Kerala

Idukki

CC/53/2021

Rajendran V B - Complainant(s)

Versus

SC/ St Development Corporation - Opp.Party(s)

01 Apr 2023

ORDER

ADATE OF FILING : 9.3.2021

IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, IDUKKI

Dated this the   1^st  day of   April,  2023

Present :

                   SRI. C. SURESHKUMAR                   PRESIDENT

SMT. ASAMOL P.                             MEMBER

SRI. AMPADY K.S.                           MEMBER

CC NO.53/2021

     Between

Complainant                                       :         Rajendran V.B.,

                                                                   Vattola House,

                                                                   Valara P.O.,

                                                                   Chillithodu.

        And

Opposite Party                                    :        The District Manager,

                                                                   SC/ST Development Corporation,

                                                                   Painavu P.O.,                          

                                                                   Idukki.

(By Adv: N.K. Vinodukumar)

 

O R D E R

 

SRI. C. SURESHKUMAR, PRESIDENT

 

          1. This case originates from a complaint filed under Section 35 of the Consumer Protection Act of 2019 (the Act, for short).  Complaint averments are briefly discussed here under :

 

          Complainant had availed a loan of Rs.3 lakhs in June 2018, from SCST Development Corporation represented in these proceedings by its District Manager.  Complainant had remitted instalments towards repayment of loan till 16.3.2020.  Thereafter owing to Covid pandemic, RBI had declared moratorium for this loan and others for the period from 1.3.2020 till 31.8.2020.  During moratorium, instalments were not paid.  However, opposite party corporation had initiated recovery proceedings against complainant while moratorium was subsisting, for recovering arrears from March 2020 till 31.10.2020.  Recovery proceedings initiated on 23.11.2020 by the District Manager of opposite party are illegal.  Complainant therefore submits that opposite party should be directed to pay a compensation of Rs.5 lakhs to him on account of any civil or criminal action which sureties for the loan may initiate against him and also for the loss of faith of sureties in him due to initiation of recovery proceedings.

 

          2. Complaint was admitted and upon notice opposite party had entered appearance and filed a reply. Contentions addressed in version are briefly reproduced hereunder:                                                                                                                (cont....2)

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Complainant had applied for a loan for expansion of his hardware shop under self-employment scheme of opposite party with one Mr. Anilkumar A.M. as surety, who is a Vocational Instructor of Govt. VHSS, Deviyar Colony as surety.  Application was allowed.  On 5.7.2018, loan agreement was signed.  First instalment of loan was released on 18.7.2018, 2^nd instalment of even amount on 30.8.2018.  As per the loan agreement, amount was repayable with 6% interest and in case of default, with penal interest at the rate of 2%.  Complainant was to repay the loan in 60 equated monthly instalments of Rs.6000/- each.  However, from 19.8.2019 onwards as per the table of repayment given in the written version, instalments remain unpaid. In November 2020, defaulted amount was Rs.55,000/-.  Thereafter notice by registered post was sent to complainant and to his sureties intimating that salary recovery proceedings will be initiated.  As there was no response, request for recovery by attaching salary was given as per Spark, on 23.11.2020.  On that date, surety had paid Rs.5,000/-.  After this, complainant had raising the same allegation as mentioned in the complaint, sent a petition to the Head Quarters of opposite parties, in response a reply was given on 7.12.2020, stating that loans given by Scheduled Caste and Scheduled Tribe Development Corporation are not covered by any moratorium orders.  Yet considering the difficulties caused by Covid pandemic and lock down, complainant was informed that he will be given facility of repaying the arrears in instalments and for that he had to approach the District Manager.  Complainant was contacted on phone also.  However, he has not turned up and made any request for repayment of arrears in instalments.  Instead he had filed complaints against opposite parties in Idukki Lok Adalath, Kerala State Scheduled Castes and Scheduled Tribes    Commission and Human Right Commission.  Loans are given by the Corporation only for advancement and development of Scheduled Castes and Scheduled Tribes community.   If Members  of the community, are not making regular remittances, it would affect the financial position of  corporation and no more financial help can be given to deserving members of  community.  In the loan agreement executed, complainant and his surety had agreed for recovery proceedings including by attachment of salary.  Opposite party had proceeded only in accordance with the terms and conditions of agreement.  Opposite party corporation is not a bank working under RBI or NBFC, which is within the supervision and control of RBI.  After effecting recovery and also giving credit for payment as such, loan arrears as on 20.4.2021 would come to Rs.51,000/-.  Arrears for the moratorium period are still subsisting.  Complaint lacks bonafides.  In the Lok Adalath held on 9.1.2021, District Manager had appeared in person and repeated the offer to clear arrears by accepting instalment payment.  However, there was no response from complainant. 

 

          On these premises, opposite party seeks dismissal of complaint.

 

          3. After filing of written version, case was posted for steps and then for evidence.  Despite availing repeated opportunities, complainant had not appeared to give evidence.                                                                                                                (cont...3)

- 3  -

Hence documents produced along with complaint were marked suomoto, without formal proof as Ext.P1 to P4 series 3 in numbers.  Ext.P1 is salary recovery notice dated 23.11.2020.  Ext.P2 is registered notice issued before salary attachment dated 20.10.2020.  Ext.P3 is a copy of Reserve Bank Circular No.RBI/2019-20/244, DOR No.BP.BC.71/21.04.048/2019-20 dated 23.5.2020.  Ext.P4 series – 3 in numbers are receipts issued for remittance made on 19.8.2019 (Rs.12000/-), on 23.1.2020 (Rs.6000/-) and on 22.11.2019 for Rs.12000/-.

