Punjab

Faridkot

CC/17/316

Jagan Nath Gurbachan Singh - Complainant(s)

Versus

HDFC Bank Ltd. - Opp.Party(s)

Amit Kumar Mittal

19 Aug 2019

ORDER

 

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, FARIDKOT

 

Complaint No. :            316 of 2017

Date of Institution :        20.09.2017

Date of Decision :           19.08.2019

M/s Jagan Nath Gurbachan Singh through its Proprietor Sanjeev Kuamr aged about 45 years son of Gurbachan Singh, Gaushala Road, Jaitu, Tehsil Jaitu District Faridkot.                            

                         .....Complainant

Versus

 

HDFC Bank Ltd having its Branch at Jaitu, through its Branch Manager.

..........OP

 

Complaint under Section 12 of the

Consumer Protection Act, 1986.

 

Quorum:     Sh Ajit Aggarwal, President,

Smt Param Pal Kaur, Member.

Present:       Sh Amit Mittal, Ld Counsel for Complainant,

 Sh Ravinder Parkash Goyal, Ld Counsel for OP.

ORDER

(Ajit Aggarwal, President)

                                           Complainant has filed the present complaint under Section 12 of the Consumer Protection Act, 1986 against OP seeking directions to refund the excess amount charged from complainant and for further directing OP to pay Rs.5,00,000/-on account of compensation for harassment and mental agony suffered by him besides litigation expenses of Rs.1,00,000/-.

 

 

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2                                   Briefly stated, the case of the complainant is that he is having a cotton mill and he availed cash credit limit and term loan for Rs.1,15,00,000/-from OP bank at the rate of 10.70% interest per anum and then he used to repay the amount at said rate of interest, but in July, 2017,  he was surprised to see his bank account statement  that revealed that OP charged interest at the rate of 12.85% per anum and for some period interest was charged upto 14% and 15% which is beyond and against the agreed rate of interest. He further noticed that insurance charges of Rs.21,000/-were also charged to him though he himself got insured his premises and supplied copy thereof to opposite party bank. Complainant asked OP about charging of this heavy amount, but they did not give any satisfactory reply, which amounts to deficiency in service and trade mal practice on the part of OP. He made several requests to bank authorities to refund the amount charged in excess from complainant, but they paid no heed to his genuine requests. All this has caused huge harassment and mental agony to him. He has prayed for accepting the present complaint alongwith compensation and litigation expenses besides the main relief. Hence, the complaint.

3                                                         Ld Counsel for complainant was heard with regard to admission of the complaint and vide order dated 3.10.2017, complaint was admitted and notice was ordered to be issued to the opposite party.

4                                                        On receipt of the notice, OP filed written statement wherein admitted that complainant is having an account with their bank and he availed loan and cash credit facility from them. However, they have denied all the other allegations of complainant being wrong and incorrect and asserted that there is no deficiency in service on their part. Complainant has availed their 

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services for commercial purpose and therefore, he is not the consumer of answering OP. He has not come to the Forum with clean hands and has concealed the material facts from them and moreover, present complaint involves complicated questions of law and facts requiring lengthy evidence, which is not  possible in summary proceedings of this Forum and therefore, complaint in hand is required to be referred to Civil Court. Further averred that rate of interest is charged as per terms and conditions of sanction of the facility and penal interest is charged whenever, there is any breach or violation of terms and conditions of the sanction on the part of account holder or borrower. It is alleged that complainant has also been running accounts in other banks, which is against the terms of sanction as well as RBI guidelines. He has availed loan and cash credit facility for commercial purpose and thus, he is not entitled for relief sought. All the other allegations are denied being wrong and incorrect and prayer for dismissal of complaint with costs is made.

5                                                          Parties wanted to lead evidence to prove their respective pleadings and proper opportunity was given to them. Ld counsel for complainant tendered in evidence affidavit of complainant Ex.C-1 and documents Ex C-2 to C-11 and then, closed his evidence.

6                                                                 In order to rebut the evidence of the complainant, ld counsel for OP tendered in evidence affidavit of Honey Bansal Ex OP-1 and documents Ex OP-2 to Ex OP-4 and also closed the evidence.

