Order-15.
Date-02/02/2016.
In this complaint Complainant Vinay Madhogariaby filing this complaint has submitted thatcomplainant is running a proprietorship business in the name and style of AGV International having his office at 46, Moulana Abdul Kalam Azad Road, Howrah-711101 and presently residing at Orbit Residency, Flat No.6A 29A, Ballygunje Park, Kolkata- 700019, P.S.- Karaya.Sometimes on or about 2005 complainant availed of a Home Loan account no. 43866557 for 10 years repayable by monthly EMI of Rs. 1,13,512/-.
Considering the excellent track record of the complainant in repaying his EMIs against the said Home Loan A/C No. 43866557 on or about August-Sept.-2008 op offered another Mortgage Loan i.e. Home Saver Loan for Rs. 1,18,00,000/- as per floating interest out of which complainant availed of Rs. 11,46,1,104.34 paisa in the name of his proprietorship concern AGV International for a period of 180 months under Home Saver Loan A/C No. 3220545714 and monthly EMI of Rs. 1,48,420.75 paisa and the op also charged Rs. 80,850/- towards processing charges.
The present complaint is confined to the aforesaid Home Savel Loan in whose respect the ops in utter defiance of RBI guidelines imposed various charges as annual charges and also levied huge foreclosure charges. It is pertinent to mention that at the time of documentation the complainant was never told about such annual charges and prepayment printed documents whose contents were never explained to the complainant nor its copy was ever handed over to him at the time of processing of the said Home Saver Loan.
Op charged of Rs. 80,850/- from the complainant in the name of processing fee and every year the op bank used to levy Rs. 1 to 1.5 lacs as annual charges since 2011 to 2013 total amount of Rs. 4,17,805/- which is very annoying since the complainant always paid his EMIs in time and being fed up with such huge annual charges, complainant decided to prepay the aforesaid home save loan and intimated to the op about his intention by writing a letter in June-July 2013 and asked for the final payable amount.
Accordingly op intimated the complainant that it would levy foreclosure charges if prepayment is made. So, complainant discussed this matter with the officials of the ops but no possible output remitted. Op imposed and debited of Rs. 4,56,983.77 paisa as prepayment penalty and the entire loan was repaid by the complainant on or about 13.08.2014 and closed the home save account but he compelled to remit prepayment charge of Rs. 4,56,983.77 paisa under protest.
In fact op levied huge prepayment charges in utter defiance of RBI guidelines in this regard and it is pertinent to mention that all the banks in India are bound to follow the circulars issued by RBI and by issuing circular DBOD No. 107/13.3.00/2011-12 dated 05.06.2012 regarding levy of foreclosure charges/repayment penalty and in the above circular the monetary policy statement announced on 01.04.2014 indicated that bank should also allow its customers to prepay floating rate terms loan without any penalty and that banks are not permitted to charge foreclosure charges/prepayment penalties on all floating rate terms of loan to the individual borrowers.
Fact remains that complainant stated that the said Home Saver Loan was taken by the complainant in the name of his proprietorship concern but in the eyes of law the proprietorship concern is synonymous with the proprietor himself and both are having same identity as well as PAN number and at the time of granting Home Saver Loan account op never appraised the complainant about such charges and he was made to sign on huge documents and the contents of those documents were neither explained nor its copy was ever provided to the complainant.
In such a situation complainant approached Banking Ombudsman against the op for its noncompliance of the circulars of RBI and illegal realization of foreclosure charges. So, op contested the claim of the complainant before Banking Ombudsman and Banking Ombudsman while disallowed the prayer of the complainant vide order dated 19.05.2015 and closed the same yet granted liberty to the complainant to approach any other legal Forum or authority for redressal of grievances as such the complainant filed this complaint before this Forum for getting proper relief.
In fact the act of the op in imposing and collecting prepayment charges from the complainant is contrary to the guidelines prescribed by RBI and so the complainant was compelled to pay prepayment charges amounting to Rs. 4,56,983.77 paisa and such an act is no doubt deficiency in service on the part of the op and also deceitful manner of trade.
Further op defied the basic principal that there is synonymy between an individual and is proprietorship concern as much as a Proprietorship Concern has no separate existence apart from the individual himself and both the individual and its proprietorship concern is one same and identical in the eyes of Law yet the op compelled the complainant to pay Rs. 4,56,983.77 paisa in the name of foreclosure/prepayment charges.
As because the Banking Ombudsman has granted liberty to the complainant to approach any legal Forum for redressal of his grievance as such complainant filed a complaint before this Forum for getting proper relief and cause of action arose on 13.08.2014, though it was continued upto 19.05.2015 that is on the date of rejection of the complaint by Banking Ombudsman.
In the above premises complainant prayed for redressal.
On the other hand op by filing written version submitted that the present complaint is not tenable in view of the fact that the entire complaint is an abuse of process of law and truth has not been disclosed. So, the present complaint is vexatious and liable to be dismissed.
