Meghalaya

StateCommission

A/9/2022

Shri Javed Akhtar Siddiqui - Complainant(s)

Versus

HDFC Bank - Opp.Party(s)

26 Sep 2024

ORDER

MEGHALAYA STATE CONSUMER DISPUTES REDRESSAL COMMISSION

SHILLONG

 

F.A No.9 of 2022

 

BEFORE

 

Hon’ble Mr.Justice(Retd) S.Pandey, PRESIDENT

 

Learned Member : Dr. G.B.M Mihsill

 

  Shri. Javed Akhtar Siddiqui,

  Of Lower Barapathar (Mawbah),

  Near Decent Tailor, Shillong,

  East Khasi Hills District, Meghalaya.       …Appellant

                    

-versus-

 

1)The H.D.F.C Bank Ltd.

  Represented by its Branch Manager,

  Bara Bazar Branch, Shillong,

  East Khasi Hills District, Meghalaya.

 

2)The Gold Loans Operations Manager,

  H.D.F.C. Bank Ltd.

  Shillong Branch,

  Shillong, Meghalaya.                        …Respondents  

 

                        

  For the Appellant        :    Smt. Meena K. Sah

For the                    Respondent               :    Mr. K. P. Bhattacharjee

 

  Date of Judgment & Order    : 26.09.2024        

  Whether to be reported    :

 

The instant appeal has been filed by the appellant, who is the complainant in the District Consumer Forum, challenging the order dated 14 June, 2022 passed in Consumer Complaint Case No. 11 of 2015 by the District Consumer Redressal Commission, East Khasi Hills, Meghalaya Shillong (hereinafter mentioned as court below Or District Consumer Forum), whereby and whereunder the District Consumer Forum has held that there is no deficiency in service from the part of the Opposite Parties/respondents as all necessary actions were taken by them in terms of the rules and regulation of the Agri Gold Loan, collateralized by Gold of HDFC Bank under the  Indian Contract Act, 1872 and directed the HDFC Bank (respondent herein) to re-issue a cheque amounting to Rs.29,195/-(Rupees Twenty Nine Thousand One Hundred Ninety Five) only along with interest of 15% and further directed that the payment should be made within 45 days after receipt of the certified copy of the order of the court, failing which it would carry 18% interest per annum.

The complainant/appellant herein approached the HDFC Bank, Bara Bazar Branch, Shillong-2 Meghalaya for gold loan by pledging ancestral ornaments being 81.300 grams, which the bank was ready to give gold loan and directed the Complainant/Appellant to open the bank account, which the complainant opened vide account number 23301530002216. Whereafter the loan of Rs.1,43,000/-(Rupees One lakh Forty Three Thousand) was sanctioned by the HDFC Bank and its officer(s) under product name Agri Loan collateralized by Gold, and, accordingly, the loan account was opened vide account no. 28251240. The total weight of gold ornaments was 81.300 grams. Descriptions of ornaments have been mentioned in the complaint petition. The parties entered into the agreement(typed agreement) under which the loan was given for six months. Under the Gold Loan Scheme, the complainant was to pay interest only on the amount which has been sanctioned with the liberty to renew again for the grant of loan for further six months. On the basis of the assurance, the Complainant started the payment of interest on each and every month without fail. As he failed to pay back the loan amount after 6 months, he again approached to the officials of the HDFC Bank for renewal of loan amount as per terms of loan, but he was directed to pay the total interest amount of 6 months in advance to process of renewal of loan amount. The Complainant having no other alternative remedy but to complying with the condition by 15th May, 2014 along with other additional taxation and other charges which amounted to Rs. 13,231/-(Rupees Thirteen Thousand Two Hundred Thirty One) only and deposited the interest amount of 6 months at a time in advance and the loan amount was sanctioned/renewed on 15th May, 2014 vide loan account number 06182990000099. The period of loan was for six months and after completion of six months, the complainant was at liberty to renew the loan under a new terms of agreement between Complainant and the Bank. Again, he approached the bank official for renewal of the loan amount where he was directed by the official to deposit the interest of six months at one time in addition to the amount of Rs. 15,000/-(Rupees Fifteen Thousand) only which was to be deposited as the price of the gold in the market was devalued. The total demand amount of the Bank was approximately Rs. 30,000/-(Rupees Thirty Thousand) only. This time, Complainant was not ready with money to make such deposit amount and failed to comply the same as during that period, he was facing various difficulties, requested the Manager of the Bank to grant some time to make arrangement of such a huge amount, which was duly granted to him. On account of some family obligation, he remained absent from Shillong during the period from 1st December, 2014 to 15 February, 2015 and, during that period, he had received the auto-generated message from the Bank. Pertaining to the said gold loan, on 18th February, 2015, Complainant received a telephonic message that his gold ornaments would be sold in auction as he failed to renew the same. On the next day, i.e., on 19th February, 2015, he approached the bank authority with the money, but he was shocked to know from the bank official, namely, Mr. Sameer Mondal that his pledged gold ornaments were sent for auction on 16th February, 2015 and further asked the complainant to talk to Mr. Sandeep, HDFC official at Guwahati and during discussion, the Complainant was informed that the said ornament was already auctioned/sold to Mr. Raja, it would be better to talk to Mr. Raja over this matter, in turn, he contacted Mr. Raja, who shared his view that he would return the ornament subject to payment Of Rs.2,00,000/- (Two lakh rupees) only. The complainant was of the view that his family gold ornament had been auctioned/sold under the conspiracy/mischief. During discussion with female officer, it has been informed that his ornaments were already been auctioned/sold 2(two) weeks earlier but Mr. Parto, an officer of the Bank informed him that his gold was auctioned/sold on 20th February, 2015. When he has insisted for return of the gold ornament, Mr. Parto offered a cheque of Rs.29,195/-(Rupees Twenty Nine Thousand One Hundred Ninety Five) only by way of excess amount after adjustment of loan amount. The Complainant in the complaint petition stated that it was his family ornaments, was very much emotionally attached with the priceless ornaments of the family. The complainant whereafter sent legal notice on 26th February, 2015 and asked to return the gold ornaments but without any result. 

