Punjab

Nawanshahr

CC/103/2015

Prem Singh Badwal - Complainant(s)

Versus

ICICI Bank Limited - Opp.Party(s)

Navneet Sareen

04 May 2016

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SHAHEED BHAGAT SINGH NAGAR

                               Consumer Complaint No. : 103 of 09.09.2015

                               Date of decision                 : 04.05.2016

 

1.       Prem Singh Badwal, S/o Late Shri Piara Singh

2.       Surinder Kaur Badwal W/o Prem Singh Badwal

Both residents of H. No.565, Gali No.3, Guru Angad Nagar, Nawanshahr. 

                                     ......Complainants

                                             Versus

1.       ICICI Bank Limited, Registered Office “Landmark” Race Course Circle, Vadodra, 390007 through its Managing Director/Chief Executive Officer.

2.       ICICI Bank Limited, Banga Road, Nawanshahr through its Branch Manager.

                                                                                ....Opposite Parties

                   Complaint under Section 12 of the Consumer Protection Act, 1986

 

QUORUM

          MRS. NEENA SANDHU, PRESIDENT

          S.KANWALJEET SINGH, MEMBER

 

ARGUED BY

Sh. Navneet Sareen, Advocate, counsel for the complainant

Sh. V.K. Gupta, Advocate, counsel for OPs 

 

ORDER

          PER MRS. NEENA SANDHU, PRESIDENT

1.       Sh. Prem Singh and Surinder Kaur have filed this complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’) against the Opposite Party (hereinafter referred to as ‘the O.Ps.’)  praying for the following reliefs:-

i)       To direct the O.Ps. to rectify the account of  complainants in terms of the repayment schedule provided to them in the year 2007

ii)      To pay the complainant a sum of Rs.1,25,000/- as costs.  

2.       In brief, the case of the complainants is that on the allurement of the Branch Manager of O.P. No.2, they took home loan for a sum of Rs.10,00,000/-. The loan was sanctioned on 23.5.2005. Complainants were initially apprehensive about contracting a loan from a private Bank like O.Ps but they were prevailed upon into doing so, when the O.Ps. laid down an attractive and elaborate repayment schedule comprising of 141 monthly installments of Rs.11,741/- and last installments was to be paid on 07.04.2017 as per agreement No.LANWS 00001066226. Complainant No.1 was the principal borrower and complainant No.2 was taken on record as a co-applicant upon the persuasion of the Manager of O.P. No.2. Complainants were given to understand that there were no grey areas in the deal and that the repayment schedule, given in writing, was the cornerstone of the transaction and there were no hidden costs and charges. It is averred that complainant No.1 is a simple shopkeeper and he is not very educated and complainant No.2 is a simple housewife. The complainants were not provided with the repayment schedule at the time of disbursement of the loan but the same was provided to them sometime in year 2007 upon their insistence. The complainants are not versed with legal or commercial terminology. Complainants have been diligently paying the EMIs to the O.P. Bank. It is also averred that when complainants approached the O.P. No.2 for foreclosure of their loan (which is due on 07.04.2017), the O.P. No.2 had initially been dilly-dallying but after a few rounds of the bank, they were informed that their account could not be foreclosed by calculating the monthly installments due upto 07.04.2017, but the same would now be calculated upto the year 2023. The complainants were further informed by the Nawanshahr Branch of ICICI that their account had been reworked by their Jalandhar Head Office and they would be required to pay installments upto the year 2023. Hence, this complaint.

