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

CONSUMER COMPLAINT NO.216/2022

DATED ON THIS THE 24^th  FEBRUARY-2023

Present:        1) Sri. B.Narayanappa

M.A., LL.B., - PRESIDENT  

                     2) Smt. Sharavathi. S.M,

                                               BA., LLB., MEMBER

ORDER’s pronounced by Smt. SHARAVATHI. S.M,

                                                               MEMBER

1.     This is the Complaint filed by the Complainant U/S Section 35 of Consumer Protection Act 2019, against the Opposite party (herein referred in short as OP) alleging the deficiency in service in making illegal demands high interest and charged 18.24% Flat rate of interest per annum and directions to the OP to charge  rate of interest be converted to simple rate of interest @ prevailing market of 11.12% p.a. and refund collected sum of Rs.31,371/-on 10/12/2021 and for other reliefs as the Commission deems fit.

2.     The brief facts of the Complaint are that:- the complainant availed a Jumbo loan  on 17/09/2021 of Rs. 5,80,000/- from OP payable in regular installment. On a floating rate of interest chargeable then was 11%. Subsequently at the time of disbursal the bank increased the rate by 1% to 12%. Thereafter the bank again revised the rate up to 18.24% i.e., without informing the said flat rate of interest in his view this was also an unfair trade practice as this provision was not explained to him at the time of taking the loan. They are making to be claim secretly without the knowledge of the customers to their whims and fancies. In view of this there is deficiency in service and unfair trade on the part of OP and hence prayed to this Commission allow the complaint.

3.     Upon the service of the notice, OP not appeared hence, placed ex-parte.

4.     In order to prove the case, the complainant filed his affidavit evidence along with documents. Heard the arguments of the complainant. 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 Affirmative

    POINT NO 2:- Partly in the Affirmative

                         for the following:

                              REASONS

POINT NO 1:-

6.     Perused the Complaint, affidavit evidence and the documents produced by complainant. It is not in dispute that the complainant is the account holder and valuable customer of OP having borrowed jumbo loan of Rs.5,80,000/- from OP under floating scheme  of paying interest. it is the contention of the complainant that there were prompt and regular in paying the EMI’s, but still, OP is demanding to pay a sum of Rs. 31,371/-  In the force of OP the said amount also paid by the complainant.

7.     It is the contention that demand of the OP that they calculated the interest as per the agreed rate of interest in the loan sanction letter and agreement executed by the complainant, whereas as per the guidelines and monitory policies of the government of India and that of RBI with reference to the change of rate of interest in respect of the said loan from the date of the complainant borrowing the loan, the rate of interest have gone up and the same was not taken into consideration while calculating the interest to be paid by  the complainant and hence there is difference in the rate of interest and hence they had to pay the  amount as demanded by them as mentioned above.

8.     It is the duty of the OP to bring to the knowledge of the each and every borrower regarding the raising or lowering of the interest in respect of the floating rate of interest of said loans. It is held by the Hon’ble High Court of Karnataka in Writ Petition No.42815/2019 that notice has to be given to each and every party in respect of change of rate of interest and also without waiting for the request to get the interest reduced, the bank has to reduce the rate of interest as per the policy of the RBI and the Government of India.

9.     It is true that for the floating rate of interest for loan the quantum of equated monthly installments and the number of installments will not be constant throughout the loan period. If the interest on the loan is raised by the RBI/Government of India, then the amount per installment will increase, if the number of installment is raised, it will be advantage for the bank as it would get the interest for the whole period. On the other hand, if the complainant raises the quantum of amount to be paid every month within the number of EMI’s he will be benefitted, through it will be an additional burden to him to pay higher amount per installment.

10.   Further as per the say of the complainant that OP  is unconstitutional in collecting higher rate of interest from some other persons the hired Goonda people have forced complainant daughter to pay on UPI payment sum of Rs.31/371/- on 10/12/2021 as per Ex-P3   as excess interest in respect of loan accounts which is a clear unfair trade practice and further not informing personally the change of rate of interest as and when the interest rate was changed and not resetting the rate of interest in the EMI’s as and when there was a change in the rate of interest amounts to deficiency in service and hence we answer POINT NO 1 IN THE AFFIRMATIVE.

POINT NO 2:-

11.   As pointed above, OP has calculated excess interest of Rs.31,371/- in respect of complainant account. Under the circumstances, we direct OP to pay a sum of  Rs.20,000/- as compensation for putting the complainants under the mental agony, strain, physical hardship and further direct to pay a sum of Rs.5,000/- towards litigation expenses and answer POINT NO 2 PARTLY IN THE AFFIRMATIVE and pass the following.

                                    ORDER

1. Complaint is allowed in part with cost.
2. OP is herewith directed to refund sum of Rs.31,371/- to the complainant.
3. OP is further directed pay a sum of           Rs.20,000/- as compensation and Rs.5,000/- towards litigation expenses to the Complainant.

4. Both the parties are directed comply the above order within 30 days from the date of receipt of this order and submit the compliance report to this Commission within 15 days thereafter.

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

 (Dictated to the Stenographer transcribed, typed by him, corrected by us and then pronounced in open Commission on this the 24^th February 2023)