Punjab

Faridkot

CC/16/330

Vishal Goyal - Complainant(s)

Versus

Oriental Bank of Commerce - Opp.Party(s)

Anil Kumar Chawla

19 May 2017

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, FARIDKOT

Complaint No. :          330

Date of Institution :     8.11.2016

Date of Decision :       19.05.2017

1. Vishal Goyal aged about 45 years s/o Ved Parkash
2. Sharuti Goyal aged about 41 years w/o Vishal Goyal r/o Lajpat Nagar, Kotkapura, Tehsil Kotkapura District Faridkot.                

.....Complainant

Versus

Oriental Bank of Commerce, Kotkapura through its Branch Manager.

......OP

 

Complaint under Section 12 of the

Consumer Protection Act, 1986.

 

Quorum:     Sh Ajit Aggarwal, President,

Sh P Singla, Member.

Present:       Sh A K Chawla, Ld Counsel for Complainants,

 Sh Ravinder Goyal, Ld Counsel for OP.

 

 

ORDER

(Ajit Aggarwal, President)

                         Complainant has filed the present complaint under Section 12 of the Consumer Protection Act, 1986 against OPs seeking directions to Ops to change interest plan of housing loan from inception and to refund Rs.10,000/-paid by complainant to OPs and to pay Rs.50,000/-as compensation for harassment and mental agony and Rs.10,000/-as litigation expenses to complainant.

2                           Briefly stated, the case of the complainant is that complainants raised house loan of Rs. 20 lacs from OP on which interest at the rate of 11.65% was being charged and rate of interest was agreed to be floating rate of interest. Later on the interest was being charged at the rate of 10.65 % per anum and thereafter interest rate was changed on such type of house loan to 9.7%, but OP continued to charge interest at the rate of 10.65%. on this, complainants approached OP and requested them to charge interest at the rate of 9.7%, which was prevailing as other banks have also agreed to charge interest at the rate of 9.7 %. On this, OP advised complainants to deposit Rs.10,000/-alongwith application for change of interest rate at prevailing rate of 9.7% from the date of inception of loan amount. Believing OP, complainants deposited Rs.10,000/-with them, but instead of changing the interest rate from the beginning, OP changed the interest rate from the date of filing the application though they were bound to do so from the  date of raising the loan. It also came to the notice of complainants that OP have illegally and unlawfully charged Rs.10,000/-from them, which amounts to deficiency in service. Complainants requested OP to change interest rate from the date of inception, but they did not do so. Complainants also served legal notice to OP, but that also bore no fruit as OP flatly refused to accommodate with complainants. All this amounts to deficiency in service and unfair trade practice. Complainant has also prayed for compensation and litigation expenses along with main relief. Hence, the complaint.

3                         Ld Counsel for complainant was heard with regard to admission of the complaint and vide order dated 15.11.2016, complaint was admitted and notice was ordered to be issued to the opposite party.

4                              On receipt of the notice, OPs filed written statement wherein submitted that from the statement of Home Loan account of complainants, it is clear that interest was agreed to be charged at rate of 11.65 %, but it was later being charged at the rate of 11.40% and as the interest rate was of flouting nature, therefore Bank has been reducing the interest rate from time to time and no excess interest was ever charged by bank from complainants. It is submitted that only in case of default in making repayment in time, penal interest at the rate of 2% is charged. It is denied that rate of interest was 9.7% in House Loan, rather it was in case of fresh loans. It is further submitted that complainants were being charged interest as per terms and conditions of their loan case and on request of complainants, they were allowed one time option to Switch over as per Circular No. HO : Retail : 5.02.2012 dated 10.05.2012 and as per terms and conditions, one can avail one time Switch over option but the processing fee at the rate of 0.50% is to be charged and accordingly, when complainant opted the one time option of Switch over and deposited Rs.10,000/-as processing fee, their interest rate was changed to 9.70 % per anum. It is denied that OP bank gave any assurance to complainants regarding reduction of interest rate from the beginning of loan, rather is from the date of Switch over option and deposit of process fee. It is further averred that there is no deficiency in service on their part and complainant has levelled false and fabricated allegations against the bank. It is further averred that it is afterthought of complainants that rate of interest was to be reduced from inception of loan, rather terms and conditions of original sanction are changed i.e repayment period, interest rate slab/ group etc and accordingly, new rate of interest is determined. Moreover, they have not charged any amount illegally from complainants, rather amount is charged as processing fee as per Switch over option circular.  All the other allegations are a result of afterthought and are concocted only to extract undue advantage from OP. It is further averred that there is no deficiency in service or unfair trade practice on the part of answering opposite party. All other are refuted with a prayer to dismiss the complaint.

5                                   Parties wanted to lead evidence to prove their respective pleadings and proper opportunity was given to them. The complainant tendered in evidence his affidavit Ex.C-1 and documents Ex C-2 to C-4 and then, closed his evidence.

6                                 In order to rebut the evidence of the complainant, Counsel for OP tendered in evidence affidavit of Sh Manmohan Aggarwal, Branch Manager as Ex. OP-1 and documents Ex OP-2 to 4 and then, closed the evidence.

7                              We have heard learned counsel for parties and have very carefully perused the affidavits & documents placed on the file by complainant as well as opposite party.

