Orissa

Cuttak

CC/98/2014

Pradeep Kumar Samantray - Complainant(s)

Versus

Sriram Transport Finance Company - Opp.Party(s)

B M Mohapatra

30 May 2017

ORDER

IN THE COURT OF THE DIST. CONSUMER DISPUTES REDRESSAL FORUM,CUTTACK.

C.C No.98/2014

 

Pradeep Kumar Samantaray,

At: PO:Gatanai,

P.S:Marshaghai,Dist:Kendrapapra.                                       … Complainant.

 

            Vrs.

 

1.        Sri Ram Transport Finance Company,

Mahanadi Vihar,PO:College Square,

                   Cuttack

 

2.       Sri Ram General Insurance Company Ltd.,

 10003-E, RICCO Industrial Area, Sitapura,

Jaipur, Rajasthan-302022.                                                  … Opp. Parties.

 

Present:            Sri Dhruba Charan Barik,President.

Sri Bichitra Nanda Tripathy, Member.

 

Date of filing:    18.07.2014

Date of Order:    30.05.2017.

 

For the complainant        :         Sri B.M.Mohapatra, Advocate & Associates.

For the O.P. No. 1 .         :         Sri P.K.Ray,Adv. & Associates.

For the O.P No.3             :         Sri Adam Ali Khan,Adv. & Associates.           

 

Sri Bichitra Nanda Tripathy, Member.

1. Shortly the case of the complainant is that the complainant purchased a Truck bearing Regd. No.OR-21A-9424 by availing a loan from O.P No.1.  The said truck was insured with O.P No.2. (Annexure-1)  On 26.04.2012 the said truck was stolen at Dochhaki for which the FIR was lodged with Paradeep Port Police Station) (Annexure-2).  The vehicle could not be traced by police and the matter was brought to the notice of O.P No.1 and 2.  The loan from O.P No.1 was repayable in 60 installments @ Rs.30,597/- each of which 33 installments amounting to Rs.9,79,250/- were repaid by the complainant as on 31.08.2010.  The complainant demanded a sum of Rs.9,40,000/- from O.P No.2 towards insurance claim, since the vehicle was stolen on 26.04.2012(Annexure-3).  O.P No.1 demanded to settle the outstanding dues against the said vehicle and the complainant expressed his inability to repay such amount since the claim was not settled by O.P No.2.  On a later date the complainant came to know from O.P No.2 that the claim was settled for Rs.9,38,500/- and the same has been paid to O.P No.1 on 31.12.2012.  The complainant had repaid Rs.9,79,250/- to O.P No.1 towards repayment of the said loan and O.P No.1 received a further sum of Rs.9,38,500/- from O.P No.2 towards settlement of the insurance claim.  The complainant has alleged that O.P No.1 received an excess amount of Rs.4,06,014/- over and above the total loan amount payable by the complainant as on that date.  Finding no other way the complainant has take shelter under this Hon’ble Forum.  He has prayed to direct OP No.1 to refund back a sum of Rs.4,06,014/- as received excess and to direct O.P No.2 to pay a compensation of Rs.2,00,000/- for illegal disbursement of the insured amount to O.P No.1 without the knowledge of the complainant, a further sum of Rs.50,000/- from O.P No.1 towards mental agony, for harassment a sum of Rs/1,00,000/- and for legal expenses a further sum of Rs.20,000/- from O.P No.1 & 2.
2. O.P No.2 vide their written version dt.16.10.2014 has intimated that the complainant signed a loan agreement vide No.CUTTKO 903310008 dt.31.03.2009 with O.P No.1. (Annexure-A).  The borrower was irregular in repaying his installments (copy of Accounts statement vide annexure-B).  A sum of Rs.1142,300/- was financed by O.P No.1 vide the above agreement which was repayable in 59 nos. of installments @ Rs.30,597/- each excluding the 1st installment which was Rs.30,615/- between 01.05.2009 to 01.03.2014.  The net agreement value was Rs.18,05,241/- including financial charges amounting to Rs.6,62,941/-.  The complainant repaid a sum of Rs.9,09,250/- and O.P.2 paid a sum of Rs.9,38,500/- to O.P No.1 towards settlement of  insurance claim.  As such the O.P. No.1(financier) received a total sum of Rs.18,47,750/- against the total dues of Rs.22,18,081/- against the complainant  as on 14.08.2014.  Thus the complainant is liable to pay a further sum of Rs.3,70,331/- to O.P No.1.
3. O.P No.2 vide written version dt.24.11.2014 has intimated that the O.P No.2 had issued a Public Carrier Package Policy bearing No.10003/31/12/447622 in favour of the complainant which was valid from 22.12.2011 to 21.12.2012 covering the risk of the truck bearing No.OR-21A-9424.  (Annexure-A & B).  During the currency of said insurance policy the concerned vehicle was stolen and the complainant had intimated the matter to O.P No.2 (Annexure-C).  After completion of necessary formalities a sum of Rs.9,38,500/- was settled against the said claim and was paid to O.;P No.1 since the vehicle was under hypothecation to O.P No.1(Annexure-D).
4. We have gone through the case in details.  We have perused the documents minutely as submitted by the complainant as well as by the O.Ps, we have also heard the advocates from both the sides at length and have observed that the complainant had availed a loan from O.P No.1 for purchase of a truck bearing No. OR-21A-9424.  The loan amount was Rs.11,42,802/- and the same was repayable in 59 installments of which the 1^st installment was Rs.30,615/- and rest 58 installments were @ Rs.30,597/- each starting from 01.05.2009 to 01.03.2014.  The total amount payable was Rs.,18,05,241/- which includes financial charges with Rs.6,62,241/-. 

