IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM
Dated this the 13th day of July, 2021
Present: Sri. Manulal V.S. President
Smt. Bindhu R, Member
Sri. K.M. Anto, Member
C C No. 198/2017 (filed on 24-08-2017)
Petitioner : Antony Chacko,
Ezhuthupallickal,
Perumpanachi Post,
Changanacherry – 686534.
Vs.
Opposite Parties : 1) The Deputy General Manager,
Indian Overseas Bank,
Central Office, Chennai.
2) Manager,
Indian Overseas Bank,
Changanacherry – 686101.
(Adv. Agi Joseph)
O R D E R
Smt. Bindhu R, Member
The complainant availed an education loan of Rs.2, 70,000/- from the 2nd opposite party and repaid in several monthly instalments. The same loan was settled by paying Rs.2, 00,000/- on 30.08.2011.The complainant had given an application to the District collector for granting subsidy for the education loans under the central Government scheme. Accordingly Rs.48090/- was credited to the complainant’s bank account with the opposite parties. As per the direction of the 2nd opposite party the complainant sent a registered letter to the 1st opposite party for the reimbursement of the said amount. But he had received a reply after one month informing that it was not possible to return the amount of Rs.48090/- This is a deficiency of service on the part of the opposite parties and to be compensated and hence this complaint.
Upon notice from this commission the opposite parties appeared and filed joint version through the Manager of the 2nd opposite party. The opposite parties’ contention is that the education loan interest subsidy scheme is not a bonanza to the loan applicant. This scheme was introduced by the then finance minister in 2014. As per the scheme the students availed loan prior to 1.4.09 and who paid the interest regularly, where in a disadvantageous position. Since interest component was either nil or negligible, they did not get any benefit of the interest subsidy. Similarly students who closed the education loan account before 31.12.2013were not also eligible to get interest subsidy. The complainant and his son availed the education loan on 11-8-2003.
One time settlement for NPA accounts is for a restructuring of the payment of loan due to their continuous default and in the event of no chance for an immediate recovery. The one time settlement will not absolve him from the entire liability. The only assurance is that the bank will not take any measure for the recovery of the remaining amount if the party making payment of the agreed amount. In this case there is a balance liability of Rs.76338/- on the last date of making payment under one time settlement. The interest subsidy is given by the government to the bank and not to the loan applicant. Hence the loan applicant is not entitled to get any amount as claimed by him. As per the notification of the
Reserve bank of India the payment of one time settlement is as follows:
“The amount of settlement arrived at in both the above cases, shall preferably be paid in one lump sum. In cases where the borrowers are unable to pay the entire amount in one lump sum, at least 25% of the amount of settlement shall be paid upfront and the balance amount of 75% should be recovered in instalments within a period of one year together with interest at the existing Prime Lending Rate from the date of settlement up to the date of final payment”
The complainant is liable to pay interest even after agreed date of one time settlement if the amount is outstanding. Hence the complainant is not entitled to get the subsidy for interest granted by the government. One time settlement is only a settlement of account and not a closing of loan account. The outstanding liability is still continuing in the loan account of the applicant. Even if the amount
is paid on one time settlement the credit of the loan applicant will continue as a defaulter. There is no cause of action for filing this petition.
The complainant adduced evidence as PW1 and through Exhibits A1 to A5.The opposite parties also filed proof affidavit along with Exhibits B1 and B2.
Considering the above facts and evidence we arrive at the opinion of framing
Issue no 1 whether a deficiency of service is on the part of the opposite parties is
established by the complainant?
Issue no 2: If so what are the reliefs the complainant is entitled for?
Issue Nos.1&2
The complainant has filed the complaint for compensation for the deficient act of the opposite parties by denying the amount obtained from the central government as subsidy to the education loan. Defending the allegation the opposite parties raised a contention that the complainant was not eligible for the subsidy and a onetime settlement means the outstanding balance amount is payable at any time to the bank and they are entitled to recover the subsidy amount.
Here we have gone through the documents produced by both the parties. The complainant had availed a loan amount of Rs.2,70,000/- towards the education purpose of his son. The complainant has deposed that he had applied for the grant of subsidy to the district collector and accordingly the subsidy was granted. On 19.10.12 the loan account was settled as per Exhibit A1 pass book. The complainant further deposed that though there is a condition stipulated by the central government not to accept any collateral security for educational loan, the opposite parties demanded to give collateral security and he deposited the deeds of 40 cents of land and a LIC policy of Rs. 2laks as collateral security. This allegation is not raised in the complaint. The complainant though deposed about the collateral security, no evidence has been adduced in this regard.
The complainant further argued that the opposite parties had settled the loan account of the complainant as One Time Settlement. At the time of settlement, as per Exhibit A5, the bank officials assured him that as of that date he had a due of Rs.7508 as per Exhibit A5. The complainant in his deposition has categorically stated that Exhibit A5 was issued by the 2nd opposite party. The opposite parties have not disputed Exhibit A5 and has not produced any valid evidence to disprove Exbit A5. The complainant has stated that the opposite parties had settled the loan and he had paid Rs.51,450/- on 5.10.12 as per exhibit A1 pass book and Exbt B2 loan account statement. According to Exhibit A1, the said account is shown as settled on 5.10.12 and in B1 it is shown as OTS A/c on 31.10.2012. Exbt A5 shows that the 2nd opposite party assured the complainant that the outstanding balance was only Rs.7508/- at the time of settlement of account as OTS. Thereafter on 7.8.2014 an amount of Rs.48171/- was credited in the account of the complainant as the government subsidy which was credited to the alleged loan amount dues by the opposite party 2. As the opposite party has already settled the account with an outstanding amount of 7508/- towards the whole settlement including the interest, they are not at liberty to adjust the subsidy amount against the outstanding. Though the opposite parties put a question in the cross examination regarding the authenticity of Exbt A5, they have not produced anything to disprove the same. The Onetime settlement was arrived after settling the interest also.
“CSIS subsidy is an education loan subsidy scheme for economically disadvantaged students to pursue technical/professional courses approved by NBA or Institutions of National Importance or Central Funded Technical Institutions in India only.” The subsidy is being given towards the settlement of interest. As the opposite parties had already availed the interest from the complainant as part of the settlement at the time of onetime settlement, and as there was an amount of only 7508/- as acknowledged, they are not entitled to receive the subsidy amount in total. The opposite parties are entitled only to realize Rs.7508/- from the complainant. Point no 1 and 2 are found accordingly.
In the light of above discussion we allow the complaint and the opposite parties are directed to pay the complainant an amount of Rs.40,663 /- with an interest at
the rate of 9% from 7.8.2014 till the date of realization.
Pronounced in the Open Commission on this the 13th day of July, 2021.
Smt. Bindhu R, Member Sd/-
Sri. Manulal V.S. President Sd/-
Sri. K.M. Anto, Member Sd/-
Appendix
Witness from the side of complainant
Pw1 – Antony Chacko.
Exhibits marked from the side of complainant
A1 : Copy of pass book issued by opposite party
A2 : Copy of letter issued by complainant to 2nd opposite party
A3 : Copy of letter issued by complainant to Public Information Officer
A4 : Copy of Appellate Order No.55/2016-17 dtd.15-06-2016
A5 : Copy of settlement of Rs.7,508/-
Exhibits marked from the side of opposite party
B1: Copy of notification of RBI dtd.03-06-2005
B2 : Copy of statement of account of petitioner
By Order
Senior Superintendent
