Punjab

Ludhiana

CC/15/285

Jai Kishan Sharma - Complainant(s)

Versus

Punjab National Bank - Opp.Party(s)

22 Aug 2016

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, LUDHIANA.

 

Consumer Complaint No. 285 of 27.04.2015

Date of Decision            :   22.08.2016 

 

Jai Kishan Sharma son of Shri Suresh Kumar Sharma student ID No.15679888 of Latrobe University, Melbourne, Australia at present and local C/o Sh.S.K.Sharma, House No.115 (909/3-Old) Tagore Nagar, Ludhiana, through Power of Attorney Sh.S.K.Sharma.

….. Complainant

                                                         Versus

 

1.Punjab National Bank, Overlock Road, Ludhiana through its Chief Manager.

2.Punjab National Bank, Overseas Branch, Ludhiana through its Chief Manager.

 

…Opposite parties 

             (Complaint U/s 12 of the Consumer Protection Act, 1986)

 

QUORUM:

 

SH.G.K.DHIR, PRESIDENT                                     

MRS.          BABITA, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant                      :          Sh.Suresh Kumar Sharma, Representative of

                                                 complainant

For OPs                          :          Sh.Vijay Kumar Gupta, Advocate

 

PER G.K.DHIR, PRESIDENT

 

1.                Complainant, a student at Melbourne (Australia) filed complaint through his father Sh.S.K.Sharma, who holds general power of attorney on his behalf. As complainant was interested to pursue higher studies from Latrobe University, Melbourne(Australia) for Master of Accounting and Financial Management and as such, he approached Ops for availing education loan of Rs.15 lac. That loan was sanctioned by OPs to the complainant along with co-borrower Sh.S.K.Sharma(father of complainant) subject to individual guarantee of Smt.Karam Rekha(grand-mother of complainant) on creation of equitable mortgage of 150 sq. yards of commercial property bearing No.B-7-357 situate at Sati Soodan Street, Ludhiana. That property was owned by Smt.Karam Rekha, the co-borrower. Loan documents were executed by the complainant in favour of OP bank on 19.12.2007. Borrower was to repay the loan with accrued interest in 84 equal monthly installments. Repayment was to commence one year after the course period or 6 months after getting job whichever occurred earlier. Extension of repayment period was within the discretion of OPs bank. As per the agreement, loan was to be utilized by the borrower for the purpose of pursuing studies. That loan was to be utilized for payment of fee payable to college/school/hostel,examination/library/laboratory fee or for purchase of books/equipment/instruments/uniforms etc. Education course was completed by the complainant on 14.12.2010 and result notification was received on internet from the university directly. Degree was supposed to be provided to the complainant in March 2011 only and thereafter, complainant could have applied for the job. Complainant has not got the job so far. Period of one year for repayment of education loan was to commence w.e.f.14.12.2011, which date has not come up till the date of filing of the complaint. However, Ops illegally, arbitrarily and against cannons of justice and norms fixed by RBI declared the said account as NPA(Non Performing Assets) on 5.5.2010 with the balance of Rs.18,05,461/- knowing fully well that repayment schedule yet to arrive. As per RBI guidelines, NPA can be declared only if installment of loan or interest not paid for 180 days. No sufficient opportunity was provided to the complainant of being heard before declaring the account as NPA. Despite numerous approaches by the complainant to OPs to withdraw their order of declaring the account as NPA, OPs have not done anything. Loan was to be disbursed by the OPs on completion of every semester exam, but they committed intentional illegality of not disbursing the same as per the terms and conditions of the loan agreement. OPs were also liable to pay for the diet money i.e. food amount, rent, purchase of computer essentials and other equipments required for completion of the course. Complainant was in India in February, 2009 and at that time, he requested Ops to send his tuition fee to Latrobe University, Melbourne(Australia). Application for sending 9155 AUS$ was submitted, but the amount was intentionally sent to wrong bank i.e. Common Wealth Bank of Australia, Sydney instead of Melbourne without Latrobe University Swift and BSB Code number and student ID. This payment was returned by the foreign bank by deducting AUS$ 69. That is alleged to be deficiency in service on the part of OPs. OPs admitted this fact in the sent email. This payment again was re-transmitted by Ops bank having its IBB Branch, Ludhiana on 2.3.2009 on the correct address with Swift Code number, but due to this short amount of AUS$ 69, the Latrobe University stopped providing the internet course services to the complainant. Notice was issued to the complainant for calling upon him to explain. So, irreparable loss in studies was caused to the complainant. Even OPs delayed the payment of living expenses intentionally for more than two months just by demanding house rent receipts. That demand of OPs alleged to be illegal and arbitrary because no rent or receipt was issued in Australia. Complainant being international student, suffered badly because of non receipt of living expenses for more than two months. On account of delay in submission of living expenses, landlord of the complainant forced the complainant to leave the rented house and as such, complainant had to suffer because he was not having any money in Australia for food and living expenses. Rather, as per information provided by the father of the complainant to him, the officials of OPs bank were joking as if complainant can earn money by doing part time job in Australia. However, the complainant could not have done part time job, being on student visa. Complainant requested his father to send him AUS$ 1500 for the purchase of laptop, food and living expenses and payment of house rent. Father of complainant requested OPs in April, 2008 to remit the said amount, but said amount of AUS$ 780 required for the purchase of laptop, AUS$ 440 for paying house rent and AUS$ 280 for food and living expenses was intentionally delayed for more than two months by Sh.V.K.Jethi, Branch Manager and Shri. Balbir Singh, Loan Officer of Punjab National Bank Branch Office, Overlock Road, Ludhiana. These officials of  OP bank were intentionally demanding the original ink signed copy of quotation/purchase receipt of laptop. Through international email, the scanned copy of bill sent, but despite demand of original receipt/bill continued. Bank officials were informed that a week’s time will be required for reaching the documents through courier    in India. Bank officials were again reminded vide letter dated 2.5.2008 for the detailed information, but without any response. Though, the details were submitted vide letter dated 10.5.2008 in original, but despite that AUS$ 1500 were released on 3.6.2008 only.

