DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

PATIALA.

                                      Complaint No. CC/15/83 of 23.04.2015

                                      Decided on:        27.11.2015

Sunil Bansal resident of House No.105, Dalima Vihar, Rajpura Tehsil Rajpura District Patiala, Punjab. 

                                                                   …………...Complainant

                                       Versus

1.      HDFC Bank Ltd., Bank House,28, Industrial Area Phase 1, Chandigarh through its Manager.

2.      HDFC Bank Ltd., Callibre Market, Rajpura through its Manager.

3.      HDFC Bank Ltd., HDFC Bank House, Senapati Bapat Marg, Lower Parel(West) Mumbai-400013 through its Chief Manager.

                                                                   …………….Ops

                                      Complaint under Section 12 of the

                                      Consumer Protection Act.

                                      QUORUM

                                      Sh.D.R.Arora, President

                                      Smt.Neelam Gupta, Member

                                      Smt.Sonia Bansal,Member

Present:

For the complainant:      Sh.G.S.Rathour  , Advocate

For Ops No.1&2:           Sh.Sanjay Khanna,Advocate                

                                         ORDER

D.R.ARORA, PRESIDENT

1. It is alleged by the complainant that he had availed Drop Line Over Draft (DOD) facility of Rs.50lac from Ops no.1&2 on 23.8.2012 in respect of his account No.01628020000479. As per the agreement arrived at between the parties, the tenure of the DOD was 108 months. As agreed between the parties, the complainant had been paying the sum of Rs.3000/- towards annual account maintenance charges and service tax. He also paid Rs.10,000/-towards processing charges at the time of the sanctioning of the DOD.
2. The complainant received letter dated 26.10.2013 from the Ops having asked him to utilize the balance unutilized limit of his Over Draft account to a minimum of 30% of his available limit every quarter failing which the bank will be constrained to levy commitment charges on the unutilized limit of the DOD with a minimum of Rs.5000/- per quarter w.e.f. January 1^st,2014.The complainant received the subsequent letters dated 14.12.2013 and 10.9.2014 and he replied the same. The complainant has challenged the claim of the Ops to levy the proposed charges being unjust, against the principles of natural justice, unilateral in as much as the Ops had not communicated any commitment charges at the time of the sanctioning of the limit. In the sanction note/agreement, the Ops have clearly stated that the commitment charges on the sanctioned limit is zero and therefore, the Ops cannot go beyond the terms and conditions of the agreement and they  have got no right to introduce the said commitment charges. The facility provided to the complainant is in the form of a loan provided against property and the facility once sanctioned can not be reviewed every year as it happens in the case of cash credit limits. Therefore, the terms and conditions  arrived at the time of the sanctioning of DOD facility can not be changed unilaterally during the tenure of the facility. It is also averred by the complainant that no doubt the bank can levy/introduce charges for providing services/additional services but the Ops have not provided/introduced any additional services so as to levy the aforesaid charges. The DOD facility had been provided on 23.8.2012 and for that sake the Ops had been charging the interest on utilized amount.
3. It is further averred that the complainant sent the legal notice dated 2.2.2015 against the Ops with a request to withdraw letters dated 26.10.2013, 14.12.2013 and 10.9.2014 within a period of 15 days and not to levy any commitment charges but to no effect.Accordingly the complainant has brought this complaint against the Ops under Section 12 of the Consumer Protection Act,1986 ( for short the Act) for a direction to the Ops to withdraw the aforesaid three letters and not to levy any commitment charges; the commitment charges already levied on the DOD facility may be refunded to the complainant;  the ops be also directed to pay Rs.25000 by way of compensation on account of the harassment and the mental agony and further to award the complainant with the costs of the complaint amounting to Rs.10000/-.