8                               Ld Counsel for complainant argued that complainants raised house loan of Rs.20 lacs from OP on which interest a the rate of 11.65% was being charged and rate of interest was agreed to be floating rate of interest. Later on the interest was being charged at the rate of 10.65 % per anum and thereafter interest rate was changed on house loan to 9.7%, but OP continued to charge interest at the rate of 10.65%. on this, complainants approached OP and requested them to charge interest at the rate of 9.7%, which was prevailing as other banks have also agreed to charge interest at the rate of 9.7 %. On this, OP advised complainants to deposit Rs.10,000/-alongwith application for change of interest rate at prevailing rate of 9.7% from the date of inception of loan amount. Believing OP, complainants deposited Rs.10,000/-with them, but instead of changing the interest rate from the beginning, OP changed the interest rate from the date of filing the application though they were bound to do so from the  date of raising the loan. It also came to the notice of complainants that OP have illegally and unlawfully charged Rs.10,000/-from them, which amounts to deficiency in service. Complainants requested OP to change interest rate from the date of inception, but they did not do so. Complainants also served legal notice to OP, but that also bore no fruit as OP flatly refused to accommodate with complainants. All this amounts to deficiency in service and unfair trade practice. Complainant has also prayed for compensation and litigation expenses along with main relief. Hence, the complaint.

9                                    To controvert the arguments of complainant counsel, ld counsel for OP argued that there is no deficiency in service on the part of answering Ops. It is submitted that from the statement of Home Loan account of complainants, it is clear that interest was agreed to be charged at rate of 11.65 %, but it was later being charged at the rate of 11.40% and as the interest rate was of flouting nature, therefore Bank has been reducing the interest rate from time to time and no excess interest was ever charged by bank from complainants. It is submitted that only in case of default in making repayment in time, penal interest at the rate of 2% is charged. It is denied that rate of interest was 9.7% in House Loan, rather it was in case of fresh loans. It is further submitted that complainants were being charged interest as per terms and conditions of their loan case and on request of complainants, they were allowed one time option to Switch over as per Circular No. HO : Retail : 5.02.2012 dated 10.05.2012 and as per terms and conditions, one can avail one time Switch over option but the processing fee at the rate of 0.50% is to be charged and accordingly, when complainant opted the one time option of Switch over and deposited Rs.10,000/-as processing fee, their interest rate was changed to 9.70 % per anum. It is denied that OP bank gave any assurance to complainants regarding reduction of interest rate from the beginning of loan, rather is from the date of Switch over option and deposit of process fee. It is further averred that there is no deficiency in service on their part and complainant has levelled false and fabricated allegations against the bank. It is further averred that it is afterthought of complainants that rate of interest was to be reduced from inception of loan, rather terms and conditions of original sanction are changed i.e repayment period, interest rate slab/ group etc and accordingly, new rate of interest is determined. Moreover, they have not charged any amount illegally from complainants, rather amount is charged as processing fee as per Switch over option circular.  All the other allegations are refuted with a prayer to dismiss the complaint.

10                                  We have thoroughly gone through the case file, evidence and documents placed on record and have carefully perused the pleading of parties. It is observed that case of the complainant is that they raised  house loan from OP Bank and at that time agreed rate of interest was 11.65% per anum on floating rate of interest. Lateron the bank changed the interest of such type of house loan to 9.70 per anum but they charged interest from complainant at the rate of 10.65 % per anum. Complainants approached Ops and requested to change the rate of interest on prevailing rate of interest at the rate of 9.70 % per anum. On it, OP advised complainant to deposit Rs.10,000/-alongwith application for change of interest rate. On the instructions of Ops, complainant deposited Rs.10,000/-alongwith application but the OP did not change the rate of interest from the date of inception of loan, rather they changed rate of interest from the date of application whereas, complainant are entitled for change in rate of interest from the very beginning of the loan. Moreover, the Ops charged the amount of Rs.10,000/-also wrongly and illegally which they were not entitled to charge. On the other hand, Ops admitted that complainants raised house loan from OP Bank and the agreed rate of interest was 11.65% per anum on floating basis. The rate of interest of complainant changed from time to time as per instructions of Reserve Bank of India and Policy of Bank. It is reduced time to time and the bank never charged any excess interest from complainants.  It is  wrong that rate of interest for all house loans was changed to rate of 9.7% per anum, rather it was for the fresh sanctioned house loan cases and complainants were charged interest as per terms of sanction of their house loan. On request of complainants,  they were allowed for one time option to switch over as per circular dated 10.05.2012. As per this circular, one can avail one time switch over option on payment of processing fee at the rate of .50% on total loan amount. Accordingly, Rs.10,000/- as processing fee was charged by them and changed the rate of interest to 9.7 % per anum. It is wrong that complainant was entitled for change of interest from the inception of loan, rather it is from the date of opting the switch over option and deposit of processing fee and accordingly, the rate of interest of complainants is reduced from that date. The OP produced a copy of relevant circular of the Bank as Ex OP-4. In this circular under head Interest Switch Over Option- the interest switch over option shall be available to existing borrowers on any occasion. When they feel the current prevailing card rates of Home loan interest is in their favour as compared to interest actually applied in their account. They may exercise the interest switch over option subject to paying onetime fee. This option shall be available only once during the currency of loan. The newly determined interest rate shall be applicable only from prospective effect i.e for the remaining period of loan as proposed by the borrower after considering the satisfactory conduct of the account in past and future source of payment.

11                           From the perusal of this circular, it is clear that the Bank charged Rs.10,000/-from complainant as per policy of bank and changed the rate of interest from the date of opting for switch over option. Moreover, the complainant themselves produced copy of application dated 18.09.2015 as Ex C-2 to Ops bank for switch over of interest and they themselves deposited the processing fee. From the aforesaid discussion and keeping in view the facts of the case, this Forum is of considered opinion that there is no deficiency in service on the part of OP  Bank and they have charged amount as per rules and regulations. Hence, complaint in hand is hereby dismissed. However, in peculiar circumstances of the case, there are no orders as to cost. Copy of the order be supplied to parties free of costs as per law. File be consigned to record room.

Announced in open Forum:

Dated: 19.05.2017

Member                          President                        (P  Singla)                      (Ajit Aggarwal)