2.                As per allegations of complainant, on 10.3.2009, the complainant was in India and he submitted margin money of Rs.24,317/- in his education loan. An amount of Rs.1,02,964/- was forwarded by OPs to Punjab National Bank Branch Office IBB, Ludhiana along with application form for issue of foreign D/D of Westpac, Banking Corporation. Ops were informed about catching of flight No.QF3954 by the complainant on 11.03.2009. However, officials of OPs bank refused to issue D/D by saying that there is holiday in New Delhi Head Office. So, complainant had to miss the flight on 11.3.2009. For next flight booking, complainant had to pay Rs.3000/- extra approximately. Even the complainant has to bear the cancellation charges. D/D could have been issued on National Foreign Exchange rate, but the said D/D No.204408 was issued on 16.03.2009 instead of 11.3.2009 resulting in sufferance of loss of interest by the complainant. Even the complainant suffered on account of difference in currency exchange rate. Complainant requested OPs to pay difference of exchange rate, interest and credit the same in his account, but nothing has been done till date. Unnecessary intentional delay in disbursement of education loan caused huge mental torture and humiliation to the complainant and as such, estimate of those studies loss pegged at AUS$ 1 lac equivalent to  Rs.43,50,000/-. On account of mental torture and harassment suffered by the complainant, he has to get himself admitted in hospital at Melbourne in November/December, 2009 for treatment. Latrobe University vide letter dated 30.09.2009 had informed the complainant as if his enrolment has been discontinued/terminated because he failed to pay the fees pertaining to 2^nd Semester enrolment by the specified dates. Intimation in that respect was received by the complainant vide letter dated 30.09.2009 and the same was sent to OPs. Complainant was intimated by the University authorities that in case, he wants revival of enrolment, then he will have to pay the outstanding fee plus $110 as revival of enrolment fee. On account of late submission of education fee, there was difference in the exchange rate i.e. from Rs.27/- per AUS$ to Rs.43.50 per AUS$. So complainant could not complete his education with the disbursed education loan and deposited  margin money. There was a short fall of AUS$ 6100. Complainant called upon his father to send the said amount, so that he may complete his course. Father of the complainant arranged AUS$ 6100 from Indian Overseas Bank, Ludhiana and remitted the same to the complainant for payment to Latrobe University. The above said loss in this respect suffered by the complainant on account of intentional deficiency in service and mal  practice adopted by the OPs.         Though, claim for such loss lodged with the head office of OPs, but to no effect. Other litigation between Guide International Export Wing and Punjab National Bank pending in Civil Courts. Even an application under order 39 rule 2-A of Civil Procedure Code for punishing the OPs for committing disobedience of injunction order dated 4.4.1997 with extension date of 6.2.1998, is pending in the Civil Courts. Complainant estimated the loss on account of mental tension, torture, agony and financial loss at Rs.19,80,000/-. By pleading negligence, deficiency in service and adoption of mal trade practice, complainant seeks directions for declaring the NPA order dated 5.5.2010 as illegal. Setting aside of the same sought. Further prayer made for issuing directions against OPs to pay compensation of Rs.19,80,000/- on account of mental sufferance, torture and agony etc.

3.               In the written statement filed by OPs, it is pleaded interalia as if complaint is not maintainable; this Forum has no jurisdiction to entertain the complaint; power of attorney placed on record does not authorize the attorney to file the present complaint. Besides, it is claimed that grievance put forth in the complaint involve interpretation of provisions of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and as such, this Forum in view of Section 34 read with Section 35 and Section 37 of the above said Act has no jurisdiction. Rather, remedy available with the complainant is to file appeal to the Debts Recovery Tribunal. It is claimed that M/s Guide International (Export Wing) and Guide International are the Family Partnership Concerns, who availed various credit facilities from OPs bank branch at Ludhiana. Education loan of Rs.15 lac was also availed by the complainant along with his father Sh.S.K.Sharma as co-borrower. It is claimed that Sh.S.K.Sharma is the Managing Partner of the said firms. All the three loan accounts were secured by way of common collateral mortgage of the property owned by Smt. Karam Rekha, mother of Sh.S.K.Sharma. Said Smt.Karam Rekha is also guarantor in all the three loan accounts. Loan account of the firm M/s Guide International (EW) was classified as Non Performing Asset on 31.12.2009 because of non-adherence of the financial discipline of the bank. Even there was family dispute amongst the partners of the firms. The other two accounts i.e. Term Loan of M/s Guide International and the Education loan in the name of Sh.Jai Kishan Sharma and Sh.S.K.Sharma were also declared as Non Performing Assets on 5.5.2010. The declaration of NPA was on account of non adherence of bank’s financial discipline as well as on account of creation of common collateral security through equitable mortgage of property of Smt.Karam Rekha, mother of Sh.S.K.Sharma. Though, loan was repayable in 84 monthly installments commencing from February, 2011, but to keep the education loan out of NPA category, the co-borrowers were requested vide letter dated 17.4.2010 to provide substituted collateral security. Despite affording of sufficient opportunity to provide the substituted security for the education loan account, the complainant or his father did not respond and as such, the bank was compelled to classify the education loan amount as NPA as on 5.5.2010. Even the bank had to file a recovery suit for Rs.38.34 lac on 15.12.2010 before DRT Chandigarh in respect of all the three accounts by enforcing a common mortgage. That suit is pending before the Forum of Debt Recovery Tribunal Chandigarh. The cost of Education Project (MBA) as submitted by the borrower at the time of availing of loan was AUS$ 64600.00, which is equivalent to Rs.22.61 lac in Indian Currency, if exchange rate as applicable at that time taken as Rs.35/- per dollar. Amount over and above laon amount of Rs.15 lac was to be borne by the borrower himself. Even the adverse fluctuation in the rate of conversion of Dollar into Indian Rupee was to be borne by the borrower. Total exposure of the bank was not to exceed Rs.15 lac limit. Disbursement of the first installment of loan of Rs.2,71,000/- was made on the date of agreement itself i.e.19.12.2007 as per request letter dated 18.12.2007. Second installment of Rs.48,400/- was disbursed on 19.2.2008 against request letter dated 18.2.2008. Third installment of Rs.99,000/- was disbursed on 20.2.2008 against request sent through letter dated 18.2.2008. Fourth installment of Rs.53,000/- was disbursed on 3.6.2008 against the request sent through letter dated 12.5.2008. Fifth installment of Rs.3,03,000/- was disbursed on 18.8.2008 against request letter dated 12.8.2008 for house rent, living expenses, food expenses and books etc for next semester. Sixth installment of Rs.1,34,000/- was disbursed on 9.9.2008 against request dated 3.9.2008 for fees. Seventh installment of Rs.1,74,000/- was disbursed on 21.10.2008 against request dated 16.10.2008 for living expenses, house rent, food and conveyance etc. 8^th installment of Rs.86,953/- was disbursed on 10.12.2008 against request dated 6.12.2008 for living expenses and house rent payment to landlord in advance for 8 months. 9^th installment of Rs.2,52,000/- was disbursed on 20.2.2009 against request dated 10.2.2009 towards education fees for the year. 10^th and the last installment of Rs.78,647/- was disbursed on 10.3.2009 against letter of request dated 4.3.2009 towards the living food, electricity, telephone, transportation charge, books and computer software etc by crediting the same in the account of complainant. So, entire sanctioned loan amount stood paid upto 10.3.2009. Thereafter, complainant was not entitled to any more amount. Loan account of the complainant was declared NPA due to compelling circumstances referred above. There was bonafide/unintentional error on the part of the remitting office of the bank in releasing the payment on 20.2.2009. That error was corrected forthwith on 2.3.2009 on being pointed out by the borrower. Allegations of remittance of the amount on wrong address denied. In fact the payment to the University was due on 19.3.2009, but the amount was remitted after correction of mistake on 2.3.2009. The alleged short fall of AUS$ 69 was also remitted by the bank on 20.4.2009. Disbursement of loan was made after completion of due formalities as per the terms and conditions of the loan agreement and as such, by denying each and every other averment of the complaint, prayer made for dismissal of the complaint. Every payment was used to be credited to the account of the complainant or through draft. After disbursal of the entire sanctioned loan limit amount of Rs.15 lac on 10.3.2009, complainant was not entitled to any more advance on the strength of the loan documents. The difference in exchange rate owing to fluctuation, if any, is always to be borne by the borrower. Besides, the margin money always to be borne by the borrower himself. Filing of application under order 39 rule 2-A of CPC admitted, but it is denied that OPs have committed any disobedience of the injunction order.

