Date of Filing: 29/08/2011
Date of Order: 15/09/2011
BEFORE THE I ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SESHADRIPURAM BANGALORE - 20
Dated: 15th DAY OF SEPTEMBER 2011
PRESENT
SRI.H.V.RAMACHANDRA RAO,B.SC.,B.L., PRESIDENT
SRI.KESHAV RAO PATIL, B.COM., M.A., LL.B., PGDPR, MEMBER
SMT.NIVEDITHA .J, B.SC.,LLB., MEMBER
COMPLAINT NO. 1616 OF 2011
Smt. Smitha Satish,
W/o. H.V. Raghuram,
No.133, Blue Spruce Ln
Union City, CA-94587, U.S.A.
Rep. by her GPA Holder:-
Smt. Revathi Venkatesh,
W/o. Venkatesh,
No.34, Siddehalli Main Road,
Soundarya Layout,
Bangalore-560 073.
(Rep. by Advocate Sri. B.Subraya Kharvi) Complainant.
-V/s-
(1) M/s. Corporation Bank,
Malleshwaram 18th Cross Branch,
No.65, Vastra Bhavan, 4th Main,
18th Cross, Malleshwaram,
BANGALORE-560 003.
Rep. by its Senior Manager.
(2) M/s. Corporation Bank,
Head Office, Mangala Devi Temple Road,
Pandeshwar, Mangalore-575 001.
Rep. by its Chairman & Managing Director. Opposite parties.
BY SRI.H.V.RAMACHANDRA RAO, PRESIDENT
ORDER
The brief antecedents that lead to the filing of the complainant made Under Section 12 of the Consumer Protection Act, seeking direction to the opposite parties to reverse the charging of interest at the commercial rate on the loan sanctioned to the complainant and to release the balance of loan amount sanctioned to the complainant as and when she is able to commence construction of the house on the site purchased by the complainant after obtaining the necessary approval from the BBMP which is the competent local authority now and to pay compensation of Rs.5,000/- for mental agony, are necessary:-
The opposite party has sanctioned a Composite Loan of Rs.33,50,000/- in March-2007 to purchase the site and to construct the building therein to the complainant. Out of that Rs.17,50,000/- has been released to the complainant in March-2007 for purchase of the site. Accordingly, she purchased the site. The complainant was intended to take up construction of the building after getting the Khatha changed to her name, obtain sanctioned plan from the Village Panchayat. Later the Village Panchayat had been merged with the BBMP; hence she wants to move the BBMP to get the Katha and license. The BBMP has written to the complainant on 09.04.2009 stating that they are awaiting the Government Order for change of Katha. Now it is learnt that, the Government has passed an order and the complainant is trying to get the Katha changed in her name. Soon after that she will get the license and then construct the building. In May-2011 the complainant learnt that the opposite party had debited huge amount of Rs.6,00,000/- to her account as penalty. On 28.05.2011 she wrote to the opposite party to reverse the penal charges. On 18.07.2011 the opposite party replied stating that, as she has not constructed the residential house as per the terms of sanction, within the stipulated period, the Bank is charging and collecting the maximum interest at commercial rate applicable which is debited to her loan account on 18.05.2011. It is also stated in the said reply that as per the terms of the sanction scheme guidelines the complainant had to obtain necessary approval from the local authority and commence construction within 12 months from the date of first release of the loan and complete the same within 24 months, failing which interest at commercial rate from the date of the first release has to be paid. The opposite party failed to appreciate the difficulties of the complainant. Hence complainant issued a legal notice on 25.07.2011 to the opposite parties to which the opposite parties have replied on 09.08.2011. The action of the opposite party in penalizing the complainant only on the ground that the terms of the sanction containing a stipulation to charge commercial rate of interest is unjust, inequitable, unfair and unwarranted in the circumstances of the case. Hence the complaint.
2. Heard.
3. The points that arise for our consideration are:-
- Whether this Forum has pecuniary jurisdiction to entertain the complaint?
- Whether the action of the opposite party in debiting Rs.6,00,000/- as penalty as per the terms agreed to between the parties could be dealt by this Forum in this complaint?
- What order?
4. Our findings on the above points are:-
Point (A) & (B):In the Negative
Point (C):As per the final order
For the following:-
REASONS
POINT (A) to (C):-
5. The complaint is summarized supra the same be read herein again. Reading the complaint in conjunction with the documents that has been produced by the complainant it is a fact that the complainant was sanctioned a Composite Loan of Rs.33,50,000/- on 29.03.2007 and released Rs.17,50,000/- regarding that the complainant wants the balance of Rs.18,00,000/- to be ordered to be released to her and it is also admitted that Rs.6,00,000/- has been levied as penalty as per the terms of the contract by the opposite party and debited to her account and complainant wants that Rs.6,00,000/- as to be reverted. That means the complainant wants Rs.18,00,000/- the amount to be released to her and Rs.6,00,000/- penalty imposed to be given back to her. That means the complainant wants Rs.24,00,000/-.
