Kerala

Wayanad

CC/2/2021

Alikutty (Late), Rep by Nabeesa Alikutty, Manalpally House, Mandad (PO), Kuttamangalam - Complainant(s)

Versus

Kalpetta Housing Sahakarana Sangham, Liquidator, Cliptham No:D2310, Assistant Registrar (General) Of - Opp.Party(s)

29 Aug 2024

ORDER

CONSUMER DISPUTES REDRESSAL COMMISSION
CIVIL STATION ,KALPETTA
WAYANAD-673122
PHONE 04936-202755
 
Complaint Case No. CC/2/2021
( Date of Filing : 05 Jan 2021 )
 
1. Alikutty (Late), Rep by Nabeesa Alikutty, Manalpally House, Mandad (PO), Kuttamangalam
Kuttamangalam
Wayanad
Kerala
...........Complainant(s)
Versus
1. Kalpetta Housing Sahakarana Sangham, Liquidator, Cliptham No:D2310, Assistant Registrar (General) Office, Vythiri, Kalpetta (PO)
Vythiri
Wayanad
Kerala
2. The Managing Director, Kerala State Co-Operative Housing Federation, cliptham No:4330, P.B No:1896, Kaloor, Kochi-682017
Kaloor
Ernakulam
Kerala
............Opp.Party(s)
 
BEFORE: 
 HON'BLE MRS. Bindu R PRESIDENT
 HON'BLE MRS. Beena M MEMBER
 HON'BLE MR. A.S Subhagan MEMBER
 
PRESENT:
 
Dated : 29 Aug 2024
Final Order / Judgement

By Smt. Beena. M, Member:-

            This is a complaint filed under section 35 of the Consumer Protection Act 2019.

2.  Facts of the case in brief:  The Complainant’s husband, Alikutty, had taken a loan of Rs. 60,000/- from the 1st Opposite Party on 20.10.1992 by mortgaging the Title Deed of his house property.  While regularly paying the principal and interest, the society shifted their office from there and the location of the branch was not known and the payment was delayed.  At that time, the Complainant’s husband was diagnosed with cancer and fractured leg bone in a car accident and died on 19.07.2010.  After that, the Complainant came to know the information about the Society on enquiry.  On learning that large amount of principal, interest & penalty interest is due, the Complainant made a complaint before the Chief Minister and afterwards, the Complainant approached the 1st Opposite Party with the reply from the Chief Minister.  Then, loan was settled by paying Rs. 73,852/-through the Liquidator on 25.06.2020.    The Complainant after closing the loan demanded the Title Deed pledged by the husband of the Complainant.   Later, the 2nd Opposite Party by letter informed the Complainant that they could not give back the Title Deed.  The act of the Opposite Parties is clear deficiency in service on their part.  Hence, this complaint.  

3. On receipt of complaint, notices were issued to the Opposite Parties and the 1st and 2nd Opposite Parties appeared and filed version. 

4. The 1st Opposite Party submitted that Kalpetta Housing Co- Operative Society Ltd, No. D2310 was registered on 11.04.1979 and started functioning on 19.04.1979 and working under the control of Co-Operative Department.  As the Society could not be survived, as per Order No. A.E.L/25/2017 dated 27.09.2017 of the Joint Registrar of Wayanad District Co-Operative Society, Kalpetta unit inspector of Vythiri Assistant Registrar (General) Office was appointed as liquidator for winding up  work of the Society.  Based on the above order, steps are being taken to collect the assets and liquidate the liabilities of the Society to complete the winding up proceedings.  The husband of the Complainant, Alikutty, member No. 399, had taken a loan of Rs. 60,000/- from the Society on 20.10.1992 by mortgaging the house property bearing Survey No. 857/1 309/92/4.2.92.  The liquidator issued notice on 27.02.2020 to close the  loan account stated that as on 31.01.2020 Rs.36,610/- as principal, Rs.67,934/-as interest, Rs.507/- as other expenses and total Rs. 1,05,051/- was remained to be repaid.  The loan account of the Alikutty had closed on 25.06.2020 by paying only Rs. 73,852/- after giving concessions on interest and penal interest.  The 1st Opposite Party further submitted that the Title Deed of the Complainant is in the possession of the 2nd Opposite Party.  The 1st Opposite Party informed to the Managing Director of the 2nd Opposite Party that the loan taken by the Complainant’s husband has been terminated and Title Deed is repayable.  Assets accumulated as part of the liquidation proceedings are to be deposited in the liquidator’s account.  Under Rule 61 (2) of the Kerala Co-Operative Societies Act, 1969, priority is given to the payment of dues by the government out of the amount so collected. Rs. 6,05,000/- and interest is currently payable to the government, the accumulated assets are insufficient to meet the government’s liability. The land of 0.0202 hector bearing document No. 1640/97 under survey number 80/P.T is in the name of the Society comprised in Kalpetta Municipality.  The Deeds and related documents of land near old bus stand in Kalpetta Town was given as security for taking loan from 2nd Opposite Party.  To complete the liquidation proceedings, the liquidator appointed under section 72 of the Kerala Co-Operative Act, 1969, using the powers under section 73, has issued a legal letter to the 2nd Opposite Party to return the Deeds of the members and the deeds of the Society to be vested in the liquidator, but the same has not been returned till date.  The 2nd Opposite Party reserves the liability to return the same.  The Complainant has no right to demand the relief from the 1st Opposite Party as the 2nd Opposite Party is possessing the Title Deeds. It has to demand the relief from the 2nd Opposite Party and it is only the 2nd Opposite Party has to compensate the Complainant.  Since the Complainant’s loan account is closed, the 2nd Opposite Party is liable to return the Deeds to the Complainant. Hence, the 1st Opposite Party prays to give direction to 2nd Opposite Party to release the Title Deed of the Complainant.