3.       On being put to notice, the O.Ps. No.1 & 2 have filed written version by taking preliminary objections; that complainant is not maintainable; that complaint is hopelessly barred by limitation. It is stated that the loan was availed by the complainant in the month of May 2005 and the objection regarding increase in the rate of interest has been raised in the year 2015 i.e. after lapse of 10 years of sanction and disbursement of the loan amount; that the complainants had concealed the actual and true facts from this Forum while filing this complaint; that complainants have availed home loan amounting to Rs.10 Lacs from O.Ps. in the month of May 2005 and the said loan was initially repayable in 120 installments of Rs.11,741/- i.e. in 10 years; that the complainant while availing the home loan had opted for the floating rate of interest and at that time rate of interest was applicable was 7.25% per annum (i.e. FRR 8.25%-margin 1% per annum). This fact was duly intimated to the complainants, at the time of sanction of the loan and was specifically mentioned in the sanction letter and in credit facility application submitted by them; that complainants after knowing the contents of the sanction letter and that of the credit facility application form have signed the same in token of their acceptance of the terms and conditions of the loan and only thereafter the said loan was disbursed to them by the O.Ps; that with a view to ensure transparency to the borrowers, the O.P. Bank had introduced, floating rate of interest (FRR) for determining the rate of interest for loan sanctioned on floating rate of interest; that the current rate of interest are applicable in the loan account of complainant is 14.45% (FRR 15.45%- Margin 1% per annum) as on 31.10.2015 and the tenure is of 216 months; that the increase or decrease in tenure of the loan or EMI depends upon the increase or decrease in the rate of interest on the loan, subject to permissible limit; that the complainant has no cause to file the present complaint. On merits, it is admitted that complainants were provided loan vide loan account No. LBNWS000001066226 amount to Rs. 10,00,000/-. It is stated that the complainants have jointly apply for home loan with O.Ps. and had opted for floating rate of interest. The repayment schedule was provided to them at the time of sanction of the loan as per prevailing rate of interest. It is stated that the terms and conditions were duly explained to the complainants at the time of sanction of the loan. It is stated that repayment of the loan by the complainants has duly been reflected in the statement of account, complainants can close the loan account at any time after paying the dues to the bank as mentioned in foreclosure letter. It is further stated that change in rate of interest duly notified to the complainants from time to time by the O.Ps. by sending the reset letters and was duly reflected on the website of the bank and is duly notified in the newspaper for the information of the general public. There is no deficiency in service on the part of the O.Ps. Complainants are liable to pay the due amount as per the terms and conditions as agreed upon between the parties and reflected in the statement of the account and foreclosure letter. Rest of the allegations made in the complaint have also been denied and a prayer has been made for dismissal thereof with costs.

4.       On being called upon to do so, the learned counsel for the complainant tendered affidavit of complainant Ex.CW1/A, photocopies of documents Ex.C1 to Ex.C3 and closed the evidence. On the other hand, the learned counsel for the O.Ps. tendered affidavit of Sh. Sagar Kumar, Deputy Manager Ex.OPA along with photocopies of documents i.e. Ex.OP-1 to Ex.OP-24 and in additional evidence tendered Ex.OP-25 to Ex.OP-28 and closed the evidence.

5.       We have heard the learned counsel for the parties and gone through the record of the file, carefully. 

6.       At the outset, the learned counsel for the O.Ps. No.1 & 2 raise the objection that the complaint is hopelessly barred by limitation because complainants availed the loan in the month of May 2005 and they have raised the objection regarding increase/change in the rate of interest in the year 2015 i.e. after 10 years from the sanction and disbursement of the loan amount. Therefore, the instant complaint is liable to be dismissed solely on this ground. To this effect, the learned counsel for the complainants submitted that the O.P. Bank is still maintaining in the loan account of the complainants and they have yet to repay the loan amount. He further submitted that the recently cause of action accrued to the complainant to file the complaint against the O.Ps. on 09.09.2015, because on the said date, the complainants approach the O.Ps. for foreclosure of the loan account, but they did not allow them foreclose their loan account. Not only this, the officials of the O.Ps. told that they have to pay the loan amount upto the year 2023 whereas as per the loan agreement they had to pay the loan amount upto the year 2017. As such, the cause of action has arisen to the complainants to file the complaint against the O.Ps. No.1& 2 in the year 2015. Thus, the objection raised by the learned counsel for the O.Ps. No.1 & 2 that the complaint is barred by limitation may not be taken into consideration.

          No doubt, the complainants took loan from the O.Ps. in the year 2005 but the complainants had to pay the said loan amount within ten years as per loan agreement. Undisputedly, the complainants still have to pay the loan amount. Thus cause of action is continuous until and unless the complainants pay the loan amount. Even otherwise, as per the version of the complainants, that they approach the O.Ps. for foreclosure of their loan amount in the year 2015 but the O.Ps. did not allow them foreclose the same. Thus, taking these facts into consideration, we are of the view that this objection raised by the learned counsel for the O.Ps. that the complaint is barred by limitation is baseless.