4.                Earlier, complainant was represented by Sh.Rajeev Abhi, Advocate, who closed the evidence of complainant on 5.7.2011 after tendering in evidence affidavit EX.CW1/A of General Power of Attorney of complainant along with documents Ex.C1 to Ex.C34. On the other hand, Sh.Vijay Kumar Gupta, Advocate, representing OPs tendered in evidence affidavit Ex.RW1/A of Sh.Major Singh, its Senior Manager along with documents Ex.R1 to Ex.R6 and closed the evidence on 19.8.2011. Thereafter, an application for permission to lead additional evidence was filed by OPs on 30.11.2011 and the same was allowed vide orders dated 14.12.2011. Counsel for Ops tendered in additional evidence affidavit Ex.RW2/A of Sh.V.S.Bhandari, Senior Manager; affidavit Ex.RW3/A of Sh.Major Singh, Senior Manager along with documents Ex.R7 to Ex.R12 and then closed the additional evidence. In rebuttal to this additional evidence, counsel for complainant tendered in evidence affidavit Ex.CW2/A of Sh.S.K.Sharma, Power of Attorney holder of complainant along with documents Ex.C35 to Ex.C43 and then closed the evidence.

5.                After hearing the arguments, earlier complaint was disposed off with the observations that in view of allegations of forgery, the parties should avail the remedy before appropriate court of law. That order dated 18.04.2012 was challenged in appeal and the Hon’ble State Consumer Disputes Redressal Commission, Punjab, Chandigarh vide orders dated 26.03.2015, remanded the case back to this Forum by observing that case should be decided on merits considering the pleadings and evidence produced by the parties. It was observed by the Hon’ble State Consumer Disputes Redressal Commission, Punjab, Chandigarh in order dated 26.3.2015 passed in First Appeal No.706 of 2012 that complaint pertains to the deficiency in service and unfair trade practice on the part of OPs in declaring the education loan as NPA before time and as such, complaint should be decided on merits. Even liberty was given to the OPs to raise question about bar of jurisdiction of this Forum in view of pendency of       proceedings under the SARFAESI ACT before DRT, before this Forum.

6.                          After remand of the case to this Forum by the Hon’ble State Consumer Disputes Redressal Commission, Punjab, Chandigarh, an application was filed for fetching up certain documents from the complainant, but that application was dismissed by holding that public record can be produced by OPs themselves by seeking permission from Court concerned. However, permission to lead additional evidence was granted to OPs vide orders dated 1.12.2015. Liberty was granted to the complainant to produce in rebuttal, the affidavits sought to be produced by him, subject     to proof of relevancy. Thereafter, another application was filed by OPs for directing the complainant to produce on record the copies of complaint and written statement of civil suit. That application was virtually for reviewing the earlier orders referred above and as such, said application was dismissed with costs of Rs.1000/- to be deposited by OPs in the Consumer Welfare Fund, which were deposited on 20.01.2016 Counsel for OP tendered in evidence affidavit Ex. RX of Sh. S.P. Chawla, Manager Punjab National Bank, Ludhiana ARMB, 5, Ferozepur Road, Ludhiana along with documents Ex.RW4/1, Ex.RW4/2 as well as Ex. RA and Ex. RB and then closed the additional evidence. Representative of complainant tendered in evidence documents Mark A to Mark M and Ex.K1 and then closed rebuttal to additional evidence of complainant. Written arguments were filed on behalf of complainant not once, but on more than three occasions. That practice of submitting the written arguments again and again was found not appreciable. Arguments at length repeatedly addressed by the representative of complainant without stop, despite insistence that such practice not permissible. Arguments of counsel for Ops also heard and records gone through minutely.

7.                Representative of complainant through written and oral arguments argued that action be taken against counsel for OPs and erring officials of Ops like Sh.S.P.Chawla and others. However, Consumer Forums cannot punish the erring official in complaint proceedings, albeit such right of punishment can be exercised only for enforcement of the order to be passed in this complaint. In holding this view, we are fortified by law laid down in case titled as Inder Singh Sachdeva (Wing Commander) Vs Amritbir Singh and others 2015(4)CLT-162(Punjab State Consumer Disputes Redressal Commission, Chandigarh). As per ratio of this case, in case cancelation of allotment due to irregularities in allotment takes place, then District Consumer Disputes Redressal Forum has no jurisdiction to pass order for registration of FIR against the erring employees and further to direct to proceed against them by Chief Secretary of State Government. Issuuance of such directions held in the above cited case, to be beyond the purview of the District Forum because it is for the concerned authorities to take departmental action against  erring employees. So if any irregularity committed by officials of Ops, then the departmental authorities alone can take action.

8.                 If there was an interim injunction against Punjab National Bank in civil suit of Guide International decided by the court of Sh. Jagdeep Sood, Civil Judge (Senior Division), Ludhiana in December 2013 and violation of the same committed, then remedy available with concerned is to proceed under order 39                          Rule 2-A CPC and this Fora has nothing to do with that. Guide International is a distinct concern than that of the individual identity of the complainant as a borrower for contracting education loan for studying abroad and as such, also for violation of the orders of civil court, this Forum has no jurisdiction. The Consumer Forum to assume jurisdiction in case a case of deficiency in service on the part of Ops or adoption of unfair trade practices made out. So the scope of adjudication in this complaint is limited to the extent as to whether any deficiency in service on the part of Ops is there or as to whether any unfair trade practice adopted by Ops in disbursal of the loan to complainant.

9.               If counsel for Ops obtained copy of plaint of civil suit titled as Jai Kishan Sharma Vs Mukesh Kumar Sharma or of case Guide International Vs Punjab National Bank, then due to that it cannot be held that any unfair trade practice was adopted by the said counsel because while dismissing the application filed by Ops for directing complainant to produce on record copies of the plaint and written statement of civil suit titled as Jai Kishan Sharma Vs Mukesh Kumar Sharma with costs of Rs.1,000/- on 11.01.2016, it has already been held that said copies may be obtained after seeking permission of Presiding Officer of the court concerned. So if uncertified copies of that suit (after being obtained from the civil court concerned) produced on record as Ex. RA and Ex. RB, then no illegality committed because those copies of the plaint and written statement itself reflect as if uncertified copies got from the inspection cell and prepared by officials, whose initials are there on the seals of  the copies being uncertified.

10.               If the education loan of complainant legally declared as NPA, then same could  be deficiency in service for which liability of Ops as principal will remain. Branch Manager Sh. Varinder Bhandari or Sh. S.P. Chawla or Sh. Balbir Singh or Sh. J.C. Grover acted as agents of OP bank being its employees. Contract/agreement for loan Ex. C9 was executed by complainant along with co-borrower (as guarantor) on one side and Punjab National Bank on the other side and as such, if the officials of OP committed any illegality or irregularity in disbursal of the loan or declaring the loan as non performing asset in illegal manner, then liability remains of OP bank as principal. Section 226 of Indian Contract Act provides that the contracts entered into through an agent, liable to be enforced in the same manner and will have the same legal consequences, as if contract had been entered into by the principal in person. In view of Section 226 of Indian Contract Act, 1872 and in view of the fact that it is not a case of exercise of authority by officials of OP in excess of their authority as agents of OP, it is obvious that for deficiency in service (if any), liability of OP will remain and there is no need to punish its officials, particularly when such punishment is beyond purview of this Forum.

