Punjab

Ludhiana

CC/19/480

Manjit Singh - Complainant(s)

Versus

ICICI Bank - Opp.Party(s)

Rajesh Kumar Adv.

10 Jan 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:480 dated 14.10.2019.                                                         Date of decision: 10.01.2024.

 

Manjit Singh S/o. Sh. Saudagar Singh, R/o.B-36/40, Vikas Nagar, Pakhowal Road, Ludhiana.                                                                                                                                                                                        ..…Complainant

                                                Versus

ICICI Bank Ltd., through its Branch Manager, SCO 1 & 2 & 3^rd Floor, Ferzoe Gandhi Market, Pakhowal Road, Ludhiana.

Regd. Office Address:

ICICI Bank Tower, Near Chakli Circle, Old Padra Road, Vadodra 390007, Gujarat, India.                                                                                                                                                                                   …..Opposite party 

Complaint Under Section 12 of the Consumer Protection Act, 1986.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

SH. JASWINDER SINGH, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. Rajesh Kumar, Advocate.

For OP                           :         Sh. Alok Mohidra, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Shorn of unnecessary details, the facts of the complaint are that the complainant availed Housing loan of Rs.6,50,000/- from the OP bank and a written agreement dated 30.04.2003 was executed for the housing loan for total term of 15 years. Out of the said amount, an amount of Rs.5,20,000/- was disbursed on 30.04.2003 and an amount of Rs.1,20,000/- was disbursed on 20.05.2003 and Rs.1,30,000/-. The complainant stated that as per loan agreement, he had to pay EMI for a period of 15 years @ 9.75% per annum with adjustable interest rates RPLR- .5%, Prime Lending Rate 10.25% in 180 installments of Rs.7770/- each for first 8 years and remaining monthly EMI of Rs.4780/- to be paid for next coming 7 years. The bank received title deed of property as security. The bank sanctioned loan vide sanction letter dated 22.05.2003. The complainant further stated that he had regularly paid the amount of installments to the OP bank up till 8 years. However, in the beginning of 9^th year, when he started depositing amount of Rs.4780/- per month as per agreement but the bank in utter violation of terms and conditions of loan agreement had wrongly considered the EMIs deposited by the complainant from 9^th year onward as part payment of principal outstanding amount itself by levying heavy interest rate without any information and knowledge of the complainant. The complainant further stated that the OP bank had initiated proceedings of SARFAESI Act against the complainant which he changed before DRT-II, Chandigarh in the year 2013. The DRT-II, Chandigarh stayed the proceedings and the OP bank made a statement before DRT-II that it had withdrawn the securitization proceedings. Hence the complainant withdrew the said SA 152 of 2013 from the Debt Recovery Tribunal vide order dated 22.09.2015. Thereafter, the complainant started paying the installments as ear schedule in order to clear his loan amount but he shocked to see that OP had again wrongfully and illegally started adjusting all the installments in the loan amount towards principal amount increased by the bank with high interest rates. Rather OP bank had been showing a huge outstanding amount against the loan. Even when the complainant demanded No Due Certificate/No Objection Certificate and title deed from the OP bank after completion of loan installments, then the OP bank threatened the complainant to clear the entire loan otherwise to sell his property. The complainant sent legal notice twice through his counsel upon the OP but to no use. Hence this complaint, whereby the complainant has prayed for issuing directions to the OP bank to issue No Due Certificate/No Objection Certificate and release title deed of the property and also to pay compensation of Rs.10,00,000/-.

2.                Upon notice, the OP filed written statement and by taking preliminary objections assailed the complaint on the ground of maintainability; concealment of material facts, the complainant being estopped by his own act and conduct; lack of jurisdiction; the complaint being barred by time etc. The OP stated that the complainant was fully aware of change in the rate of interest as he had opted for adjustable/floating rate of interest and the said rate of interest can be vary with any change in the ICICI Home Prime Lending Rate i.e. IHPLR of the bank. Moreover, as pr Section 21A of Banking Regulation Act, the rate of interest charged by banking companies is not subject to scrutiny by courts. The OP further stated that he had every right under the contract to determine IHPR depending on various factors. The Reserve Bank of India had issued the guidelines that the rate of interest is to be determined by the banks with the approval of their respective board of directions subject to regulatory guidelines issued by the Reserve Bank of India in its Master Circular-Reserve Bank of India (Interest Rate on Advances) Directions, 2016 bearing memo No.DBR. Dir No.85/13.03.00/2015-16 dated 03.03.2016. So no wrongful action has ever been done by the Bank.  