Further it is submitted that op Bank denied the statement that op in utter defiance of RBI Guidelines imposed various charges as annual charges or that also levied huge foreclosure charges or that at the time of documentation complainant never told about such annual charges and prepayment printed documents whose contents were never explained to the complainant nor its copy was ever handed over to him at the time of processing of the said Home Saver Loan and the op Bank stated that with regard to annual charges, Home Saver Loan Against Property is an Overdraft Product with various features and it attracts annual charges for its usage which was duly intimated to the complainant vide letter dated 25.02.2011 and the revision of the Schedule of the Service Charges was duly intimated to the complainant vide letter dated 17.03.2011.
Further as per the terms of the Agreement, op Bank reserved the authority to make any changes in the tariff as deemed fit and in fact complainant has authenticated by affixing his signature in the sanction letter and the agreement that he will abide to the changes effected by the Bank from time to time.
No doubt complainant approached the op Bank in July 2014 for closing the account and as per settled and agreed terms and conditions, the Pre-termination Quote (PTQ) was issued to the complainant in August 2014 and the complainant is well aware of the fact that he is liable to pay the pre-payment charges on pre-closure of the account and the details of the same are also clearly mentioned in the sanction/facility letter duly signed by the complainant.
Fact remains that op Bank not only strictly complies with the provisions of the Banking Regulation Act, 1949, Reserve Bank of India Act, 1934 but also abides by all the guidelines, directives, instructions or advices of the RBI as may be in force from time to time and the said loan had been issued in the name of the Sole Proprietorship Firm M/s. AGV International, so as per the relevant circular, the waiver is applicable only for individual accounts.
Ld. Ombudsman also stated in its order dated 19.05.2015 that the Bank is not deficient in its service to the customer and so the complaint filed by the complainant was rejected.
Further it is submitted that at the time of granting of loan and issuing loan copy of all documents were supplied to complainant with signature and it is within the knowledge of complainant. But complainant with malafide intention has filed this complainant in fact this complaint is liable to be dismissed and for some ill purpose this complaint is filed.
Decision with reasons
On proper consideration of the complaint and written version and also relying upon the materials on record, it is found that accepted fact is that loan was granted to the borrower AGV International, NIF ISPAT Ltd. Vinay Kumar Madhogaria&ShobhaMadhogaria and from the copy of the application for loan agreement, it is found that Vinay Kumar Madhogaria signed on behalf of NIF ISPAT and AGV International and ShobhaMadhogaria signed as individual.
Further it is found that the loan was not taken individually by the complainant, but it was taken by NIF ISPAT Pvt. Ltd. and AGV International and Vinay Kumar Madhogaria signed for himself and for NIF ISPAT Pvt. Ltd. and AGV International and also for self andShobhaMadhogariafor self and they signed in all the pages of the loan agreement and no doubt copy was also supplied and that was informed by letter subsequently and the complainant received all those letters and thereafter no doubt complainant foreclosed the said loan account.
Ld. Lawyer of the complainant has tried to convince that it is a Home Loan. But from the Agreement it is clear that it is an Agreement for loan against property and this loan is titled as Home Saver Loan. But it is not a housing loan for purchasing house or purchasing under construction house for residential purpose or anything and as per agreement and including the Clause, it is clear that complainant as a top business man was well aware of the terms and conditions of the loan and previously he also took loan in such a manner in the year 2005 against similar type of Home Loan A/C No. 43866557 and it is further proved that complainant not only alone but including ShobhaMadhogaria, NIF ISPAT Pvt. Ltd.and AGV International jointly took the loan and it is found that complainant as Director of NIF ISPAT Pvt. Ltd. singed in the Agreement as proprietor of AGV International signed the agreement and also signed as an individual and one ShobhaMadhogaria signed as individual.
So, truth is that complainant took loan against property and not only that it is found that it is a loan taken jointly by complainant himself and also on behalf of AGV International as proprietor, as director of NIF ISPAT Pvt. Ltd. and ShobhaMadhogaria is one of the co-borrower and from the copy of the application, it is found that the loan was granted for commercial business purpose and no doubt NIF ISPAT Pvt. Ltd. is one of the co-borrower that means the entire purpose of the loan is commercial and as per clause Home Saver A/C means current account in the name of borrower which is linked to the loan account and permitted to pre-payment, pre-mature repayment as per terms and conditions as laid down by Standard Chartered Bank in that behalf and enforced at the time of repayment and definition of rate of interest means the rate of interest as referred in Article 2.2 of the Agreement and as per Clause 2.2- The variable rate of interest shall be reviewed by SCB at the end of every three months from the month of disbursement and upon review SCB may decide to increase, decrease or remain the interest rate unchanged.
