Before the District Consumer Dispute Redressal Commission [Central District] - VIII, 5th Floor Maharana Pratap ISBT Building, Kashmere Gate, Delhi
Complaint Case No. 49/17.08.2020
Shri Neeraj Khiwani son of Late OP Khiwani
C/o 306, Hemkunt House, Rajender Place
New Delhi-110008 …Complainant
Versus
OP.HDFC Bank Ltd through its Bank Manager
Office at Old Rajindr Nagar, Bada Bazar,
New Delhi – 110060 ...Opposite Party
Date of filing: 17.08.2020
Coram: Date of Order: 03 08.2024
Shri Inder Jeet Singh, President
Ms Rashmi Bansal, Member -Female
FINAL ORDER
Inder Jeet Singh , President
It is scheduled today for order (item no.8)
1.1. (Introduction to case of parties) - The complainant has grievances of unfair trade practice and of deficiency of servicers against his banker/OP [where he is maintaining bank account no.00261000278322 (briefly ‘account’) besides FDRs]. The complainant had approached OP for loan for short period against his FDRs, which invokes 1% interest above the rate of interest on FDR, however, when after 10 EMIs and had requested the OP for foreclose of loan, then it was revealed that business loan at higher interest of 13% was granted and FDRs were kept in lien. Moreover, foreclose charges were also levied. That is why the present.
1.2. The OP opposed the complaint with request to dismiss it, since complainant himself applied for business loan and it was allowed on his application. There was request for foreclose of loan account, the appropriate applicable charges were invoked. There is no cause of action is made nor OP-bank is liable for any amount under any head towards the complainant.
2.1. (Case of complainant) – The complainant is maintaining bank account with his banker/OP. The complainant is also having FDRs and he usually takes loan against FDRs, since loan upto 80% of FDR amount is granted that too without any verification or collateral security. The complainant was having FDR of Rs.30,20,000/-.
2.2. The complainant was in need of loan for a short period and he was having FDRs of Rs. 30.20 lacs for period of 5 years, however, he was not desires of discounting the FDR to meet the requirement of loan for shorter period. Therefore, he approached the OP on 19.04.2019 for loan of Rs. 20 lacs for a short period, he met Sh. Shambhu authorized representative of the OP, but he mistold about the product. He disbursed pre-approved business loan and wrongful product was given to the complainant. In fact, the complainant is in habit of taking loan against FDR which is his normal practice and when FDR are pledged, 80% of amount of FDR are disbursed as loan without any verification or security, since loan are 100% secured as FDRs are pledged with the bank besides bank charges very low rate of interest on the loan. Moreover, no charges like loan processing, pre-closure charges, etc. are levied. The bank charges additional 1% interest to the existing interest rate over pledged FDR.
2.3 Since the complainant was in need of loan for shorter period OP’s two executive on behalf of OP approached the complainant, one of them was Sh. Shambhu who completed the formalities and loan was given. The complainant was not provided copy of any document as it was assumed that the loan was against FDR. The complainant was disbursed loan of Rs. 20 lakhs with an option that loan may be repaid at EMI of Rs. 53,665/- for the tenure of 4 years.
The complainant had paid 10 EMI and since he was having enough fund in the hands, he decided to close the loan account. When he was approached OP that he was surprised to find that OP is not authorized to give loan and it was clarified that the loan given to the complainant was through its centralized processing cell. Then, complainant approached that loan cell in Motia Khan, Paharganj, where it was revealed that the loan was not against FDR . The OP’s executive Mr. Shambhu wrongly told the product, it was pre-approved business loan given by the bank on the basis of transaction of the complainant, that is why no documents was taken as it was pre-approved business loan. The rate of interest was 13% and not 8% which was to be there. It was further surfaced that complainant is required to pay closure charges at the rate of 4% +GST, which came to Rs.76,862/-.
2.4 The complainant approached the Branch Manager in January that its Executive wrongly told the product and the Branch Manager was enquired about the documents, the complainant was informed that the documents are in central loan branch, however, till then the complainant was not given any document. They have wrongly told the product in fraudulent way.
Since the complainant realised that the OP is not interested in resolving the issue as well as it will head nowhere, the complainant decided to close the account and paid the amount under compelling situation. However, the complainant suffered losses, extra interest, besides mental tension and agony as he had to pay interest at the rate of 13% and foreclosure charge of Rs. 76,862/-. The complainant was also constraint to pay an amount of Rs.17,12,943/- which has been debited through his account on 20.02.2020. The lien on the FDR was released on 28.02.2020; complainant encashed the FDR of Rs. 30,24,000/- on the same day, this lien was just created to suppress wrongly sold of product by the Executive of OP. Therefore, the complainant has suffered interest amount of Rs. 3,26,974/- inclusive of pre-closure charges of Rs. 76,862/-, interest for a period of 11 months which comes out to be more than 3%, mental tension and agony. The complainant also served notice dated 01.03.2020 while asking the OP to rectify its commissions but OP failed to take corrective measures and complainant had no option but to file the present complaint. The complainant seeks refund of pre-closure charges of Rs. 76,862/-, business loan processing charges of Rs. 27,226/-, to invoke correct rate of interest of 7%pa instead of other rate of interest by which amount was extracted illegally from the complainant and to refund the excess amount, compensation of Rs. 5 lakhs in lieu of mental tension and agony, amount of Rs. 60,000/- towards legal charges for filing the present complaint and interest of 15% on the compensation to be determined by the Commission.
2.5. The complaint is accompanied with copies of – legal notice dated 01.03.2020 with postal receipt and track report, acknowledgement provided by the banker of application, letters issued by OP, repayment schedule, statement of account.
