ORDER
R.Vijayakumar, Member.
This is a complaint filed Under Section 11 and 12 of Consumer Protection Act.
The complaint is filed for getting an order directing the opposite party to repay Rs.1671.50, the excess amount collected from the
(2)
complainant along with an interest @ 8 % per annum and for compensation and cost.
The complainant’s case is that he had pledged 15.5 gms of gold in opposite party firm and obtained a sum of Rs.15000/-. The opposite party bank made to believe the complainant that the interest rate is 17% per annum. But when the complainant approached the opposite party to redeem the gold, opposite party demanded interest @ of 30%. This is against RBI rules and Money Lenders Act. The complainant was forced to pay the exorbitant interest due to the urgency to redeem the gold.
On 06/08/09 the complainant sent a legal notice demanding the repayment of the excess amount. Even after receiving that notice, the opposite party did not pay excess amount. The complainant sustained mental agony and financial loss due to the deficiency in service of opposite party. Hence the complaint.
The opposite party’s case is that the complainant had agreed to take back the pledged gold ornaments within 3 months and with agreed rate of interest ie; 17% in addition to other risk, interest and its depending upon the different scheme chosen by the borrower. The complainant has no right to act against his agreement. Even though the gold ornaments was not worth
(3)
Rs.15000/- opposite party paid the said amount based on agreement executed on 23/09/08. The opposite parties collected only Rs.3857/- as interest and other expenses for the period of 10 months and 7 days. The complaint is not maintainable as the complainant is not a consumer under Consumer Protection Act and the complaint is bad for non-joinder also. Hence the complaint is liable to be dismissed.
The complainant filed affidavit. PW1 examined.Exts.P1 to P4 and D1 series marked.
Heard both sides.
The points that would arise for consideration are :
1. Whether the complaint is maintainable?
2. Whether there is any deficiency in service from the part of opposite party?
3. Compensation and cost.
Points (1)
The opposite party contented that the complaint is bad for non joinder of parties and it not maintainable as the complainant is not a consumer under the provisions of Consumer Protection
(4)
Act. Consumer Protection act is not meant for recovery of money. This Forum is not having jurisdiction to ascertain an interest rate also.
In our opinion, the complaint was filed against the necessary party who has involved in the transaction. The complaint is not bad for non joinder as it is not specified which of the necessary party is to be impleded. The Forum has jurisdiction to entertain the case because the complainant is alleging deficiency in service from the part of opposite party which resulted monitory loss and mental agony to the complainant. Hence the complaint is maintainable in the Forum.
Points (II) and (III)
Admittedly the complainant had pledged 15.5 gms of gold ornaments with opposite party for Rs.15,000/- on 23/09/08 and he had redeemed the gold ornaments on 31/07/09. The opposite party collected Rs.3857/- as interest.
The allegation of the complainant is that the opposite party had collected interest in an exorbitant rate than the agreed interest rate. The opposite party’s contention is that they had collected interest based upon the agreement executed by both parties.
(5)
We have perused the documents in detail. Ext.D1 shows that the basic interest rate for the loan is 17%. It is stated in Ext.D1 (a) that more amount is payable based on the value of gold and under various schemes. The interest rate also will be varied to higher rate. The space to note the interest rate kept blank in Ext.D1 (a) the loan receipt. But in Ext.D1 (b) it is noted that the risk interest in this case is 12 per cent and if the loan repaid within 3 months 6% risk interest and in case of refund within 6 months 3% risk interest will be waived. It is also noted that compound interest also will be calculated in case when the loan repaid after 1 year. The complainant has submitted that the staff of opposite party made to believe the complainant that the interest rate is 17% per annum and at the time of pledging gold the complainant never agreed to pay any excess interest. The opposite party has extracted 30% interest and this is against the Reserve Bank guide lines.
The opposite party had not challenged the fact they had collected 30% interest and repeatedly stated that they had collected only the agreed rate of interest. According to the opposite party the agreed rate of interest is 17+12 percent per annum. As a Non- Banking Finance Company, they had to abide
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by the guidelines of RBI.
In our opinion the opposite party had collected an exorbitant rate of interest for the loan availed by the complainant pledging the gold ornaments. The opposite party had right only to collect interest at the rate of a maximum of 18% as decided by the Hon’ble State Commission. We are of the view that there is deficiency in service from the part of opposite party. The points found accordingly.
In the result, the complaint is allowed directing the opposite parties to refund the amount collected in excess of 18% per annum for the pledged period along with interest at the rate of 8% from the date of till the date of payment. The opposite party is further directed to pay compensation Rs.1000/- and cost Rs.1000/-.
The order is to be complied with within one month of this date of receipt of the order.
Dated this the 30th day of November 2010.
K.Vijayakumaran :Sd/-
Adv.Ravi Susha :Sd/-
R.Vijayakumar :Sd/-
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INDEX
List of witnesses for the complainant
PW1 - Biju
List of documents for the complainant
P1 - Advocate notice
P2 - Postal receipt
P3 - Acknowledgment card
P4 - Reply notice
List of documents for opposite party
D1 (a) & D1(b) - agreement dtd:23.09.08.
D1(C) - Copy of application
// Forwarded by Order //
Senior Superintendent