5. The 2ndOpposite Party in their version stating that State Co-Operative Housing Federation is the Apex Co- Operative Institution covering the entire State of Kerala. Primary Housing Co-Operative Societies affiliated to the Housing Federation are the members of the 2nd Opposite Party.  There are 205 Primary Housing Societies including 1st Opposite Party.  The Housing federation grants loans to Housing Co-Operative Societies in accordance with the bye-laws and loan conditions approved by the Registrar of the Co-Operative Societies.  The Housing Federation provides loans on the basis of the security given by the borrower to the society, including the property pledged by each borrower for the loan and the house being built on it.  The concerned Societies gives security to the Federation by way of Assignment Deed by paying first charge to the Federation on collateral security on the land and building thereon.  The Housing Federation borrowed the loan amount from the financial institutions on the basis of the floating charge of the security obtained from the society.  The 2nd Opposite Party keeps the Title Deed until the total amount of the loan plus interest and penalty is paid by the Societies. These documents are also subject to scrutiny by the finance agencies of the Federation. The Federation does not lend loan directly to individuals.  According to the loan terms of the Federation, the loan application and related documents of the individuals submitted by the Society are accepted and the loan amount given to the respective borrowers.   Thus, the repayment of the loan shall be made after deducting a margin of 1% allowed to the Society and the remaining amount shall be repaid to the respective loan account of the Federation. Due to non-repayment of the amount by the Society to the Federation, there is arears due to the Federation.  The Society is now in liquidation.  The 2nd Opposite Party further stated that in Alavikutty’s loan, as on 11.01.2024, as per OTS, Rs. 43,125/- as principal and Rs. 1,03,035/-as interest, total outstanding repayment to the Federation is Rs. 1,46,160/-.  The 2nd Opposite Party cannot release the Title Deed of the Complainant without receiving the amount due to them.  If the Title Deed is handed over in violation of the bye-law and loan terms of the Federation, the Federation will incur huge losses and face legal action from the financial institutions of the Federation.  On 27.11.2021, the Federation itself has directed the Society Liquidator to close the loan account as soon as possible and buy back the Deeds by availing the concessions under the one-time settlement scheme implemented by the Federation till 31.12.2021. The amount of  Rs. 73,852/- claimed to have been repaid by the borrower have not been credited to the account of the Complainant till date by the liquidator.  It is the responsibility of the liquidator to retrieve the document and make it available to the borrower once the payment has been made to close the loan.  Therefore, there is no deficiency in service on the part of the Federation in not returning the Title Deed of the Complainant.  So, the 2nd Opposite Party prays to remove them from the complaint.

6. The Complainant filed proof affidavit and was examined as PW1 and the document produced were marked as Ext. A1 to A4.  The son of the Complainant was examined as PW2.  The 1st Opposite Party was examined as OPW1 on 16.12.2023, at that time no documents marked, thereafter, on 09.01.2023, OPW1 further examined and the document produced were marked as Ext B1 to B5.  At the time of marking, Ext B4 was objected from marking, and so the document marked as subject to proof.  The 2nd Opposite Party filed proof affidavit and was examined as OPW2 and documents produced were marked as Ext. B6 and B7.  Ext. B7 was marked with objection.

