Tamil Nadu

North Chennai

CC/109/2015

M/s.Vishal Kumar Sethia - Complainant(s)

Versus

M/s.Standard Chartered Bank - Opp.Party(s)

M/s.Sethia Associates

23 Feb 2022

ORDER

                                                                  Complaint presented on : 14.05.2015

                                                                    Date of disposal            : 23.02.2022

                                                                                  

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

CHENNAI (NORTH)

@ 2^ND Floor, T.N.P.S.C. Road, V.O.C. Nagar, Park Town, Chennai – 600 003.

 

PRESENT: THIRU. J. JUSTIN DAVID, M.A., M.L.      : PRESIDENT

THIRU. S. BALASUBRAMANIAN, M.A., M.L.          : MEMBER

 

C.C. No.109/2015

 

DATED THIS WEDNESDAY THE 23^rd DAY OF FEBRUARY2022

                                

Mr.Vishal Kumar Sethia,

Proprietor, M/s.Sethia Infotech,

Rep. by his POA, Vikas Kumar Sethia,

No.2/6, Narasingapuram Street,

Mount Road, Chennai – 600 002. 

                                                                                                    .. Complainant.                                                                  ..Vs..

 

 

M/s. Standard Chartered Bank,

Represented by its Branch Manager,

No.19, Rajaji Salai,

Chennai – 600 001.

 

                                                                                                 ..  Opposite party.

 

 

 

Counsel for the complainant                           : M/s.Sethia Associates

Counsel for the  opposite party                     : M/s. R & P Partner

 

 

 

ORDER

THIRU. J. JUSTIN DAVID, PRESIDENT

          This complaint has been filed by the complainant against the opposite parties under section 12 of the Consumer Protection Act, 1986 prays to  refund a sum of Rs.76,000/- towards penalized amount to pay a sum of Rs.8,00,000/- towards loss of  business and to pay a sum of Rs.10,00,000/- towards compensation for mental agony with cost of this complaint.

1.THE COMPLAINT IN BRIEF:

          The complainant is carrying on business of dealing with computer laptops, desktops and peripherals of several brands under the name and style of M/s.Sethia Infotech at No.2/6, Narasingapuram Street, Mount Road, Chennai 600 002 as the sole proprietor. The complainant in the year 2009 avoided overdraft facilities under loan account No.42705434903 for a sum of Rs.7.6 crores (which included bank guarantee). In the normal course of business, the overdraft facility will be renewed for a term of 12 months and reviewed for the following term of 12 months duration. The last renewal was due on 31.08.2014. The complainant was offered a loan at a rate of around 12% (Floating) by M/s.Yes Bank Limited. Therefore, the complainant preferred to migrate to M/s.Yes Bank Limited to avail future financial assistance for his business. There was a balance of Rs.3,97,40,429.78 in the overdraft account as on 26.08.2014 with the opposite party. Out of the said sum, a sum of Rs.3,86,90,000/- was paid by the complainant on the same day. After the said payment, a sum of Rs.17,63,510/- remained to be paid under the overdraft account with the complainant as on 30.08.2014. On 30.08.2014, the complainant paid a sum of Rs.20,00,000/- and as a result, there was an excess amount of Rs.2,36,490.22/-(plus balance) in the overdraft account. In the instant case, there was no occasion for claiming pre-closure charges from the complainant because as on 31.08.2014(Sunday) the date on which 12 months term terminated. For availing loan with the opposite party, properties belonging to the complainant’s family members were given as security by depositing the title deeds with the opposite party. The complainant by his e-mail dated 29.09.2014 requested the opposite party to release their title deeds dept with them as collateral securities, the opposite party surprisingly refused to release the documents (title deeds), pertaining to the property, stating that the complainant was liable to pay pre-closure charges of Rs.15,20,000/- plus service tax, in all a sum of Rs.17,07,872/-. According to the opposite party, the payment of Rs.3,86,90,000/- on 26.08.2014, a major portion of the outstanding loan amount itself will be treated by them as pre-closure. The view taken by the opposite party was wholly untenable. The opposite party made a huge  demand only to prevent the complainant from migrating to another bank for funding his business. The opposite party made an unreasonable claim under the guise of pre-closure charges only with a malafide intention and deliberate motive to hold the complainant back from shifting his account. On the other hand, M/s Yes Bank insisted the complainant to deposit the title deeds, which were in the custody of the opposite party. Out of the total loan sanctioned by M/s Yes Bank, they with held a sum of Rs.65,00,000/- from disbursement and refused to give bank guarantee till all the original title deeds were deposited with them. The opposite party cited clause 5 of the loan agreement. Clause 5 of the loan agreement reads as follows: “Pre-payment charges: The facility shall attract prepayment charge at 2% plus applicable service tax (as may be revised by the Bank from time to time) on the facility limits granted to the Borrower in the event of: (a) Repayment by the Borrower to the Bank of any amount ahead of previously agreed repayment schedule or tenor or terms or dates of repayment or renewal as contained in the Facility Letter: or (b) The Borrower’s not availing the facility or any part thereof within 60 (sixty) days from the date of its grant”. The opposite party is not entitled to claim pre-closure charges and they were also very well aware of the same. The complainant thus was forced to file a Writ Petition numbers as W.P.No.30759 of 2014 before the Hon’ble High Court of Madras to seek a direction for release of original title deeds from the opposite party, but the Hob’ble Court declined to admit the writ petition itself since there was no jurisdiction to entertain writ petitions against private banks. The complainant therefore registered a complaint before the Hon’ble Banking Ombudsman against the opposite party on 10.12.2014 which was registered as complaint No.201415006003679/2014-15. The opposite party finally by their e-mail dated 05.02.2015 agreed to release the original title deeds without demanding any pre-payment charges from the complainant. On 17.02.2015 when the opposite party requested the opposite party to collect the original title deeds, the opposite party deliberately did not hand over the patta, chitta and adangal of Kundrathur property which they subsequently handed over to the complainant after couple of days.  The opposite party committed an act of deficiency in service as per the Consumer Protection Act. The complainant, therefore, has no other option but to file the above complaint before this Hob’ble Forum. The complainant was made to run from pillar to post to get back his original title deeds. The conduct of the opposite party amounts to deficiency in service. The complainant therefore is entitled for  refund of  penal amount of Rs.76,000/- which M/s Yes Bank has penalized him for not depositing original title deeds apart from damages for loss of business. Hence this complaint.

2.WRITTENVERSION FILED BY THE  OPPOSITE PARTY  IN BRIEF:

          The opposite party, Standard Chartered Bank, is a banking company incorporated with limited liability, in England in 1853. The opposite party takes a preliminary objection as to the maintainability of the complaint before this forum as the opposite party is not deficient in rendering any of the services to the complainant. The complainant is not a consumer as defined under the consumer protection act. The grievance of the complainant if any can only be redressed by a competent civil court and not before this forum. Based on the application form duly signed by the complainant and the other requisite documents provided, the SME account bearing number : 42705434903 under the category SME – Over draft facility had been opened on October 01,2009. Accordingly, the opposite bank had been renewing the facility was renewed lastly in the month of November 2013. Post the last renewal of the facility in November 2013, the said facility was due for its next review on 31.08.2014. The desire of the complainant to shift to another bank is solely the discretion of the complainant and the opposite party does not wish to comment on the same. The complainant is bound to facilitate the closure of the loan account and release of the title documents collected as collateral security. As per the terms and conditions agreed and signed by the customer for availing the facility, the pre-payment of the facility granted will attract a pre-payment charge at 2% with service tax. An extract from the facility letter dated 19.11.2013 is provided below for reference. Pre – Payment Charges – The facility shall attract prepayment charge at 2% plus applicable service tax (as may be revised y the bank from time to time) on the facility limits granted to the borrower in the event of: Repayment by the borrower to the bank of any amount ahead of previously agreed repayment or renewal of the facility as contained in the Facility Letter; or. The complainant had deposited a cheque for Rs.38,690.000.00 on august 26,2014, against the outstanding of Rs.39,775,035.78 as on 25.08.2014 although the renewal date falls on august 31,2014. The complainant had further credited the account with an amount of Rs.34,606/- on august 26,2014, thereby effecting a payment of 97.35% against the actual outstanding, as on august 25,2014. Hence, the complainant is liable to pay prepayment charges for closing the facility before the renewal date of august 31, 2014. Despite non-Payment of the pre-closure charges and requesting for closure, the complainant had been operating the account. The opposite party is concerned only with the account maintained by the complainant with the opposite party and if the Complainant had made the necessary pre-closure payments as agreed in the facility letter, the opposite would have completed the formalities and closed the account. Considering, the fact that the complainant had repeatedly raising concerns for waiver of the Pre-closure charges, on receipt of the Banking Ombudsman complaint, the opposite party had proactively called the complainant for settlement talks. As a goodwill measure the Opposite party had also released the property documents without applying the Pre-Payment charge of Rs.17,07,872.00/-, thus waving it off. The details of the same were also communicated to the complainant. The complainant in fact had also acknowledged the same and confirmed closure of complaint post receipt of the property documents vide his email dated 04.02.2015. On resolution of the banking Ombudsman complaint, a detailed response had also been sent to the banking Ombudsman copying the complainant. There is no cause of action to institute Present complaint.        

3. POINTS FOR CONSIDERATION:    

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

2.Whether the opposite party is liable to refund Rs.76,000/- to the complainant?

3. Whether the complainant is entitled for compensation towards loss of  

    business and deficiency in service?

4 To what other relief, the complainant is entitled?

 

 

4. POINT NO :1TO 3

The complainant is a proprietor of M/s Sethia Infotech and opposite party is  Standard Chartered Bank. The complainant is carrying on business of dealing with computer laptops, and desktop. The complainant availed overdraft loan facilities with the opposite party from the year 2009.  In the normal course of the business, the over draft facility will be renewed for a term of 12 months and renewed up to 31.08.2014. Thereafter the complainant preferred to migrate  to M/s Yes Bank Limited to avail financial assistance for his business. There was a balance of Rs.3,97,40,429.78/-  in his over draft account as on 26.08.2014. Out of the said outstanding balance, the complainant paid a sum of Rs.3,86,90,000/- on 26.08.2014. After the said payment a  balance sum of Rs.17,63,510/-  is to be  paid under the over draft account. The complainant paid a sum of Rs.20,00,000 on 30.08.2014 and there was excess amount of 2,36,490.22 in the over draft account. The complainant requested the opposite party to release the title deeds kept with the opposite party as collateral security. But opposite party refused to  release the document stating that the complainant was liable to pay pre-closure charge of Rs.15,20,000/- plus service charge totalling Rs.17,07,872/-. The opposite party also  not disputed the above averment of the  complainant.

          05. The complainant alleged that the opposite party refused to release the title deeds on the reason that the complainant is liable to pay pre-closure charge and service tax totaling Rs.17,07,872/-.  The opposite party contended that as per the terms and conditions agreed and signed by the complainant, the customer has to pay pre-payment charge at 12% with service tax and therefore the complainant is liable to pay pre-payment charge of Rs. 17,07,872/-. The opposite party demanded the above said amount as per the terms and conditions signed by the complainant at the time of availing the facilities. Therefore, there is no deficiency in service on the part of the opposite party.

          06. Thereafter, the complainant preferred a complaint to the banking ombudsman and ombudsman registered a complaint against the opposite party on 10.12.2014.  The complainant and opposite party agreed for a settlement before the banking ombudsman. Ex.A28 is the letter written by the Assistant Manager of Bank to the complainant on 04.02.2015. In Ex.A28 it is written as follows. “As per the discussion, you have verbally confirmed closure of this complaint in the event, the property documents are released without the applicability of pre-closure charges.” The complainant and  the opposite party  entered into a compromise and opposite party as a good will measure waive the complainant re-payment penalty and arrange for release of property document and the complainant confirmed the receipt of property documents vide e-mail dated 04.02.2015 and therefore banking ombudsman closed the complaint of the complainant. Ex.A30 is the letter dated 05.02.2015  and Ex.A32 is the copy of ordered passed by the banking ombudsman dated 11.02.2015.

          07. The complainant is doing business and for his business purpose availed over draft facilities from the opposite party. Therefore the complainant is not a consumer within the meaning of consumer as defined in the Consumer Protection Act 1986. Therefore the Consumer complaint filed against the opposite party also not maintainable before this commission.

          08. The complainant in his complaint admitted the receipt of original document from the opposite party. On the other hand the complainant alleged that the opposite party made the complainant to run from pillar to post to get back his original title deeds and the conduct of the opposite party amounts to deficiency in service.

          09. The opposite party as a goodwill waive the pre-closure charge and service tax payable by the complainant and return all the originals. The delay in return of original documents to the complainant is not because of the opposite party but because of the complainant who was liable to pay the pre-closure charge and service tax as per the terms and conditions agreed by the complainant at the time of availing the facility. Therefore, there is no deficiency in service on the part of the opposite party the opposite is not liable to refund Rs.76,000/- to the complainant  and complainant is not entitled for compensation towards loss of business deficiency in service.

10. POINT NO :4

Since the opposite party has not committed any deficiency in service, the complainant is not entitled for any relief as prayed and the complaint is liable to be dismissed.

          In the result, this complaint is dismissed. No costs.                    

Dictated  by the President to the Assistant taken down, transcribed and computerized by her, corrected by the President and pronounced by us in the open Commission on this the 23^rd  day of February 2022.

 

MEMBER – I                                                                PRESIDENT

LIST OF DOCUMENTS MARKED ON THE SIDE OF COMPLAINANT:

Ex.A1 dated 19.11.2013          Overdraft Facility Letter by opposite party

 

Ex.A2 dated NIL                     Bank Account Statement for the period from 01.08.2014 to 30.08.2014

 

Ex.A3 dated NIL                     Loan facility granted by M/s. Yes Bank to complainant

 

Ex.A4 dated 29.09.2014          E-mail correspondence to opposite party requesting return of collateral security

 

Ex.A5 dated 30.09.2014          Reply to email correspondence dated 29.09.2014 from opposite party demanding pre-closure charges.

 

Ex.A6 dated 13.10.2014          E-mail correspondence to opposite party requesting for return of collateral security again without payment of pre-closure charges

 

Ex.A7 dated 15.10.2014          Reply to e-mail correspondence dated 13.10.2014 from opposite party demanding pre-closure charges for releasing security

 

Ex.A8 dated 26.11.2014          E-mail correspondence requesting opposite party to release documents without levying pre-closure charges

 

Ex.A9 dated 10.12.2014          Acknowledgement from Banking Ombudsman for Registration of complaint against opposite party

 

Ex.A10 dated 16.12.2014        Acknowledgement from Banking Ombudsman for admitting complaint as maintainable

 

Ex.A11 dated 20.12.2014        E-mail correspondence from opposite party demanding pre-closuree charges for releasing documents

 

Ex.A12 dated 20.12.2015        Reply e-mail correspondence to opposite party

 

Ex.A13 dated 24.12.2014        E-mail correspondence to opposite party to know the status of complaint

 

Ex.A14 dated 30.12.2014        Email correspondence from opposite party demanding pre-closure charges for releasing documents

 

Ex.A15 dated 30.12.2014        Reply to opposite party denying liability to pay pre-payment charges

 

Ex.A16 dated 05.01.2015        E-mail correspondence to opposite party seeking their response towards complaint

 

Ex.A17 dated 06.01.2015        E-mail correspondence asking opposite party to respond to complaint with ombudsman

 

Ex.A18 dated 06.01.2015        Reply from opposite party seeking time to respond to complaint

 

Ex.A19 dated 12.01.2015        E-mail correspondence to opposite party to know status of complaint

 

Ex.A20 dated 13.01.2015        E-mail correspondence requesting opposite party to release documents since they were prolonging the matter on some or other reasons

 

Ex.A21 dated 19.01.2015        Another E-mail correspondence requesting opposite party to respond properly

 

Ex.A22 dated 19.01.2015        Reply from opposite party requesting time till 23.01.2015 to reply

 

Ex.A23 dated 23.01.2015        E-mail correspondence to opposite party seeking assurances for closing the issue

Ex.A24 dated 29.01.2015        E-mail correspondence to opposite party

 

Ex.A25 dated 03.02.2015        E-mail correspondence to opposite party from opposite party seeking more time to sort out issue

 

Ex.A26 dated 04.02.2015        Letter sent to Banking Ombudsman to direct opposite party to release documents without further delay with postal receipt

 

Ex.A27 dated NIL                   Acknowledgement Card

 

Ex.A28 dated 04.02.2015        E-mail correspondence from opposite party seeking permission to close complaint given to banking ombudsman

 

Ex.A29 dated 04.02.2015        Reply to opposite party

 

Ex.A30 dated 05.02.2015        E-mail correspondence from opposite party to release documents by waiving off pre-payment charges as service gesture by 16.02.2015

 

Ex.A31 dated 05.02.2015        Reply to opposite party denying service gesture for relasing title deeds

 

Ex.A32 dated 11.02.2015        Letter from opposite party to Banking Ombudsman

 

Ex.A33 dated 19.02.2015        Reply to Lette dated 11.01.2015 (of opposite party) to Banking Ombudsman with postal receipt)

 

Ex.A34 dated NIL                   Statement of accounts reflecting Money borrowed by private individual

 

Ex.A35 dated NIL                   Yes Bank lette reflecting penealty charges

 

Ex.36 dated NIL                      Annual Turnover - Report

LIST OF DOCUMENTS MARKED ON THE SIDE OF OPPOSITE PARTY

Ex.B1 dated 19.11.2013                   Facility Letter

 

Ex.B2 dated NIL                      Statement of Accounts

 

Ex.B3 dated 30.09.2014                   E-mail Communication

& 15.10.2014

 

Ex.B4 dated 20.12.2014                   E-mail communication

 

Ex.B5 dated 09.12.2014          Complaint given by complainant to banking ombudsman

 

Ex.B6 dated 04.02.2015          Complainant e-mail confirming closure of complaint

 

Ex.B7 dated 11.02.2015          Letter to the banking ombudsman from the opposite party

 

 

MEMBER – I                                                               PRESIDENT