11.              It is vehemently contended by counsel for Ops that as proceedings under Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred as SARFAESI Act) had already been initiated by OPs and as such, in view of compromise arrived at between the OP bank and the co borrowers, this Forum has no jurisdiction to adjudicate the complaint. Those submissions advanced by counsel for Ops though looks exfacie correct, but in fact they have no force. The produced documents on record namely Ex.R2 to Ex. R6 establishes that one time settlement was arrived at between Punjab National Bank on one side and M/s. Guide International or Mukesh Kumar Sharma and guarantor Smt. Karam Rekha. Ex. R2 is the copy of the application filed by OP with Debt Recovery Tribunal-II, Chandigarh. Ex.R2 establishes as if complainant Jai Kishan Sharma was arrayed as defendant No.9 in that case along with guarantor Karam Rekha as defendant No.5 and co borrower Suresh Kumar Sharma as defendant No.3. In the proceedings of that application for issue of recovery certificate, one time settlement was arrived at on statement of offer Ex. R3 by Smt. Karam Rekha and Sh. Mukesh Kumar Sharma and that is why that application was got dismissed as withdrawn by OP through order Ex. R6. That settlement was arrived at by Punjab National Bank after getting approval from the authorities of OP. That settlement was with respect to Non Performing Asset accounts of M/s. Guide International (Export Wing); M/s. Guide International; Jai Kishan Sharma and Suresh Kumar Sharma (education loan). These are the facts borne from the contents of Ex. R3 and Ex. R4 itself. Said compromise was arrived at between the bank by Smt. Karam Rekha and partner of M/s. Guide International, Mukesh Kumar Sharma and as such, certainly complainant or his representative Sh. Suresh Kumar Sharma were not parties to that one time settlement. That settlement was for discharging liability with respect to the loan accounts referred in  the statement Ex. R3. Through that statements Ex. R3 and Ex. R4, it was specifically mentioned that compromise considered by the bank as commercial decision and will have no bearing, whatsoever on the ongoing criminal case/investigation, if any carried out by CBI, police or any other agency. The decree to be obtained in terms of one time settlement, for the entire claim in proceedings of suit for recovery before Debt Recovery Tribunal, Chandigarh, by filing memorandum of settlement is a clause contained in Ex. R4. The withdrawal of              claims/counter claims/criminal cases, if any filed, in any court of law against the bank/its officials, was agreed by Mamta Sharma, Mukesh Sharma (partners) of M/s. Guide International (Export Wing) and Smt. Karam Rekha, Mortgagor cum guarantor. No mention made in Ex. R4 or Ex. R3 or Ex. R5 or in order Ex. R6 that due to affect of that one time settlement, this complaint also will be withdrawn. Rather complainant or his representative cum father Sh. Suresh Kumar Sharma did not put signatures on Ex. R3 and Ex. R4 and as such, virtually one time settlement was arrived at between guarantor cum surety and the lendor. As per section 128 of Indian Contract Act, 1872, the liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract. Besides as per clause 4 of the loan agreement Ex. C9, it was the responsibility of borrower i.e. complainant, Jai Kishan Sharma to provide suitable surety for the loan. In view of this clause, letter of guarantee Ex. C10 was executed by Smt. Karam Rekha by specifically agreeing  through clause 3 that the guarantee will be a continuing guarantee. As per   Clause 4 of Ex. C10, guarantor to be taken as joint debtor with the borrower. So if Smt. Karam Rekha stood surety for complainant in the education loan in question, then her liability for payment of the outstanding due to remain as joint debtor. In view of Smt. Karam Rekha, being joint debtor with complainant and in view of  Smt.Karam Rekha having stood as surety, it is obvious that liability of Smt. Karam Rekha for repayment of the education loan in question was co-extensive  with complainant. So if Smt. Karam Rekha as surety/guarantor/co borrower entered into one time settlement with bank for discharge of liability of complainant qua education loan in question, then said settlement was for escaping the liability of auctioning the property mortgaged by Smt. Karam Rekha as guarantor/co borrower/surety. So withdrawal of suits or counter claims or criminal cases was to be an act performed by Smt. Karam Rekha or Sh. Mukesh Kumar Sharma  or Mamta Sharma, who submitted proposal through offer Ex. R3 and agreed to the terms of settlement Ex. R4. As complainant or his father cum representative were not parties to Ex. R3 and Ex. R4 and as such, they certainly did not undertake for withdrawal of this complaint. So Rule of estoppel does not operate as a bar against complainant in pursuing this complaint.

12.              It is vehemently contended by Sh. V.K. Gupta, Advocate representing OPs that in view of initiation of proceedings under SARFAESI Act  by complainant, jurisdiction of this Forum is barred in view of Section 34 of the above said Act. After going through Section 34 of SARFAESI Act, it is made out that no civil court shall have jurisdiction to entertain any suit or proceedings in respect of any matter, which a Debts Recovery Tribunal or the Appellate Tribunal is empowerd by or under this Act to determine and no injunction with respect to the same shall be issued. Debt Recovery Tribunals under above said Act are constituted for empowering the secured creditor to enforce the security measures without interference of the court. For exercise of that powers, possession of security assets may be taken and after issue of the debt recovery certificate, secured assets can be sold or put to auction. Interim orders for securing advanced loan  of the secured creditors even can be passed. Debt Recovery Tribunal on filing of the application by the secured creditors qua non performing assets to issue notice to the borrower or its representative and thereafter on failure of borrower to discharge the liability, the secured creditor may be ordered to take possession of the secured asset or even to take over management of business of borrower. Even the Debt Recovery Tribunal as per Section 13 of SARFAESI Act may appoint a manager for managing the secured assets and order the auction of secured assets through bid by reserving a price. So purpose of SARFAESI Act is to enable the secured creditor to avail speedier remedy against the defaulting borrowers. Nowhere in the SARFAESI Act, it has been provided that for deficiency in service on the part of the bank officials or the banks, they cannot be held liable. Rather the disputes regarding classification of NPAs should be considered and resolved by the internal mechanism of the bank. It is not a whim and fancy of the financial institutions to classify the asset as NPA. Rather Reserve Bank of India has laid a policy for providing guidelines in the matter of pendency of asset to be a non performing asset known as, “RBI’s prudential norms on income recognition, asset classification and provisioning-pertaining to advances” through circular dated 30.08.2001. So OP or its officials, if at all was to declare the education loan account of complainant as NPA, then they should have acted in accordance with norms laid down by Reserve Bank of India. In case the loan account in question declared NPA in violation of instructions issued by Reserve Bank of India, then the same amounts to deficiency in service on the part of OP because OP or its officials could not have classified the  loan in question as NPA in violation of instructions issued by Reserve Bank of India. Even Hon’ble Apex Court of the country in case titled as Merdia Chemicals Ltd. Vs Union of India in AIR 2004 S.C. 2371 has held that the financial institutions/lendors owe a duty to act fairly and in good faith. Further it has been held by Hon’ble Apex Court of the country that the financial companies/institutions are not free to ignore performance of their part of the obligation as a party to the contract.  It is also observed by Hon’ble Supreme Court that it cannot be a one sided affair shutting out all the possible and reasonable remedies to the other party, namely, borrowers and assume all drastic powers for speedier recovery of NPAs. The borrower cannot be left remedy-less in case they have been wronged against or subjected to unfair treatment violating the terms and conditions of the contract. So certainly the borrower can plead in defence deficiencies on the part of the banks and financial institutions. When such right of pleading deficiency in service on the part of the bank available to borrower, then certainly the Consumer Forum in view of section 13 of Consumer Protection Act has powers to deal with such cases of proved deficiency in services by the banks.  The pleading of deficiency in service can be done by the borrower even before Debt Recovery Tribunal assuming jurisdiction in the matter of recovery of the NPA loan account for escaping the liability of payment of debt or part thereof. It is not a case in which account of secured creditor or its official or manager, exercising any of the right of secured creditor under challenge before this Forum. More over it is not a case in which action of Debt Recovery Tribunal in passing order on the basis of one time settlement  under challenge and as such, benefit of Section 32 and 34 of SAFAESI Act not available in this case, particularly when compensation in this case claimed on account of deficiency on the part of OP or its officials in declaring the loan account as NPA.  Moreover Debt Recovery Tribunal has not adjudicated the case on merits through order Ex. R6, but ordered Punjab National Bank to withdraw the application for issue of certificate of recovery of the loan accounts declared as NPA. So provisions of resjudicata are not applicable in this case, particularly when the subject matter of the proceedings before Debt Recovery Tribunal was distinct that those of the proceedings of this complaint. Subject matter of this complaint is as to whether the bank officials remained deficient in providing services in respect of education loan due to non disbursal of the same in time or not. However, subject matter of proceedings before Debt Recovery Tribunal was recovery of the loan amounts. No findings given by Debt Recovery Tribunal through order Ex. R6 qua the loan in question being classified as NPA against guidelines and norms issued by Reserve Bank of India and as such, order Ex. R6 of Debt Recovery Tribunal does not debar this Forum to adjudicate the question of deficiency in services by OP to complainant.