7.       On merits, the learned counsel for the complainants submitted that the complainants took loan of Rs.10,00,000/- from the O.Ps., in the year 2005, repayable in 141 monthly installments worth Rs.11,741/- and last installment was to be paid on 07.04.2017. However, when they approached the O.Ps for foreclosure of the loan account, the official of the O.P. bank told them they have to be pay the loan installment upto the year 2023. He further stated that O.Ps. cannot revise/increase the rate of interest suo moto. It is not out of place to mention here that O.Ps have not intimated them regarding increase in the rate of interest on the loan amount. The said act of the O.Ps. amounts to deficiency in service.  He further submitted that additional evidence lead by the O.Ps. was not in terms of order dated 3.3.2016, passed by this Forum as production of record of the relevant dispatch entries was absolutely essential for proving the intimation of the debt reset letters. The additional evidence lead by the O.P. bank deserves to be discarded. As purported additional evidence lead by the O.Ps. has no value in the eyes of law, therefore, the same may not be read into evidence.  On the contrary the learned counsel for the O.Ps. submitted that complainants while availing the home loan had themselves opted for floated rate of interest (Adjustable rate of interest) and at that time rate of interest applicable was 7.25% per annum (i.e. FRR (Floating Reference Rate) 8.25% - margin 1% per annum). The complainants were duly intimated at the time of sanction of the loan that the increase or decrease in tenure of the loan or EMI depends upon the increase/decrease in the rate of interest on the loan. The O.Ps. have charged the interest on the basis of FRR- margin 1% per annum and have not charged and no excess rate of interest had been charged by the O.P. bank. He further submitted that complainants may foreclose the loan account after paying the due outstanding amount and prayed for dismissal of the complaint with costs.

          From the perusal of sanction letter, Ex.OP-15 and schedule B Ex.OP-18, it is evident that the complainants have availed home loan from the OPs and have opted for floating rate of interest (Adjustable rate of interest). In  term 2.2 (c) of the loan agreement Ex.OP-17, it is mentioned that for adjustable interest rate offered by ICICI Bank, the terms applicable to such loan as stated in Schedule-B.  In term No. 4 of schedule-B,  the expression “Adjustable interest rate” means FRR and the margin if any.  As per term D (g) of the schedule-B, the ICICI bank may vary its FRR from time to time in such manner as ICICI Bank may deem fit in its sole discretion.  In term No.(D) – Amortisation;  it is categorically mentioned that the borrower shall be required to pay such increase EMI amount and/or the differential amount resultant as determined by ICICI Bank as its sole discretion and intimated to the borrower.  Thus, from the terms and conditions of the loan agreement, it is very clear that whenever there is increase in the rate of interest, the loanee has to pay the same and the bank may either increase the tenure of repayment of the loan or to increase the EMI.  In the present case, the tenure for repayment of loan has been changed/increased. In this view of matter, the OPs cannot said to deficient in providing services. 

So far as the other grievance of the complainants regarding non intimation of the increase/change in the rate of interest is concerned, the complainants alleged that they were not informed by the O.Ps. regarding the increase/change in the rate of interest of the loan amount. On the other hand, the plea of the OPs is that, whenever there is any increase/change in the rate of interest, the same has always been displayed at all business premises of the O.P. bank and also got published in the news paper. The Head Office of the bank always intimate all the customers individually. Complainants were also informed regarding increase/change in the rate of interest from time to time, as is evident from letters Ex.OP1 to Ex.OP-13 respectively. The OPs further averred that the OPs have to send the reset letter to millions of customers, since it is electronic era and they instead of maintaining manual dispatch record have maintained electronic record and the same has been placed on record as Ex.OP-25 to Ex.OP-28. Thus, the allegation of the complainants regarding non-maintenance of record of dispatch is baseless.

          It may be stated that copy of production of electronic register maintained by the OPs is valid proof of having intimated about the increase/change in the rate of interest.  Thus, allegations of the complainants    regarding ,  non - maintenance of the record of dispatch of the letters to the complainants is incorrect.

8.       In the case of ICICI Bank (Home Loan) & Anr. Vs Ganga Singh Shekhawat 2015 (3)  CPJ 507, the Hon’ble National Commission, has held that though petitioner did not intimate about increasing rate of interest at every time nor placed directions of RBI on record yet they were entitled to enhance rate of interest.

9.       Taking aforesaid facts and circumstances into consideration, we are of the view that the complaint is devoid of merit. Consequently, we dismiss the same.

10.     The certified copies of this order be supplied to the parties forthwith, free of costs, as permissible under the rules and the file be indexed and consigned to Record Room

 

ANNOUNCED                                                                       (NEENA SANDHU)

Dated .04.05.2016                                                PRESIDENT

 

 

                                      (KANWALJEET SINGH)

                                                                     MEMBER