STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

                                    U.T., CHANDIGARH 

        Toyota Financial Services India Limited, C/o M/s Pioneer Toyota, Plot No.177H-I, Industrial Area Phase-I, Chandigarh through its Authorized Representative Mr.Parth Sachdeva and 

        Having  Registered Office at:

Toyota Financial Services India Limited, 12th Floor, RG Tower,       Wazirpur District Centre, Netaji Subhash Place, Pitampura, New Delhi 110034.

                                                                         ….Appellant

                                                   Versus

M/s Allena Auto Industries Pvt. Ltd., having Registered Office at  Plot   No.C-116, Industrial Area, Phase-7, Mohali, Chandigarh through its Director.

                                                                                               ……Respondent

                 Appeal under Section 15 of the Consumer Protection Act,1986                           against  order dated 01.01.2018 passed by District Consumer                          Disputes Redressal Forum-II, U. T. Chandigarh in C.C.No.No.                           939/2016..

Argued by:  Mr.Nagar Singh, Advocate for the appellant.

BEFORE:       JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                       MR.DEV RAJ, MEMBER

                       MRS. PADMA PANDEY, MEMBER

PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT

                     Appellant/Opposite party has filed this appeal against order dated 1.01.2018, passed by the District Consumer Disputes Redressal Forum(II), U.T. Chandigarh (for short the Forum only),  allowing a consumer complaint filed by the respondent/complainant, ordering refund of the amount with interest which was retained by the appellant towards foreclosure charges for pre-payment of loan. 

 2.           As per facts on record, respondent/complainant purchased one car on 29.7.2015 by making payment of Rs.15,00,455/- plus Rs.3500/- towards logistic charges. The vehicle was got insured through ICICI Lombard General Insurance Company and the policy was valid between 29.7.2015 to 28.7.2016.  To purchase the said car, the complainant had raised loan through the appellant/OP to the tune of Rs.13.00 lacs. The vehicle was stolen on 8.1.2016 ; report was made to the Police and an FIR was recorded on 9.1.2016 qua theft of the said vehicle.  Thereafter, insurance claim raised by the complainant was settled at Rs.14,23,432/-. The insurance company put the entire amount at the disposal of the appellant/OP as the vehicle was under hypothecation.  After adjusting the loan account, balance amount, out of the said amount, was to be paid to the respondent/complainant.  However, when paying the balance amount, OP wrongly deducted an amount of Rs.48,644/- towards foreclosure charges @ 5% on the outstanding loan amount.  When request made not to deduct that amount failed, a consumer complaint was filed. 

3.             Upon notice, reply was filed. By placing reliance upon Clause 3.8.1 of the Agreement, deduction of pre-payment charges was stated to be justified.   

4.            The Forum, on analysis of pleadings, documents on record, and arguments addressed, rejected the said contention by observing as under ; 

“Admittedly, the vehicle in question, which was financed by the complainant from the Opposite Party got stolen and the claim of insurance was settled, resultantly, an amount of Rs.14,23,432/- was paid by the insurance company, which was put at the disposal of the OP Finance Company for the satisfaction of the loan amount, with request to refund the excess amount to the complainant, after due satisfaction of the balance loan amount. The Opposite Party Company after adjustment of the loan amount of the complainant from the amount received from the insurance company, instead of refunding the balance amount of Rs.4,45,428/- refunded only an amount of Rs.3,96,783/- after deducting Rs.48,644/- as pre-payment/foreclosure charges.  The Opposite Party in order to justify the deduction of an amount of Rs.48,644/- as foreclosure charges out of the balance amount of the complainant, referred Clause No.3.8.1 of the Loan Agreement (Ann.R-1).  The said clause is reproduced as under:-

 “In case of pre-payment of the loan by the applicant  TFSIN shall charge as additional charges as mentioned in schedule I which shall be lower of either the “pre-payment charge” or the interest outstanding as on the day of repayment”.

       We are of the concerted view that the Opposite Party has illegally deducted the disputed amount on account of pre-payment charges taking recourse to Clause 3.8.1 of the Loan Agreement.  The given case is not a voluntary closure of the loan account, rather it is an exceptional case, where unfortunately the vehicle financed, got stolen and the insurance company settled the insurance claim of the complainant and paid the amount to the finance company i.e. Opposite Party for settlement of the loan amount with further request to refund the balance excess amount to the complainant. Thus, under the given situation and circumstances, the deduction make by the Opposite Party company as pre-payment charges, is held to be totally illegal and unjustified. Hence, the deficiency in service on the part of Opposite Party is writ large.”

 5.             It was rightly said that it was not a case of pre-closure  of loan account in a routine manner. The vehicle was stolen and the Insurance Company settled the claim raised by the complainant and the entire amount was put at the disposal of the OP to clear its loan account.  By noting above fact, it was rightly said that reliance could not have been placed upon Clause 3.8.1 of the loan Agreement. We are of the opinion that the  view taken by the Forum is perfectly justified. On account of theft of the vehicle, and upon settling his account by the insurance company, no option was left with the respondent/complainant except to make  payment as the vehicle was under hypothecation.  No case is made out  to interfere in the order, under challenge.

6.          For the reasons recorded above, the appeal, being devoid of merit, must fail, and the same is dismissed, at the preliminary stage,  with no order as to costs. The order of the District  Forum is upheld

7.              Certified copies of this order, be sent to the parties, free of charge.

8.           The file be consigned to Record Room, after completion.