It is learnt from the accounts statement as  submitted by O.P No.1 vide Annexure-B that the complainant has failed to pay most of the installment on 1^st day of each month for which the O.P No.1 has charged penal interest for the purpose.  The O.P No.1 has admitted that the complainant had paid Rs.9,09,250/- as on 09.09.2011 and the O.P No.2 has paid Rs.9,38,500/- as on 02.01.2013 towards settlement of insurance claim.  Thus O.P No.1 has received Rs.18,47,750/-against the total repayable value of Rs.18,05,241/-.  Thus O.P No.1 has received the full repayment value as on 02.01.2013 which was supposed to be repaid by 01.03.2014.  Therefore O.P No,1  has received the full loan amount prior to 1 year and 2 months of the date of final repayment.  It is also clear that even if the complainant has made delay in repaying the installments O.P No.1 has received the full loan amount prior to 1 year and 2 months of the last date for repayment.

As per schedule-III as submitted by the O.P No.1 for the loan amount of Rs.11,42,300/- interest was supposed to be charges @ 11.8% P.A. with monthly rest on the outstanding balance.  This is important to record it here that the outstanding balance reduces with repayment of monthly installments.  The total amount repayable (as per schedule-III) was Rs.18,05,241/- of which Rs.11,42,300/- was loan amount and Rs.6,62,941/- was the interest component.  If we calculate interest @ 11.8%  p.a for 59 months on Rs.11,42,300/- it comes to Rs.6,62,724/- against which Rs.6,62,941/- is charged by the O.P No.1.  Since the repayment period was 59 installments ( i.e. 1 month less than 5 years) we conclude that the interest charged i.e. Rs.6,62,941/- is on the entire loan for 59 months and not on monthly outstanding balance.  Thus it is clear that the O.P No.1 has charged excess interest which is beyond their own guidelines.  O.P No.1 has charged penal interest @ 36% p.a. for the defaulted amount which they have charges @ 3% per month.  But they have also charged penalty charges on several occasions whereas as per R.B.I guidelines issued to all non-banking financial organizations “there will be no penalty charged on the delayed payment (Ref. to circular No.RBI/2012-13/27 DNBS(PD) C.C No.286/03.10.042/2012-13 dt.2.7.2012 issued to all Non-Banking financial companies(MBFCs) & Residuary Non-Banking Companies(RNBCs). 

