IN THE DISTRICT CONSUMERS’ DISPUTES REDRESSAL FORUM AT MYSORE<br /> <br /> PRESENT: 1. Shri.D.Krishnappa<br /> B.A., L.L.B - President <br /> <br /> <br /> 2. Smt.Y.V.Uma Shenoi<br /> M.Sc., B.Ed., - Member<br /> <br /> 3. Shri. Shivakumar.J.<br /> B.A., L.L.B., - Member<br /> <br /> CC 8/09 DATED 16.04.2009<br /> <br /> ORDER<br /> <br /> Complainant Smt.Sunandamma, <br /> W/o Mahesh, R/at Habbanakuppe Village, Hunsur Taluk, Mysore District.<br /> (By Sri.S.Ravikumar., Advocate)<br /> <br /> Vs. <br /> Opposite Parties 1. The Branch Manger, Karnataka Bank Ltd., Chikunda, Hunsur Taluk, Mysroe District.<br /> (By A.V.Jayarama Rao, Advocate)<br /> 2. Smt.Sharadamma, W/o Late Subbe Gowda, R/at Habbanakuppe Village, Hunsur Taluk, Mysore District. <br /> (DELETED)<br /> <br /> Nature of complaint : Deficiency in service<br /> Date of filing of complaint : 06.01.2009<br /> Date of appearance of O.P. : 05.03.2009<br /> Date of order : 16.04.2009<br /> Duration of Proceeding : 1 MONTH 11 DAYS<br /> <br /> <br /> PRESIDENT <br /> <br /> <br /> <br /> MEMBER<br /> <br /> <br /> MEMBER<br /> <br /> <br /> Sri.D.Krishnappa,<br /> President<br /> <br /> 1. The grievance of the complainant in brief against the opposite parties is, that the second opposite party approached the first opposite party and availed loan of Rs.25,000/- from them. That she prior to 07.07.2008 came to know the first opposite party has taken a sum of Rs.36,639/- from her S.B. account and closed the loan account of the second opposite party. That the first opposite party without her consent has taken the amount from her S.B. account towards the loan account of the second opposite party. The first opposite party has not taken any action against the second opposite party for recovery of the loan amount legally. That the claim of the first opposite party against the second opposite party is barred by limitation. That she is only a co-obligant to the borrower the second opposite party. That the first opposite party is wrong in adjusting her amount without consent against the borrower second opposite party, therefore contending that the first opposite party has misusing the powers has taken Rs.36,639/- from her account and therefore she got issued a legal notice, which was of no use and therefore has prayed for a direction to the first opposite party to refund Rs.36,639/- and to award compensation of Rs.4,50,000/-.<br /> <br /> 2. This Forum considering the grievance of the complainant ordered issue of notice to the first opposite party who has appeared through his advocate and filed version, contending that this complainant, second opposite party and one H.S.Nagesh had applied for sanction of Rs.25,000/- and the same was sanctioned on 17.06.2004, for which this complainant and one H.S.Nagesh were the co-obligants to the second opposite party who have executed an ondimand promissory note jointly. The complainant has authorized then to debit installments / interest from of her accounts maintained with them at its absolute discretion without any further reference or concurrence from the complainant. The complainant, second opposite party and H.S.Nagesh have committed default in repaying the loan amount. As the payments are not made, they have without alternative exercised their right of general lien and also the authority given to them in the take delivery letter dated 17.06.2004 and debited amount from the S.B. account of the complainant without further reference to her and closed loan account. The first opposite party further contended Rs.36,639/- was debited to the account of the complainant, as it was the outstanding balance. Therefore, the complainant’s contention that they ought to have proceeded against the second opposite party for recovery of the loan cannot be heard and therefore contending to have not committed any deficiency in their service have prayed for dismissal of the complaint.<br /> <br /> 3. In the course of enquiry into the complaint, the complainant and the first opposite party have filed their affidavit evidence reproducing what they have stated in their respective complaint and version. The complainant has produced a copy of the letter of the first opposite party, copy of the legal notice she got issued to the first opposite party. The first opposite party has produced copy of the take delivery note and the copy of the joint promote executed by the complainant, second opposite party and one H.S.Nagesh and an account extract of the complainant account. Heard the counsel for both the parties and perused the records.<br /> <br /> 4. On the above contentions, following points for determination arise.<br /> 1. Whether the complainant proves that the first opposite party has caused deficiency in his service in debiting a sum of Rs.36,639/- from her account, though the claim for recovery of loan was barred by limitation?