BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, KOZHIKODE.
C.C.35/10
Dated this the 27th day of September 2012.
( Present: Sri. G. Yadunadhan, B.A., LLB. : President)
Smt. Jayasree Kallat, M.A. : Member
Sri. L. Jyothikumar, B.A., LLB. : Member
Remesh Kumar, Pulparamb Meethal, }
Palazhi, Pala, Iringallur, Kozhikode. } Complainant
(Rep.by Adv.P.C.Padmaja, Calicut)
1. Secretary, Kozhikode Pradamika Sahakara Karshika }
Gramavikasana Bank, Puthiyara-P.O., Kozhikode. } Opposite party
2. Registrar, Sahakaranasangam, Thiruvananthapuram. }
(Rep.by Adv.K.P.Rajaagopal, Calicut)
ORDER
By Jayasree Kallat, Member.
The petition was filed on25.01.2010. The petition is filed under Consumer Protection Act section 12(1). The petitioner had applied for a loan of Rs.1,20,000/- in the Opposite party’s bank. On 15.12.2000 Complainant received the first instalment of the loan Rs.90,000/- and on 11.01.2001 he received the 2nd installment of Rs.30,000/-. The interest was 15.50% for the loan amount. The complainant’s mother was the surety to the loan. Seven cents of land and house, the property which belonged to Madhavi the complainant’s mother who was the surety had pledged against the loan. Madhavi was also a member in the opposite party’s Bank. Complainant had availed the loan for business purpose but due to unforeseen events and robbery in the shop complainant had to face financial crisis. Hence he could not repay the loan amount on time. The opposite party had arranged for an auction of the pledged property to retrieve the loan amount along with interest. Opposite party had also advertised in the Mathrubhoomi daily regarding the auction, from the Head office of the Ist opposite party’s institution. This is against the Kerala State Co-operative(Agricultural & Rural Development Bank) Act Section 20(2). But the opposite party had conducted the auction at OP’s Head office and bid the property on behalf of the first opposite party. According to opposite party complainant has to repay an amount of Rs,1,82,567/- but the opposite party had sold the property in the auction for an amount of Rs.1,87,255/-. Complainant had preferred a claim petition pointing out the defects in the sale of the property and requested the opposite party to return back the property to its owner. Opposite party did not respond to the request. Complainant preferred a writ petition before the High Court. Opposite party did not heed to the request of the complainant. Later during January 2008 as per the application from the complainant and his mother opposite party had informed the complainant that they were ready to return back the property if the complainant paid the amount due to the opposite party. Opposite party had directed the complainant to remit 2,54,422/- rupees. Opposite party had no right to demand for interest or any other amount above the auctioned amount. Complainant had complained to the Registrar of Co-operative Society but opposite parties were negligent and they had not helped the complainant in any way. The complainant had to suffer financially and mentally due to the deficient act of the opposite parties. Hence this petition is filed seeking compensation.
Opposite party No.1 had filed version denying the averments in the complaint except that those are expressly admitted.. Petitioner is not a consumer.
The opposite party admits that petitioner had availed a loan from first opposite party. Petitioner and his mother had applied for a loan of Rs.1,20,000/- by mortgaging the property belonging to the mother of the petitioner. Loan amount was disbursed to the petitioner and his mother Rs.90,000/- on 15.12.2000 and 30,000/- on 11.01.2001. The normal rate of interest was fixed at 15.50%. From 01.04.2004 on wards the rate of interest was reduced to 12% as per the direction of Nabard. The petitioner had made default in repayment of the loan. Opposite party had put the property in the auction by sale officer to recover the due amount. Opposite party had referred the matter to the sale officer for recovery of the due amount. Sale officer is an officer appointed by the Registrar under section 28 of Kerala State Co-operative Agricultural and Rural Development Bank Act The opposite party has not conducted any sale and made publication. The averment of the complainant that the sale conducted by the sale officer from the Head office of the bank is against the provision of Section 20(2) is not true. Sale conducted by the sale officer is according to Law. Complainant has not filed any application to set aside the sale. The averment of the complainant that opposite party had levied extra money from the complainant is not correct. The bank had power to purchase the property in auction . So the bank had auctioned for an amount of Rs.1,87,255/-. Opposite party denies all the averments in the petition. The petitioner did not repay the due amount in time. So he is not entitled to get any benefit. After purchasing the property the bank is the owner of the property. The mother of the petitioner had made a written request to the opposite party that she is ready to pay the entire amount along with interest to the bank and requested to ask the Director Board to take decision to return back the property . So the Director Board had taken the decision to return the property if the petitioner and his mother pay the entire due amount with interest and cost to the bank. This decision was taken only on the basis of humanitarian consideration. The petitioner had defaulted in repaying the amount. Even after repeated requests and demand by the bank petitioner did not clear the dues. So the bank had auctioned in accordance with law. The opposite party is giving loan by using the fund allotted by Nabard and Kerala State Co-operative agricultural and Rural Development Bank. The opposite party is bound to repay the amount with interest to the Apex bank. Opposite party has not collected excess amount from the complainant. Petitioner is not entitled to get any money from the opposite party. The mother of the complainant had requested the opposite party to reconvey the property by stating that they are ready to deposit the due amount with interest and cost. The bank had considered the request on humanitarian consideration . There was no deficiency in service on the part of the opposite party. Opposite party has collected only the due amount from the complainant. Hence opposite party prays to dismiss the petition.
