IN THE CONSUMER DISPUTES REDRESSAL FORUM, ALAPPUZHA
Wednesday the 31st day of March, 2010
Filed on 11.11.08
Present
- Sri. Jimmy Korah (President)
- Sri. K. Anirudhan (Member)
- Smt. Shajitha Beevi (Member)
in
C.C.No.266/08
between
Complainant:- Opposite Party:-
Sri. K.Harikumar, The Secretary,
Harisree Bhavanam, Karthikappally CARD Bank,
Mannarassala.P.O., Ltd., No.4326,
Harippad. Harippad.P.O., Allappuzha.
(By Adv.M.Liju) (By Adv.K.Raveendran)
O R D E R
SRI.JIMMY KORAH (PRESIDENT)
The case of the complainant is as follows: - The complainant, on 31st March 2006 availed a loan amount of Rs.50,000/-(Rupees fifty thousand only) from the opposite party. The interest levied on the said loan was 9% per annum. The complainant renewed the said loan on 19th April 2007. The complainant had remitted the interest of the said loan amount with out fail up to 1st March 2008. On 28th March 2008, the complainant received a demand notice issued by the opposite party requiring him to remit Rs.l,877/-(Rupees one thousand eight hundred and seventy seven only) as interest arrears. The complainant never let the interest fall in arrears; as such he preferred a complaint to the opposite party and its Asst. registrar-valuation officer as to this. The Asst. registrar gave the complainant a reply to the effect that as per the NABARD Circular No-NB Kerala ICD1499/ICD37/2007-08 dated 24th May 2007 there was a hike in the offered interest viz. from 9% to 11.5% with retrospective effect from 1st October 2006 onwards. The complainant went through the aforesaid circular, but didn't notice anything that suggests any inflation in the interest rate. The complainant brought this aspect to the notice of the opposite party; still the opposite party is disinclined to pull out the enhanced rate of interest. Got aggrieved on this the complainant approached this Forum for compensation and other relief.
1. On notice being sent, the opposite party turned up and filed version. The opposite party contends that the complainant is not a consumer. The opposite party has every right to increase the rate of interest from time to time in line with the instructions of the NABARD. The complainant is obliged to remit the interest so imposed by the NABARD, the opposite party argues. The opposite party has not charged any interest against law. The circular issued by the NABARD was showed and read over to the complainant. The NABARD is also an inevitable party to this case. The complainant at the time of availing the loan had executed an agreement to the opposite party obliging himself to remit any interest in line with the change of rate therein decided by NABARD, Reserve Bank etc. from time to time. The complainant has no manner of right to act contrary to the terms of the above said agreement. The complaint is only to be dismissed with cost, the opposite party asserts.
2. The complainant’s evidence consists of the testimony of the complainant himself as PW1, and the documents Exbts. Al to A6 were marked. On the side of the opposite party, the secretary of the opposite party was examined as RW1, and the documents Exbts. B1 and B2 were marked.
3. Taking into account the contentions of the parties, the questions come before us for consideration are:-
(1) Whether the opposite party is empowered to impose enhanced rate of interest on the complainant?
(2) Whether the complainant is entitled to any relief sought for?
4. Admittedly the complainant availed a loan amount of Rs.50,000/-(Rupees fifty thousand only) from the opposite party. Equally admitted is that at the initial stage, the interest charged for the said loan amount was 9% per annum. It is also not disputed or denied that the complainant had remitted the interest without failure until 1st March 2008.The complainant has hired its service and the complainant is its consumer. The bone of the contentions of the instant case is that the opposite party on 28th March 2008 issued a notice to the complainant demanding 11.5% interest for the said loan amount with retrospective effect from 1st October 2006. Therefore, the immediate short question that comes up before us for consideration is whether the enhancement of the interest by the opposite party is warranted. To put it in other words, the question is whether the opposite party is empowered by law to modify the interest rate in the manner as it did in the instant case. According to the opposite party, the interest hike was along the line of the instructions in the circular issued by NABARD. We went through materials placed on record by the opposite party. Going by the evidence let in by the opposite party, it appears that no material is forthcoming to show before us that any such instruction was put in place by the said authority. That apart, Exbt. B2 produced by the opposite party is inconsequential in its favour which on the other hand only lends credence to the case of the complainant. A plain perusal of the same discloses that the opposite party assured no more than 9% interest to the loan amount. At the same time, the complainant takes us through the procedure stipulated to be observed by the RBI proceeding to the revision of the rate of the interest. The complainant asserts that the opposite party didn't follow any such procedure. The complainant places on record a copy of the website of the opposite party as to the rate of interest the opposite party offers. The same categorically reveals that the rate of interest offered by the opposite party is not more than 9% for the loan amount up to Rs.50000/-(Rupees fifty thousand only). In the cash receipt dated 4th February 2008, the opposite party issued to the complainant, it is clearly stated therein that the amount outstanding is mere Rs.50,000/-(Rupees fifty thousand only) and the interest arrears nil. It is interesting to note that the said cash receipt has been issued in 2008, after a year of the alleged circular (2007) on which the opposite fell back for the interest hike. In this context, we are least hesitant to hold that the contentions advanced by the opposite party do not merit acceptance. The opposite party committed deficiency in its service. We are of the considered view that the complainant has substantiated his case with sufficient materials.
From the forgoing facts and findings herein above of the case, we cancel the demand notice issued by the opposite party requiring him to remit 11.5% interest. The opposite party shall procure from the complainant the interest only in the offered rate of 9% from the date of default if any. The opposite party shall not impose any penal interest on the arrears of interest if any existing. The opposite parties are further directed to pay an amount of Rs.5,000/-(Rupees five thousand only) to the complainant as compensation.
Complaint stands disposed accordingly. No order as to cost.
Pronounced in open Forum on this the 31st day of March, 2010.
Sd/-Sri. Jimmy Korah
Sd/-Sri. K. Anirudhan
Sd/-Smt. N. Shajitha Beevi
Appendix:-
Evidence of the complainant:-
PW1 - K.Harikumar (Witness)
Ext. A1 - The Notice of RBI in Malayala Manorama Daily page No.11 dated,
14.07.2006
Ext.A2 - The Notice published in Malayala Manorama Daily page No.6 dated,
31.08.2009
Ext. A3 - The letter issued by the Asst.Registrar dated, 04.03.2008
Ext. A4 - The Cash Receipt from the opposite party dated, 04.02.2008
Ext. A5 - The Notice from the opposite party dated, 28.03.2008
Ext. A6 - The copy of the details of Interest taken from the Website
Ext. A7 - The Certificate-cum-Policy Schedule from the Oriental Insurance Co.Ltd.,
Ext. A8 - The Telegram from the Postal Department of India
Ext. A9 - The Letter from the State Bank of India dated, 04.06.2007
Evidence of the opposite party:-
RW1 - M.Sulekha (Witness)
Ext. B1 - The copy of the Circular and Annexure
Ext. B2 - The Loan Sanction Order dated, 22.03.06
// True Copy //
By Order
Senior Superintendent
To
Complainant/Opposite Parties/S.F.
Typed by:- k.x/-
Compared by:-