13.              Benefit of ratio of case New Bank of India Vs Surinder Kaur 2005(2) ISJ (Banking) 139, cannot be availed by OPs because in the reported case, question involved was as to whether sanctioned loan should have been disbursed without furnishing of guarantee/surety by the bank. Those are not the question involved in the case before us because disbursal of the education loan has already taken place and even virtually recovery through one time settlement from the surety has been affected.  In case of Bank of Baroda Vs Ranjeet Singh 2012(3) Consumer Protection Cases (NC), it has been held that in view of Section 171 of Indian Contract Act, matter regarding lien of the bank over a title deed of mortgaged property with respect to debts is within domain of  adjudication of Debt Recovery Tribunal and not Consumer Forum. That question of exercising of lien is not involved in the proceedings of this complaint and as such, benefit from ratio of this case not available to OPs.

14.              Certainly as per law laid down in case of B.L. Joshi, Glayland Ltd. S.A. & others Vs Bank of India 2013(2) Consumer Protection Cases 300 (NC), Consumer Fora cannot go against the orders of Debt Recovery Tribunal because it cannot sit as appellate authority on the order passed by Debt Recovery Tribunal. In the case before us, Debt Recovery Tribunal passed order Ex. R6 for withdrawal of the application for issue of recovery certificate by OP and that order of Debt Recovery Tribunal is not under challenge and as such, this Forum not sitting as appellate authority over the order Ex. R6 of Debt Recovery Tribunal. Cause of action in the complaint before us emanates from the deficiency in service, owing to non following of the norms laid by Reserve Bank of India and as such, complaint is maintainable.

15.              In para No.6 of the case titled as Hari Prasad Kabra Vs Dena Bank and others 2013(2) Consumer Protection Cases 191 (NC), it has been specifically found that authorized representative of complainant could not point out any deficiency on the part of OP bank and as such, in view of subject matter qua recovery of the loan from particular property, jurisdiction of the Consumer Forum held barred with respect to   the matters falling in the domain of Debt Recovery Tribunal. Question of recovery of the loan from particular property is not involved in this complaint and as such, certainly this Forum can go into the question as to whether OP was deficient in providing service to complainant or not. In case titled as Harianandan Prasad Vs State Bank of India  2013(1) Consumer Protection Cases 176 (NC), it has been held that District Forum has no jurisdiction to pass interim order for directing the bank not to proceed for recovery of debt  by taking coercive measures. No such order going to    be passed in this complaint and as such, benefit of ratio of above cited case not available to complainant. Certainly Consumer Forum  has no jurisdiction to entertain a complaint raising a controversy falling within domain of Debt Recovery Tribunal, but the Consumer Forum certainly has jurisdiction to decide as to whether deficiency in service on the part of bank is there or not because of violation of norms/guidelines issued by Reserve Bank of India.

16.              The challenge to one time settlement Ex. R3 and Ex. R4 or the orders passed on the basis of the same as Ex. R6,certainly cannot be given in the proceedings of this complaint because authenticity/validity of one time settlement is within domain of Debt Recovery Tribunal, who passed the orders on the basis of the same.

17.              Though reference made to orders passed by Sh. Jagdeep Sood, Learned Civil Judge (Senior Division), Ludhiana and the other orders of the civil courts, but those orders have no relevancy for the disposal of this complaint because civil suit no.243 of 04.04.1997 titled as Guide International (Export Wing) Vs Punjab National Bank was for permanent injunction for restraining Punjab National Bank from invoking letters of credit No.LTA 7414P/76 and LTA 7415P/96 both dated 19.09.1996. The loan account  of Guide International (Export Wing) stands on different footings than that of the education loan account of complainant and as such, order of injunction passed by the court of Sh. Jagdeep Sood, Civil Judge (Senior Division), Ludhiana has no bearing to the controversy of deficiency in service or of adoption of unfair trade practices by OPs (if any). Besides the produced clippings of newspapers by the complainant has no bearing to this case. Copy of the statement of account of complainant Jai Kishan Sharma Ex. RW4/1 and of Sh. Mukesh Kumar Sharma Ex. RW4/2 produced in course of additional evidence by OPs are admissible            because of their being certified true copies by concerned Senior Manager Sh. Jagdish Chander Sharma. These copies carry presumption of truth due to such certification in view of Section 4 of Banker’s Book Evidence Act. No proof adduced by complainant to rebut the contents of Ex. RW4/1 and Ex. RW4/2 and as such, they are to be taken as correct. After going through copy of statement of account of complainant Jai Kishan Sharma Ex. RW4/1, it is made out that an amount of Rs.3,03,000/- was disbursed  to him on 18.08.2008, but an amount of Rs.1,34,000/- on 09.09.2008 and Rs.1,74,000/- on 21.10.2008. These amounts disbursed in education loan account of complainant. However, copy of statement of account of Sh. Mukesh Kumar Sharma Ex. RW4/2 shows as if amount of Rs.2,23,389/- transferred through RTGS by complainant Jai Kishan Sharma on 22.09.2008 and that amount stood transferred by Sh. Mukesh Kumar Sharma on 23.09.2008 to Guide International. Further an amount of Rs.1,87,689/- remitted through RTGS by complainant Sh. Jai Kishan Sharma to Sh. Mukesh Kumar Sharma on 29.10.2008 and same was transferred by Sh. Mukesh Kumar Sharma to Guide International on 31.10.2008, but to the tune of Rs.1,86,000/- only. So these certified copies of statement of accounts enough to establish that Sh. Jai Kishan Sharma was possessing capacity to transfer Rs.2,23,389/- and Rs.1,87,689/- to account of his uncle Sh. Mukesh Kumar Sharma and said Mukesh Kumar Sharma out of these received amounts transferred amount of Rs.2,23,389/- and Rs.1,86,000/- to M/s. Guide International. A person possessing capacity of transferring these amounts definitely cannot be financially constraint and as such, vehement submissions of sufferance by complainant due to non disbursal of the installment of loan amounts, has less force because document cannot tell lie, albeit the person may. Besides copy of the plaint of civil suit titled as Jai Kishan Sharma Vs Mukesh Kumar Sharma placed on record as Ex. RA establishes that on request of Sh. Mukesh Kumar Sharma, uncle of complainant, the complainant advanced Rs.2,23,389/- by credit  entry in Saving No.3463000101476481 on 22.09.2008 maintained with Punjab National Bank, Overlock Road branch, Ludhiana. In copy of this complaint Ex. RA, it is further mentioned that an amount of Rs.1,87,689/- more was transferred by complainant Jai Kishan Sharma in the account of his uncle Sh. Mukesh Kumar Sharma on 29.10.2008. Contents of this complaint Ex. RA as such corroborates the entries of Ex. RW4/1 and Ex. RW4/2 each. In para No.2 of the complaint, the copy of which is produced on record   as Rx. RA, it is specifically mentioned that complainant engaged himself in private employment, so as to meet needs of his subsistence and other requirement as student of Latrobe University Melbourne (Australia). This admission of complainant suffered in complaint Ex. RA enough to establish that the complainant continued to earn through private employment even during his career as student in Latrobe University Melbourne (Australia). Above referred amounts were advanced by complainant to his uncle Sh. Mukesh Kumar Sharma on loan @ 18% per annum interest as per contents of Ex. RA and as such, contents of Ex. RA enough to support the contentions of Sh. V.K. Gupta, Advocate that complainant was not in financial constraint during his stay in Australia, as a student.

