BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, IDUKKI

Dated this the 27th day of February, 2010

Present:

SRI.LAIJU RAMAKRISHNAN PRESIDENT

SMT.SHEELA JACOB MEMBER

SMT.BINDU SOMAN MEMBER

C.C No.152/2009

Between

Complainant : Abraham Chacko,

S/o Chacko,

Valummel House,

Kattappana South P.O.,

Kattappana Village,

Udumbanchola Taluk,

Idukki District.

(By Adv: C.K. Babu)

And

Opposite Party : Manager,

State Bank of India

Agricultural Development Branch Kattappana,

Kattappana P.O.,

Kattappan Village

Idukki District.

(By Adv: Joeph Kavumkal)

O R D E R

SRI. LAIJU RAMAKRISHNAN (PRESIDENT)

The complainant availed a Housing Term loan from the opposite party wide No.PHTL 29/99 on 2.3.1999 for an amount of Rs.3,00,000/- for a period of 12 years ending by 2011 under the security of 1.59 Acres of Agricultural land in Survey No.19/1 of Kattappana Village. The period of loan is 144 months. The EMI is Rs.4,600/-. On 30.6.2006 the opposite party issued a notice stating that the above loan is irregular and the debt is classified as NPA and hence the complainant was directed to settle the same within 60 days. The outstanding liability shown in the notice was Rs.3,79,800/- as on 30.6.2006. On 10.6.2008 a notice was affixed on the outer wall of the Car Porch of the complainant wherein it is mentioned that Bank has taken possession of the property. On 16.6.2008, 27.8.2008 and on 10.10.2008 the complainant had submitted applications before the opposite party requesting redressal of grievances against the illegal acts of the bank. On 31.10.2008 the opposite party had issued a notice claiming a total due of Rs.94,149/-. As per the notice Rs.25,000/- is charged under charges payable to enforcement agent. Scared of the proceedings the complainant remitted the entire dues on 24.11.2008 with protest. Opposite party has no manner of right to proceed against an agricultural property under SARFAESI Act. So collection of Rs.25,000/- as enforcement agent charges is an unfair trade practice and hence quite illegal. The opposite party has collected a total amount of Rs.6,23,149/- that is, Rs.3,23,149/- as interest and other charges. This is an exorbitant amount. Though the complainant demanded for a fair calculation of the accounts, the opposite party has not heeded so far. So the petition is filed against the opposite party to return the enforcement charges collected by the opposite party and to direct the opposite party to calculate interest account as per law, return the excess amounts collected by way of interest and the other charges.

2. The opposite party filed an objection stating that the matter is not maintainable under section 17, 34 and 35 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act. Amount availed under the housing term loan has to repay in 144 instalments of Rs.4,600/- each, starting from 30.7.2009 along with interest and other charges. If there is a default in payment of the instalments in time, the account will be classified as non performing asset and recovery steps will be initiated for the recovery of the entire amount outstanding at once. The above loan account was classified as NPA for the default in repayment of the instalments in time. As the account became irregular, the bank has paid charges to the enforcement agent which is to be realized from the complainant for which the bank has authority. Had the complainant remitted the amount in time as per the terms and conditions of the loan such charges could have been avoided. For the recovery of amount due, the bank had referred the account under Securitisation Act and to the recovery agent who is entitled for charges incurred and for the fees. The opposite party has every right to proceed against the property as per the provisions of the SARFAESI Act. It is a housing loan and not an agricultural loan. The property is a house site. His house, car shed etc. are situated at the said property. There is no question of any unfair trade practice as alleged. Correct statement of account was produced to the complainant. No excess amount or interest is collected as alleged . The title deeds will be realised only on remitting entire amount due from him in the loans secured on the said properties. The complainant had instituted CC 38/07 against the opposite party in respect of another two loans availed by him by stating that he has 4.68 hectors of property only and entitled for the benefit under the Agricultural Debt Waiver scheme. The said scheme is applicable only to those agriculturists who are having property below 5 acres of land. In his complaint in CC 38/07 he himself had admitted that he is having 11.56 acres of land. The opposite party preferred appeal against the order dated 28.10.2008 of this Forum before the Honourable State Commission. The complainant became provoked on preferring appeal on the ground of his admission in the complaint itself, among other grounds. Aggrieved with the preferring appeal against the order in CC.38/07 the complainant has preferred the above complaint as a counter blast, as a test to put the opposite party into loss and damages. So the petition may be dismissed.

