BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAS NAGAR, MOHALI
Consumer Complaint No.715 of 2014
Date of institution: 23.12.2015
Date of Decision 24.06.2015
Radhey Sham Goyal Sole Proprietor of M/s Goyal Electric Agencies, SCO No. 106, Phase-III-B-2, SAS Nagar.
……..Complainant
Versus
1. M/s Kotak Mahindra Bank Ltd, SCO No. 108, Phase-III-B-2, Sahibzada Ajit Singh Nagar.
2. M/s Kotak Mahindra Bank Ltd, Personal Assets Division, SCO No. 831, Notified Area Committee Mani Majra, UT, Chandigarh.
………. Opposite Parties
Complaint under Section 12 of the
Consumer Protection Act, 1986.
CORAM
Mrs. Madhu. P. Singh, President.
Shri Amrinder Singh, Member.
Mrs. R.K. Aulakh, Member.
Present: Sh. Ashok Sharma, cl for the complainant
Sh. Yogesh Jain, cl for the OPs.
(Shri A.S. Sidhu, Member)
ORDER
The complainant filed the present complaint pleading that he is having a small rented electric shop on rented accommodation SCO No.106, Phase III-B-2, SAS Nagar. He is sole proprietor of this shop and it is his sole source of livelihood. In July, 2010 one Mr. Amit Singhal, Sales Incharge in Credit Team of the Opposite parties ( for short ‘ the OPs’) approached him to open account by assuring that best banking facilities with comparatively lowest rate of interest shall be charged from the complainant. Upon repeated assurances of the OPs, the complainant closed his account with his previous bank i.e. Axis Bank and opened current account No. 02542190000016 with OP No.1 for cash credit facility. Later on OP No.1 also provided housing loan and loan against property banking facility to him. While providing banking loan facilities, the OPs got signatures of the complainant on different blank documents i.e. agreement, schedules and on sanction letter etc. As per the sanction letter OP no.1 agreed to charge 13.75% interest on cash credit/overdraft banking facility as well as loan against property banking facility. The complainant was regularly making the payment of interest @ 13.75% on the banking facilities availed by him without any default. The complainant decided to withdraw banking facilities from the OPs, by way of returning their whole loan amount because the OPs are charging the rate of interest at higher side while the other banks are charging interest @ 12% or 12.5% which is a lower rate of interest. The OPs have wrongly charged 2% as foreclosure charges on cash credit/over draft facility. The complainant was having cash credit/over draft facility of Rs. 1.35 crore. Upon the discontinuity of this facility the OPs have charged a sum of Rs.3,03,372 as 2% foreclosure charges and service tax etc. The complainant has mentioned that earlier when he closed the same facility with the Axis Bank in July-August, 2010 then Axis Bank did not charge 2% as foreclosure charges on cash credit facility. Even no other bank charges foreclosure charges on cash credit or over draft banking facility. The sanction letter which is issued by the OPs nowhere mentioned that in the event of discontinuous of the said banking facility the bank shall charge 2% as foreclosure charges. There are no RBI instructions to levy such charges. The complainant has written letter dated 09.12.2013 which is sent through email raising objections against this discriminatory and illogical foreclosure charges of 2%. The OPs have not given any reply to this email. Thus levying excess charges amounts to deficiency in service on the part of the OPs. Lastly, the complainant prayed for compensation on account of loss suffered by him andharassment, mental agony, pain and suffering as under:-
- To refund him Rs. 3,03,372/- along with 18% compounded interest illegally charged by the OPs as foreclosure charges;
- Compensation of Rs. 50,000/- on account mental agony, pain and suffering and harassment;
- Rs. 50,000/- as cost of litigation.
2. After the service of the notice, the OPs appeared and filed the reply by taking the preliminary objections that the complainant has not come to this Forum with clean hands; there is an arbitration clause 12.8 of the agreement stating dispute to be adjudicated by the arbitrator; complainant is not a consumer but a person conducting commercial activity; the complainant is barred by rule of estopple; no cause of action accrued to the complainant against the OPs; this Forum has no jurisdiction and Civil Court is competent to decide the present dispute. Thus taking these preliminary objections, the OPs prayed for the dismissal of the complaint on these grounds. On merits the OPs in reply to para no.1 objected that the complainant is carrying on commercial activities and, therefore, does not fall within the definition of the consumer. The OPs in para No.2 denied that they approached the complainant but stated that it is the complainant who requested the OPs to provide their services to him. The OPs specifically denied that blank documents were ever executed by the complainant. In para No.6 of the reply the OPs stated that the complainant is charged as per agreement. In nutshell the OPs have denied all the allegations made against them and prayed for the dismissal of the complaint with costs.
3. To support his case, the complainant tendered in evidence his affidavit Ex.CW-1/1 and copies of documents Ex.C-1 to C-3.
4. To rebut the evidence of the complainant, the OPs tendered in evidence affidavit of A. Prasad Rao, their Vice President Ex.OP-1/1 and copy of agreement Ex.OP-1.
5. We have heard learned counsel for the parties and gone through their pleadings and evidence.
6. The main issue involved in the present complaint is whether the OPs wrongly charged rate of 2% as foreclosure charges on cash credit/overdraft facility;
OR
The OPs have charged rate of 2% as foreclosure charges on cash credit/overdraft facility as per agreement.
7. Ex.OP-1 which is overdraft agreement between the complainant and the OPs is an important document. Clause-VIII of Schedule-A clearly states that:
“VIII. Premature closure charges: If the closure is within a period of 6 months from the date of this agreement, the premature closure charges shall be computed as (4%) of the operating Limit.
If the closure is at any time thereafter, the premature closure charges shall be computed as 4% of the operating Limit.”
8. In view of above mentioned document Ex.OP-1, it is clear that the OPs have charged rate of 2% as foreclosure charges on cash credit facility as per agreement between parties. It is duly signed and stamped by the complainant. In order to rebut OPs reply, the complainant filed his affidavit Ex.CW-1/1 alleging that the OPs obtained his signatures on blank papers. The allegation of the complainant that the OPs obtained his signatures on blank papers is no help to the complainant in Consumer Forum because only civil court can decide such issues as they require elaborate evidence for the adjudication of such issues.
9. Therefore, the complaint is dismissed as there is no deficiency in service on the part of the OPs. Certified copies of the order be furnished to the parties forthwith free of cost and thereafter the file be consigned to the record room.
Pronounced.
June 24, 2015.
(Mrs. Madhu P. Singh)
President
(Amrinder Singh)
Member
(Mrs. R.K. Aulakh)
Member