<br /> 2. To what relief the complainant is entitled.<br /> <br /> 5. Our findings are as under:-<br /> Point no.1 : In the Negative.<br /> Point no.2 : See the final order.<br /> REASONS<br /> <br /> 6. Point no. 1 :- As could be perused from the pleadings of the parties and the copies of documents produced by the complainant, the complainant, second opposite party and one H.S.Nagesh found to had borrowed a sum of Rs.15,000/- on 17.06.2004 and Rs.10,000/- on 21.06.2004 from the first opposite party and executed joint promissory note in favour of the first opposite party with consideration receipt, though the principal barrower is the second opposite party. The first opposite party has also produced take delivery note executed by the complainant and the other two and an account extract of the complainant maintained with the first opposite party. On perusal of the contents of the account extract and as contended by the counsel for the complainant it lo0oks that the first opposite party had not initiated any action for recovery of the loan amount from any of these borrowers, but debited Rs.36,639/- from the credit of this complainant towards the loan account on 26.02.2008. Apparently, as on the date of this debiting, the claim of the first opposite party found to had been barred by limitation and that could not have been pursued for recovery by initiating any proceeding in a court of law.<br /> <br /> 7. The learned counsel appearing for the complainant taking clue from these facts argued that the first opposite party has not initiated any legal proceeding for recovery of the loan against the borrower, therefore the claim of the first opposite party had become barred by limitation and therefore once that claim of the first opposite party is barred by limitation he could not have debited to the account of the complainant and adjusted the amount found in the credit in the complainant and thereby has sought for the relief as prayed for and he in support of his arguments relied upon a decision of the Hon’’ble High Court reported in 2008 (4) Karnataka Law Journal page 56. In this decision, the Hon’ble Supreme Court while deciding a case arising out of Karnataka State Financial Corporation Act has held that the Corporation could not have proceeded against the surety without taking any recourse to the court of law that means to say the Corporation has been held to have proceeded against the surety directly without an order of any court which has been held as not legal. Whereas the counsel for the first opposite party argued that though the first opposite party cannot have any remedy of initiating legal proceeding for recovery of the amount, but still the first opposite party can exercise his general lien to adjust or appropriate the funds of the surety or co-obligant towards the dischargal of the loan and in this regard relied upon two decisions reported in AIR 1992 Supreme Court page 1815 and another decision of Hon’ble High Court of Karnataka reported in ILR 2001 Karnataka page 5015. In these decisions, the Hon’ble Supreme Court and Hon’ble High Court of Karnataka have categorically held though the remedy to recover the debt from the principal debtor is barred by limitation, the liability still subsists and the bank is entitled to appropriate the debt due, from the amounts belonging to either principal debtor or surety, which are in its possession. As could be noticed from the take delivery letter, which has also been executed by the complainant, which reads as under:-<br /> “The bank shall have the right but not obliged to debit installments / interest to any of my / our accounts with the bank at its absolute discretion without any further reference to or concurrence from me / us.”<br /> The first opposite party exercising his right under the terms of this take delivery letter has appropriated Rs.36,639/- from the account of the complainant towards the loan amount and discharged the loan which in our view in accordance with the contract and therefore cannot be held as deficiency. Thus, we find no merits in the complainant and therefore answer point no.1 in the negative and pass the following order:- <br /> <br /> ORDER<br /> <br /> 1. The Complaint is dismissed.<br /> 2. Parties to bear their own costs.<br /> 3. Give a copy of this order to each party according to Rules.<br /> <br /> (Dictated to the Stenographer, transcribed by her, transcript revised by us and then pronounced in the open Forum on this the day 16th April 2009)<br /> <br /> <br /> <br /> <br /> <br /> (D.Krishnappa) <br /> President <br /> <br /> <br /> <br /> (Y.V.Uma Shenoi)<br /> Member<br /> <br /> <br /> <br /> (Shivakumar.J.)<br /> Member<br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />