Chandigarh

DF-II

CC/1020/2019

Ram Pal - Complainant(s)

Versus

Hinduja Layland Finance Limited - Opp.Party(s)

Devinder Kumar Adv.

24 Apr 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II,

U.T. CHANDIGARH

Consumer Complaint  No	:	1020 of 2019
Date  of  Institution	:	07.10.2019
Date   of   Decision	:	24.04.2023

 

 

 

 

 

Ram Pal son of Sh.Suraj Bhan, Aged about 48 years, r/o House No.2234, Sector 52, Chandigarh.

            …..Complainant

 

Versus

1]  Hinduja Leyland Finance Limited, SCF No.39, Second Floor, Phase-5, Sector 59, Chandigarh.

2]  Hinduja Leyland Finance Limited, Plot No.128, Industrial Area, Phase-1, Chandigarh through its Branch Manager

 

3]  Credit Information Bureau India Limited (CIBIL), Registered Corporate Office: One Indiabulls Centre, Tower 2A, 19^th Floor, Senapati Bapat Marg, Elphinstone Road, Mumbai, Maharashtra 400013 through its Managing Director  

   ….. Opposite Parties

 

 

BEFORE:  MR.AMRINDER SINGH SIDHU,       PRESIDENT

                MR.B.M.SHARMA                 MEMBER

 

Argued by:-     Sh.Devinder Kumar, Counsel of complainant

Sh.Gaurav Bhardwaj, Adv. proxy for Sh.Puneet Tuli, Counsel of OPs No.1 & 2.

OP No.3 exparte.

 

PER  B. M. SHARMA, MEMBER

 

        The case of the complainant briefly is that he had taken loan from Paul Merchant Finance Private Limited, Chandigarh and Capital Finance Limited now IDFC First Bank and cleared the same without any default (Ann.C-1 & C-2). It is stated that the complainant stood guarantor for one Sh.Ravi Parkhi, who had taken loan of Rs.1,50,000/- for purchase of three wheeler from OP.  The said Ravi Parkhi defaulted in repaying the loan, as such his Three Wheeler was repossessed by the OPs. Thereafter, the complainant and Ravi Parkhi were issued letters dated 5.2.2015 (Ann.C-4) to pay the balance amount.  It is submitted that the matter was then settled with the OPs and as per directions of the OPs, an amount of Rs.27,000/- was deposited by Sh.Ravi Parkhi for closure of the said loan.  Accordingly, the OPs, on receipt of said amount, issued letter dated 14.6.2017 (Ann.C-5) with assurance that NOC will be issued after completing the formalities.  However, instead of issuance of NOC, the OPs vide letter dated 24.7.2017 raised a demand of Rs.80,498/- (Ann.C-6) which was clarified by the complainant with the OPs that the balance loan has already been cleared vide closure letter dated 14.6.2017 (Ann.C-5).

        It is submitted that in Jan., 2019 when the complainant visited Co-operative Bank and Oriental Bank of Commerce for obtaining loan, he was denied the same on the ground that as per CIBIL records name of the complainant exists in defaulter list. The complainant appraised this fact to the OPs, with request to remove his status as defaulter’s from the record of CIBIL as Sh.Ravi Parkhi for which he stood guarantor had already paid the balance amount of loan vide letter dated 24.7.2017, but they did nothing.  It is submitted that from the CIBIL report dated 11.6.2019 it is clear that the name of the complainant still exists in defaulter’s list and the same has not been removed by the OPs despite request of the complainant made vide letter dated 28.6.2019. Hence, this complaint has been preferred alleging the above said act & conduct of the OPs as gross deficiency in service and unfair trade practice.    

 

2]      The Opposite Parties No.1 & 2 have filed joint reply and while admitting the factual matrix of the case, stated that the complainant stood as guarantor in the loan for the purchase of a three wheeler which was purchased by one Sh.Ravi Parkhi.  It is stated that borrower and guarantor are equal in the eyes of law.  It is submitted that the answering OPs are required to furnish the information with regard to all loanees, whether a defaulter or not to the credit rating agency i.e. CIBIL as per terms & provisions of The Credit Information Companies (Regulation) Act, 2005. It is also submitted that in terms of the guidelines laid down by the RBI with regard to the formats to be followed the information is retrieved by the credit rating agency from the computer system of the answering OPs and then the same information is collated by the agency to generate its own report.  It is pleaded that the answering OPs have no part to play in the generation of the report by the credit rating agency which based on its own parameters collates the information.  

