IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM

Dated, the 28^th day of June, 2024

Present:  Sri. Manulal V.S. President

Sri. K.M. Anto, Member

C C No. 202/2023 (Filed on 30.06.2023)

O R D E R

Sri. Manulal V.S. President

The complaint is filed under Section 35 of the Consumer Protection Act 2019.

The complainants availed a loan under Account No. 0749675100000505 for an amount of ₹ 24,00,000/- (Rupees twenty four lakhs only)  from the first opposite party Bank through the second opposite party branch office in the year 2016 by way of mortgage by depositing original Settlement Deed belongs to the first complainant vide Deed No. 2017/1/2015 in respect of the property having an extent of 6 Ares of Changanasserry SRO comprised in re-survey No. 429/24 Block No. 1, at Kurichy Village and other documents including original prior deeds. Those original documents were deposited for the said loan as collateral security. All the documentation and transactions for availing such a loan, including the last payment, were done through the second opposite party, and the documents collected from the complainants were taken under safe custody by the first opposite party.

The first complainant was the applicant, and the second complainant, the husband of the first complainant, is the co-applicant in the loan agreement. The said loan transaction was closed as its full and final settlement on repayment of the loan amount on 14.10.2020 at the office of the second opposite party.

Hence, the loan transaction was closed forever, but the first or second opposite party has not yet issued the closure certificate, and on the closure of said loan transaction, the first opposite party through the second opposite party promised the complainant that all the documents deposited with the first opposite party will be returned within 45 days. Even after repeated oral requests both opposite parties did not turn up to return the original Title Deeds. Therefore, the complainants caused to issue a letter of notice dated 08.02.2021 to the first opposite party. In a reply dated 09.07.2021, the first opposite party informed that the original Title Deeds and other supporting original documents, which were forwarded to their office at Mumbai named Stock Holding Corporation of India Limited (SHCIL) for the purpose of storage at the first opposite party's custody, has been partially damaged/destroyed in a fire incident alleged to have been taken place on 11.12.2017 in the said strong room. Further, the first opposite party assured to return the partially damaged Title Deeds as the complainant has fully repaid the captioned loan and closed the loan amount, and if the complainants wish to obtain certified copies of Title Deeds, the first opposite party will assist the same.

The complainants further caused a notice dated 20.07.2021 to the first opposite party, conveying the unacceptability of getting certified copies of the partially/destroyed original documents. The first opposite party has a strict liability to return the original Title Deeds as per the norms of the agreement.

Aggrieved by the said inaction, latches, and gross negligence on the part of the first opposite party, the complainants preferred a complaint before the Banking Ombudsman, Thiruvananthapuram, seeking a direction to return the original documents. On 21.03.2022 the said complaint was closed by the Banking Ombudsman, Thiruvananthapuram on receiving a letter from the first opposite party that the certified copies of original Title Deeds are obtained and the Banking Ombudsman, Thiruvananthapuram, appraised the same.

After that, the complainants filed a second complaint before the Banking Ombudsman, where it was clearly stated that merely receiving certified copies instead of original documents was not the appropriate remedy for the loss sustained by the complainants. For which the Banking Ombudsman responded, informing that the complaint No. N202122015007733 was closed on 21.03.2022 under clause 14(9) (a)/(b) of Facilitation of RB-IOS, 2021, it is non-appealable and cannot be reopened. Further the Banking Ombudsman, Thiruvananthapuram suggested to approach other Fora if complainants are not satisfied.

Aggrieved by this, the complainants preferred an appeal/representation to the Hon'ble Deputy Governor, Reserve Bank of India, Mumbai. The Hon'ble Deputy Governor, Reserve Bank of India, Mumbai, by order dated 21.03.2022, informed the complainant that a sum of ₹ 70,000/- (Rupees seventy thousand only) has been credited to the account of the complainants. Further, it was stated that the first opposite party paid the compensation and acted on the complaint after being admitted at RBIO, it was treated as closed. The order further provides to approach any other forum for the redressal of grievances if the complainants are unsatisfied with the order.

Thereafter, the complainants filed a writ petition vide No. 30647/2022 before the Hon'ble High Court, Kerala, seeking a remedy. However, the Hon'ble High Court of Kerala also directed the complainants in an order dated 10.10.2022 to approach other fora to seek redressal of their grievances.

In this case, the opposite parties did not consider the return of the original Title Deeds and other original documents. It is the strict liability of both opposite parties to return the original document as the law burdens it. Both the opposite parties are legally bound to return the original documents to the complainants when the whole loan amount falls due and at the time of its repayment to the complainant.  The opposite parties defaulted on returning the original Title Deed to the complainants. Thus, the services of the opposite parties suffer from a deficiency. 

