STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

(First Appeal No.382 of 2009)

Birbhan Goyal s/o A.P. Goyal r/o H.No.52, Sector 9, Panchkula, Haryana.

……Appellant

                           V E R S U S

ICICI Bank Limited, SCO No.181-182, Sector 9-C, Chandigarh.

                                  ..…Respondent

Appeal under Section 15 of the Consumer Protection Act, 1986.

BEFORE:                HON’BLE MR. JUSTICE SHAM SUNDER, PRESIDENT.

                             MRS. NEENA SANDHU, MEMBER.

Argued by:     Sh. Vikramjit S. Saini, Advocate for appellant.

       Sh. Sandeep Suri, Advocate for respondent.             

PER  JUSTICE SHAM SUNDER, PRESIDENT

1.             This appeal is directed against the order dated 12.06.2009, rendered by the District Consumer Disputes Redressal Forum-I, UT, Chandigarh (hereinafter to be called as the District Forum only), vide which it dismissed the complaint filed by the complainant (now appellant).

2.             The facts, in brief, are that the complainant, for his personal requirement, to increase his efficiency and livelihood, took a loan of Rs.70.00 lacs,  from the OP, in the name of Goyal Builders Birbhan Goyal, on 31.12.2005, which was repayable in 36 equal monthly installments of Rs.2,22,599/-. The complainant paid all the 36 EMIs towards the said loan, as per the agreement, executed between the parties, but inspite of that the OP Bank arbitrarily increased the term of EMIs from 36 months to 38 months amounting to Rs.2,22,599/- each and directed the complainant, to send two new sets of PDCs each for Rs.2,22,599/-, vide letter dated 22.11.2008 (Ann.C-2).  It was further stated that the OP also sent a copy of the repayment schedule, Ann.C-3, vide which it arbitrarily added two more installments.  The matter was taken up with the OP, but it did not pay any heed. Ultimately, a legal notice dated 5.12.2008 (Ann.C-4) was sent to the OP, for withdrawing its letter dated 22.11.2008, but to no avail. It was further stated that the OP was deficient, in rendering service, as also indulged into unfair trade practice.  When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only) was filed.

3.             The OP, in its reply, admitted the factual matrix of the case. It was stated that the loan availed of, by the complainant, was on floating rate of interest. It was further stated that at the time of granting loan, the rate of interest was 9% p.a. with the tenure of 36 months, which later on changed to 9.25% p.a. It was further stated that the aforesaid demanded amount, was on account of variation, in the rate of interest, as applicable, from time to time, as the loan was granted on floating rate of interest. It was further stated that the complainant had provided a limited number of cheques, in respect of the same i.e. towards the repayment of loan. The complainant was requested to make appropriate arrangements, to defray its liability, towards the payment of dues, to the bank. It was further stated that it was duly communicated to the complainant vide letter dated 28.8.2008.  It was further stated that the OP was neither deficient, in rendering service, nor indulged into unfair trade practice.   The remaining averments were denied, being wrong.

4.             The parties led evidence, in support of their case.

5.             After hearing the Counsel for the parties, and, on going through the evidence and record of the case, the District Forum, dismissed the complaint, on the ground, that the same was false frivolous and vexatious, in nature, and imposed costs of Rs.10,000/- on the complainant. 

6.             Feeling aggrieved, the instant appeal, was filed by the appellant/complainant.

7.             We have heard the Counsel for the parties, and have gone through the evidence and record of the case, carefully. 

8.             The Counsel for the appellant, submitted that, no doubt, the loan was taken by the appellant/complainant, on 31.12.2005 for Rs.70.00 lacs,  repayable in 36 equal monthly installments of Rs.2,22,599/- each. He further submitted that the complainant/appellant was making payment of equal monthly installments, as per the agreement, executed between the parties. He further submitted that the dispute was only with regard to the arbitrary action of the OP in increasing the equal monthly installments, from 36 to 38 months, amounting to Rs.2,22,599/- each and  directing the complainant to send two new sets of PDCs each for Rs.2,22,599/- vide letter dated 22.11.2008 (Ann.C-2).  He further submitted that, in the repayment schedule, Annexure C-3, two installments, were arbitrarily added. He further submitted that despite repeated requests, to the OP, to withdraw the arbitrary demand, no action was taken. He further submitted that the OP was, thus, deficient, in rendering service, and indulged into unfair trade practice.

9.             The Counsel for the respondent/OP, submitted that the loan was obtained by the complainant, on floating rate of interest, and he was to pay the same in 36 equal monthly installments. He further submitted that, at the time of grant of loan, the rate of interest was 9% p.a. Subsequently, the rate of interest was raised to 9.25% p.a. as per the RBI instructions. It was further submitted that the loan was taken at a floating rate of interest, which was likely to increase or decrease, during the period of repayment of the same. He further submitted that the amount was charged from the complainant, completely, in accordance with the terms and conditions of the agreement, executed between the parties. He further submitted that no arbitrary demand was raised by the OP, from the complainant. He further submitted that since, there was an increase, in the rate of interest, the amount which was payable by the complainant, also increased, and as such, he was required to repay the same in 38 equal monthly installments, instead of 36 equal monthly installments. It was further submitted that the OP neither indulged into unfair trade practice, nor was deficient, in rendering service. 