18.              Copy of the written statement filed by Sh. Mukesh Kumar Sharma in civil suit titled as Jai Kishan Sharma Vs Mukesh Kumar Sharma placed on record as Ex. RB. Perusal of that written statement Ex. RB reveals that Sh. Mukesh Kumar Sharma along with his brother Sh. Suresh Kumara Sharma (father of complainant) remained as partners in firm M/s. Guide International (Export Wing) and the margin money for the advance of the educational loan was paid out of account of firm M/s. Guide International (Export Wing). Further in this written statement Ex. RB itself, it has been mentioned that money received by Sh. Mukesh Kumar Sharma on 22.09.2008 and 29.10.2008 was transferred in the account of above said firm through savings account maintained with Punjab National Bank, Overlock Road, Ludhiana branch. Margin money of  educational loan was paid out of this transferred money as per contents of Ex. RB. Whether or not, really it happened so, that is the controversy to be adjudicated by the civil court, but not by this Forum because such like complicated questions requiring elaborative evidence can be decided by civil court. That controversy falling within the domain of civil court need not to be gone into      in summary proceedings of this complaint. However, from the produced documentary evidence on record, there remains no dispute that actually complaint possessed the capacity to transfer huge amounts of Rs.2,23,389/- and Rs.1,87,689/-  on 22.09.2008 and 29.10.2008, during which period he remained as student in Australia.

19.              Complainant in rebuttal to additional evidence, tendered in evidence document Ex. A to M and Ex. A1. Ex. A is the list of submitted documents, whereas Ex. B is copy of order dated 23.01.2014 passed by worthy Commissioner of Police, Ludhiana to the effect in respect of the complaint filed by Smt. Karam Rekha against parents of complainant, it was appropriate that owing to pendency of the case in the court of JMICs, Ludhiana, the parties will have to abide by orders of the court concerned. Ex. C      to Ex. E are replies of application under RTI sent by officials of Punjab National Bank. Through Ex. E it is conveyed to complainant that information regarding NPA account of complainant has already been conveyed. Ex. F to Ex. K are the documents showing as if complaints against some judicial officials filed by representative of complainant and even some information under RTI sought from Hon’ble High Court  or from the office of Hon’ble Chief Justice of Punjab and Haryana High Court. Those documents are not relevant. If some application like Ex. K has been field for initiating the proceedings qua tempering with the file of civil suit, then the same has nothing to do with the adjudication of this complaint.

20.              Ex. C1 is the copy of general power of attorney executed by complainant in favour of his father Sh. Suresh Kumar Sharma and as such, complaint has been filed through duly authorized representative. Ex. C2 to Ex. C4 and Ex. C6 are the documents showing as if certain amounts disbursed to complainant in the loan   account or that the correctness of the results of the complainant as student conveyed to Punjab National Bank as per terms and conditions of the agreement Ex. C9. After going through clause No.6 of Ex. C9, it is made out that the borrowers will repay the loan together  with accrued interest thereon by equal monthly installments in 84 EMIs i.e. 7 years after commencement of the repayment i.e. one year after the course period or 6 months after getting job, whichever is earlier and that fact has not been denied in the written statement or in the affidavit Ex. RW1/A of Sh. Major Singh, Senior Manager   of Punjab National Bank and even the same mentioned in Ex. R12 also, where it is mentioned that repayment holiday/moratorium will be course period + 1 year or 6 months after getting job, whichever is earlier. So certainly the submissions advanced by representative of complainant has force that education loan in question       repayable after one year of the course period or 6 months after getting job, whichever is earlier. Course of Master of  Accounting and Financial Management was completed by complainant from Latrobe University Melbourne (Australia) on 23.03.2011 is a fact borne from perusal of Ex. C32, copy of the certificate issued by the academic board of the said university. This course in fact was completed on 14.12.2010 as per para 7 of complaint. There is nothing on record to suggest as to when the complainant got job after completion of this course on 14.12.2010. So in view of above clauses (reaffirmation of which submitted by Punjab National Bank through Ex. C34), it is made out that repayment of loan in question was to commence w.e.f. 14.12.2011 onwards. However, loan in question declared as NPA on 05.05.2010 is a fact borne from contents of affidavit Ex. CW2/A of representative of complainant; affidavit Ex. RW1/A of Sh. Major Singh, Senior Manager of OP and also by contents of Ex. R2, copy of application filed by OP with Debt Recovery Tribunal for issue of recovery certificate. So virtually loan in question declared as non performing asset even prior to the commencement of the repayment period. As the first loan installment was to be repaid by complainant w.e.f. 14.12.2011 and as such, declaration of the loan account in question as NPA on 05.05.2010 was before the day of commencement for repayment of loan. Submission of representative of complainant in this respect certainly has force.

21.              Counsel for OP vehemently contends that loan in question was declared as NPA after issue of letter dated 17.04.2010 and to substantiate the same, affidavit of Sh. Major Singh, Ex. RW3/A as well as Ex. RW2/A of Sh. V.S. Bhandari produced on record. Even photocopies of postal receipts Ex. R7 to Rx. R9 along with copy of the  Dak receipt register Ex. R10 has been produced. From the contents of above referred affidavits and postal receipts Ex. R7 to Ex. R9 and entry of Dak register Ex. R10, it is made out that letter dated 17.04.2010 was sent to complainant at his Ludhiana address as well as at Australian address and even the same was sent to Sh. Suresh Kumar Sharma (as revealed by postal receipt Ex. R9 and Ex. R10). Even representative of complainant Sh. Suresh Kumar Sharma through letter dated 22.04.2010 addressed to Deputy General Manager, Punjab National Bank, Circle Office, Ferozepur Road, Site No.5, Ludhiana (copy of which produced on record as Ex. R11) admitted having received a letter No. NIL dated 17.04.2010. After acknowledging the receipt of this letter dated 17.04.2010 on 22.04.2010, it was complained through Ex. R11 itself as if the branch office not following the instructions of circle office till date. So submission advanced by representative of complainant has no force that letter dated 17.04.2010 (copy of which produced on record as Ex. R1) was never received by complainant or his representative. Arguments advanced qua  non receipt of this letter and non dispatch of the same by OP bank to complainant or his representative at the address available with OP bank, is absolutely incorrect in view of above produced documentary evidence by OP.

22.              After going through Ex. R1, letter dated 17.04.2010, it is made out that the complainant as well as his father (as co borrower) were required to substitute collateral security in the education loan within 15 days of receipt of the notice. Through Ex. R1 itself, it is specified that Smt. Karam Rekha guarantor stood as collateral security in respect of the loan accounts of M/s. Guide International (Export Wing) and M/s. Guide International each along with education loan account of complainant in question. Despite asking for substituted collateral security, same was not provided and as such, after warning to complainant and his representative, the education loan classified as NPA. Same was ordered on 05.05.2010 and as such, it is vehemently contended by counsel for OP that classification of the education loan in question as NPA was done after affording due opportunity of hearing to complainant and his representative by issue of letter Ex. R1 and dispatch of the same through postal receipts Ex. R7 to Ex. R9 and entry in the Dak register Ex. R10. Despite all this it has to be ascertained as to whether due to non furnishing of substituted        collateral security, education loan in question could have been declared as NPA by OP bank even at the time, when period for repayment of loan installments was yet to commence.