                   On merits, the OP reiterated the crux of averments made in the preliminary objections. The OP admitted the sanctioning and disbursement of housing loan of Rs.6,50,000/- to the complainant vide loan account No.LBLUD000003540129. The OP further stated that the complainant opted for adjustable/floating rate of interest which is dependent on the availability and cost of funds, cash liquidity in the market, the repo rate, the reverse repo rate and the CRR fixed by the RBI and various other policies of the Government, RBI and the bank. As such, the rate of interest is not fixed and can change due to the said circumstances. According to the OP bank, the costs of funds is one of the components of IHPLR so any change in the cost of funds would have an impact on all the borrowers whose loan is linked to IHPLR and the said fact was duly conveyed to the complainant. The complainant duly agreed and accepted the same and he signed the loan agreement and other documents along with co-applicant Charanjit Kaur. Even the spread between the IHPLR and actual rate of interest offered to the borrowers is called ‘Margin’. The change in the rate of interest is always on account of the change in the IHPLR and the margin remains constant throughout the loan. Further any such increase or decrease in the rate of interest is within the public domain and is regularly published in newspapers and in the electronic media. The policies of the RBI and the Government are being regularly published in the print media and in the electronic media and as such, nobody can claim ignorance to change in the said policies. As per the terms of agreement, whenever there is an increase in the interest rate, the bank increases the tenure of loan to the borrowers subject to permissible limits in order to avoid burdening the borrowers with higher EMI and the same is mentioned in the facility agreement i.e. the loan agreement duly signed by the borrower at the time of disbursement. However, in case the borrower wishes to reduce the tenure then he may opt to increase the EMI or make a part prepaying or a combination of both. Whenever there is an increase or decrease in interest rate, change in tenure on EMI then rest letters are sent by the bank at the communication address of the borrowers. It is also mentioned in the loan agreement that no further intimation shall be given by the bank as to increased or reduced number of EMIs required to be paid by the borrower upon each/any change in the adjustable rate of interest in case the bank issues any notice for payment of the amount at change rate then the same shall be treated by the complainants as sufficient and reasonable notice. The OP bank further stated that it had acted in it totally transparent manner and no excess interest had ever been levied to the loan account of the borrower at any point of time during the entire tenure of loan.

                   The OP further stated that as per the revised RBI guidelines, the borrower is having an option of migrating to benchmark Marginal Cost of Fund Based Lending Rate (MCLR) which is available to the existing customers and by opting for MCLR 1Y or MCLR 6M, the customers can get rest the benchmark interest rate at the interval or 1 year or 6 months respectively. In such a case the borrow is required to visit the branch and to execute the conversation document and pay the requisite applicable conversion fee plus service tax on principal outstanding. The changed rate would apply upon execution of the conversion document and payment of fee. Although, as per the terms of the contract, the OP bank is not duty bound to send the letter each and every time whenever there is any revision in rate of interest yet it had been sending such letters from time to time. The OP had been using press releases from time to time publishing therein any change of interest that takes place due to any change in PR/IHPLR/FRR and as such, when the public notice had been issued then there is no further need of any notice to be sent individually to the complainant or any other borrower. Moreover, it is the complainant who had deposited overdue amount in the DRT as per calculation made by the OP and as such, the complainant had admitted the correctness of the calculation of balance principal amount and rate of interest applied thereupon. The OP bank further stated that it had duly sent a reply on 17.09.2019 to the notice issued by the complainant. The complainant had been making default in repaying the amount of loan in as much as the last payment received from the complainant is Rs.9,23,764/- on 07.12.2020 and the complainant had paid only 143 installments against 198 installments payable by him. The OP bank further stated that it had sent Loan Recall Notice vide letter dated 09.09.2011 and 11.10.2011 and also sent him the SARFAESI Awareness Notice dated 20.09.2011 informing about the outstanding balance on his loan account. In addition to that, the OP had also sent the Conciliation Notice vide letter dated 12.10.2011 inviting the complainant for attending the Conciliation proceedings held on 21.10.2011 and 22.10.2011 to know his difficulties in repayment of dues but the OP bank never received any response from the complainant. Further after receiving the entire outstanding amount, the loan account will be closed and the original property papers will be released to the complainant. The complainant had to clear the entire loan amount to get the original property papers back from the OP bank. The OP has denied that there is any deficiency of service and has also prayed for dismissal of the complaint.

3.                In support of his claim, the complainant tendered his affidavit Ex. CA in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 is the copy of his Aadhar card, Ex. C2 is the copy of agreement dated 30.04.2003, Ex. C3 is the copy of home loan sanction letter dated 22.05.2003, Ex. C4 is the copy of petition field before DRT-II, Chandigarh, Ex. C5 is the copy of interim order dated 06.02.2013, Ex. C6 is the copy of final order dated 22.09.2015, Ex. C7 is the copy of statement of loan account, Ex. C8 is the copy of legal notice dated 11.01.2019, Ex. C9 to Ex. C12 are the postal receipts, Ex. C13 is the copy of legal notice dated 27.08.2019, Ex. C14 is the postal receipt and closed the evidence.