7                                                 We have heard the learned counsel for complainant as well as Opposite party and have very carefully perused and gone through the affidavits & documents placed on the file by respective parties.

 

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8                                                        From the careful perusal of record, it is observed that case of the complainant is that he availed cash credit limit and loan  from OP bank at 10.70% rate of interest, but they deducted interest against his cc limit at the rate of 12.85 % and for some period from 14 to 15% which is much beyond and against the agreed rate of interest. Premises of complainant are duly insured and he himself supplied copy of said insurance to OP bank, but despite having received the insurance copy, they deducted Rs.21,000/-from the account of complainant on account of insurance charges. Grievance of complainant is that despite repeated requests, OP have not refunded the excess amount deducted from his bank account as insurance charges and on account of difference in interest rate. In reply, OP stressed mainly on the point that rate of interest is charged as per terms and conditions of sanction of the facility and penal interest is charged whenever, there is any breach or violation of terms and conditions of the sanction on the part of account holder or borrower. OP further alleged that complainant also holds accounts with other banks, which is against the terms of sanction as well as RBI guidelines and therefore, he is not entitled for any kind of relief and there is no deficiency in service on their part.

9                                                       With regard to insurance charges, the OP submitted that during the continuation of financial assistance, the complainant had to get the stock insured for full amount of limit and to submit the insurance cover to bank, but the complainant did not get his stock insured for full amount of limit as he failed to get insured the items for adequate value. However, for the period of policy in question, the complainant had not submitted any insurance policy cover to bank to save the interest of bank as per terms and conditions of the loan and to secure their interests the bank got insurance cover for the stock and building of complainant and debited the premium amount from the account of complainant.

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10                                                    Now, to prove their case, ld counsel for OP produced copy of sanction letter of the complainant firm Ex OP-3 wherein it was agreed that rate of interest is 11% i.e base rate + 1%. Ld Counsel for OP argued that as per RBI guidelines, the base rate of the bank increases or decreases from time to time. As such, rate of interest fluctuates from time to time. The rate of interest for the complainant firm is not fixed one, rather it keeps changing as the base rate of bank increases or decreases. Now, to prove that complainant himself got insured his stock and premises from time to time, the complainant produced copies of Insurance Policies from Ex C-9 to Ex C-11 vide which, he got insured his stock from time to time. From the perusal of these insurance documents it is transpired that these insurance covers were valid only upto 19.05.2017 and after that, complainant did not renew the insurance policy. OP produced insurance cover in question as Ex OP-4, which is for the period from 31.05.2017 to 30.05.2017. The complainant failed to produce insurance cover for this period. So, the OP have rightly got insurance for this period as per terms and conditions of the loan at the expenses of complainant.

11                                                Now, on the point of charging excessive rate of interest and penal interest, the version of the OP is that as per terms and conditions of loan, the complainant firm had exclusive bank dealings with OP bank and he is barred to deal with any other bank but in violation of the agreement, complainant firm has dealings with other banks and as such, penal interest was charged to complainant. On this point, we are of considered opinion that OP bank cannot impose such type of restrictions on their customers only to deal with exclusive clause that their customers cannot deal with any other bank except their bank. It is unreasonable restriction and monopoly act which cannot be permitted. Moreover, the ld counsel for OP submitted that as goodwill gesture, they have already

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refunded the amount of excessive interest or penal interest charged to complainant for having dealings of complainant with other banks to his account.  

12                                                       From the above discussion and keeping in view the pleadings made and evidence produced by respective parties, it is made out that there is deficiency in service on the part of OP bank. Hence, complaint in hand is hereby partly allowed. Opposite party is directed to refund the amount of excessive interest or penal interest charged by OP bank to the complainant on account of dealings of complainant with other banks, if already not refunded. Compliance of this order be made within one month of receipt of copy of the order failing which complainant shall be entitled to proceed under section 25 and 27 of the Consumer Protection Act. Copy of the order be supplied to parties free of costs as per law. File be consigned to record room.

Announced in open Forum

Dated: 19.08.2019

(Param Pal Kaur)                    (Ajit Aggarwal)

Member                       President