23.              It is well settled that parties are bound by the terms and conditions of the contract agreement and nothing can be added or subtracted thereto by the parties unilaterally or by the courts. So terms of documents Ex. C9 and Ex. C10 has to be taken into consideration. After going through clause No.4 of Ex. C9, it is made out that the complainant, being borrower, to avail the loan by providing suitable security. Unless suitable surety furnished, complainant was not authorized to avail the loan     or any part thereof as per clause 4 of Ex. C9. It was in terms of this clause 4 of Ex. C9 that the surety/guarantee of Smt. Karam Rekha was furnished through Ex. C10 on 19.12.2007 itself. The disbursement of the entire amount of Rs.15,00,000/- took place upto 10.03.2009 is a fact borne  from contents of  copy of ledger entry Ex. RW4/1 maintained by OP qua loan account in question of complainant. Clause No.7 of Ex. C9 provides that in the event of death of any of the borrower, the bank shall be entitled not to disburse further loan and even had authority to recall the outstanding under the loan already disbursed, irrespective of installments fixed. It is not a case in which death of Smt. Karam Rekha took place prior to 05.05.2010, when the account in question declared NPA and as such, benefit of clause 7 of Ex. C9 not available to Ops. After going through all clauses of Ex. C9, it is not made out that in case security provided became insolvent or contemplated to be treated as insolvent, due to declaration his/her account as NPA, then the bank will be entitled to declare the education loan in question also as NPA. Moreover in Ex. C9, it is not at all mentioned as to under what circumstances, the bank can call for substituted security and if that  be the position, then virtually the bank not justified in calling for substituted security in lieu of one provided by Smt. Karam Rekha through Ex. C10. Rather Smt. Karam Rekha was to continue as surety till liability in the loan account in question stood discharged. Rather as per clause 5 of Ex. C10, guarantee not to be affected by the death of surety Smt. Karam Rekha or by the death of any of the borrowers till the bank has received formal authentic notice  in writing thereof. No such authentic notice in writing claimed by the bank to be received and as such, guarantee furnished by Smt. Karam Rekha qua loan account in question to continue till repayment  of the loan by complainant or by his co borrowers. Rather as per clause 8 of Ex. C10, guarantee to remain binding on Smt. Karam Rekha or her executor, administrators and assigns and shall ensure for the benefit of the bank its successors and assigns. In view of these clauses of Ex. C10, it is obvious that virtually bank was not given power to call for substituted security. When such power to the bank by the terms of contract arrived through Ex. C9 and Ex. C10  was not given, then certainly the bank could not have called for substituted security through letter dated 17.04.2010 placed on record Ex. R1. So declaration of loan account as NPA due to non furnishing of the demanded security/surety is virtually violative of the terms and condition of the contract agreement arrived through Ex. C9 or Ex. C10. Even letter dated 24.12.2012 issued by Sh. A.C. Chugh, the Learned General Manager has been produced on record by the complainant to show that clarification already given to the affect that classification of the loan account of the complainant had erroneously happened because of wrong interpretation of circular by the field functionaries. In this unexhibited letter of 24.12.2012, written by Sh. A.C. Chugh to Assistant General Manager, Reserve Bank of India, it has been specifically mentioned that commonality of a collateral security has no role in determining the asset classification as NPA by the officials. So declaration of the loan account in question as NPA due to commonality of the security is not as per instructions of Reserve Bank of India as per admission of officials of Punjab National Bank itself.

24.               As per paragraph 17.2 of  Master Circular No. DBOD. No.Lrg.BC.19/09.07.006/201011 dated 01.07.2010 issued by Reserve Bank of India, in case  banks are at fault in not complying with the instructions of Reserve Bank of India for declaring the loan as NPA or otherwise, then banks should compensate customers without Demur. Further as per this paragraph 17.2 in case neither the bank is at fault nor customer, but the fault lies elsewhere in the system, then also the banks should compensate the customer (up to a limit) as per approved customer relations policy of the Board. This paragraph 17.1 and 17.2 annexed with Ex. C20, the reply received by representative of complainant under RTI. So in view of this paragraph 17.2, in case declaration of loan as NPA found erroneous due to fault of the bank or no fault of the officials, then compensation has to be allowed to the complainant.

25.              As per clause 2.1 of Reserve Bank of India Master Circular dated 01.07.2005 known as Prudential Norms On Income Recognition, Asset Classification and Provisioning- Pertaining to Advances an asset becomes non performing,when it ceases to generate income for the bank. As from 31^st March, 2011, a non performing asset shall be an advance where the interest and/or installment of principal remain overdue for a period for more than 180 days in respect of a Term Loan or the account remains out of order for a period of 180 days, in respect of overdraft/cash credit or the bill remains overdue for a period of more than 180 days in the case of bills purchased and discounted. Further as per clause 2.1 of the RBI Master Circular, the classification of an asset an NPA should be based on the record of recovery. An advance amount should not be classified as NPA merely due to existence of some deficiencies, which are temporary in nature, such as non availability of adequate drawing power based on the latest available stock statement, balance outstanding exceeding the limit temporarily, non submission of stock statements and non renewal of the limits on the due date etc. As record of recovery to be taken into consideration for classification of an asset as NPA and as such, loan account of complainant would have been classified as NPA only if interest or installment of principal remains overdue for a period more than 180 days. As already discussed above, the loan was repayable after one year of the degree courses and as such, same could have been declared as NPA only after 14.12.2011 because the course was completed on 14.12.2010 as per admission of complainant. Same also borne by contents of Ex. C2 and Ex. C3. However, the loan declared as NPA on 05.05.2010 without keeping in mind definition laid down in clause 2.1 of RBI Master Circular referred above. That certainly is a deficiency in service on the part of Ops. If the co-borrower has entered into one time settlement, then they did so for discharging their joint and several liability and there is nothing wrong in that respect, particularly when the complainant not claiming that he is liable to pay the outstanding loan amount till date.

26.              Now the question remains as to whether the loan was disbursed to complainant in time as per terms of contract or not.

27.              As per plan of disbursement qua education loan scheme in question as envisaged through Ex.R12, as and when the borrowing scholar i.e. loanee, is in need of funds to pursue his studies, he will approach the lending office and he will explain his needs to the Incumbent Incharge. On being satisfied about the genuineness of the needs and purpose, for which, money is needed by the borrower, the Incumbent Incharge will permit drawing on the borrower’s account within the limit fixed. But the loan is to be disbursed in stages as per the requirement/demand directly to the Institutions/Vendors of Books/equipments/instruments,to the extent possible. Besides, as per the disbursement plan declaration, stipulated through Ex.R12,  in case of purchase of stationery and books, loan may be disbursed in cash on declaration by the applicant and production of bills. This scheme envisaged through Ex.R12 is in consonance with clause 2 of the loan agreement Ex.C9, which provides that amount of the loan will be utilized by the borrowers only for the purpose of persecuting studies of the student, like payment of fee payable to college/purchase of books/equipments/uniforms etc. If utilization of the loan in question was for the purposes stipulated in clause 2 of Ex.C9, then certainly OP bank was having   authority to call for the bills regarding purchase of computer/laptop, for its satisfaction that the loan utilized for the purposes, for which, it was contracted by the       applicant. So, in case, the OP bank called for the complainant to produce the bills of purchase of computer/laptop, then no illegality or irregularity committed by it because scheme of disbursement stipulated through Ex.R12 as referred above provides so.

