/07/2018 for getting the benefit of 3% interest subvention.” The credit facility is sanctioned at the sole discretion of the bank as evident from Exbt. B4. The opposite party has not produced any contra evidence to show that the date of agreement prevail than the date of disbursement.

The complainant in his complaint states that he had suffered financial loss to the tune of Rs.9,577/- for closing the loan. As per the passbook Rs.1,227/- was collected as ‘Unded charges’ on 27/07/2018 by the opposite party. Hence the complainant is eligible to get refund of Rs.7,790/- from the opposite party and hence there was deficiency in service occurred from the part of the opposite party towards the complainant.

Based on the above mentioned observations made by the Commission, above issues (1) and (2) are found in favour of the complainant. The complainant is also entitled to get compensation and cost of proceedings from the opposite party.

In the result, the complaint is allowed and the following orders are hereby passed.

1. The opposite party shall refund Rs.7,790/- (Rupees seven thousand seven hundred and ninety only) to the complainant.
2. The  opposite party shall pay a compensation of Rs.10,000/- (Rupees ten thousand only) to the complainant.
3. The opposite party shall also pay Rs.6,000/- (Rupees six thousand only) as litigation charges to the complainant.

The above order shall be complied with by the opposite party within 30 days from the date of acceptance of a copy of this order. If the order is not complied within 30 days the amount ordered (1) and (2) above shall attract interest at the rate of 9 % from annum from the date of order till the date of realization.

Pronounced in the open commission on 27^th day of May 2024

Sd/-

                                                                                    Sreevidhia.T.N, Member

Sd/-

D.B.Binu, President

Sd/-

                                                                                    V.Ramachandran, Member

Forwarded by Order

Assistant Registrar

APPENDIX

Complainant’s evidence

Opposite party’s evidence :  

Date of dispatch         ::

By Hand  ::                 By Post