Date of Filing 25.09.2023

                                                                                                             Date of Disposal: 30.01.2024

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION

THIRUVALLUR

BEFORE TMT. Dr.S.M. LATHA MAHESWARI, MA. ML, Ph.D (Law),                                         …….PRESIDENT

               THIRU.P.VINODH KUMAR, B.Sc., BL.,                                                                              ……MEMBER-I

               THIRU.P.MURUGAN, M.Com, ICWA(Inter), BL.,                                                           ……MEMBER-II

CC.No.103/2023

THIS TUESDAY, THE 30^th DAY OF JANUARY 2024

Shri.S.Rajendran,

Plot No.26, 3^rd Cross Street,

Sree Nagar, Kakkalur,

Thiruvallur, Thiruvallur District 602 0                                                   ......Complainant.

                                                                              //Vs//

The Manager,

M/s.Canfin Homes Limited,

52, 1^st Floor, TNHB, MIG Type,

Kakkalur Main Road, Thiruvallur 602 001.                                       ….opposite party.

Counsel for the complainant                                   : Party in Person.

Counsel for the opposite party                               :  M/s.D.Sathish Kumar, Advocate.

This complaint coming before us on various dates and finally on 22.01.2024 in the presence of complainant who appeared as party in person and M/s.D.Sathish Kumar, counsel for the opposite party and upon perusing the documents and evidences of both sides this Commission delivered the following:

ORDER

PRONOUNCED BY TMT.Dr.S.M. LATHA MAHESWARI, PRESIDENT

1. This complaint has been filed by the complainant u/s 35 of the Consumer Protection Act, 2019 alleging deficiency in service against the opposite party with regard to non intimation of increase in interest rate for the loan availed by complainant and that the amount paid by the complainant towards principal was not accounted along with a prayer to revise the EMI with respect to the present outstanding amount, to pay a sum of Rs.5,00,000/- towards compensation for the mental agony and hardship caused to the complainant, to discontinue the unfair trade practices and to pay the cost of the complaint.

Summary of facts culminating into complaint:-

2. Complainant availed loan from the opposite party Bank M/s. CANFIN Homes Limited, a sum of Rs.14,90,000/- to be repaid in 20 years tenure in 2016.  The EMI was fixed at Rs.14,500/- and was promptly paid without any default.  The increase in interest rate was never intimated to the complainant.  On 16.11.2021 opposite party debited Rs.885/- as NACH bouncing charges.  As no cheque was issued for payment of EMIs, after a long fight the said amount was reversed.  In April 2023 and May 2023 complainant paid a lump sum amount of Rs.2,00,000/- and Rs.4,00,000/-.  There was no proper accounting for it.  In April 2023 the EMI debited was Rs.15,847/- for which no prior intimation was given.  Only after mail sent to Grievance Redressal mail id of opposite party, they replied.  When they increased the rate of interest of 10.6% and why they did not consider the decrease in Principal was not answered after payment of 6 lakhs towards Principal.  On 08.09.2023 email was sent by opposite party that outstanding balance is Rs.9,48,760/- and @ 10.6% for 12 years the EMI comes to Rs.11,670/-. Thus aggrieved by the act of the opposite party the present complaint was filed for the reliefs as mentioned above.

The crux of the defence put forth by the opposite party:-

3. The opposite party filed version disputing the complaint allegations stating that the changes in rate of interest was never intimated by the opposite party because every changes made in the rate of interest would be intimated to their customer via SMS.  Likewise all the communications from the opposite party to the complainant has been communicated through SMS to the registered mobile number 9841858458.  Further Rs.885/- was debited as NACH bouncing charges because the date of deduction of EMI from the complainant’s Bank Account was 15^th of every month, likewise on 15.11.2021 during EMI deduction vide ECS it would have happened. The amount has been re-credited to the complainant’s Account after obtaining approval from Head Office of the opposite party. The opposite party denied the allegations that he made a long struggle to get the statement which was totally a false statement because on 18.05.2023 he sent an email and requested to send a Statement of Accounts for which the opposite party replied on the same day along with the requested statement. Whenever an EMI was debited from the customer’s saving account and credited into their Loan Account, a portion of amount would be credited as capitalised interest and remaining amount would be adjusted toward principal which can be clearly seen from the statement of the complainant.  Hence reason for raising question about particular amounts i.e. Rs.10,418/- and Rs.8556/- was known to the complainant. If any customer wants to pay some amount apart from the EMI amount they should pay the same on prior intimation to the opposite party because then only they can adjust entire amount towards the principal and the EMI shall be paid as usual.  But if any such amount paid through money transfer or any other mode without the knowledge of the opposite party that too before the EMI date (ECS) than on the amount transferred by the complainant a portion of amount that is equivalent to the EMI amount would be credited to loan account as EMI and the remaining amount alone would be adjusted towards the outstanding and apart from these on the specified EMI date EMI amount also debited from the customer’s account as it is automated system of payment. Unless request was raised it could not be stopped which was very well informed to the complainant. With respect to change in rate of interest it was very well informed to the complainant through SMS.  Any amount credited to his loan account would be immediately communicated to him through SMS from NACH. Complainant alleged that though his outstanding was reduced to Rs.7,57,316/- EMI was not reduced. EMI could be reduced based upon the existing outstanding only upon the request from the customer but though the EMI amount was not reduced obviously the tenure of the repayment would come down. The actual date of closure of loan was 09.05.2035 but at present the closure date of complaint is 01.04.2029.  Hence the tenure for pre closing complainant’s loan account was 6 years before than agreed earlier. It was submitted that all the confusions arose because of the transactions done by the complainant without prior intimation to the opposite party.  If he would have intimated the same they would have advised him to deposit the amount separately to the principal and these unnecessary complications would have been avoided. The same was intimated to him when he visited the opposite party’s Branch. Thus he sought for the dismissal of the complaint.