28.              As per para no.11 of the complaint, complainant requested OPs in April, 2008 to remit 1500 AUS$, out of which, 780 AUS$ required for purchase of Laptop, but 440 AUS$ for house rent and 280 AUS$ for food and living expenses. As per the claim of the complainant, despite reminder dated 2.5.2008, amount of 1500 AUS$ was released only on 3.6.2008. As per para no.11 of written statement of OPs, as complainant completed formalities on 10.5.2008 and that is why, Rs.53000/- were disbursed on 3.6.2008 for the purchase of laptop etc. No documentary evidence produced to show that the complainant was displaced from his house due to non-payment of the rent for two months. Complainant in para no.11 of the complaint    even admits that details were submitted by him vide letter dated 10.5.2008 in original and loan of 1500 AUS$ was released on 3.6.2008. So, from the pleadings of the parties and produced affidavits, it is made out that the complainant himself failed to send the original bills of the purchased laptop until 10.5.2008 and that is why, disbursal of the loan amount of 1500 AUS$ stood delayed upto 3.6.2008. As OP   bank within its right to call for the bills and as such, it was the duty of the complainant to send the bills of the purchase of laptop. So, delay in release of 1500 AUS$ for purchase of laptop and bearing expenses on food and living or house rent not attributable to the OPs.

29.              In para no.9 of the complaint, it is specifically claimed that application for sending 9155 AUS$ was submitted in February 2009, but the amount was sent on wrong address without complete particulars of Swift and BSB Code etc., and as such, retransmission of the amount on 2.3.2009 resulted in harassment of the complainant. This plea taken in para no.9 of complaint has force to the extent that actually delay took place in release of this installment because in corresponding para no.9 of written statement itself it has been admitted that though payment was released by the bank well in time on 20.2.2009, but due to unintentional and bonafide error on the part of remitting office, the amount in fact was remitted on 19.3.2009. In para no.9 of the written statement itself it is mentioned that shortfall of 69 AUS$ was also remitted by the Ops bank on 20.04.2009. Reference to letter Ex.C25, Ex.C27, Ex.C28 and Ex.C30 was specifically made in this respect. Perusal of this correspondence reveals that tuition fee of 9155 AUS$ did not reach in time and that is why, the complainant called upon the Senior Manager of PNB, Ludhiana to took up the matter with International Bank Branch. As on requirement of the loan amount, the responsibility to transmit the due amount to education institution of complainant was of OPs and as such, delay in sending 9155 AUS$ certainly caused harassment to the complainant. Though remittance by the Branch Office, I.B.B., Industrial Area, Ludhiana took                 place on 20.2.2009, but amount returned back by the Foreign Bank due to incomplete Swift Code/account No. of the La-Trobe University is a fact borne from the contents Ex.C30. Had the bank officials been vigilant in mentioning the correct swift code and account number of La-Trobe University, then certainly amount of 915 AUS$ would have reached in time to the education institution, in which, the complainant was studying. However, willy-nilly mistake took place on part of officials of OP bank in this respect and as such, certainly deficiency in service on the part of OPs remained in not remitting the amount to the due institution in February 2009. This complaint filed on 15.2.2011 and as such, this pointed out deficiency acceptable because of filing of the complaint within two years of accrual of cause of action.

30.              In para no.12 of the complaint, it is mentioned that complainant   intimated Ops bank on 11.3.2009 that he is to travel through flight, but officials of  OPs refused to issue D/D saying that there is holiday in New Delhi H.O. It is also claimed  in para no.12 of the complaint that complainant missed the flight on 11.3.2009 and that is why, for getting the fight next date booked, he has to pay Rs.3000/- extra. Loan agreement Ex.C9 provides for disbursal of the loan amount for bearing expenses of studies and not for expenses of a flight undertaken by the student and as such, in view of the fact that responsibility of OP bank was to remit the fees/charges to the institution directly, the complainant was not entitled to ask for a demand draft on 11.3.2009. So, this violation pointed out in para no.12 of the complaint is against the terms and conditions of the disbursal of loan agreement Ex.C9 and as stipulated in Ex.R12. So, deficiency in service on the part of OPs in this respect cannot be held.

31.              Liability of OP bank was to disburse the contracted loan amount only as per envisaged schedule of disbursement of loan installments and as such, OP bank cannot be held liable for any loss suffered by the complainant due to difference of exchange rate of Indian currency viz-a-viz the Australian Dollar. Ex.RW4/1=Ex.C15= Ex.C6 duly supports the contents of written statement that amount of loan installments were disbursed to the complainant on 19.12.2007, 19.2.2008, 20.2.2008, 3.6.2008, 18.8.2008, 9.9.2008, 21.10.2008, 10.12.2008, 20.2.2009 and 10.3.2009 respectively. Contents of Ex.RW4/1 and Ex.RW4/2 establishes that complainant was possessing capacity to transfer by RGTS huge amount of Rs.2,23,389/- and Rs.1,87,689/- respectively on 22.9.2008 and 29.10.2008 and as such, submission advanced by representative of complainant has no force that the complainant had to remain without food or living expenses. It is so because a person transmitting such a huge amount definitely not supposed to remain without money. In Ex.C8 itself it has been claimed by the complainant that Mr.V.K.Sethi, Manager and Mr.Balbir Singh, Loan Officer of PNB unnecessarily demanded the original copy of quotation/purchase receipt of laptop. That assertion contained in Ex.C8 is absolutely incorrect as already pointed above. OP bank or its officials were within their right to call for the original bills as per the terms of the loan agreement EX.C9 and clause of disbursement of loan amount contained in Ex.R12. Invoice Ex.C11 shows as if Dell Laptop purchased against payment on 30.3.2008 for 680 AUS$, but the complainant claimed as if the same purchased for 780 AUS$. So, this document Ex.C11itself contradicts the claim of the complainant qua necessity of 780 AUS$ for the purchase of Laptop. In view of all this, we have no hesitation in holding that though some delay in disbursal of the loan installments took place, but the complainant cannot be said to have suffered much because of his capacity of earning in Australia and remitting the huge amount through RTGS. Admission of the complainant contained in Ex.RA, enough to establish that the complainant           owing to his engagement in private employment in Australia, was in position to earn there even during the period he stayed there for the course, for which, he contracted loan in question. However, plight of the student leaving abroad can be imagined in case his loan declared NPA, even prior to the time, when repayment of the loan amount scheduled to start or when the money received by him from his creditor somewhat late. Keeping in view all this difficulty in mind, it is fit and appropriate to allow compensation for mental harassment and agony or of sufferance to the extent of Rs.50,000/- along with litigation expenses of Rs.5000/-. No other relief legally can be granted to the complainant, particularly when believable averments discussed in detail above only establishes that all the pointed out sufferings in fact were not borne by the complainant, but he faced some sufferings due to deficiency in service on the part of OPs in late sending the loan installment amount.

32.              As a sequel of the above discussion, complaint allowed in terms that compensation for mental harassment and agony of Rs.50,000/-(Rupees Fifty Thousand Only) allowed. Rs.5000/-(Rupees Five Thousand only) more allowed as litigation expenses. Payment of compensation and litigation expenses be made by the OPs to the complainant within 30 days from the date of receipt of copy of this order. Copies of order be supplied to the parties free of costs as per rules.

33.              File be indexed and consigned to record room.

 

                   (Babita)                                        (G.K. Dhir)

          Member                                          President

Announced in Open Forum

Dated:22.08.2016

Gurpreet Sharma.