3.1 (Case of OP)-The OP filed detailed written statement and opposed the complaint that complainant is not a consumer as the loan was taken for commercial purposes. It was a business loan, which was allowed for Rs. 20 lakhs on interest at the rate of 13%pa vide loan account no. 66004966 and it was disbursed on 12.03.2019 repayable in 48 EMIs of Rs. 53,655/- and loan was disbursed on the loan application of complainant and it was subject to terms and conditions of loan agreement and the schedule. In addition, the complainant has also given auto debit instructions form to the OP for repayment of EMIs towards the loan account.
3.2. In February 2020 the complainant requested the OP to foreclose the loan account as he was no more in need of the funds. Accordingly, a pre-closure was drawn on 19.02.2019 and an amount of Rs. 17,12,943/- was found due and payable, which also included Rs. 76,862/- towards prepayment charges at the rate of 4.27% (4% +GST) and this prepayment charges were levied as per terms and conditions of loan agreement and schedule thereto which was signed and accepted by the complainant. The prepayment charges were also elucidated in the general information sent to the complainant at the time of disbursal of the loan, which complainant had filed with the complaint. The complainant also completed the payment of Rs.17,12,943/- towards the closure of the loan account on 24.02.2020 without any protest or demur.
The RBI has also restrained the banks from levying foreclosure charges of home loan and floating rate term loans only in cases of individual borrowers, who took the loan for the purposes other than business, but this is not applicable to the case of complainant. The complainant applied for the loan under his signature, it was business loan and the same was disbursed to the complainant and later complainant foreclosed the account. Neither any excess rate of interest was charged nor the OP is liable for any liability or amount since the terms and conditions of agreement were followed. The OP denies all allegations of complaint in respect of FDRs or loan against FDR, the complainant never requested for loan against FDR. The complaint is liable to be dismissed.
3.3 The written statement is accompanied with power of attorney, loan application form, terms and conditions applicable to business loan, schedule cum key fact statement dated 08.03.2019, authorization letter dated 08.03.2019, circular dated 07.05.2014 and 02.08.2019 by RBI on the point of levy of foreclosure charges, statement of account.
4. (Replication of complainant) – The complainant filed rejoinder as a reply to the allegations of written statement and he reaffirms the complaint correct and denies the allegations of written statement. The documents filed by the OP do not bear signature of complainant (except page no. 5 of Annexure R1/D), which is completely forged as two different signatures are appearing. The OP has filed only documents Annexure R1/B/page 3 which genuinely bears signature of complainant. The terms and conditions of application loan form are not bearing signature of complainant. The high-lighted portion on the loan application form “Sales Promo Code BL-FD & Scheme BL-FD, demonstrates that it was loan against fixed deposits. The complainant reserves his right to file appropriate FIR. The complaint is correct.
5.1. (Evidence)- The complainant led his evidence by filing his affidavit with the support of documents annexed with the complaint.
5.2. The OP also led its evidence by filing affidavit of Ms Bharati Thakur, Authorized Representative of OP; the affidavit of evidence is on the lines of written statement of OP.
6.1 (Final hearing) - Both the parties filed their respective written arguments, following by oral submission by Shri Sumit Aggarwal, Advocate for OP. There is no oral submission on behalf of complainant despite opportunity, however, the written arguments will be considered.
6.2. It does not require to reproduce the rival contention of the parties, since the detail of case of the parties have already been given in paragraphs 2 & 3 above.
7.1 (Findings) - The case of parties, their evidence and rival contentions are considered keeping in view the material on record and provisions of law. After considering them, the following conclusions are drawn –
(i) Both the complainant and the OP have no dispute that complainant is maintaining bank account with the OP. There is also no dispute that complainant availed loan of Rs.20 lakhs; the case of complainant is that he had requested for loan against his FDRs but according to OP it was business loan.
(ii) When the complaint was filed, prior to its legal notice was also given and there is no dispute that complainant is having FDR with the bank and there is also no contrary evidence by the OP that loan cannot be granted on pledged of FDRs. Therefore, the dispute appears to be a consumer dispute, it is covered under the Consumer Protection Act 1986.
(iii) The OP has proved application form, which bears photograph of complainant and signature of complainant, which he does not dispute on the application form. The schedule cum key fact statement also bear signature of complainant, which is also not disputed by him. When there is explicit documentary record of loan application, signed by the complainant, there is no other independent evidence by the complainant to disprove the loan application.
(iv) According, to complainant the abbreviation BL-FD stands for loan was against FD but according to OP, it was “business loan and there was lien on FD”. However, the OP has proved loan application form and it specifically mentions that loan was being availed for business purposes.
To say, there is no documentary record proved by the complainant that loan was availed against FD to disprove the documentary evidence proved by the OP that it was loan application for business loan of Rs. 20 lakhs under scheme BL-FD and accordingly it was disbursed to the complainant; it also contains the applicable charges and interest rate.
(v) The OP has also proved circulars issued by RBI that foreclosure charges are not applicable in respect of certain categories of loan in the eventuality of pre-payment, the same does not exempt the business loan.
7.2. In view of the above, it does not make out case of unfair trade practice trade practice or of deficiency of services on the part of OP; the complainant could not prove the complaint against OP. The complaint fails. The complaint is dismissed. There is no order as to costs.
8. Announced on this 3rd day of August 2024 [श्रवण 12, साका 1946]. Copy of this Order be sent/provided forthwith to the parties free of cost as per rules for compliances, besides to upload on the website of this Commission.
[Rashmi Bansal]
Member (Female)
[Inder Jeet Singh]
President
[ijs101]
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