Without the original Title Deeds, the complainants would not get the actual market value of the property, nor would they be availed of any Bank loan, including these opposite parties, in the future. The opposite parties did not consider the mental agony, peril, and hardships that the complainants undergo on account of the non-availability of original Title Deeds, including the prior Title Deeds. The amount of damages awarded by the Banking Ombudsman, Thiruvananthapuram, is too meager to meet the devaluated state of property without original Title Deeds.

Hence, this complaint is filed by the complainant praying for an order to direct the opposite parties to return the original Title Deeds and other documents deposited by the complainants or, in the alternative, in the event of finding that the original Title Deed and other original documents are irrecoverably lost, pass an award directing the opposite parties to grant damages of ₹ 20,00,000/- (Rupees twenty lakh only)  and to direct the opposite parties to issue loan closure certificates to the complainants.

Upon notice from this commission, opposite parties appeared before the commission and filed joint version contending as follows.

The complaint is not maintainable in law or on facts. This commission has no jurisdiction to entertain and try this complaint. This commission has no territorial jurisdiction to entertain and try this complaint. No transactions occurred at Changanacherry. As such, the second opposite party is an unnecessary party. The complaint is bad for non-joinder of necessary parties. The complaint is barred by limitation.

The loan was availed by depositing the Title Deeds, and the subject loan was closed by the parties. While availing the loan, the parties had submitted Title Deeds pertaining to the mortgaged property. As the storage of original documents is centralized in Mumbai, the Tirur branch of the opposite parties has forwarded all the loan documents, security documents, Title Deeds, etc., to the office in Mumbai for storage at their custody, i.e., Stock Holding Corporation of India Limited (SHCIL), one of the premier institutions providing end to end document management services. The SHCL is a well-equipped professional team engaged in preserving and managing vital documents. The documents were kept with SHCL in a fireproof, strong storage space with due diligence, care, caution, and proper security. However, an unforeseen and unfortunate fire accident occurred in the storage premises of SHCIL at about 05.30 pm on 11.12.2017. Though the opposite parties and SHCIL have taken all necessary precautions to keep the original Title Deeds in a fireproof and strong storage space, certain documents have been partly or wholly damaged due to the fire fighting measures. The subject documents of the parties in this case were destroyed by the fire. The opposite parties and SHCIL had taken all necessary precautions to keep the original Title Deeds in a strong, fireproof storage space. However, despite all necessary precautionary measures, the documents were destroyed in the said fire accident, which was unforeseen and beyond the control of the opposite parties. With respect to the fire accident, a case was registered with Police Station Regale M.I.D.C., Navi Mumbai. As per the General Diary Entry dated 23.12.2017, before the Police Station Regale MIDC, Navi Mumbai (GD No.012), the fire accident occurred due to an electric short circuit. The opposite parties informed these facts vide letters/certificates dated 09.07.2021 and dated 28.02.2022 to the parties to the loan stating all these facts. The first opposite party issued a loan closure certificate. It is false and denied that 1^st   opposite party  through 2^nd  opposite party  promised the complainant that all the documents deposited would be returned within 45 days.

Upon closure of the loan, the opposite parties have handed over all the other documents in original, the certified copies of the documents procured at the cost of opposite parties, besides issued letters/certificates dated 09.07.2021 and dated 28.02.2022 informing all concerned that loss of the said Title Deed occurred due to the fire accident in SHCIL and to consider the Title Deeds handed over by the opposite parties as the only documents related to the property so that whoever intends to transact with the property/propose to grant the loan on the security of the property can rely upon the said certificate issued and proceed with the transaction, without insisting for the original of those two Title Deeds. The letters/certificates dated 09.07.2021 and dated 28.02.2022 was issued by the opposite parties to prove their ownership over the property, and accordingly, they can make any transfer of the said property in terms of applicable laws.

Therefore, there is no question of any damages or loss occurring. Since the opposite party issued letters/certificates dated 09.07.2021 and dated 28.02.2022 with respect to the loss of documents from their custody the parties can avail loans from financial institutions with certified copies of Title Deeds.

The complainant filed complaint before Banking Ombudsman, Thiruvananthapuram, thereafter appeal before Reserve Bank, Mumbai and High Court of Kerala. The  opposite party  has complied with the Ombudsman's order. As such, the complainants are stopped from proceeding/claiming further. There is no order of Ombudsman or the High Court allowing the complainants proceeding further or seeking redressal of grievances further. It is decided finally by the Ombudsman and the  opposite party  satisfied the order of the Ombudsman. Since the complainants have already availed proper remedies by filing complaints before the Banking Ombudsman, Reserve Bank, Mumbai, and High Court of Kerala, no further complaints/proceedings are maintainable.

