Tamil Nadu

North Chennai

CC/31/2011

M/s.Pratap Ramanathan - Complainant(s)

Versus

M/s.S.Seetha - Opp.Party(s)

M/s.S.Durai Raj

17 Jun 2016

ORDER

                                                            Complaint presented on:  10.02.2011

                                                                Order pronounced on:  17.06.2016

 

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, CHENNAI (NORTH)

    2^nd Floor, Frazer Bridge Road, V.O.C.Nagar, Park Town, Chennai-3

 

PRESENT: THIRU.K.JAYABALAN, B.Sc., B.L.,        PRESIDENT

                    TMT.T.KALAIYARASI, B.A.B.L.,           MEMBER II

 

FRIDAY THE 17^th  DAY OF JUNE 2016

 

C.C.NO.31/2011

 

1.Pratap Ramanathan,

C/O.S.Dorai Raj,

30, Pettai Agraharam,

Sholavandan,

Madurai, Tamil Nadu – 625 214.

 

2.Ms. S.Seetha,

Parent of Pratap Ramanathan,

 

Through S. Dorai Raj,

Authorized Agent.              

                                                                                ..... Complainants

..Vs..

	The Manager, Indian Bank Asiad Colony Branch, 1961 – B, Vijaya Complex, Anna Nagar Western Extn. Chennai – 600 101.   2.The Chairman & Managing Director, Indian Bank Head Office, 66, Rajaji Salai, Chennai – 600 001.   Having a Branch Office at 100/101, East Avani Moola Street, Madurai – 625 001.
	...Opposite Parties     \

Date of complaint                                  : 22.02.2011

Counsel for Complainant                      : S.Dorai Raj (Authorized Agent)

Counsel for   Opposite Parties                 : M/s. RRK Associates

 

O R D E R

 

BY PRESIDENT THIRU. K.JAYABALAN B.Sc., B.L.,

          This complaint is filed by the complainant u/s 12 of the Consumer Protection Act.1986.

1.THE COMPLAINT IN BRIEF:

          The 1^st  Complainant possessed an Engineering Degree having secured first class he want to pursue his M.S higher studies in the USA  and he got admission in the University of Texas at Austin, USA.  The 2nd Complainant is the aged mother of the 1^st Complainant. The Complainants jointly applied for an educational loan of Rs.7,00,000/-  to the 1^st Opposite Party on 07.06.2008. The bank demanded for collateral security for the said loan. The total educational expenses estimated around Rs.23,00,000/-. The 1^st Opposite Party unduly delayed decision in sanctioning the loan. Due to security problem and as misguided by the 1^st Opposite Party, the Complainant opted for a lesser loan amount of Rs.4,00,000/-. The Complainant forced to provide a 3^rd party guarantee. Nearly after two months causing hardship, inconvenience to the Complainants, the 1^st Opposite Party issued the sanction ticket on 02.08.2008, barely 4 days before departure. The loan amount has to be disposed of on different stages. The 2^nd semester fee was payable on 23.01.2009. The Co-borrower / 2^nd Complainant sought for disbursement of balance amount of Rs.2,00,000/- on 26.12.2008. The bank failed to release the said amount, the 2^nd Complainant forced to encash her term deposit by way of pre-mature and thereby she sustained a loss of Rs.1,955/- by way of interest. It was only thereafter 13 days on 22.01.2009 the 1^st Opposite Party released the loan amount of Rs.2,00,000/- waiving all conditions. The Opposite Parties committed the following deficiencies:

i) Committed gross Deficiency in Service and unfair trade practice in the implementation of a beneficial social welfare loan scheme in the priority sector intended to provide financial support to the deserving student community;

ii) Committed gross Deficiency in Service in not providing to the Complainant No.1 the loan of Rs.7 lakh even though he fulfilled all the eligibility norms laid down in the Loan of Rs.7 lakh even though he fulfilled all the  eligibility norms laid down in the Loan Scheme;

iii) Committed gross Deficiency in Service in not issuing an acknowledgement for the receipt of the loan application;

iv) Committed gross Deficiency in Service in not providing authenticated copies of the loan documents;

v) Committed gross Deficiency in Service in misguiding the complainants to accept and causing inordinate delay in sanctioning, the reduced amount of the loan of Rs.4 lakh;

vi) Committed gross Deficiency in Service in obtaining a third party guarantee for the reduced loan of Rs.laks where no security at all was needed;

vii) Committed gross Deficiency in Service in not returning the third party guarantee illegally obtained;

viii) Committed gross Deficiency in Service in imposing illegal conditions in, and delaying, the disbursement of the second installment of the loan of Rs.2 lakh causing financial loss to Complainant No.2;

iX) Caused the Complainants harassment. Mental agony and hardship at every stage of the loan application in general and in creating hurdle after hurdle and imposing condition after condition add nauseum in releasing the second installment of the loan of Rs.2 lakh, in particular.

