Kerala

StateCommission

RP/14/2017

SOUTH INDIAN BANK - Complainant(s)

Versus

P K SATHEESH - Opp.Party(s)

V S MOHANAN NAIR

23 Aug 2018

ORDER

 

KERALA STATE CONSUMER DISPUTES REDRESSAL

COMMISSION  VAZHU THACAUD, THIRUVANANTHAPURAM

 

 

REVISION PETITION.14/2017

JUDGMENT DATED:23.08.2018

PRESENT : 

SHRI. T.S.P MOOSATH                                             : JUDICIAL MEMBER

SHRI. RANJIT. R                                                         : MEMBER

South Indian Bank,

Kadavallur, R/by

Branch Manager, Kadavallur Branch,

Thalappilly, Thrissur-680 543.                                         : PETITIONER

 

(By Adv: Sri. R.S. Mohanan Nair)

 

            Vs.

 

Satheesh P.K, S/o Kochunny,

Pulikkottil House, Kadavallur P.O,                                 RESPONDENT

Thalappilly, Thrissur

 

JUDGMENT

SHRI. RANJIT . R: MEMBER

Opposite party before the lower forum has filed this revision against the order dated, 3^rd February 2017 in I.A.18/17 in CC.457/2016 on the file of Consumer Disputes Redressal Forum (for short district forum), Thrissur by which the forum allowed interlocutory application filed by the complainant and directed the revision petitioner/bank to act as per the auction notice and release the gold ornaments by closing the gold loan on or before 8.12.2017.

2.      Revision counter petitioner/complainant had filed the complaint in CC.457/16 seeking an order restraining the revision petitioner/opposite party for conducting auction sale of the pledged gold ornaments and directing revision petitioner/opposite party to return the gold ornaments to the complainant at the time of clearing the pledged money.  The revision counter petitioner/complainant filed an application for interim order as I.A.18/17 for handing over the gold ornaments pledged with the revision petitioner/opposite party to him till the disposal of the complaint.  The Forum below passed that impugned order under challenge.  Aggrieved by this order the revision petitioner preferred this revision.

3.      Heard the counsel for the Revision Petitioner and respondent/ complainant who was present in person.  We perused the records.

4.      Learned counsel for the revision petitioner contended that the revision petitioner/bank is entitled to recover the dues for the default of loan amount, by auction sale of the pledged ornaments and if there is any surplus available, it could be appropriated by the bank towards any other loan, overdraft or debt due by the partner as debtor or guarantor or in any other capacity.  The revision petition/bank is entitled to retain the gold ornaments unless and until the entire loan transaction with the revision petitioner is fully and finally settled by the revision counter petitioner.  Learned counsel further contended that the loan transaction in the name of revision counter petitioner/complainant become NPA.  Therefore any assets of the complainant kept by the bank, the action available to the revision petitioner is to recover the dues to them from the assets kept by them.

5.      The revision counter petitioner/complainant strongly opposed this and contended that, the bank has decided to consider the gold in dispute as additional security for other loans.  Bank ought to have issued a notice to the petitioner with all these details instead of auction notice.  He further contended that for other loans there is sufficient security.  The revision counter petitioner also submitted that the marriage of his daughter was proposed to be conducted on 13.2.2017 and he pledged the gold ornaments kept for the marriage of his daughter for agricultural loan.  The bank refused to return the gold ornaments to the complainant even in case of remittance of agricultural loan.  It is also contended that the complainant is meeting financial stringencies due to the recent economic policy and currency notes prohibition and hence he is left with no other chance to get money for the marriage of her daughter.  He further submitted that he is ready and willing to remit the loan amount towards gold loan and its interest, and submitted that gold ornaments pledged as security for loan transaction with the bank may be released.

6.      Admittedly the revision counter petitioner/complainant has other loans, ie KCC over draft and educational loan in the same bank and that these loans has already been classified into NPA due to non payment of dues.  Bankers usually catagorise loan as Non Performing  Assets (NPA) after 90 days of non payment of interest which can occur during the term of the loan.  Further the bank can exercise the lien and try to set of as per the banking law and also as per the terms of the agreement executed with the complainant infavour of the revision petitioner/bank.  These terms and conditions are existing in all similar agreement of pledge, in the respondent bank and all other banks in India.  Revision petitioner/bank has right to exercise the lien/set of as per clause 7 and clause 8 of loan agreement executed by the complainant.

7.      Section 171 of the Contract Act states that “general lien of bankers, factory, wharfinger, attorneys and policy brokers may, in the absence of the contract to the contrary, retain security for a general balance of account in goods bailed to them.  But no other person has a right to retain as a security for such balance goods bailed to them unless there is an express contract in that effect.

8.      Applying this principle of law to this case we are of the view that undoubtedly the revision petition/bank has a lien over the KCC over draft and educational loan of the complainant.  The Hon’ble Supreme Court of India has laid down this legal position in the decision ‘Syndicate Bank Vs. Vijaya Kumar and Others’ reported in 1992 KHC 821 (SC).  The Hon’ble National Commission in State Bank of India Vs. Padmakar Mirajkar reported in 2018(1)CPR 451 (NC) relied on this decision of the Apex Court  and held that banker has a general lien on the amount deposited by the complainant in his individual account.

9.      This legal principle laid down by the Hon’ble Supreme Court of India was not looked into by the lower Forum.

10.    The district forum carried away by the recitals in the auction notice issued by the bank in violation of the legal principle, passed the order directing the bank to act as per the auction notice and to release the gold ornaments by closing the gold ornaments on or before 8.2.2017.  More- over by passing the impugned order, in the interlocutory application, the district forum has granted the final relief itself sought by the complainant  in the complaint which is highly erroneous in law.

11.    Based on the above discussion it can be seen that the district forum was not able to make correct analysis of facts and circumstances.  The revision petitioner/bank has a right to exercise their lien/set of as per clause 7 and 8 of gold loan agreement executed by the complainant/revision counter petitioner unless and until the complainant pay the over due and regularize the KCC over draft and education loan and close the gold loan.  The direction of the district forum to release the gold ornament of the complainant is to be set aside, we do so.

In the result the revision petition is allowed and the order passed by the district forum in I.A.181/7 in CC.451/16 is set aside.

The district forum is directed to dispose the complaint as expeditiously as possible.  Parties to suffer their respective costs.

 

T.S.P MOOSATH : JUDICIAL MEMBER

 

RANJIT. R : MEMBER

VL.