 

          On the side of opposite party, one of his employee Mr. Muhammed  Shafi has filed a proof affidavit.  Exts.R1 to R6 were marked on their side.  Ext.R1 is photocopy of Memorandum and Articles of Association of Kerala Development Corporation for Scheduled Castes and Scheduled Tribes Ltd, the opposite party herein.  Ext.R2 is copy of RBI circular which has been marked as Ext.P2 from the side of complainant.  Ext.R3 is copy of letter sent to complainant dated 10.10.2020.  Ext.R4 is a copy of salary recovery notice dated 23.11.2020 sent by opposite party to the Principal of Govt. VHSS, Deviyar Colony for initiating salary attachment from the salary of Mr.Anilkumar.  Ext.R5 is a copy of letter sent to complainant dated 7.12.2020 whereby complainant was permitted to repay the arrears which had accumulated during lock down period in instalments.  By the same letter, complainant was requested to approach the District Manager for further proceedings.  Ext.R6 is photocopy of loan agreement executed by complainant along with his surety, with opposite party.  After admission of documents, evidence was closed.  Since complainant was not present and he was not represented by anyone else, he could not be heard on the date when the case was posted for hearing.  We have heard the learned counsel for opposite party.  Now the point which arise for consideration are :

1)  Whether there is any deficiency in service from the side of opposite party ?

2)  Whether complainant it entitled for the reliefs prayed for in the complaint ?

3)  Final order and costs. 

 

4.  Point Nos.1 and 2 are considered together :

 

          We notice that the affidavit filed by the employee of corporation does not disclose what is the official capacity of the deponent in the corporation.  It is only stated that he is working in the corporation situated in the district and that he has been authorised by opposite party to file affidavit.  There cannot be authorisation for giving evidence, but only for representing the parties as such before this Commission.  Since we are not aware of the official capacity of the deponent, his claim that he knows all  the facts relating to the case cannot be accepted.  Despite the fact that the deponent was not cross examined for reasons mentioned above, we are not inclined  to act upon the affidavit as such.  However, able counsel has contended that opposite party is not a banking company or a non-banking financial company working under the supervision and                                                                                                                        (cont....4)

• 4  -

control of RBI.  It is a corporation registered under the Companies Act, formed only for  development of scheduled castes and scheduled tribe community members.  We find force in this contention.  Circular copies  marked as Exts.P2 and R2 are only applicable to banking and financial concerns which are subject to the supervision and control of RBI.  Opposite party is Kerala State Development Corporation for Scheduled Castes and Scheduled Tribes Ltd.  A perusal of Ext.R1 would clearly go to show that the primary purpose and objective of the company  is the overall development including financial of members belonging to scheduled caste and scheduled tribes.  As per clause 5, under the objects incidental or ancillary to the attainment of main objectives of the corporation, it is made clear that the corporation will not carry on banking business within the meaning of the Banking Regulation Act of  1949.  Hence we are of the view that the corporation is not a financial institution or a banking company which is under the direct control and supervision of RBI.  Circular is not to be acted upon  by corporation and it is not bound by the same.

 

          On facts  also, we notice that recovery proceedings were initiated after the lock down period.  Therefore, we are of the view that there is no deficiency in service from the side of opposite party.  Complainant is not entitled for the reliefs prayed for.  Point Nos.1 and 2 are answered accordingly.

 

5.  Point No.3 :

 

          In the result, this complaint is dismissed, under the circumstances, without costs.  Parties shall take back extra sets of copies, without delay.

 

                    Pronounced by this Commission on this the   1^st   day of April, 2023

 

 

                                                                                                Sd/-

SRI. C. SURESHKUMAR, PRESIDENT

 

                             Sd/-

 SMT. ASAMOL P., MEMBER

 

                        Sd/-

SRI. AMPADY K.S., MEMBER

 

 

 

                                                (cont....5)

 

 

 

• 5  -

 

APPENDIX

 

Depositions :

Nil.

Exhibits :

On the side of the Complainant :

Ext.P1     -  Salary recovery notice dated 23.11.2020. 

Ext.P2    -  Registered notice issued before salary attachment dated 20.10.2020. 

Ext.P3    -  Copy of Reserve Bank Circular No.RBI/2019-20/244,

        DOR No.BP.BC.71/21.04.048/2019-20 dated 23.5.2020.

On the side of the Opposite Party :

Ext.R1    -   Photocopy of Memorandum and Articles of Association of  Kerala

                  Development Corporation for Scheduled Castes and Scheduled Tribes Ltd.

Ext.R2   -  Copy of RBI circular which has been marked as Ext.P2. 

Ext.R3   -  Copy of letter sent to complainant dated 10.10.2020. 

Ext.R4   -  Copy of salary recovery notice dated 23.11.2020 sent by opposite party to the

                 Principal of Govt. VHSS, Deviyar Colony.

Ext.R5   -  Copy of letter sent to complainant dated 7.12.2020.

Ext.R6   -  Photocopy of loan agreement executed by complainant along with his surety,

                 with opposite party.

 

 

 

                                                                             Forwarded by Order,

 

 

 

                                                                        ASSISTANT REGISTRAR