Hence the Complainant filed this Complaint seeking various reliefs including the compensation with cost of the Complaint.

2. WRITTEN  VERSION OF THE OPPOSITE PARTIES IN BRIEF:

          The Complainant Sri.Pratap Ramanathan had approached the Opposite Parties for availing an Education Loan. The Complainant represented that he has secured admission for the M.S.Degree Course in the University of Texas, Austin. He had submitted a loan application on 07.06.2008 seeking a financial assistance for Rs.7lakhs against a total Educational expenses of Rs.22,86,984/- with a margin of Rs.15,86,984/- would be available by way of Fixed Deposits/Cash as sources to meet the shortfall and agreed to offer securities to the tune of Rs.16,18,972/-. As per the Model Educational Loan Scheme of the IBA a suitable Guarantor was sought for as the amount exceeded Rs.4.00 lakhs. The loan was sanctioned on 16.07.2008. On 25.07.2008 the Complainant sent a letter expressing his inability to offer securities and sought for reduction in the limit to a sum of Rs.4.lakhs and availed the said sum on 02.08.2008, a token amount of Rs.100/- was also disbursed. The margin was modified and fixed as 82.51% and the bank considered his request for the release of the amount without insisting proportionate amount of margin. Again for the second semester fees of US $ 8000 the Complainant did not bring   the required margin of 82.51% however as a special case the Opposite Party released the entire unavailed limit of Rs.1,99,000/- and US $ 8000was issued by debiting the borrowers account for the difference amount. The loan application was filled in by the Complainant himself.  

3. It is also pertinent to note that while releasing the loan the Complainant had on one hand stated that he would require the loan only for the 2^nd year of the course, his uncle Mr.Dorai Raj representing himself to be an authorised agent sought for release of loan in the 1^st year itself. The Loan Scheme itself clearly states that the loan is to be disbursed only in stages and when the mother of the Complainant sought to make a demand, the Opposite Party was constrained to remind that the loan was for the 2^nd year however, when the Complainant/student himself sought for the amounts, the Opposite Parties disbursed the amounts. The Opposite Parties have not committed any Deficiency in Service and therefore prays to dismiss the Complaint.

4. POINTS FOR CONSIDERATION:

          1. Whether there is deficiency in service on the part of the opposite parties?

          2. Whether the complainant is entitled to any relief? If so to what relief?

5. POINT NO : 1

          The admitted facts are that the Complainant applied for an Education Loan for an amount of Rs.7,00,000/-  to study M.S. Degree at Texas University, USA  with the 1^st Opposite Party/Bank and when the bank wanted for collateral security the Complainant expressed his inability to furnish the same and hence the Complainant opted for a lesser loan amount of Rs.4,00,000/- and the said loan was also sanctioned by the 1^st Opposite Party.

          6. The Complainant alleged deficiencies against the Opposite Parties in the Complaint are that (i) not sanctioning the loan amount of Rs.7,00,000/- even though he has full filled the eligibility norms, (ii) an inordinate delay in sanctioning the loan amount of Rs.4,00,000/- and misguiding the Complainant to accept such lesser amount and (iii) obtained 3^rd party guarantee illegally. The Opposite Parties dismissed the above deficiencies and said that they have acted everything within the time.

          7. The Complainant applied under Ex.B1 application dated 07.06.2008 to the 1^st Opposite Party for sanction of Rs.7,00,000/-  for studies in abroad. The said amount was sanctioned on 16.07.2008 in Ex.B3. However the bank wanted to furnish collateral security as per the  IBA’s Model Educational Loan Scheme, since the amount is more than 4,00,000/- i.e., the loan amount sanctioned was a sum of Rs.7,00,000/-. The Complainant unable to furnish the collateral security, he gave Ex.B8 another letter dated 25.07.2008 to the 1^st Opposite Party to consider sanctioning of Rs.4,00,000/- out of the sanctioned value of Rs.7,00,000/-. Thereafter, the 1^st Opposite Party sanctioned loan amount of Rs.4,00,000/- in Ex.B4 sanction ticket dated 30.07.2008. It is the Complainant who himself unable to provide collateral security to the 1^st Opposite Party, even after sanctioning of such amount establishes that the Complainant has  fulfilled the eligibility norms to avail the sanctioned loan amount of Rs.7,00,000/- in favour of Complainant is not sustainable and in that respect the Opposite Parties have not committed  Deficiency in Service.