Against Clause 2.3- Computation of Interest is specifically noted and details of Disbursement are also noted. Further from the Clause 2.8, it is found that in case of Pre-Payment SCB may, in its sole discretion and on such terms as pre-payment charges, minimum prepayment amount etc. as it may prescribe, permit prepayment/acceleration in payment of EMIs at the request of the Borrower, subject that SCB may specify, from time to time, the minimum amount of prepayment/amounts payable on account of acceleration of EMIs. In the event SCB permits any prepayment/acceleration, the repayment schedule for the Loan shall be amended/altered by SCB for giving effect to such prepayment/acceleration and such amended/altered repayment schedule shall be binding upon the Borrower.
Considering the above definition clause of the prepayment clause etc. including terms and conditions of the Agreement, it is clear that complainant a very big business man jointly with other companies’ and persons took this loan and complainant is also the director of one private limited company that is NIF ISPAT Pvt. Ltd. So, the loan was not granted individually to the complainant or AGV International. Loan was granted to NIF ISPAT Pvt. Ltd. and AGV International, complainant and also ShobhaMadogaria and no doubt this loan was granted for commercial purpose nor for livelihood of the complainant and complainant before taking that loan he had his running business and he is multi-millionaire for which he took loan more than one crore and this loan was only for his benefit of his business and to increase his profit and benefit from the business and that is for commercial purpose and it is not personal loan that is proved.
At the same time it is found that it is not a housing loan or home loan for purchasing house or for construction of house or for repairing of the house. But the loan was taken for commercial purpose and loan was granted subject to mortgaging the property. So, this loan is called loan against property, but style and title of the loan is Home Saver Loan. But it is not a Home lona when that is the fact, then it is clear that as per RBI guideline only in respect of Housing property loan, the RBI has instructed the bank not to impose any penalty charges against foreclosure or prepayment of the loan account, but that order is not applicable in case of commercial loan taken against mortgaging property and in the present case that order of RBI is not applicable. But we have gathered that in so many cases the big merchants after taking Home Saver Loan (against Agreement for Loan against Property) and after foreclosure/prepayment appeared before this Forum by producing the copy of RBI for deciding the matter. But the entire matter has been decided by the Banking Ombudsman and Banking Ombudsman decided that the said RBI order is not applicable in the present case and complainant’s application is rejected.
Another factor is that as per Agreement for foreclosure and prepayment penalty must be given and against that RBI has not issued any such order.
Moreover the above order is applicable in respect of home loan but such a loan shall be sanctioned to individual borrower. But in the present case the loan was not sanctioned to any individual/borrower. But it was sanctioned to Private Company, complainant and other and no doubt this loan is not a loan granted by the op to any individual borrower. When that is the fact, then that RBI order as mentioned by the complainant is not applicable in this case.
Further it is found that on prepayment of entire loan complainant with some ill motives appeared personally and filed this complaint having his no legal right on the ground the loan was granted actuallyto one private limited company one proprietorship concern and two other individuals and jointly they took loan which is evident from the application and agreement clause and it is not a housing property loan but it is loan against property for which the RBI guidance as mentioned in this complaint is not applicable in this case.
At the same time it is clear that purposefully and only to harass the op, complainant has filed this complaint with vexatious allegation and truth is that there is no evidence of negligence and deficiency on the part of the op but op has complied all the terms and conditions, directions guidelines of RBI properly and complainant as a big commercial business units took loan.
So, under the eye of law this complaint cannot be an individual borrower in respect of the present loan but loan was borrowed by 4 units one the complainant himself, one ShobhaMadogaria, another NIF ISPAT Pvt. Ltd. and next AGV International. So, in the eye of Law the present complainant cannot be a consumerwhen purpose of loan is no doubt for commercial purpose and for extending their business and ultimately they have extended their business and when the loan was taken that was not the for the first time but in the year 2005 another Home Loan was taken for same terms and conditions.
So, it is clear that only for the purpose of grabbing money, this complaint is filed and it is no doubt frivolous and such sort of complaint is filed by so many traders after foreclosure of the loan after prepayment of the loan and that has become another business of the complainant and moreover the NIF ISPAT Pvt. Ltd. company is one of the co-borrower, then complaint is also not maintainable and truth is that suppressing the truth complainant appeared before this Forum by raising some hoax allegations against op only to harass the op and so the entire act on the part of the complainant, though he is not a consumer in the eye of Law is no doubt harassing and the entire complaint is frivolous, false for which this complaint fails.
Hence, it is
ORDERED
That the complaint be and the same is dismissed on contest with penal cost of Rs. 10,000/-.
Complainant shall have to pay the penal cost of Rs. 10,000/- to this Forum within one month from the date of this order failing which 9 percentinterest p.a. shall be assessed till its full realization and if complainant fails to comply this order in that case penal proceeding shall be started u/s 25 read with Section 27 of C.P. Act, 1986 for realization of the penal cost including other for which further penalty and fine shall be imposed upon complainant.