4. The cognizance of the complaint was taken against Ops no.1&2 who on appearance filed the written version having raised certain preliminary objections, interlaid, that the complaint is bad for non joinder of the other loanees namely  Niti Bansal, Puja Bansal, Anish Bansal and Mohan Lal Bansal; that the complaint is not maintainable as the loan amount of Rs.50lac raised by the complainant and others was of the commercial nature and therefore, the complainant is not a consumer under the Act; that the Forum lacks jurisdiction to try the complaint as the complainant has challenged the validity of the agreement and the Forum cannot decide the same under the summary procedure. Moreover, the complaint involves the complicated questions of facts and that the complaint being false and frivolous the same is liable to be dismissed with special costs. As regards the facts of the complaint, it is admitted by the Ops that the complainant and his associates had taken the facility of the Drop Line Over Draft facility  in a sum of Rs.50lacs and that the tenure of the same was 108 months. The complainant paid Rs.10,000/- towards processing charges. At the time of the sanctioning of the limit and at the time of the execution of the agreement, the complainant was apprised that they were liable to utilize the Over Draft account atleast  more than 30% and only thereafter the complainant and others had executed the agreement and other documents. It is admitted by the Ops that they had issued letters dated 26,10,2013,14,12,2013 and 10.9.2013 to the complainant and the demand raised vide the same is said to be legal as the bank as per its policy has a right to demand the same and the complainant has got no right to challenge the same. It has rightly been mentioned in the letter dated 26.10.2013 that in case the complainant fails to utilize the available limit of his overdraft upto a minimum of 30% thereof in every quarter, they will be liable to pay a sum of Rs.5000/- per quarter for unutilized limit w.e.f. January,2014. It is denied that the said proposal of the charges conveyed to the complainant is unjustified, unilateral, null and void, against the principle of natural justice etc. or that the Ops had not communicated any such commitment charges to the complainant at the time of the sanctioning of the limit. The bank has charged the commitment charges legally and the complainant is bound to pay the same. It is denied that the loan facility once sanctioned cannot be  reviewed every year  or that the bank cannot raise the commitment charges and rather the same have been charged as per the policy of the bank as clearly mentioned in the agreement. The Ops have also made a reference to para No.18.5 of the agreement, which provided that the borrower shall bear and pay all taxes, rates, duties (including stamp duties) charges and other imposts and obligations, existing as well as future , in respect of (a) the execution delivery and performance of agreement(b) the payment of interest or any other amounts pursuant to this agreement and (c) the creation, perfection and enforcement of security, if any, and they have further made a reference to clause 3.4.2 of the Code of Bank’s Commitment issued by the Banking Codes and Standards Board of India (BSSBI) vide which the bank has rights to introduce fee with one month advance notice to the borrower/s. After denouncing the other averments of the complaint, going against the Ops, it was prayed to dismiss the complaint.
5. In support of his complaint, the complainant produced in evidence Ex.CA his sworn affidavit alongwith documents Exs.C1 to C10 and his counsel closed the evidence.
6. On the other hand, on behalf of the Ops, their counsel  tendered in evidence Ex.OPA, the sworn affidavit of Sh.Deepinder Singh, Assistant Manager of the Branch of the Op, Chhoti Baradari, Patiala alongwith documents Exs.OP1 to OP6 and closed their evidence.
7. The parties failed to file the written arguments.We have heard the learned counsel for the parties and gone through the evidence on record.
8. First of all we take up the legal objection raised by the Ops. It is the objection raised by the Ops that the complaint is not maintainable in the present form as the same has been brought only by Sunil Bansal and other loanees namely Niti Bansal, Puja Bansal, Anish Bansal and Mohan Lal Bansal have not challenged the charges raised by the Ops. A perusal of the complaint would go to show that Drop line Overdraft (DOD) facility was raised by Sunil Bansal and his associates. Nothing is disclosed by the complainant about the status of Sunil Bansal and Associates that is whether it is the partnership concern or a company registered under the Companies Act,1956. From the letter of continuity placed on file alongwith the agreement arrived at between Sunil Mohan Bansal and Associates Chattered Accountant,Rajpura and the Ops, it appears that it is a company incorporated  under the Companies Act,1956 or it may be a partnership firm registered with the Registrar of the firms. There is yet one more document being a part of the said document which is noted as Schedule-1 , in which constitution of Sunil Bansal/Niti Bansal/Pooja Bansal/Anish Bansal is recorded to be individual.Whatever the status of aforesaid Sunil Mohan Bansal and Associates Chattered Accountant, Rajpura may be, one thing is clear that it is a group of five persons namely Sunil Bansal,Niti Bansal,Pooja Bansal , Anish Bansal and Mohan Lal Bansal, who raised the facility of Drop line Overdraft facility of Rs.50lacs from Ops no.1&2.  It is the positive plea taken up by the Ops that the complainant and others had raised the loan from the Ops for commercial purpose as would appear from the pleadings as also from the agreement and therefore, the complainant can not be said to be a consumer under the Act.