          8. The Complainant themselves  unable to furnish collateral security, and they themselves prevented the 1^st Opposite Party by giving Ex.B8 letter to consider and sanction of Rs.4,00,000/- as loan and accordingly such amount was also sanctioned. Therefore, there is question of misguiding the Complainants to accept lesser loan amount. The said loan of Rs.4,00,000/- was sanctioned within 6 days under Ex.B4  sanction ticket dated  30.07.2008.   Hence, there is no delay in sanctioning the loan amount of Rs.4,00,000/-.

9. The 1^st installment of Rs.2,00,000/- was released on 21.08.2008. Thereafter the Complainants wrote Ex.A8 letter dated 28.12.2008 and Ex.A9 letter dated 09.01.2009 to release further fund of Rs.2,00,000/- enabling the Complainants to pay fees and last date was due on 23.01.2009. The 1^st Opposite Party released the fund on 22.01.2009 one day prior to the payment of fees. Therefore, we hold that the Opposite Parties have not committed any Deficiency in Service either misguided the Complainants in accepting lesser loan amount   or caused inordinate delay in sanctioning and disbursing the loan amount.

          10. The next contention of the Complainant is that the Opposite Parties have obtained 3^rd party guarantee illegally. Thiru V.Ramamoorthy, Guarantor for Complainants signed in the Ex.B4 sanction ticket and in  terms conditions and also in Ex.B7 consent letter. At the time of giving such consent no protest made by the Complainants. Therefore, in this respect also the Opposite Parties have not committed any Deficiency in Service.

          The Complainant relied on a  judgment of the Supreme Court reported in  

          1. JT  2002 (6) SC 1(Dr.JJ. Merchant & Ors Vs. Shrinath   

          Chaturvedi)

 

and orders of the National Commission  rendered  in            

 

          2.R.P.No.3210 of 2005 dated 14.10.2008 (Canara Bank Vs.

             Shri Binay Kumar Jha)

 

          3.O.P.No 284 of 1997 dated 05.12.2006 ( Bihar State Sugar

             Corpn. Ltd.,  Patna Vs. State Bank of India, General

             Manager, New Delhi and Ors.)

 

          4. R.P.No.53 of 2006 dated 08.05.2006 (Reliance India

              Mobile Ltd., Vs. Hari Chand Gupta)

 

          5. F.A.No.27 of 2007 dated 05.08.2008 (CMD, Bank of               

              Baroda Vs. Dr.George John)

and contended that the Opposite Parties have committed Deficiency in Service. The facts in  the above referred orders of the  Hon’ble National Commission  and the judgment of the Hon’ble Supreme Court of India are different from the facts of the case in hand and do not support the case of the Complainants.  Therefore, we hold that the Opposite Parties 1 & 2 have not committed Deficiency in Service in this Complaint and accordingly this point is answered.

11. POINT NO :2 

          Since the Opposite Parties have not committed any Deficiency in Service, the Complainant is not entitled for any relief in the Complaint and the Complaint is liable to be dismissed.

          In the result the Complaint is dismissed. No costs.

          Dictated to the Steno-Typist transcribed and typed by her corrected and pronounced by us on this 17^th   day of June 2016.

 

MEMBER – II                                                               PRESIDENT

LIST OF DOCUMENTS FILED BY THE COMPLAINANTS:

Ex.A1    Letter Dt. 25.07.2008 from Complainant No. 1 to o.p.No.1

Ex.A2    E-mail Dt. 26.07.2008 from Complainant No.1 to O.P.No.1

               E-mail Dt.29.07.2008 from S.Dorai Raj to Dr.S.Lakshmanan   

 

Ex.A3    G.M. & Nodal Officer and his reply Dt. 30.07.2008

Ex.A4    Sanction Ticket dated 20.07.2008 Dt.02.08.2008

Ex.A5    E-mail Dt. 29.09.2008 from S.Dorai Raj to Dr.S.Lakshmanan

Ex.A6    E-mail Dt.29.12.2008 from S.Dorai Raj to Mr. S.Lakshmanan

Ex.A7    E-mail Dt.26.12.2008 from O.P.No. 2 to S.Dorai Raj and his reply

              Dt.26.12.2008

 

Ex.A8     E-mail Dt.28.12.2008 from Complainant No.1 to O.P.No.1            

Ex.A9    Request Form (Annexure 1) for Release of further installments

               In Educational Loans Dt. 09.01.2009

 

Ex.A10  Specimen Letter from Student Borrower to Bank

Ex.A11  Form D-11 for Reconfirmation of Securities.