5. It is learnt from accounts statement submitted vide Annexure-B that O.P No.1 has charged excess amount apart from interest and penal interest, marked as IST 1/12 to 12/12 @ Rs.2212/- P.M.(charged between 01.02.2010 to 01.01.2011), charged @ Rs.5000/- P.M. between March to June,2011 again @ Rs.1908/- P.M. from 01.02.2011 to 01.01.2012 and charged Rs.5000/- P.M  from June,2011 to September,2011,  @ Rs.2128/- P.M, from 01.02.,2012 to 01.01.2013.  We have observed that these amounts have charged by O.P No.1 without any justifications.  O.P No.1 has also failed to justify such charges.  The E.M.I for a loan of Rs.11,42,300/- with interest @ 11.8% p.a. comes to Rs.25,610/- for 59 EMIs whereas the same is charged @ Rs.30,597/- by O.P No.1 as per scheduled-III excluding the Ist installment which was Rs.30,615/-.  Thus Rs.30,597/-  - Rs.25,610/- x 59 = Rs.2,94,233/- + Rs.18/- (towards excess of 1^st installment) = Rs.2,94,251/- has been charged towards excess interest by O.P No.1 excluding overdue interest  which is charged @ 36% per annum and other charges.  Towards IST as stated above, O.P No.1 has charged excess charges amounting to Rs.2212x12+Rs.1908x12+Rs.2128x12+ Rs.5000x4 + Rs.5000/-x4(which comes to) =Rs.1,14,976/-.  Thus the total excess amount charged by O.P No.1 comes to Rs.2,94,251/- + Rs.14,976/- = Rs.4,09,227/-.  As on 02.01.2013 a sum of Rs.7,44,404/- was overdue and 14 installments @ Rs.30,597/- were payable by the complainant  as per accounts statement as submitted by O.P.No.1 which comes to Rs.7,44,404 + Rs.4,28,358 = Rs.11,72,762/- of which Rs.4,09,227/- was calculated excess as shown earlier.  Thus Rs.11,72,762/- - Rs.4,09,227/- = Rs.7,63,535/- was the actual balance of loan outstanding as on 02.01.2013 against which O.P No.2 paid to O.P No.1 towards settlement of insurance claim amounting to Rs.9,38,500/-.  Thus Rs.9,38,500 – Rs.7,63,535/- = Rs.1,74,965/- was received as excess by O.P No.1 which should have been refunded to the complainant as on 02.01.2013.  But surprisingly the O.P No.1 has made vague calculations and shown that a sum of Rs.3,70,331.65p is still outstanding against the complainant whereas the complainant should have refunded with Rs.1,74,965/- as on 02.01.2013.

5. Basing on the facts and circumstances as stated above, we conclude that O.P No.1 is at fault since they have charged excess interest and penal charges to the complainant deviating their own guidelines as well as the guide lines of Reserve Bank of India.  O.P No.2 has settled the insurance claim for Rs.9,38,500/- without the knowledge/consent of the complainant.  It was held by Hon’ble National Commission vide Case No.2002 (2) CPR-46 (NC) that “it was incumbent on the Insurance company to settle the claim with the consent of the complainant and giving him prior notice.  The insurance company could not keep the complainant out of the transactions and pay the amount in full and final settlement to the financier at his back.  The interest of the complainant’s was involved and he should have been apprised of the position.”  In the present case also O. P No.2 paid the claim amount to O.P No.1 directly without intimating the complainant. O.P.2 also failed to prove that the matter was intimated to the complainant or the consent of the complainant was obtained for the purpose.  Since the interest of the complainant is also involved in this case, we also observed that O.P No.2 is also at fault by not intimating the complainant/not taking his consent while remitting the money to O.P No.,1 towards settlement of insurance claim of the complainant.  Basing on the facts and circumstances as stated above and to meet the ends of justice, we allow the case against O.P No.1 & O.P No.2.

ORDER

O.P No.1 will refund the complainant the excess amount taken by them amounting to Rs.1,74,965/- along with interest on the said amount @ 10% from 02.01.2013 till date of final payment.  O.P No.2 will also pay a sum of Rs.50,000/- to the complainant towards compensation for not intimating the complainant/ not obtaining the consent of the complainant towards settlement of insurance claim as on 29.12.2012.  Apart from the above, both O.P No.1 & 2 will pay to the complainant a sum of Rs.10,000/- each towards cost of litigation.  The above payment shall be made to the complainant by O.P No.1 & 2 within a period of 45 days from the date of receipt of this order, failing which the complainant is at liberty to take shelter of this Hon’ble Forum as per C.P.Act,1986.

Typed to dictation, corrected and pronounced by the Hon’ble Member in the Open Court on this the 30^th  May,2017 under the seal and signature of this Forum.

 

(Sri B .N Tripathy)

Member.

                                                                                                            (Sri D.C Barik)                                                                                                                                                                                                          President.