No irresponsibility or negligence was committed by the officials of the opposite parties. The parties were intimated about the fire accident, and the opposite parties have taken steps to make good the same by volunteering to obtain certified copies of Title Deeds at the cost of the opposite parties and provided necessary certification from the Bank along with other necessary documents, as regards to destruction of original Title Deeds in fire. It is the settled position of law that if the loss of original Title Deeds is made out clearly, certified copies of lost Title Deeds would be the best evidence to support the title over the property and would be treated as primary evidence whosoever it may be concerned. The petitioner is not entitled to get any compensation from this respondent. There is no negligence, latches, or deficiency of service on the part of the opposite parties, the fire accident that occurred is beyond the control of the Bank, and the Bank has handed over all the documents, including the certified copies of Title Deeds lost, there is no loss caused to the complainant. Hence, opposite parties are not liable to compensate the complainant in terms of money. The opposite parties provided maximum service to the complainant. As there is no deficiency of service or negligence or wilful or illegal act on the parties, the reliefs claimed are not maintainable and not allowable.

The first complainant filed proof affidavit in lieu of chief examination and marked Exhibit A1 to A13. Lakshmi S Kumar, who is the Branch Manager of the first opposite party, filed proof affidavit in lieu of chief examination and marked Exhibit B1 to B8 from the side of the opposite parties.

We would like to consider the following points in evaluating the complaint, version, and the evidence on record.

1. Whether the complaint is maintainable before this commission?
2. Whether the complainant had succeeded to prove deficiency in service or unfair trade practice on the part of the opposite parties? 
3. If so, what are the reliefs and costs?

Point Nos. 1 to 3

There is no dispute on the fact that the complainants availed a loan for an amount of ₹ 24,00,000/- (Rupees twenty four lakh only) from the first opposite party through the second opposite party in the year 2016 by way of mortgage of depositing original Settlement Deed, belongs to the first complainant vide deed number 2017/1/ 2015 in respect of the property having an extent of 6 Ares. It is also admitted that the complainant repaid the entire loan amount, which was closed on 14.10.2020. The opposite parties contended that the complaint was not maintainable before this commission, stating that the complaint was barred by limitation and that this commission had no jurisdiction to entertain this complaint. According to the opposite parties, all the transactions of the subject matter were taken at the Tirur Branch, which is within Malappuram District, and the complainants reside at Veliyanadu village, which is within Alappuzha District.

Jurisdiction of the district commission is defined under Section 34 of the Consumer Protection Act 2019. As per section 34 (2), a complaint shall be instituted in a District Commission within the local limits of whose jurisdiction the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, ordinarily resides or carries on business or has a branch office or personally works for gain.

Here, in the case on hand, the opposite parties are the branches of IDBI Bank Limited, which has branches in Tirur and Changanassery. Therefore, we are of the opinion that this commission has amble jurisdiction and territorial jurisdiction to entertain this complaint. With regard to the contention regarding the limitation, this commission vide order dated 05.10.2023 in IA No. 207 of 2023 condoned the delay of 250 days caused in filing this complaint. Therefore, we are of the opinion that the complaint is maintainable before this commission and that point number one is answered accordingly.

The complainant's specific case is that despite closing the loan, the opposite parties did not return the original Title Deed, which was pledged to the first opposite party. The opposite party vide Exhibit A2 notice informed the complainants that the original Title Deeds and other supporting original documents, which were forwarded to their office in Mumbai for storage with their custodian, i.e., the Stockholding Corporation of India Limited, have been partially damaged or destroyed in a fire accident took place on 11.12.2017. In Exhibit A2, the opposite parties informed the complainant that if the complainant wishes to obtain certified copies of the deeds, they would assist in obtaining them from the concerned Sub-registrar. In reply, the complainant issued Exhibit A3 notice to the opposite parties demanding to take steps to get the original Title Deed. The first opposite party informed the complainant through Exhibit A4 notice dated 28.02.2022 that they obtained the certified copies of the original Title Deeds.

After that, the complainants approached the Banking Ombudsman and filed an Exhibit A5 complaint to redress their grievance. The Banking Ombudsman closed their complaint stating that the first opposite party obtains the certified copies of the original Title Deeds. The complainants preferred an appeal vide Exhibit A6 complaint, and the same was closed by the Banking Ombudsman for the reason that the order in Exhibit A5 complaint is non-appealable and cannot be reopened under clause 14(9) (a)(b) of facilitation of RB-IOS 2021. Aggrieved by the order of the Banking Ombudsman, the complainants filed Exhibit A7 appeal to the Deputy Governor,  Reserve Bank of India, and the same was closed, stating that the Bank has credited the compensation of ₹ 70,000/- (Rupees seventy thousand only) to the account of the complainants and the action taken on the complaint after RBIO admitted the complaint. After that, the complainants approached the Honourable High Court of Kerala, and vide Exhibit A11 order, the Honourable High Court of Kerala directed the complainants to approach the Civil Court or the Consumer Forum to redress their grievance.