Ex.A12  E-mail Dt. 29.12.2008 from S.Lakshmanan, GM & Nodal Officer to

              S.Dorai Raj and his reply Dt.29.12.2008 and E-mail Dt.28.12.2008  

              from Complainant No.1 to O.P.No.1

 

Ex.A13  E-mail Dt. 29.12.2008 from Complainant No.1 to H.O.CSC

Ex.A14  E-mail Dt.03.01.2009 from S.Dorai Raj to S.Lakshmanan

Ex.A15  E-mail Dt. 07.01.2009 from S.Dorai Raj to O.P.No.2

Ex.A16  E-mail Dt. 09.01.2009 from S.Dorai Raj to O.P.No.1

Ex.A17  E-mail Dt. 13.01.2009 from S.Dorai Raj to S.Lakshmanan

Ex.A18  E-mail Dt. 17.01.2009 from H.O.Customer Service Cell to

               S.Dorai Raj and his Reply Dt. 17.01.2009

 

Ex.A19  E-mail Dt.19.01.2009 from Complainant No.1 to O.P.No.1 and

               Reminders Dt. 20.02.2009 and 23.02.2009

Ex.A20   E-mail Dt. 23.02.2009 from H.O. Customer Service Cell to

                Complainant No.1 and his Reply Dt. 27.02.2009

 

Ex.A21   Notice Dt. 04.10.2009 from S.Dorai Raj to O.P.s

Ex.A22   Letter Dt. 15.10.2009 from O.P.No. 1 to S.Dorai Raj

Ex.A23    Extract of passbook of A/Complaint No. 427955967 of Complainants      

Ex.A24   Indian Bank  Sanction Ticket No.RBS/Edu/2312 / 08.09

Ex.A25   Central Information Commission, New Delhi File No.

               CIC/SM/C/2009/000579,1479,CIC/SM/C/2010/900375&   

               CIC/SM/A/2010/900708

 

Ex.A26   IBA Model Educational Loan Scheme- Adherence to guidelines

Ex.A27   Educational Loan Appraisal Note

Ex.A28   Indian Bank letter 09.01.2009

Ex.A29   Indian Bank Letter  Asiad Colony Branch 10.10.2009

Ex.A30   Right to Information Act, 2005 – Shri-Prathap Ramanathan’s

               application (e-mail) dated 03.12.09)

         

Ex.A31  RBS/EDU/IW/2312/2008-09

Ex.A32  Modified IBA Model Educational Loan Scheme

Ex.A33  Banker’s Fair Practice Code & Code of Ban’s Committed to

              Customer

 

Ex.A34  Fair Lending Practices Code (FLPC)

Ex.A35  Common Guidelines issued RBI for Priority Sector Lending

Ex.A36   Letter dated 11.07.2008 from Opposite Party to Retail Bank segment

               (Sanctioning Authority)    

 

Ex.A37  Annexure to sanction Ticket contains General Terms and conditions   

               applied for all facilities/ all types of borrowers

 

Ex.A38   Banker’s Fair Practice code

Ex.A39   IBA’s Model Education Loan Scheme

Ex.A40 Common Guidelines issued by RBI for Priority Sector Lending

 

 

 

LIST OF DOCUMENTS FILED BY THE OPPOSITE PARTIES:

Ex.B1 dated 07.06.2008                   Application

Ex.B2 dated 21.06.2008                   Guarantor Form

Ex.B3 dated 16.07.2008                   Sanction Ticket

Ex.B4 dated 30.07.2008                   Sanction Ticket

Ex.B5 dated 02.08.2008                   Agreement for Educational Loan

Ex.B6 dated 02.08.2008                   Disposal of Proceeds letter

Ex.B7 dated 02.08.2008                   Consent Letter

Ex.B8 dated 25.07.2008                   Letter     MEMBER – II                                                               PRESIDENT