IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM

Dated, the 30^th day of October, 2024

Present: Sri. Manulal V.S. President

  Smt. Bindhu R.  Member

Sri.K.M.Anto, Member

C C No. 109/2022 (Filed on 21.05.2022)

O R D E R

Sri. Manulal V.S. (President)

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

Brief of the complaint is as follows:

Mr Rajendran, who is the husband of the first complainant and the father of other complainants, had availed a home loan of ₹ 1,00,000 (Rupees one lakh only) from the opposite parties on 01.10.2013. At the time of executing the loan agreement, the opposite party stipulated that the original sale deed bearing No. 1147/1999 of the  SRO Thengana of the immovable property of the borrower was to be entrusted to the opposite party. At the time of executing the loan agreement, the opposite party also stipulated the condition that the entire loan amount was insured to the borrower for which the borrower has paid insurance premium amounts to the opposite party and the opposite party on their own choice, insured the loan amount. The husband of the first complaint repaid the loan amount promptly to the opposite party up to 31.08.2020. The husband of the first complainant died on 31.08.2020. After the death of Rajendran, the complainant approached the opposite party, even though there was adequate insurance coverage for the loan, they demanded more than ₹ 30,000/- (Rupees thirty thousand only) due to the opposite party. After that, when the first complainant approached the second opposite party to get back the original title deed, they demanded ₹ 50,000/- (Rupees fifty thousand only) to close the loan transaction with the opposite parties. It is alleged in the complaint that the opposite parties illegally and arbitrarily demanded more amounts from the complainants to close the loan account.

According to the complainants, the act of the opposite parties amounts to unfair trade practices and deficiency in service by which the complainants are put to severe mental agony. Hence, this complaint is filed by the complainants praying for an order to direct the opposite parties to return the original sale deed 1147 of 1999 dated 19.05.1999 of the SRO Thegana and to pay ₹ 25,000/- (Rupees twenty five thousand only) as compensation along with ₹ 10,000/- (Rupees ten thousand only) as cost of this proceedings.

Upon notice from this Commission, opposite parties appeared before this Commission and filed a version contenting as follows:

Mr. Rajendran, the husband of the complainant and father of the other complainants, obtained a home loan from the opposite party by depositing sale deeds as security for a loan amount of ₹ 1,04,506/- (Rupees one lakh four thousand five hundred and six only) with an agreed EMI of ₹ 3,901/- (Rupees three thousand nine hundred and one only). At the time of the loan agreement, the opposite party did not stipulate that the loan be insured, requiring the complainant to pay insurance premiums, as the opposite party is not an insurance company.

Mr. Rajendran did not consistently repay the loan on time, and the loan was classified as a Non-Performing Asset (NPA) in April 2014. The loan tenure was from 05.02.2013 to 05.06.2023. Rajendran's last EMI payment was made in January 2018. He paid a total of ₹ 1,16,025/- (Rupees one lakh sixteen thousand and twenty five only) and received a death claim amount of          ₹ 55,089/- (Rupees fifty five thousand and eighty nine only) resulting in a combined amount of ₹ 1,17,114/- (Rupees one lakh seventeen thousand one hundred and fourteen only).

As Mr. Rajendran defaulted the loan, there are outstanding dues, which now come to a total of ₹ 77,883/- (Rupees seventy seven thousand eight hundred and eighty three only) including interest, in accordance with RBI guidelines. The insurance only covers future payments, not the earlier due amounts. Therefore, the complainants must settle Rajendran's outstanding dues before they can retrieve the documents, if any.

The opposite party has lawfully claimed the defaulted payments and accumulated interest and has not acted illegally or unfairly. They have the legal right to demand the arrears from Rajendran or his legal heirs and retain the sale deeds as collateral until the outstanding dues are cleared. There has been no deficiency in service or unfair trade practices on the part of the opposite party.

The first complainant filed proof affidavit in lieu of chief examination and marked Exhibits A1 to A4 from the side of the complainants. Saranraj K.R., who is the Manager of the second opposite party, filed the proof affidavit in lieu of chief examination and marked Exhibits B1 and B2 from the side of the opposite parties.

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

1. Whether there is any deficiency in service or unfair trade practice on the part of the opposite party?
2. If so, what are the reliefs and costs?

For the sake of convenience we would like to consider the point Nos. 1 and 2 together.

The specific case of the complainants is that Rajendran, who is the husband of the first complainant and the father of the other complainants, availed a home loan from the opposite party on 01.10.2013 by depositing the original Sale Deed No.1147 of 1999 of the SRO Thengana. According to the complainants, at the time of availing the loan, the loan amount was insured, for which Rajendran had paid an insurance premium to the opposite party. The said Rajendran repaid the EMI of the loan promptly until his death on 31.08.2020. When the complainants approached the second opposite party to get back the original Title Deed, the second opposite party informed the complainant that, even though there was adequate insurance coverage, they demanded more than ₹ 50,000/- (Rupees fifty thousand only) which was said to be due to the opposite party.