4.                On the other hand, the counsel for the OP tendered affidavit Ex. RA of Sh. Ararshdeep Kumar, Authorized Signatory6, ICICI Bank Ltd., Feroze Gandhi Market, Ludhiana along with documents Ex. R1 is the copy of loan application, Ex. R2 is the copy of sanction letter, Ex. R3 is the copy f loan agreement, Ex. R4 is the copy of Master Circular issued by RBI, Ex. R5 is the copy of legal notice dated 06.07.2021, Ex. R6 is the copy postal receipt, Ex. R7 is the copy of possession notice, Ex. R8 to Ex. R13 are the copies of letters intimating the complainant regarding revision of rate of interest, Ex. R14 is the copy of statement of account and closed the evidence.

                  

5.                We have heard the arguments of the counsel for the parties and also gone through the complaint, affidavit and annexed documents and written statement along with affidavit and documents produced on record by both the parties. We have also gone through written arguments submitted by the complainant.

6.                Admittedly, on the basis of home loan application submitted by the complainant jointly with one Charanjit Kaur          to the OP, a loan of Rs.6,50,000/- was sanctioned having a tenure of 180 months vide sanction letter dated 22.05.2003 Ex. C3 on the following terms and conditions:-

Disbursement Date	20-May-03
Loan Amount Sanctioned	Rs.650,000/-
Cumulative Disb. Amount	Rs.650,000/-
Disbursement Amount	Rs.130,000/-
Cheque Amount	Rs.130,000/-
Adjustable Interest Rate	RPLR - .5% (9.75%) p.a.
Retail Prime Lending Rate	10.25% p.a.
Period	180 months
EMI	For the Period of 96 months is Rs.7,770/- For the Period of 84 months is Rs.4,780/-
EMI is calculated on	Monthly rests

 

                   Thereafter, the officials of the OP executed a loan agreement Ex. C2 = Ex. R3. The complainant had been paying EMIs but he has now raised a grievance that he has paid the entire loan amount as per terms and conditions of the loan agreement but the OP is not issuing No Due Certificate/No Objection Certificate and also not releasing the title deed of the property of the complainant.

7.                The counsel for the OP refuted the allegations and contended that since the rate of interest was floating and the EMI was bound to increase/decrease during the tenure of the loan. So there is no deficiency in service on the part of the bank.

8.                Perusal of sanction letter, loan agreement and other documents shows that the rate of interest was floating one which was being charged on the basis of loan agreement. The OP is well within its right to increase or decrease the rate of interest and no further consent from the complainant is required as the complainant has already agreed to pay the loan as per terms of the loan agreement. There is nothing on record to show that the charging of rate of interest by the bank was erroneous or was contrary to the guidelines issued by the Reserve Bank of India from time to time. Rather the OP has placed on record and referred to Master Direction – Reserve Bank of India Ex. R4 to substantiate its claim. The allegations of the complainant are bald and general in nature and their contentions with regard to deficiency or adoption of unfair trade practice on the part of the bank cannot be sustained.

9.                There is another aspect of the case. The complainant himself admitted that he filed an application under Sub-Section (1) of Section 17 of the SARFAESI Act, 2002 before Debt Recovery Tribunal-II, Chandigarh which came up for hearing on 06.02.2013 and interim relief vide order Ex. C5 was granted. However, on 22.09.2015, the counsel for the complainant withdrew the said application vide order Ex. C6. The operative part of the order reads as under:-

                   “The counsel for the respondent stated that they are withdrawing               the securitization proceedings.

In view of the above, the counsel for the applicant wishes to withdraw this SA.

Dismissed as withdrawn”

         

10.              The Consumer Protection Act, 2019 being a special enactment created an additional remedy in favour of the consumers to raise consumer disputes before the Consumer Commissions constituted under this Act. Section 100 of the Consumer Protection Act provides that the provision of this act shall be in addition to and not in derogation of provisions of any other law for the time being in force. However, as Three Judge Bench of the Hon’ble Supreme Court of India in Ireo Grace Realtech Pvt. Ltd. Vs Abhishek Khanna & another (2021) 3 SCC 241 has held that when two concurrent remedies are available to the aggrieved consumer, one under Consumer Protection Act and second under other laws, then aggrieved consumer has an independent option to elect which one out of two or more remedies, he wishes to exercise and if he elects one over the other, he loses the right to simultaneously exercise the other for the same cause of action. In the present case as well, the complainant had earlier opted remedy under SARFAESI Act, as such, now he is estopped from filing the present complaint by his act and conduct. So in view of the ratio of above cited laws, the complaint is not maintainable and deserves dismissal.

11.              As a sequel of above discussion, the complaint is hereby dismissed. However, there shall be no order as to costs. The pending application(s), if any, also stands disposed of.  Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.   

12.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Jaswinder Singh)                   (Sanjeev Batra)                      Member                                  President   

 

Announced in Open Commission.

Dated:10.01.2024.

Gobind Ram.