Opposite party No.2 had filed a version denying the averments in the complaint. Complainant had availed loan from the first opposite party by mortgaging the land belonging to his mother. Loan was for a period of 10 years for a rate of 15.50% interest. Complainant was a constant defaulter in paying back the amount. Hence first opposite party had auctioned the property as per the Kerala Co-operative(Agricultural &Rural Development Bank)Act 1984 Rules and regulations Section 19(1) as per the above mentioned section first opposite party had the right to auction property without the interference of court. Sale officer who was appointed under section 28 of the said Act had auctioned the property, after observing the norms. As there was no outsider to bid in the auction bank had taken the property in auction as per section 25 of the Act of 1984. The complainant had not made any application before the first opposite party regarding the sale by the sale officer. Smt.Madhavi the owner of the pledged property had made a request to the opposite party to return back the property for an amount of Rs.2,54,422/- She was ready to remit the amount before the first opposite party. Hence Smt.Madhavi Amma the surety to the loan availed by the complainant had remitted the full amount and taken back the property.. The bank give loan to the members by availing huge amount of loan from Nabard. If the loan amount is not paid back in time first opposite party has to return back the amount to the funding agency and the central bank the primary Agricultural & Rural Development Bank with interest and penal interest. In such a circumstance the first opposite party had taken the interest from the complainant’s mother from the date of auction 07.02.2005 up to 10.01.2008. There is no deficiency in taking 11.25% of interest on the auctioned amount from the complainant. There is no provision to return back auctioned property to the person who had availed the loan and defaulted. Yet up on a request of Smt. Madhavi the auctioned property in this case was returned to the original owner because the Director Board of first opposite party had taken a lenient view and humanitarian consideration. As the opposite parties had taken steps to get back their loan amount only according to law there was no deficiency on the part of the opposite parties, hence opposite party No.2 prays to dismiss the petition.
Points for consideration-
Point No.1whether there was any deficiency on the part of the opposite parties.
Point No.2. Whether the complainant is entitled for any relief.
Complainant was examined as PW1 Exts.A1 to A6 were marked on complainant’s side. OP was examined as RW1 Ext.B1 to B8 were marked on opposite party’s side.
Point No.1.The complainant had availed a loan from the opposite party for an amount of Rs.1,20,000/- while availing the loan complainant’s mother who was the surety for the loan had mortgaged seven cents of land and a house belonging to her . The rate of interest was fixed as 15.50% .Complainant has admitted in the complaint that he has availed the loan for his business. But due to robbery in the shop and other circumstances he faced financial crisis. Hence he could not repay the loan amount on time. Opposite party had taken steps to auction the mortgaged property in order to get back the loan amount along with interest as the complainant was a constant defaulter. The opposite party had in turn availed loan from Nabard a funding agency. If the amount taken by the bank is not repaid along with interest bank will have to pay interest and penal interest. More over primary co-operative Agricultural & Rural Development bank does not receive deposits like other bank and for the same reason they do not have there own fund. So it is natural for the Rural Development Bank to take loan from Nabard and return back along with interest on time. If the members who have taken the loan do not repay timely it will cause difficulty to the opposite parties. In this case opposite party has put the property in auction as per the Kerala Co-operative.Agricultural & Rural development Bank Act 1984 section 19(1). The property was handed over to the sale officer as per section 28 of the Act. In this particular case the property owner had requested the bank to return back her property and expressed her willingness to repay the loan amount along with interest. Ext.B7 produced by the opposite party is the document by which Smt.Madhavi had made this request . Ext.B8 is produced by the opposite party which shows that Smt. Madhavi had received all the documents submitted before the bank in connection with the loan availed by the complainant. Signature of Smt.Madhavi and her son Jaykumar is found in Ext.B7. Opposite party had argued that property once sold in auction due to non payment of loan and interest will not be returned back to the original owner. Opposite party No.2 had clearly mentioned this fact in their version. As per Kerala Co-Operative Agricultural Rural Development Bank Act 1984 property can not be returned back to the loanee even after repayment within 30 days. This property was returned back after 3 years. This action was not according to law but only because of humanitarian consideration. So the bank had right to collect interest up on the auctioned amount . opposite party had returned back the document after collecting 2,54,422/-rupees only as per the regulations. The forum can not find any negligence or deficiency in service on the part of the opposite parties.
Point No.2.As the forum has not found any negligence or deficiency in service on the part of the opposite parties the complainant is not entitled for any relief.
In the result the petition is liable to be dismissed.
Pronounced in the open court this the 27th day of September 2012.
Date of filing:25.01.2010.
SD/- PRESIDENT SD/- MEMBER SD/- MEMBER
APPENDIX
Documents exhibited for the complainant:
A1.Loan pass book of Pradamika Sahakarana Karshika Grama Vikasana Bank
A2. Writ petition WP (C ) No.4674 of 2005 (F)
A3. Cash receipt of Rs.54,422/- dtd.10/01/2008.( 2 No’s in series)
A4.Letter to the complainant dtd.31.05.09
A5. Auctioned property Notice of the opposite party dtd.15.12.04.
A6.Claim petition letter dtd.07.03.2005.
Documents exhibited for the opposite party:
B1.Loan application form of the complainant and his mother(Photocopy)
B2. Form for creating Gehan/Mortgage/Hypothecation and loan sanction order
Of the Bank.
B3.Photocopy of OS.No.657/2003 dtd.25/07/07.
B4.Photocopy of court order 657/2003 dtd.21.07.07.
B5.Photocopy of court order O.S.No.190/2005 dtd.15.03.2005.
B6. Court Order with affidavit copy of O.S.No.190/2005.
B7. Complainant’s mothers application to the Bank
B8. Loan Ledger details of the bank from 01.04.01 to 01.04.05.
Witness examined for the complainant:
PW1. RameshKumar(Complainant)
Witness examined for the opposite party:
RW1.Krishnan Nair, Secretary, Kozhikode primary co-op.Agricultural
And Rural Development Bank.
Sd/-President
//True copy//
(Forwarded/By Order)
SENIOR SUPERINTENDENT