The Complainant in Para 14 has asserted that the price of the gold was Rs.2,45,000/-(Rupees Two Lakh Forty Five Thousand) only and sought the relief, as they failed to return the gold ornaments to the complainant and in alternative, the Bank should return the cost of gold ornament of Rs.2,45,000/-(Two Lakh Fourty Five Thousand) only along with Rs.6,00,000 (Rupees Six lakh) only towards compensation for emotional loss and cost of proceeding. 

The Opposite Party/Bank filed written statement/ show cause. The Bank has not disputed the factual part with regard to the grant of loan to the claimant and also renewal of the same after payment of entire interest amount for 6(six) months in second time. It has been stated that the gross weight of the pledged gold ornament was 81.33 grams and net weight of the gold was 76.100 grams as per the valuation certificate issued by the approved valuer. 

It has been stated in the written statement that the second time, when the period of loan of 6(six) months was over, he approached the Bank and he was asked to deposit Rs.30,000/-(Rupees Thirty Thousand) only in advance. 

In para 17 of the written statement, the Opposite Parties/respondents/Bank have disputed the fact that the Bank had demanded Rs.30,000/-(Rupees Thirty Thousand) only for renewal of the loan, but was asked to deposit the legal amount, which was required to deposit. On the second renewal of the loan, in terms of the bank rule, he was charged from the Bank and no extra amount was asked by the Bank to deposit. At the second time renewal of the gold loan in terms of Clause 3 of the condition of the agreement signed between the parties, he was required to deposit additional security  amount in case of the value of the gold security falls lower, in that event, it was required that the  merchant amount to be deposited. As the complainant has neither paid the amount of the loan nor renewed the same, as such, he was defaulter in renewing the second time gold loan.

 The opposite party has also disputed and denied that the complainant has approached the opposite party for granting a rational time for second renewal of the gold loan, which was granted by the Bank. 