4. On the side of complainant proof affidavit was filed and documents marked as Ex.A1 to Ex A10 were submitted. On the side of opposite party proof affidavit was filed and documents marked as Ex.B1 to Ex.B5 were submitted.

Points for consideration:-

1)    Whether the complaint allegations as to debit of 885/- towards cheque bouncing charges when no cheque was issued by complainant and non intimation of increase in the interest rate with respect to the loan availed by the complainant amounts to deficiency in service on the part of opposite party and whether the same has been successfully proved by the complainant by admissible evidence?

2)    Whether the complaint allegations that the amount paid by him towards the Principal of the loan availed was not accounted towards Principal by the opposite party could be termed as deficiency in service?

3)    If so, what relief the complainant is entitled to?

Point No.1&2:-

The following documents were filed on the side of complainant in support of his contentions;

1)    Loan repayment statement of account from 01.04.2023 to 08.09.2023 was marked as Ex.A1;

2)    Email to Canfin Thiruvallur office dated 18.05.2023 was marked as Ex.A2;

3)    Email to Canfin Thiruvallur Office dated 03.07.2023 was marked as Ex.A3;

4)    Email to Canfin Grievance Redressal Office dated 01.09.2023 was marked as Ex.A4

5)    Reply from Canfin Thiruvallur office dated 01.09.2023 was marked as Ex.A5;

6)    Email to Canfin Thiruvallur dated 02.09.2023 was marked as Ex.A6

7)    Email to Canfin Thiruvallur dated 02.09.2023 was marked as Ex.A7;

8)    Reply from Fanfin Thiruvallur Office dated 08.09.2023 was marked as Ex.A8;

9)    Email to Canfin Thiruvallur Office dated 08.09.2023 was marked as Ex.A9;

10)           Call history was marked as Ex.A10;

The following documents were filed on the side of opposite party in support of their defence;

1)    Email communication  was marked as Ex.B1;

2)    Statement of Account was marked as Ex.B2;

3)    Loan sanction communication letter along practices code annexure -1 and annexure was marked as Ex.B3;

4)    Message logs were marked as Ex.B4 & Ex.B5;

5. Heard oral arguments of both parties and perused the written arguments and evidences produced by them.

6. The main allegation of the complainant is that the opposite party had illegally debited a sum of Rs.885/- on 16.11.2021 towards cheque bouncing charges when there no cheque was issued for payment of EMI by the complainant.  After several measures taken by the complainant the same got reverted on back.  Further he relied upon Ex.A3 dated 03.07.2023, the email sent by him to opposite party seeking for clarification that the EMI was suddenly increased without informing him from 14500/- to 15847/-.  Thus he alleged that the opposite party had increased the rate of interest without his knowledge thereby increasing the EMI amount.  It is also his case that he had paid Rs.2,00,000/- and Rs.4,00,000/- towards principal in the month of April 2023 and May 2023, but the same was not taken into account by the opposite party for reduction of the Principal amount. Further it is argued that the opposite party never responded to the calls made by the complainant.  Thus he sought for the complaint to be allowed by issuing a direction to revise the EMI for the exact principal amount along with compensation.

7. On the other hand, the learned counsel appearing for the Bank argued that it is not mandate for them to give written communication for increase in the rate of interest by relying upon clause 12 of the Fair Practices Code of CAN FIN Homes Limited.  He admitted that Rs.885/- was debited wrongly but he defended the same that it occurred due to some technical errors and reversed back.  He also argued that notice is essential before filing the complaint.  To sum up it is stated that all the confusions arose because of the transactions done by the complainant without prior intimation to the opposite party i.e., he pointed out that the amount deposited towards principal was made by the complainant without any intimation to the opposite party.  Thus he sought for the complaint to be dismissed.