According to the opposite parties, they have complied with the order of the Banking Ombudsman and the Reserve Bank of India and paid                                ₹ 70,000(Rupees seventy thousand only)  to the complainants as compensation. The contention of the opposite parties is that the original Title Deeds of the complainant were destroyed due to the fire in the storage place of Stockholding Corporation of India Limited in Mumbai. To prove this, the opposite parties produced B-1 and B2 documents. It is pertinent to note that in all the litigations preferred by the complainants before the Banking ombudsman and the Reserve Bank of India, the opposite parties put forward these contentions, and the authorities passed their orders accepting this contention of the opposite parties. However, during the trial, i.e., at the time of the evidence of the opposite parties, the opposite parties produced Exhibit B-6 to B8 documents. These are the original Title Deeds that the complainants mortgaged when availing of loan from the first opposite party and are claimed to be destroyed in fire by the opposite parties as contented in the version.

The production of the original Title Deeds at the fag end of the trial before this commission proves the negligent manner in which the opposite parties responded to the request of the complainant to return the original Title Deeds. It is evident that except for taking the utmost effort to trace out the original Title Deeds of the complainants, the opposite parties is blatantly contended before the lawful authorities that the original Title Deeds were partially damaged or destroyed due to the fire accident. No doubt, the opposite parties are bound to return the original Title Deeds after closing the loan. The opposite parties have no right to retain the original Title Deeds mortgaged with them to avail of the loan after the closure of the same.

Section 2 (11) of the Consumer Protection Act 2019 defines Deficiency of Service as "any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service and includes (a) any act of negligence or omission or commission by such person to the consumer and (b) deliberate withholding of relevant information by such person to the consumer."

As discussed above, the opposite parties were negligent in tracing out the original Title Deeds of the complainants. On a close evaluation of the evidence, we can see that the negligence on the part of the opposite parties to trace out the original Title Deeds of the complainants led the complainants to approach various forums, including the Honourable High Court of Kerala. No doubt, due to the negligent act of the opposite parties, the complainants have suffered much mental agony and financial loss. They had to run from pillar to post to get back the original Title Deeds from the opposite parties due to the negligence and omissions of the opposite parties as a service provider.

Considering the fact that the opposite parties had paid ₹ 70,000/- (Rupees seventy thousand only)  as compensation to the complainant in compliance with the order of the Reserve Bank of India and the circumstances of the case, we are of the opinion that allowing compensation of ₹ 50,000/- (Rupees fifty thousand only) will meet the ends of justice. Therefore, we allow this complaint in part and pass the following order:

We hereby direct the first opposite party to pay ₹ 50,000/- (Rupees fifty thousand only) as compensation to the complainant for the deficiency in service on the part of the first opposite party.

We hereby direct the first opposite party to issue a loan closure certificate to the complainant within 30 days from the date of receipt of the copy of this order.

It is further made clear that the complainants are at liberty to obtain the original Title Deeds .i.e., Exhibits B6 to B8, from this commission on filing a proper application for the same.

Order shall be complied with in 30 days from the date of receipt of copy of this order. If not complied as directed, award amount shall carry 9 % interest from the date of order till realisation.

 Pronounced in the Open Commission on this the 28^th day of June, 2024

    Sri. Manulal V.S, President   Sd/-

   Sri.K.M.Anto, Member          Sd/-                                                       

APPENDIX :

Exhibits from the side of the Complainant :

A1     -        Copy of the letter dated 08.02.2021

A2     -        Reply letter from the IDBI Bank dated 09.07.2023

A3     -        Letter of notice dated 20.07.2021

A4     -        Reply letter dated 28.02.2022

A5     -        Complaint before the Banking Ombudsman.

A5(a) -        Postal receipt dated 05.02.2022

A6     -         Second complaint before the Banking Ombudsman, dated   

         05.03.2022

A6(a) -        Postal receipt dated 07.03.2022.

A7     -        Copy of the appeal to the Hon’ble Deputy Governor, RBI, dated  

                   26.03.2022

A8     -        Original document of order dated 21.03.2022 from RBI.

A9     -        E-mail message from RBI, dated 20.04.2022

A10   -        Copy of the petition filed as WP(C) No. 30647 of 2022

A11   -        Copy of the judgment dated 10.10.2022

A12   -        Copy of the closed loan account list

A13   -        Order dated 21.06.2023

Exhibits from the side of the Opposite Parties :

B1     -        General diary details

B2     -        General diary details (Translated from Marathi)

B3     -        Letter from IDBI Bank dated 09.07.2021

B4     -        Letter from IDBI Bank dated 28.02.2022

B5     -        Copy of the letter issued by the SHCIL House, Mahape

B6     -        Deed dated 29.10.2015

B7     -        Deed dated 04.09.1995

B8     -        Deed dated 04.02.1986

By Order,

                                                                                         Assistant Registrar