6. Under Section 11 of the Consumer Protection Act the District Forum has jurisdiction to entertain a complaint if the relief claimed does not exceed Rs.20,00,000/-. In this case according to the prayer in the complaint it is more than Rs.24,00,000/-. Hence this Forum has no pecuniary jurisdiction to entertain the complaint.
7. Further in a case between Shalini Shingal & Another –V/s- Bank of India & Others, in Revision Petition No.418/2011 the Hon’ble National Commission on 26.07.2011 has clearly stated that the prerogative to sanction the loan and disburse the same is of the loaning Bank and that cannot be interfered with. Here the loan has been sanctioned, some portion has been released and some portion has not been released, because of the fault of the complainant for whatever reasons it is. Hence we cannot ask the opposite party Bank to release the balance of loan.
8. In any event the complaint is as bald as it could be. It does not contain the relevant particulars. The complainant never stated in the complaint on what date the loan was sanctioned? On what date Rs.17,50,000/- was released to her? On what date she purchased the site? When she started repaying the loan of Rs.17,50,000/-? What are the terms of that loan? What are the documents she has executed? All these things are silent.
9. Further the complainant has stated that she has some difficulties in getting the Katha changed to her name and now BBMP has stated that they have not received the Government order and only after receiving the Government order they may change the Katha. Here when she had purchased the property in the year 2007? The concerned village panchayath had every jurisdiction to change the katha and grant the sanctioning of the plan, why she has not applied for it? There is no answer. These villages are coming to BBMP after 2008 not in 2007. Hence here the contention that she had difficulties is an untenable one.
10. In any event the complainant at Para-2(g) has stated thus:-
“The complainant submits that she came to know in May-2011 that opposite party No.2 had debited huge sum of Rs.6,00,000/- to her loan account as penalty. The complainant submitted her representation dated: 28.05.2011 to opposite party No.2, requesting the Bank to waive the Penalty charges.”
The complainant in Para-2(h) has stated thus:-
“The complainant received reply dated: 18.07.2011 to her representation from opposite party No.2 stating that as she had not constructed the residential house as per terms of sanction within the stipulated period, the Bank is in order in charging and collecting the maximum interest at Commercial rate applicable, which is debited to her loan account on 18.05.2011. It is also stated in the reply of opposite party No.2 that, as per the terms of sanction Scheme guidelines, the Complainant had to obtain necessary approval from the local Authority and commence house construction work within 12 months from the date of first release of the loan and complete the same within 24 months, failing which interest at commercial rate from the date of the first release has to be paid.”
The complainant in Para-2(j) has stated thus:-
“The complainant submits that the action of the opposite party in penalizing the complainant only on the ground that the terms of the sanction contain a stipulation to charge commercial rate of interest is unjust, inequitable, unfair and unwarranted in the circumstances of the case. The opposite party Bank, which is a public sector bank, is duty bound to use its discretion and examine as to whether the inability of the borrower to comply with any of the terms of sanction of the loan is willful and malafide or is because of the circumstances, beyond his control for which the borrower cannot be blamed at all.”
These speaks per itself. The opposite party has charged interest on commercial basis as per the terms agreed. The complainant never stated that she has not agreed to these terms. The opposite party was well within the jurisdiction to abide by the terms and conditions which is agreed and charged interest.
11. Accordingly in any event the opposite party on 18.07.2011 has written to the complainant reads thus:-
That is to say the complainant had agreed to commence the building within 12 months from the date of release i.e., on 29.03.2007 and completes the construction within 24 months from the date of release of the amount, i.e., within 29.03.2008 she should have started construction and within 29.03.2009 she should have completed the construction failing which it was agreed that the opposite party is bound to charge penal interest at commercial rate on the entire loan and that they have done so. Then how can it be said the action of the opposite party is illegal.
12. In any event the complainant had issued a notice to the opposite party on 25.07.2011. The opposite party had considered it and issued a reply on 09.08.2011. The said reply reads thus:-
This speaks for itself. That means the opposite party has exercised the right under the contract and charged penal interest. We cannot go behind discretion exercised by the opposite party. This Forum is not an appellate authority with respect to the opposite party in this matter. Hence there is no necessity to probe further. Hence under these circumstances we hold the above points accordingly and proceed to pass the following:-
ORDER
1. The complaint is Dismissed.
2. Return the extra sets filed by the parties to the concerned as under Regulation 20(3) of the Consumer’s Protection Regulation 2005.
3. Send a copy of this order to the complainant free of costs, immediately.
(Dictated to the Stenographer, transcribed and typed by him, corrected and then pronounced by us in the Open Forum on this the 15th Day of September 2011)
MEMBER MEMBER PRESIDENT