Further plea has been taken that there is no material on record to show that the complainant was out of Shillong during the period 01st December, 2014 to 15 February, 2015 inasmuch as the opposite party has nothing to do about the whereabouts of the complainant, but it has been said that time to time the Bank has sent the SMS either to renew the gold loan or to pay the loan amount. But he has not shown any interest to return the amount of gold loan. It has been said that he was given the SMS on 19th January, 2015; 24th January, 2015; 29th January 2015, 30th January, 2015 and final notice or reminder was sent on 18th February, 2015. Further Plea has been taken that apart from notice through the SMS, the notices were sent to the complainant through the ordinary post inasmuch as issued the recall notice dated 23rd November, 2014 and pre-sale notice dated 7th January, 2015 through speed post, which were received by the complainant and acknowledgment of the same was received. The notice dated 23rd December, 2014 was received by the claimant on 17th January, 2015 and in the notice, it has been mentioned that the notice should be treated as final opportunity to renew the loan, failing which notice has been construed as recall notice and the Bank shall be constrained to auction sale of security for recovery of loan amount. In another notice dated 7th January, 2015, it has been mentioned that they have already received notice of recall dated 23rd December, 2014 whereby it has been informed that the loan was mature on 15th November, 2015 whereby the complainant was called to renew the same. In this notice, it has been mentioned that the Bank has given 7 days time for placing the gold ornaments in the auction sale and also mentioned that if the sale proceeds are not sufficient to satisfy, remaining outstanding dues would be liable to be paid and in case of any surplus, the same would be refunded to the claimant. When they have not responded with positive note, the gold ornament was placed to the auction sale on 19th February, 2015. After receipt of the bids from two Jewelers, New Baba Lokenath Jewellery, Guwahati for Rs.179,916/-(Rupees One Lakh Seventy Nine Thousand Nine Hundred and Sixteen) and another from New Ratna Deep, Ali Road, Kakhtokia Guwahati for Rs.1,79,535/-(Rupees One Lakh Seventy Nine Thousand Five Hundred Thirty Five) Only and it was auctioned to the highest bidder and offered to return the surplus amount after adjusting the loan amount and sent cheque of Rs.29,195/-(Rupees Twenty Nine Thousand One Hundred Ninety Five) only, but he has refused to accept the cheque. 

The complainant has examined himself and exhibited some documents. Exhibit-I is the description of the gold ornament showing weight 81.300 gram. Exhibit-II is a deposit of Rs.13,231/-(Rupees Thirteen Thousand Two Hundred Thirty One) by way of Deposit of interest for 6 months, 15th  May, 2014. Exhibit-III is sanction order dated 15th May, 2014 for the renewal of the gold loan. Typed copies of the System generated message received by the Complainant form HDFC Bank in M/Exhibit-I. Legal Notice at 26th February, 2015 as Exhibit-IV, Loan release order dated 22nd May, 2024 as Exhibit-V. 

No witness has been examined from the side of Bank, but attached certain documents along with Annexures. Annexure-I is power of the attorney. Annexure-II is the gold loan application where details have been mentioned dated 29th October, 2013 and Annexure-III is the declaration cum terms and condition of loan collateralized by Gold. Annexure-IV is the accounts statement and Annexure-V and VI is the details of the gold which was pledged for the gold loan, has been shown the gross weight is 81.300 but net weight has been shown to 76.100 and verification certificate. 1st renewal gold loan application was filed by the complainant on 15th May, 2014 Annexure-VII with a fresh agreement Annexure-VIII arrived at between the party Dated 15th May, 2014 wherein, the details of the gold has been mentioned at Annexure-IX. Annexure-X and Annexure-XI are the bank statements. Annexure-XII is the notice dated 23 December, 2014. Annexure-XII/1 vide item no.1 is the details of the notice that was sent to different customers wherein the name of the complainant has also been shown. Annexure-XII/2 vide item no. 2 is the movement of the notice generated by the Indian post wherein the date of the delivery has been mentioned as 6th January, 2015, another notice has been attached as Annexure-XIII, 7th January, 2015, Annexure-XIII/1 is the details of the notice were given through the speed post to different customers including the claimant and notification of Indian Post. Annexure-XIII/2 shows notice delivered on 17th January, 2015. The participants who were participated in the auction of the loan has been shown. Annexure-XIV is final outcome of the auction sale has also been shown as Annexure-XVII cheque of Rs.29,178.93/-(Rupees Twenty Nine Thousand One Hundred Seventy Eight and Ninety Three Paise) shown in Annexure-XVII is the receipt of the post office has been shown as Annexure-XVIII through the speed post and notification at the Indian post, Annexure-XIX showing that the cheque has reached to the destination on 07th March, 2015; Annexure-XX is the legal notice recall from the site of the complainant and reply was given vide Annexure-XX1. 

