Dated: 30.05.2023

O R D E R

BY HON’BLE Mr. JUSTICE HULUVADI G RAMESH : PRESIDENT

1. This Appeal filed by Complainants under Section 41 of Consumer Protection Act, 2019, aggrieved by an order dated 20.06.2020 passed in CC/212/2019 by I Additional District Consumer Disputes Redressal Commission, Bengaluru (herein after referred as District Commission and the parties arrayed as in the consumer complaint)

2. Commission examined grounds of appeal, impugned order, appeal papers and heard learned counsels on record.

3. Complainants/Appellants raised Consumer Complaint before the Commission below alleging deficiency in service on the part of OP/respondent for collecting exorbitant interest charges as prepayment penalty.  Upon service of notice OP contested the matter contending that as per the terms and conditions had collected the pre-closure charges from the complainants and complainants did not oppose and paid the pre-closure charges, does not amounts to deficiency in service on their part and also they have acted as per the guidelines issued by RBI.  Thus sought for dismissal of the complaint.  The Commission below after holding enquiry held complainants in their complaint clearly states that they had taken loan for business and OP as per the terms had collected prepayment penalty and same do not constitute deficiency in service or unfair trade practice, thereby dismissed the complaint without cost.  Aggrieved by the said order complainants preferred this appeal on the ground that the Commission below committed grave error in appreciating materials on record and has passed the impugned order is contrary to facts and law and is liable to be set aside.  It is to be noted herein that Respondent/OP had produced Loan Documents dated 16.02.2016 before the Commission below marked as Ex.R2 wherein could see the Credit Facility Agreement (Cash Credit Open Loan (CCOL)/Over Draft (OD) between Dr.Divya Raj T.G, Ms.Priya Raj T.G., Mrs.Girija Thangarajan and The South Indian Bank Ltd., who are none other complainants and OP and in Schedule-I clause-e of the said document the purpose of loan is stated as Personnel Purpose. Further complainants have produced Sanction/Renewal of Credit Facilities issued by the South Indian Bank Limited on 16.02.2016 marked as Ex.P8 wherein clause-a of Fund Based Facilities clearly shows the purpose of credit facility is for personal.  Therefore, merely based on the complaint averments wherein complainants states that to help the business operations of their father had availed OD Loan facility at the South Indian Bank Ltd., Brigade Road Branch, Bengaluru-01 cannot be termed as the purpose of availing OD Loan facility is only for business purpose.  The documents clearly establish the fact that they had availed OD Loan facility from South Indian Bank for personal purpose and the bank had sanctioned the OD Loan facility for the said purpose.  It is therefore, we are of the view, that Commission below had committed error in appreciating materials on record, hence call for an interference of this Commission.  Accordingly, proceed to allow the appeal.  Consequently set aside the impugned order dated 20.06.2020 passed in CC/212/2019 on the file of I Additional District Consumer Disputes Redressal Commission, Bengaluru with a direction to Commission below to re-admit the complaint and afford opportunity to both the parties to produce additional documents if any and to decide whether as per the RBI Guidelines OP has the right to charge such pre-closure charges on OD Loan availed by complainants and decide the case in accordance with law as early as possible not later than three months.

4. Send a copy of this Order to the District Commission and parties to the appeal.

Lady Member                    Judicial Member                                     President

*GGH*