7. On perusal of the complaint, version and documents, Commission raised the following points for consideration.

  1. Whether there is any deficiency in service on the part of the Opposite Party?
  2. Relief and cost?

  8.  The Complainant’s case is that after closing the housing loan taken from the 1st Opposite Party, the Title Deed pledged before 1st Opposite Party was not returned to her.  The 1st Opposite Party contended that they have sent notice to the 2nd Opposite Party to return the Title Deed and the 2nd Opposite Party has the liability to return the document.  According to the 2nd Opposite Party, they provided the loan to the societies on the basis of the security given by the borrower to the Societies.  In every loan, the Society executed Assignment Deed by creating first charge over the land and building in favour of housing federation.  The Housing Federation keeps the Title Deed until the loan amount is fully repaid by the Society i.e., Opposite Party No.1.  According to the 2nd Opposite Party, the 1st Opposite Party committed default in remitting the loan amount to the 2nd Opposite Party.  Ext. A1 is the original loan pass book wherein it is recorded that the loan is closed on 25.06.2024, and  there is also no dispute that the Complainant had remitted the settled amount of loan to the 1st Opposite Party.   It is admitted by both Opposite Parties that the 1st Opposite Party is to disburse housing loan to its members by refinance from the 2nd Opposite Party and the 1st Opposite Party should remit the collected loan instalment to the 2nd Opposite Party without fail.  The said contention between the Opposite Parties shows that the 1st Opposite Party is duty bound to remit the entire loan amount to the 2nd Opposite Party. Here the 2nd Opposite Party admitted that the loan of the Complainant is closed.  As per the statement of the 1st Opposite Party they had not remitted the loan amount to the 2nd Opposite Party. Therefore, as the 2nd Opposite Party did not release the Title Deed of the Complainant and hence the Society was unable to give back the documents to the Complainant. Here it is true that, on the basis of the agreement between the 1st and 2nd Opposite Party, the 1st Opposite Party should remit the entire loan amount of the Complainant towards 2nd Opposite Party.  According to the 2nd Opposite Party, without getting the said amount they could not release the title deed in favour of the Complainant.  But here the Complainant has not borrowed any amount from 2nd Opposite Party nor owes any amount to the 2nd Opposite Party  or to the 1st Opposite Party.  The 2nd Opposite Party has no right to withhold the Title Deed of the property of the Complainant.  For the defects occurred in the transaction between the 1st and 2nd Opposite Parties, it is not fair to punish the Complainant. If there is any default in repayment from the side of the 1st Opposite Party, the 2nd Opposite Party can start recovery proceedings against 1st Opposite Party. As per Ext A1, it is clearly endorsed that the loan is closed. Therefore, by analysing the entire evidence and documents, we are of the view that there is deficiency in service on the part of 1st and 2nd Opposite Parties in not returning the Title Deed to the Complainant even after closing the loan.  Commission find that the Complainant is entitled to get back the Title Deed from the Opposite Parties and the Complainant is also entitled to get the cost and compensation.

In the result, The Complaint is partly allowed and the 2nd  Opposite Party  is directed to return the Title Deed of house property pledged by the husband of the Complainant.  The 1st and 2nd  Opposite Parties are also directed to pay jointly and severally a compensation of Rs.15,000/- (Rupees Fifteen Thousand only) and to pay Rs.10,000/- (Rupees Ten Thousand only) as cost of the proceedings to the Complainant. 

The above order shall comply within 30 days from the date of receipt of this order, failing which the amount shall carry 9% interest p.a. from the date of this order till the date of its payment. 

Dictated to the Confidential Assistant, transcribed by him and corrected by me and pronounced in the Open Commission on this the  29th    day of August 2024.

Date of filing:07.12.2020

                                                                             PRESIDENT:  Sd/-       

                                                                               MEMBER   :   Sd/-

                                                                             MEMBER    :  Sd/-

APPENDIX.

 

Witness for the Complainant:

 

PW1.           Nabeeza.                         Complainant.

PW2.          Riyas Manalpalli.            Driver.          

         

Witness for the Opposite Parties:

 

OPW1.        Jasheer. V.P.                             Government  Servant.

OPW2.        Valsaraj. P.V.                  Joint Registrar/Managing Director.

                  

Exhibits for the Complainant:

 

A1.        Loan Pass Book.

A2.        Receipt.

A3.        Receipt.                                  dt:25.06.2020.

A4.        Copy of  Proceedings .                     dt:28.12.2019.

                    

Exhibits for the Opposite Parties:

B1.      Copy of  the Order of  Joint Registrar (General). dt:27.09.2017.

B2.      Copy of Letter.                                 dt:19.03.2019.

B3.      Copy of Letter.                                 dt:07.07.2020

B4.      Copy of Letter.                                 dt:27.11.2021.

B5.      Copy of Letter.                                 dt:10.11.2023.

B6.      Deed of Mortgage.                          

B7 (Objected).        Certificate.                    dt:11.01.2024.

 

                                                                                                PRESIDENT:  Sd/-

 

                                                                                                 MEMBER    :  Sd/-

 

                                                                                                  MEMBER    :  Sd/- 

 
 
[HON'BLE MRS. Bindu R]
PRESIDENT
 
 
[HON'BLE MRS. Beena M]
MEMBER
 
 
[HON'BLE MR. A.S Subhagan]
MEMBER
 

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