In the present case, five issues were framed by the court below:

1. One of the issues was whether the complainant was a consumer. The court below after discussing arrived at the conclusion that he was the consumer which has not been challenged by the Bank.

2. The next issue was as to whether action of the bank in putting the ornaments in auction was justified or not and another point would be whether the Bank has given sufficient notice to the complainant before putting the ornaments of the complainant for auction sale.

3. Whether the complainant had acted negligently either to neutralize the loan amount or renew the gold loan in terms offered by the bank. There is no dispute in fact that the gold loan was given to the claimant on first payment on 30th October, 2023 for 6 months and, thereafter, it was renewed on 15 May, 2014 for further 6 months and it become due on 15th November, 2014. Either the claimant was to renew the loan or to make payment of the outstanding due by due date.

It appears from the SMS message sent by the Bank whereby he was called upon on 19th January, 2015; 24 January, 2015; 29 January, 2015; and 31 January, 2015 which has been accepted by the claimant in his claim application and also attached the typed copy of system generated message where it has been mentioned that Dr.Javed Aktar "Your HDFC loan account 282512400 is over due please call us at 03366253004 HDFC Bank please ignore the same is paid". The same was sent to settle the account in SMS dated 24th January, 2015 wherein it has been mentioned to settle the account in SMS 29th January, 2015 and 31st January, 2015 the same was repeated. He was given two notices, one is dated 23rd December, 2014 wherein it has been mentioned about the details of the loan amount and the outstanding dues and at the bottom, it has been mentioned that, "please treat this notice as final opportunity to renew the loan, failing which, this notice shall be construed to recall notice and the Bank will be constrained to sell pledged security of recovering your loan amount" which was delivered to the claimant on 6th January, 2015. Another notice was given to the claimant through the speed post which was received by the claimant on 7th January, 2015 wherein in the bottom, it has been mentioned, please note that in case of sale proceeds are not sufficient to satisfy outstanding dues, you will be liable for payment of balance due, in case of any surplus, the same shall be refunded. Both the letters were sent by speed post and second letter was received by the claimant on 17th January, 2015, even thereafter, he did not come out from the slumber, remains in unresponsive. The bank had sent the last SMS on 18th February, 2015, wherein the following statement was mentioned, gold Loan number 28251240, remained overdue, this final reminder before sale of security pledged with us. 

In terms of Section 176 of Contract Act, there is a right to Pawnees where it has been mentioned that in case of default in making of payment within the statutory time, two options were there; one is for filing suit and get back the money and another course has been mentioned that the item which was pledged as collateral by way of security he may sell recover the amount. The claimant was given reasonable notice either to file suit or place the same for auction. The Bank had two courses available either recovered the money back through sold of gold or placed pleaded gold for the bank instead of adopting first course followed and the second course. The Bank had put the gold ornaments for auction. The Bank had given sufficient notice  to liquidate the loan amount but he had not responded though he had taken plea that he had approached the Bank and requested for certain time to liquidate the loan account or renew the loan, but no material has been brought on record to substantiate the claim either in the claim application nor during his evidence, who examined himself as witness no.1 and had not denied that the notices were not served upon him rather accepted that several opportunities were given by the Bank. The claimant failed to read terms of agreement as it was printed in the small font. He has taken a plea that the loan was for 6 months, but he says that it is not mentioned asking for renewal of the loan but was intimation of overdue payment,but he has agreed that he was given sufficient time to clear the dues but failed to do the same. He has accepted that he had not issued letter to the Bank praying for time to settle the outstanding loan amount and he has also accepted that there is no evidence to show that he approached the Bank in time to settle the dues.

 So, in view of the evaluation of facts during cross examination, the claimant failed to take proper steps for second renewal of gold loan or took effort to return the loan amount.

In view of aforementioned discussions, it is clear that the Bank has acted legally and properly. Hence, this Tribunal does not find any error in the order of the Court below. 

Accordingly, this appeal is dismissed and the order of the Court below is affirmed.

     Sd/-                                     Sd/-

PRESIDENT                                 MEMBER