        It is stated that there is no human intervention as the software developed is approved by RBI, CIBIL and Banks/NBFC’s and the system gets the entire data from Core value system which are Finnacle, Finone and Prime.  It is also stated that once the data is extracted by the system, it is transformed into Transunion Data Format (CIBIL) and post transformation, this data is “Non-Human Readable Data”.  It is further stated that all Individual Assets Relationship Data is shared in the same format and form by all Banks and Financial Institutions in India under guidance and supervision of RBI.  It is pleaded that the data is sent periodically as stipulated under CIRCA Act (Credit Information Companies (Regulation) Act, 2005) and arrangement of replying the OPs with CIBIL (Credit Rating Agency) that Data is sent every 30 days and in the present case, the information was sent as above.  It is also pleaded that answering OPs or its officers are not responsible for the said list and that the update made by CIBIL was a mistake.  Pleading no deficiency in service and denying other allegations, the OPs No.1 & 2 have prayed for dismissal of the complaint.

 

        The OP No.3-CIBIL did not turn up despite service of notice, hence it was proceeded exparte vide order dated 17.10.2022.

 

3]      Parties led evidence in support of their contentions.

 

4]      We have heard the ld.Counsel for the contesting parties and have gone through the documents on record.

 

5]      The grievance of the complainant is that the loan in question availed & defaulted by one Sh.Ravi Parkhi, for whom he stood guarantor, had already been settled with the OPs whereupon they issued letter dated 14.6.2017 (Ann.C-5), but despite of that his name, in respect of said loan, had been shown/reflected as defaulter by the OPs in CIBIL. 

 

6]      The perusal of the file reveals that the OPs have not denied that the said loan advanced to Ravi Parkhi for which the complainant stood guarantor has already been closed and accordingly, letter dated 14.6.2017 (Ann.C-5) was issued by them.  Thus it is clear that the loan in question for which the complainant stood guarantor has already been settled.  However, the CIBIL Report, placed on record by the complainant as Ann.C-7, dated 11.6.2019, which too has not been disputed by the OPs, shows the Status of the complainant as ‘WILFUL DEFAULT’, which surely has lowered the CIBIL Rating of the complainant. 

 

7]      The OPs have not denied that the status of loan showing it to be clear or defaulted, are to be updated by the concerned financial institutes, which in the present case are the OPs and the CIBIL retrieves the data as updated by the concerned financial institution.  The OPs admits in the reply that the information is retrieved by the credit rating agency from the computer system of the OPs.  Therefore, it is clear that the OPs did not updated the correct status of the loan in question in respect of the complainant, which adversely affected his credit rating. Thus the deficiency in service on the part of the OPs is clearly made out, which certainly has caused loss, harassment and mental agony to the complainant.

 

8]      Taking into consideration the above discussion & findings, we are of the opinion that the deficiency in service on the part of the OPs has been proved. Therefore, the complaint stands allowed against the Opposite Parties No.1 & 2 with direction to the update the correct status of the complainant in respect of the loan in question and get it corrected/updated with CIBIL Authority by taking appropriate steps forthwith. The OPs No.1 & 2 are also directed to pay the complainant compensation amount of Rs.25,000/- for causing him loss, harassment and mental agony due to their deficient act, along litigation cost of Rs.10,000/-. 

        This order shall be complied with by the Opposite Parties No.1 & 2 within a period of 45 days from the date of receipt of its certified copy, failing which it shall be liable to pay additional compensatory cost of Rs.10,000/- apart from above relief.      

         Certified copy of this order be sent to the parties, free of charge. After compliance, file be consigned to record room.

Announced

24^th April, 2023             

                                                                                                  Sd/-

 (AMRINDER SINGH SIDHU)

PRESIDENT

 

Sd/-

(B.M.SHARMA)

MEMBER