3. The point for consideration is whether there was any deficiency in service on the part of the opposite parties, and if so, for what relief the complainant is entitled to?

4.The evidence consists of the oral testimony of PW1 and Ext. P1 to P9 marked on the side of the complainant and Ext.R1 to R3 marked on the side of the opposite parties.

5. POINT :- The complainant availed loan of Rs.3,00,000/- from the opposite party bank which has to be repaid in 144 equal monthly instalments of Rs.4,600/- each starting from 30.7.2009 along interest and other charges. The complainant did not pay the loan amount in time and recovery steps under Securitisation Act had taken by the bank against the complainant. This is housing loan and not an agricultural loan.

The complainant availed a housing term loan of Rs.3,00,000/- from the opposite party bank by giving1.59 acres of agricultural land as security for the loan. When the loan became due the opposite party instituted proceeding as per SARFAESI Act against the complainant. The complainant paid the entire loan amount, but is not entitled to pay the enforcement charges of the

Securitisation Act. The complainant was examined as PW1. The property of the complainant was taken possession by the opposite party through a notice dated 10.6.2008. It is marked as Ext. P2. The loan was given for security of agricultural land and the loan was for a period of 12 years. On 30.6.2006 the opposite party issued a notice stating the loan amount is irregular and the debt is classified as NPA which is marked as Ext. P3. On 10.6.2008 a notice was affixed on the outer wall of the car porch of the complainant mentioning that the bank has taken possession over the property. PW1 has been remitting the loan amount as and when he could raise funds. On 31.10.2008 the opposite party had issued a notice claiming a total amount Rs.94,149/- which is marked as Ext.P1. As per the notice Rs.25,000/- is charged under charges payable to enforcement agent. Protest complaint by the complainant dated 16.6.08 produced by the complainant is marked as Ext.P4. The copy of application by the complainant dated 27.8.2008, ready to pay the amount in the months of September and October in 4 instalments is marked as Ext. P5. The opposite party has no right to proceed against an agricultural property under SARFAESI Act. The opposite party has collected a total amount of Rs.6,23,149/- that is. Rs.3,23,149/- as interest and other charges is an exorbitant amount. The title deed was not given to the complainant after paying the amount. Copy of application by the complainant dated 10.10.2008 requesting to give back the documents is marked as Ext.P6. The receipt dated 24.11.2008 for the payment by the complainant and the copy of application along with it are marked as Ext. P7(series). Ext. P8 is the copy of the title deed of the property of the complainant's wife and the copy of pattayam issued to the complainant. As per the cross examination of the learned counsel of the opposite party, PW1 admitted that there was another case 38/07 at the time of proceedings under SARFAESI Act. There was about 11.5 acres of property owned by the complainant, his wife and children. He constructed building, car shed and store for cardamom in the same property. Cardamom is also cultivating in the property. Cardamom store is situated there which is using to dry the cardamom of him and his relatives and thinking to dry the neighbour's also if he get time and convenience. The complainant was not aware of the matter that, the complaint ought to be given to the debt tribunal if any complaint is raised against the Securitisation Act. Ext.P9 is the copy of the building permit from the Kattappana Grama Panchayath dated 23.11.2009. Site plan is also produced. It shows that the store was constructed only after 23.11.2009.

The only dispute is that whether the property of the complainant given as a security for loan to the opposite party is an agricultural land or not. As per the complainant the opposite party is not entitled to proceed against the complainant as per the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Act, 2002. As per the provisions of the act, says, (31) provisions of this Act not to apply in certain cases, the provisions of this Act shall not apply to ( i ) any security interest created in agricultural land.