Exhibit A1 is the Death Certificate of Rajendran, which is issued by the Registrar of Birth and Death of Arpookara Gramma Panchayath, proves that Rajendran died on 31.08.2020. The opposite party resisted the complaint, stating that Rajendran never repaid the loan promptly without any dues. It is contented by the opposite parties that the loan was declared as NPA in April 2014 as the tenure of the loan amount is 05.02.2013 to 05.06.2023.

However, on going through Exhibit B1, which is the statement of account of the loan, we cannot see that the opposite party declared the loan as  NPA  in the month of April 2014. They did not produce any evidence to substantiate their contention that the loan was declared as NPA in the month of April 2014. Exhibits B1 and B2 prove that ₹ 55,089/- (Rupees fifty five thousand and eighty nine only) was credited to the loan account of Rajendran, being the insurance amount. According to the opposite parties, as Rajendran was a defaulter in repaying the loan amount, as there was dues outstanding of an amount of          ₹ 77,883/-(Rupees seventy seven thousand eight hundred and eighty three only).

However, on going through the Exhibit B1 statement of account, we can see that Rajendran has repaid an amount of         ₹ 1,13,875/- (Rupees one lakh thirteen thousand eight hundred seventy five only) till 31.01.2018. Admittedly, the opposite parties received an amount of ₹ 55,089/- (Rupees fifty five thousand and eighty nine only) from the insurance company to the loan account. Therefore, the opposite party received ₹ 1,68,964/- (Rupees one lakh sixty eight thousand nine hundred and sixty four only) against the sanctioned loan amount of ₹ 1,04,506/- (Rupees one lakh four thousand five hundred and six only).

Moreover, on going through the first and second pages of the B1 statement of account, which is the MRHFL copy and the customer copy, it is stated that the status of the loan is' closed.' Therefore, we can presume that after receiving the insurance amount the opposite parties closed the load account of Rajendran. Therefore, we are of the opinion that the contention of the opposite parties that there was a due of ₹ 77,883/- (Rupees seventy seven thousand eight hundred and eighty three only) to the loan account of  Rajendran is not sustainable. Moreover, they did not adduce any evidence to show that they have taken any steps to recover the alleged dues from the collateral security offered to the opposite parties when availing the loan amount.

Admittedly, Rajendran availed a home loan from the opposite parties by depositing the Title deed of the property, which is comprised in resurvey number 312/2 of Madappally Village. After recording the loan status as 'closed' in Exhibit B1 statement of loan account, the opposite parties have no right to retain the title deed, which is deposited with the opposite party as collateral security for the loan. The complainants, being the legal heirs of the late Rajendran, are entitled to get back the title deed, which Rajendran deposited as collateral security, and the opposite parties are legally bound to return the same to the complainants. By illegally retaining the title deeds after recovering the entire loan amount, the opposite parties have committed deficiency in service. Due to the act of deficiency in service, the complainants, the legal heirs of Rajendran, have suffered much hardship and mental agony for which the opposite parties are liable to compensate. Considering the nature and circumstances of the case and keeping it in mind, the salutary principles of the Consumer Protection Act 2019, we are of the opinion that the complainant has succeeded in proving their case.

As the result, we allow this complaint and pass the following order:-

1. We hereby direct the opposite parties to return the original Sale Deed No. 1147 of 1999 of SRO Thengana to the complainants within 30 days from the date of receipt of the copy of this order.
2. We hereby direct the opposite parties to pay ₹ 25,000/- (Rupees twenty five thousand only) as compensation to the complainants for the deficiency in service on their part.
3. We hereby direct the opposite parties to pay ₹ 5,000/- (Rupees five thousand only) to the complainants as the cost of this litigation.

The order shall be complied within 30 days from the date of receipt of the copy of this order, failing which the awarded amount shall carry interest @ 9% from the date of this order till realization.

Pronounced in the Open Commission on this the 30^th day of October, 2024

Sri. Manulal V.S, President  Sd/-

    Smt. Bindhu R.  Member    Sd/-

Sri. K.M. Anto, Member      Sd/-

APPENDIX :

Exhibits from the side of the Complainant :

A1    -       Copy of death certificate of Rajendran S.

A2    -       Copy of Sale Deed No.1147 of 1999 of the SRO

                Thengana

A3    -       Copy of complaint submitted before District Police    

                Superintendent, Kottayam.

A4    -       Copy of tax receipt dated 01.10.2020

Exhibits from the side of the Opposite Parties :  

B1    -       Copy of account statement for the period of 01.12.2010

                to 23.12.2022

B2    -       Copy of short claim amount details

By Order,

sd/-

                                                                                                Assistant Registrar