DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, PALAKKAD
Dated this the 15th day of March 2014
Present: Smt.Seena.H. President
Smt.Shiny.P.R. Member
Smt.Suma.K.P. Member Date of filing : 15/07/2013
CC No.113/2013
Dr.George T Ninan,
Ninan’s Clinic and Laboratory,
Mettuppalayalm Street,
Palakkad – 678 001
(By Adv.B.Ravikumar) - Complainant
Vs
M/s.Vijaya Bank, Palakkad
Rep.by its Branch Manager,
P.B.No.36, R.S.Road,
Opp.Town Railway Station,
Palakkad – 678 001 - Opposite party
(By Adv. S.T.Suresh)
O R D E R
Order by Smt.SEENA.H, PRESIDENT
The complainant had applied for a mortgage loan and the opposite party had sanctioned an amount of Rs.20,65,000/-. The agreed rate of interest was 14% per annum with 60 EMIs. The said terms and conditions were agreed by the complainant and had signed the documents for the loan. The amount was to be availed within 90 days from the date of sanction of loan. The said facts were informed to the complainant by the opposite party by letter dated 27/2/2013. The complainant being satisfied with the terms and conditions of the opposite party had availed the loan of Rs.20,65,000/- from the opposite party on 01/3/2013. After the disbursal of the loan, the opposite party is deducting the installment amounts from the SB Account of the complainant towards repayment of the loan. On verification, it was found that the opposite party has charged an amount of Rs.29,290/- as interest for the loan i.e. at the rate of 17.02% per annum. On coming to know about this, the complainant had sent a letter to the opposite party for clarification. The opposite party replied that they are charging 16.70% (floating) interest on the loan and the sanction letter was issued by over sight. The acts of the opposite party is unfair trade practice and deficiency of service. There were other Banks and financial institutions which are ready to advance loan to the complainant at a lesser rate of interest. Since the complainant is a customer of the opposite party for a pretty long period, he opted the opposite party for availing loan. Eventhough the rate of interest mentioned in the letter dated 8/5/2013 was 16.70%, the actual rate charged was 17.02%. Now the opposite party had collected amounts in excess of what is chargeable from the complainant from April 2013 onwards. The complainant had never agreed for any interest higher than 14% per annum as there are other banks ready to give loan on a lesser rate of interest than what is charged by the opposite party. After availing the loan, the opposite party is not entitled to change the terms and conditions unilaterally without the knowledge and consent of the complainant.
Moreover, the opposite party in their sanction letter had not stated that the rate of interest was floating. But in the letter dt.08/5/2013, it was stated that the rate of interest was floating. The same is illegal.
The opposite party is bound to return the excess amount charged to the opposite party. The service rendered by the opposite party is deficient and unfair trade practice.
Opposite party filed version contending the following:
The complaint is not maintainable in law and bereft of bonafides. The Forum to raise dispute between the customer and the Bank is the “Banking Ombudsman” and not the Consumer Redressal Forum. Opposite party admits that complainant has applied for a mortgage loan and the opposite party has sanctioned an amount of Rs.20,65,000/-. It is quite incorrect to state that the agreed rate of interest was 14% per annum. The correct rate of interest chargeable is 16.70% (floating) for the aforesaid mortgage loan at the time of execution of the document. The provisional sanction letter dated 27/2/2013 was issued during Loan Mela and there was heavy rush of customers and by oversight the rate of interest was wrongly mentioned as 14% at that time. It was inadvertent error occurred and was subsequently rectified in the original sanction letter as well as in the documents executed by the opposite party and his guarantors. At the time of the execution of the document it was explained by the opposite party and complainant has categorically agreed and consented for the same. As per the guidelines issued by the Reserve Bank of India and head office of the opposite party the correct interest rate is charged. It is incorrect to state that the opposite party has charged at the rate of 17.02% per annum. The correct interest rate charged is 16.70%.
Complainant and opposite party filed their chief affidavit. Ext.A1 to A5 marked on the side of the complainant. Ext.B1 & B2 marked on the side of opposite party.
Now the issues are to be considered are
1.Whether there is any deficiency in service on the part of opposite
party ?
2. If so, what is the relief and cost entitled to the complainant ?
Issues 1 & 2
Facts of the case are more or less admitted. Complainant was sanctioned a loan of Rs.20,65,000/- is admitted. It is also admitted that in the sanctioned letter issued dated 27/2/2013, the rate of interest mentioned was 14%. According to opposite party it was erroneously written by oversight as it was issued in a loan mela, where there was huge rush. The points to be decided is whether such a mistake committed by opposite party is deficiency in service on their part. Deficiency in service means a fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service. It is to be kept in mind that opposite party is a nationalized bank acting as per RBI guidelines. Interest chargeable is also as per RBI norms. Such nationalized bank cannot be expected to lower the rate of interest so as to canvass loan applicants as other private banking institutions.
Ext.B2 evidences the fact that at the time of execution of promissory note dated 1/3/13 complainant is aware of the rate of interest. The stand of the complainant that he was made to sign on printed papers and hence was not aware of rate of interest mentioned in Ext.B2 is unbelievable especially when it is made by a well educated person like the complainant herein. The allegation of the complainant that many other bank offered loan to the complainant at a lower rate of interest is not supported by any documentary evidence.
On going through the entire evidence on record we are of the view that the mistake noted in Ext.A1 is only a human error and no deficiency in service could be attributed on that account. Opposite party has stated that document was executed in a loan mela and that was not objected by the complainant also.
In view of the above discussion we are of the view that complainant miserably failed to prove any deficiency in service on the part of opposite party. In the result complaint dismissed.
Pronounced in the open court on this the 15th day of March 2014.
Sd/-
Seena H
President
Sd/-
Shiny.P.R.
Member
Sd/-
Suma.K.P.
Member
APPENDIX
Exhibits marked on the side of the complainant
Ext.A1 – Copy of letter dated 27/2/2013 sent by opposite party to the
complainant
Ext.A2 – Copy of letter dated 24/4/13 sent by complainant to opposite party
Ext.A3 – Reply letter dated 8/5/13 sent by the opposite party to the
complainant.
Ext.A4 – Pass Book of complainant in the opposite party bank
Ext.A5 – Pass Book of complainant in the opposite party bank
Exhibits marked on the side of the opposite party
Ext.B1 – Copy of IRC Circular No.13004 issued by Head Office, Vijaya Bank,
Bangalore dated 14/2/2013
Ext.B2 – True copy of the Promissory Note executed by complainant and
Guarantors in favour of the Bank dated 1/3/2013