8. On appreciation of entire pleadings and documents it is not in dispute that a sum of Rs.885/- has been debited towards cheque bouncing charges from the complainant’s account and later on the same got reverted to the complainant’s account.  Though the said act was defended by the opposite party that due to some technical error the same occurred it is a clear negligence on the part of the Bank in deducting such charges. If the complainant would not have noticed the same and asked for, no reversal would have been done by the opposite party. 

9. Further it is the case of the opposite party that the increase in the rate of interest was timely intimated to the complainant by way of SMS.  However, no call logs or any other proof was submitted by them.  When the complainant raised an allegation as to non intimation it is the bounden duty of the opposite party to disprove the same by documentary evidence.  Further, under clause 15 of the Fare Practices Code relied upon by the opposite party themselves it has been provided that whenever there was upward revision in the rate of interest same EMI will be continued by extending the tenure.  Also, it is found that the customer is having the option of continuing the same tenure of loan by agreeing to pay enhanced EMI or prepayment of certain lump sum principal portion, by giving a specific request to the branch as per norms. Therefore, when the clause provided so, it becomes imminent/compulsory for the Bank to intimate the change in rate of interest to the borrower enabling them to opt either for increase in EMI amount or tenure or payment of lump sum amount towards the Principal.  Under clause 14 it has been specifically provided that enhancement in the rate of interest will be communicated to the borrower by SMS alerts which is not proved by the opposite party.

10.  The other allegation of the complainant is that he had paid a lump sum amount of Rs.2,00,000/- and Rs.4,00,000/- in the month of April and May 2023 respectively which was not given accounted for towards the Principal.  However the opposite party before this Commission has come up with the defence that the complainant did not give any prior intimation before depositing the said amount and hence all confusions arise.  Further it is also stated by them that due payment towards the Principal was that the tenure has been reduced.  This information was not seemed to have provided to the complainant by way of Account Statement.  Thus it is clear that the opposite party did not answer the queries with regard to the Statement of accounts relating to the loan when sought for by the complainant. If they would have intimated the complainant, no occasion would have arisen for the complainant to approach this Commission.

11. Further it is alleged by the complainant that the increase in the EMI was also not intimated to the complainant for which, no contra evidence was submitted by the opposite party that the same was duly intimated to the complainant.  We find support of our conclusion from the recent decision rendered by Odisha State Consumer Disputes Redressal Commission, Cuttack in Yasobant Das Vs State Bank of India in CC.No.20/2021 decided on 08.05.2023 wherein it has been held that

“16. The aforesaid clauses shows that the borrowers shall be deemed to have of notice of increase of rate of interest while same is placed display, filed in the Branch Office, newspaper or entry in passbook or statement of account sent to the borrower.  In the instant case, there is no any statement of account or notice in display board filed to prove the increase/decrease of rate of interest so as to give a deemed notice to the borrower/complainant.  There is only statement of account filed in the case but never it is found that same has been transmitted to the complainant.

20. The Banking institution is supposed to maintain a good faith with the customer.  A person takes the loan or makes deposit with the Bank with full trust that it is safe and his loan calculation would be also more safer but when the OP remains silent for years and accepted the EMI as paid by the complainant and suddenly comes with a huge amount which is more than the principal, definitely there is some deficiency in service on the part of the opposite parties as well as unfair trade practice adopted by them.”

12.  In such facts and circumstances we hold that the opposite party had committed deficiency in service in not deducting the cheque bouncing charges illegally, not intimating the increasing the rate of interest, in not intimating the increasing the EMI and in not accounting for the amount paid by the complainant towards the principal. Thus we hold that the opposite party had committed deficiency in service.  This we answer the point accordingly in favour of the complainant and as against the opposite party.

Point No.3:-

13. As we have held above that the Bank has committed deficiency in service in not intimating the complainant/Borrower about the increase in the rate of interest and increase in the EMI amount etc., putting the complainant on surprise we award a compensation of Rs.50,000/- for the mental agony and hardship suffered by the complainant.  Further we also direct the opposite party to consider the request of the complainant for revised EMI with respect to the outstanding loan amount.

In the result, the complaint is partly allowed against the opposite party directing them

 a) To consider the request of the complainant for revised EMIs with respect to the outstanding loan amount and to intimate the same to the complainant within four weeks from the date of receipt of copy of this order;

b) To pay a sum of Rs.50,000/- (Rupees fifty thousand only) towards compensation for the mental agony and hardship caused to the complainant;

c) To pay a sum of Rs.5,000/- (Rupees five thousand only) towards litigation expenses to the complainant.

Dictated by the President to the steno-typist, transcribed and computerized by him, corrected by the President and pronounced by us in the open Commission on this 30^th day of January 2024.

  -Sd-                                                -Sd-                                                             -Sd-

MEMBER-II                                   MEMBER-I                                                PRESIDENT

List of document filed by the complainant:-

List of documents filed by the opposite party:-

       -Sd-                                                             -Sd-                                                  -Sd-

 MEMBER-II                                               MEMBER-I                                       PRESIDENT