So the proceedings as per the opposite party is irregular and the enforcement charges of Rs.25,000/- secured from the opposite party is entitled to be refunded to the complainant. This is a clear violation from the part of the opposite party. PW1 is cultivating cardamom in his property and the land is an agricultural one. As per opposite party the property as security given to the opposite party bank is a housing plot which is having car porch and cardamom store. But Ext. P9 which is a building permit issued by the grama panchayath shows that the permit for construction of building for cardamom store was issued only on 23.11.2009. So the construction was done for the store is recently. But there was car porch and residential building situated in the property and PW1 delivered that the cardamom was cultivated after the construction of the residential building. The drier of cardamom is for the purpose of his own and his relatives. The opposite party submitted

that there was a case CC. No.38/07 in which an appeal was preferred by the opposite party against the complainant, aggrieved by the same complainant has filed this case. In that case CC.No.38/07, the area of the property was shown incorrect for getting benefit under the debt waiver scheme of the central government. But the actual area of the property was 11.5 acres. The learned counsel of the opposite party argued that the complainant never produced any evidence to show that the land given as security is an agricultural land. No certificate from the agricultural officer produced. There is no mention of agricultural land in the title deed. There are constructions in the property and it is a residential plot. The proceedings against property of the complainant as per the securitisation act was initiated on 30.6.06 and after that the complainant filed CC. No.38/07 before this forum. In that complaint also there is nothing stated about the Securitisation Act. If the complainant had any objection against the proceedings, he should have mentioned that matter in that case also.

So we think that if the proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Act, 2002, has already done by the opposite party and Rs.25,000/- was paid by the complainant as enforcement charges. If it is an agricultural land and the proceedings of the opposite party is irregular, it is not a deficiency of service from the part of the opposite party, but it is a clear violation of the act. So the complainant should proceed against the opposite party for penal action for non-compliance of act before the appropriate legal authority. The complainant can produce evidence there, to show the property is an agricultural land. It is not a matter of deficiency in service and if there is a deliberate violation in the procedure

from the part of opposite party they should be challenged by the appropriate authority like

Debt Tribunal etc.. Hence the matter in dispute is not coming under the provisions of Consumer Protection Act, 1986.

Hence the petition dismissed. No cost is ordered against the complainant.

Pronounced in the open Forum on this the 27^th day of February, 2010.

sd/-

SRI. LAIJU RAMAKRISHNAN (PRESIDENT)

sd/-
 

SMT. SHEELA JACOB (MEMBER)

sd/-
 

SMT. BINDU SOMAN (MEMBER)

APPENDIX

Depositions :

On the side of Complainant :

PW1 - Abraham Chacko

On the side of the opposite party :

DW1 - Nil

Exhibits :

On the side of Complainant :

Ext.P1 - Copy of notice issued by the opposite party dated 31.10.2008

Ext.P2 - Possession Notice issued by the opposite party dated 10.6.2008

Ext.P3 - Copy of notice issued by the opposite party dated 30^th June, 2006.

Ext.P4 - Copy of protest complaint by the complainant dated 16.6.2008

Ext.P5 - Complainant's letter dated 27.8.2008, addressed to the opposite party.

Ext.P6 - Complainant's letter dated 10.10.2008, addressed to the opposite party requesting

to give back the documents.

Ext.P7(a) - Cash receipt dated 24.11.2008 for the payment of loan by the complainant.

Ext.P7(b) - Complainant's letter dated 24.11.2008 which is sent along with Ext.P7(a).

Ext.P8(a) - Copy of the title deep of the property of complainant's wife.

Ext.P8(b) - Copy of pattayam issued to the complainant.

Ext.P9 - Copy of the building permit from the Kattappana Grama Panchayath, dated

23.11.2009 along with ownership certificate and cite plan.

On the side of Opposite party :

Ext.R1 - Copy of the ledger kept in the name of the complainant in the bank.

Ext.R2 - Copy of the circular issued from the State Bank of India.

Ext.R3 - Copy of the possession notice issued by the opposite party.