10.           After giving our thoughtful consideration, to the rival contentions, advanced by the Counsel for the parties, in our considered opinion, the appeal is liable to be dismissed, for the reasons, to be recorded, hereinafter. Admittedly, the loan of Rs.70 lacs was taken by the complainant. It is also not disputed that the same was obtained on floating rate of interest. Annexure X is the Home Equity loan Agreement which was executed between the complainant/appellant and OP/respondent which runs into as many as 14 pages. This document was signed by the complainant after fully understanding the terms and conditions thereof. According to this agreement, the complainant agreed that, in the event of any variation in:   

       “i) the date of payment of EMIs or

       ii)the amount of interest, principle or EMIs or

       iii) the numbers thereof,

the Borrower agrees and undertake to forthwith issue fresh post dated cheques to ICICI Bank as may be required by ICICI Bank and the terms of this clause shall apply also to all such post dated cheques”.

He had also signed the agreement/Schedule B, part (D) whereof reads that:-

“(a) Save and except as provided under (b) below, for administrative convenience the EMI amount was intended to be kept constant irrespective of variations in the Adjustable Interest Rate and therefore, the number of EMIs was likely to vary. It is further evident from this document that no intimation was to be given by the Bank, as to further or other or reduced number of EMIs required to be paid by the borrower upon each/any change in the Adjustable Interest Rate. It was further provided that the borrower shall be intimated of the information as to the applicable/applied Adjustable Interest Rate during the preceding financial year on an annual basis, within such time at the end of the financial year as it may determine.

(b) Notwithstanding anything to the contrary contained in this agreement, having regard to Adjustable Interest Rate for the time being, the Bank at its sole discretion shall be entitled to increase the EMI amount suitably if:

(i)         the EMI was not adequate to cover interest payments in full, and/or

(ii)   the EMI results in the term of loan exceeding the retirement age or 65 years for borrower(s), as applicable.

(iii)  If so required by ICICI Bank at its sole discretion for any reason, whatsoever, from time to time.

The borrower shall be required to pay such increased EMI amount and/or the differential amount resultant as determined by ICICI Bank at its sole discretion and intimated to the borrower”.

From the terms and conditions of the aforesaid documents/agreements, it was clear that the EMIs could be varied by the OP bank, from time to time, on account of variation of adjustable amount, due to increase in the rate of interest, as the loan, was taken on floating rate of interest. The complainant was, thus, bound by the terms and conditions, contained in the aforesaid documents. He could not come forward to say that the terms and conditions, contained in such agreements, were, in any way, unconscionable or were not acceptable to him. The Consumer Foras cannot alter the terms and conditions, agreed to between the parties. The agreement is required to be interpreted, in accordance with the terms and conditions, contained therein. In the instant case, as and when there was increase, in the rate of interest, intimation was given to the complainant. The intimation regarding variation, in the EMIs, was also given to the complainant. The District Forum was right, in coming to the conclusion, that the demand was raised by the OP, strictly, in accordance with the terms and conditions, contained in the agreement/documents, executed between the parties, and duly signed by them. Under these circumstances, the demand could not be said to be arbitrary nor the OP was deficient in rendering service, nor it indulged into unfair trade practice.

11.           The District Forum also came to the conclusion that knowing fully well, that he was bound by the terms and conditions of the agreement and the documents, executed between the parties, the complainant filed the complaint and unnecessarily dragged the OP into litigation. The District Forum also held that the intention of the complainant, right from the very beginning, was malafide, and not bonafide, and as such, the complaint was liable to be dismissed with costs, being false frivolous and vexatious. The findings of the District Forum, in this regard, are based on the correct appreciation of evidence and law, on the point. It was a case, wherein, the agreement was executed, between the parties. The terms and conditions of the said agreement, were duly understood, by the complainant and only, thereafter, he signed the same. The complainant very well knew that as per the agreement/documents, the rate of interest, on the loan which was taken by him, was floating and the EMIs and the period of loan could be varied by the OP, from time to time. He also knew that the demand raised by the OP was not illegal and arbitrary, yet he filed a false and frivolous complaint. With a view to curb the tendency of filing false, frivolous and vexatious complaints, the Consumer Foras are required to invoke the provisions of Section 26 of Act, which may act as a deterrent, for the ingenuine consumers. Thus, the District Forum, was right, in imposing Rs.10,000/- as costs, under Section 26 of the Act, on the complainant.

12.           The order passed by the District Forum, does not suffer from any illegality or perversity, warranting the interference of this Commission. 

13.            For the reasons recorded above, the appeal, being devoid of merit, must fail, and the same is dismissed, with no order as to costs.

14.           Copies of this order be sent to the parties free of charge.

Pronounced.

24^th May, 2011

Sd/-

[JUSTICE SHAM SUNDER]

PRESIDENT

Sd/-

[NEENA SANDHU]

MEMBER

Rg