It was submitted by Sh.Sanjay Khanna, the learned counsel for the Ops that a ‘consumer’ as defined under Section 2(1)(d) of the Act means any person who –“(i)buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose ;or

 (ii)hires or avails of any services for consideration which has been paid or promised or partly paid or partly promised or under  any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the  services for consideration paid or promised or partly paid or partly promised, or under any system of deferred payments, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purpose.

Explanation-For the purposes of this clause,”commercial purpose” does not include use by  a person of goods bought and used by him and services availed by him exclusively for the purpose of earning his livelihood by means of self employment”

9. It was submitted by Sh.Khanna that the complainant and his other associates having raised the facility of  Drop line Overdraft facility worth Rs.50lacs from Ops no.1&2, it can be assumed that they utilized the same for commercial purpose because otherwise  they were supposed to make an averment in the complaint that the same was raised and used by them exclusively for the purpose of earning their livelihood by means of self employment , a fact not to be found in the complaint.
10.  It was further submitted by Sh.Khanna that the complainant had the occasion and the opportunity to lead an evidence that the Drop line Overdraft facility was raised by the complainant and his other associates for the sake of earning their livelihood by means of self employment but the said fact does not find mentioned in the affidavit Ex.CA of the complainant Mr.Sunil Bansal. He also placed reliance upon the citations Vijay Kumar Verus Indusind Bank 2012(3)CLT 474 and Safe Home Developers and Contractors Versus Samata Sahakari Bank Ltd. 2013(1)CLT 344, both of the Hon’ble National Consumer Disputes Redressal Commission, New Delhi.
11. On the other hand, nothing could be said on this point by Sh.S.S.Rathour, the learned counsel for the complainant.
12. We have considered the submissions and are of the considered view that the complainant and his associates having raised the Drop line Overdraft facility  of Rs.50lacs from Ops no.1&2 and there being no averments made in the complaint that the said facility was raised by the complainant and his associates for the purpose of earning their livelihood by means of self employment it has to be assumed that the same was raised and used by the complainant and his associates for commercial purposes, especially when the complainant and his associates are a company  or partnership of Chattered Accountants.
13. It is also important to note that the Drop line Overdraft facility was raised by Sunil Mohan Bansal and Associates Chattered Accountant , as discussed earlier either by a company or by a partnership concern and not by the complainant Sunil Bansal in his individual capacity and therefore, the complaint should have been brought by aforesaid Sunil Mohan Bansal and Associates through its Director in case a company on the basis of a resolution passed by the Board of the Directors or by a partnership firm through it’s partner . The complaint is very much silent with regard to the status of the complainant and therefore, we are of the considered view that the complaint could not be maintained by the complainant Sunil Bansal alone without disclosing the status in respect of Sunil Mohan Bansal and Associates Chattered Accountant .In any case the complaint also could not be maintained  as the complainant can not be said to be a consumer as defined under Section 2(1)(d) of the Act as the facility was raised for a commercial purpose.
14. However, we also deem it expedient to discuss the merits of the case. It is the plea taken up by the complainant that under the agreement arrived at between the complainant and his associates and Ops no.1&2 , no commitment charges have been agreed to be paid by the complainant and his associates and in this regard Sh.S.S.Rathour, the learned counsel for the complainant made a reference to Schedule 1 being a part of the agreement and in which at item No.9 against Commitment Fees, nothing has been recorded and the column has been written with meaning thereby nil.
15. It was also submitted by Sh.Rathour, that the Ops have placed reliance upon para 18.5 of the agreement, which provides: “The Borrower shall bear and pay all taxes, rates, duties,(including stamp duties) and other imposts and obligations, existing as well as future, in respect of (a) the execution, delivery and performance of agreement;(b) the payment of any interest or other amounts pursuant to this agreement and ( c ) the creation, perfection and enforcement of the Security, if any”. It was submitted by Sh.Rathour that the charges now claimed by the Ops vide their letter dated 26^th October,2013,Ex.C3 do not pertain to the execution/delivery and performance of agreement; ,(b) the payment of any interest or other amounts pursuant to the agreement and ( c ) the creation, perfection and enforcement of the Security.
16. Similarly, it was submitted by Sh.Rathour that the Ops have also placed reliance upon rule 3.4.2 of the Codt of Banks’s Commitment to Customers ( Ex.OP6), which provides: “If we increase any fee or charge or introduce a new fee or charge, it will be notified through statements of accounts/e-mail/SMS alerts/notice board at branches, one month prior to the revised charges becoming effective. This information will also be made available on our website”.
17. It was submitted by Sh.Rathour that the said rule 3.4.2 is to be read in conjunction  with rule 3.4.1, which pertains to Fees & charges and part (a) thereof provides: “We will ensure that our fees and seervice charges for various services are approved by the bank’s Board or any competent authority duly authorized by the Board to take decisions in this regatd and that they would be reasonable and non-discriminatory for similar class of customers”.
18. Then, it was submitted by Sh.Rathour that the Ops could not introduce a new fee or charge without having provided any additional services than the ones already provided byvirtue of the agreement arrived at between Sunil Mohan Bansal and Associates and Ops no.1&2.
19. On the other hand, it was submitted by Sh.Sanjay Khanna, the learned counsel for the Ops  that under rule 3.4.2 of the Code of Bank’s Commitment to Customers, the Ops can introduce a new fee or charge but they have to follow the procedure to notify the same through statements of accounts, e-mails/SMS alerts/ notice board at branches one month prior to the revised charges becoming effective.
20. We have considered the submissions and are of the considered view that the Ops could not claim any commitment charges from the complainant and his associates on the basis of the letter dated 26^th October,2013, Ex.C6 because from the very beginning no such condition was provided in the agreement. In case the Ops had to raise any commitment charges they could do so only against any services to be provided in addition to the services already provided byvirtue of the agreement arrived at between the parties. A perusal of the letter Ex.C3 dated 26^th October,2013, written by the Ops to the complainant would go to show that it interalia  provided, “Due to revision in  capital adequacy norms of the bank a review of certain charges was carried out post which we as a bank are constrained to levy commitment charges on the unutilized limit of your Drop Line Overdraft facility.These charges will be effective from 1^st January,2014 . Charges will be levied as follows:

How to ensure that the account is not under-utilized:

• In case the limit available to you is in excess of your requirement, you can opt to downsize your DOD limit permanently before 30^th November 2013. Please feel free to visit the customer service desk or contact us with your request to downsize the limit.
• You can also utilize the balance unutilized limit of your overdraft account up to minimum of 30% of your available limit every quarter to avoid a levy of commitment charges to your account”.

21. When from the very beginning the Ops had not made a provision for  raising any commitment charges from the borrower and there being no provision for the same in the agreement, we fail to understand as to how the Ops could raise the same byvirtue of the letter Ex.C3 dated 26^th October,2013 and as discussed earlier rule 4.3.2 of the Code of Bank’s Commitment to Customers provides for the introduction of a new fee or charge only in case some services are provided and which are approved by the Bank’s  Board or any competent authority duly authorized by the Board to take decisions in that regard. No such approval to have been granted by the Bank’s Board or any competent authority duly authorized by the Board to take decisions in that regard is placed on file. Letters Ex.OP3 dated 26.10.2013, Ex.OP4 dated 14.12.2013 and Ex.OP5 dated 10.9.2014 were written by OP 3 and nothing is shown from the aforesaid letters with regard to the charges having been approved by the Bank’s Board or competent authority duly authorized by the Board to take the decisions in that regard. Therefore, we are of the considered view that the Ops could not raise the demand of the commitment charges vide letter Ex.C3 dated 26^th October,2013 and the others  letters i.e. Exs.OP4 and OP5.
22. However, on account of our discussion made earlier, it would appear that  the complainant alone could not maintain the complaint  in his individual capacity and even Sunil Mohan Bansal and associates who raised the Drop line Overdraft facility is not covered under the definition of the consumer as provided under Section 2(1)(d) of the Act as discussed earlier and therefore, the complaint is hereby dismissed.
23.  

Dated: 27.11.2015

                   Sonia Bansal                Neelam Gupta                        D.R.Arora

          Member                        Member                                  President