SMT. RAVI SUSHA: PRESIDENT

    This complaint has been filed U/s 12 of Consumer Protection Act 1986, seeking to get an order directing the opposite party to pay a sum of Rs.1,50,000/- towards compensation to complainant together with cost of the proceedings.

            Brief facts of the case are that the OP sanctioned an educational loan of Rs.2,00,000/-  in connection with the educational purpose of the son of the complainant Rohit Chirayil.  Out the said sum of Rs.2,00,000/-, Rs.1,80,000/- was made available in the NTTF Thalassery, the educational institution of the son of the complainant.  The son of complainant the above said Rohit joined the course on 15/07/2005 and the course was completed on 15/08/2008.  As per the stipulation of the educational loan the loan liability is expected to be repaid on July 2010.  Even though complainant started to repay the amount in the year 2009 itself.  According to the OP, EMI to be payable by the borrower is @3,799/- per month.  The complainant has been regularly paying the substantial amount in every month in fact the said remitted amount in each occasion is more than the EMI amount.  In some occasions the complainant paid Rs.25,000/- or more.  Altogether the complainant has remitted the totals sum of Rs.3,90,000/- to the OP.  The complainant alleged that OP has been suppressing the material facts relating to the financial transaction between complainant and OP.  In fact the complainant was entitled to get loan subsidy declared by the State and Central Governments.  As per various Central government and State government orders moratorium for loan taken up to 31/02/2009 was declared.  Circulars issued with laudable purpose are/were binding on the bank.  Due to the deliberate latches and negative attitude of the banking official’s interest moratorium benefits were denied to the complainant.  The OP is not entitled for compound interest as per the regulation of educational loan. The OP is expected to calculate the interest as per the guidelines issued by Government of India in respect of educational loan.  But the OP calculated the interest in violation of the guidelines issued by government of India in connection with educational loan.  It is submitted that the complainant has paid  a total sum of Rs.3,90,000/- towards the loan liability.  It is pertinent that the loan actually availed for the educational purpose of said Rohit is Rs.1,80,000/-. Even now the OP is demanding Rs.80,000/- more.   The method of calculation which is being adopted by OP is unjustifiable.  The actions and inactions from the part of OP amounts to unfair trade practice and deficiency of service.  It is submitted that the complainant has paid excess amount and he is entitled to get bank Rs.1,00,000/- from the bank.  Moreover the OP is liable to pay Rs.50,000/- as the compensation for deficiency of service and unfair trade practice committed by OP against the complainant.  Hence this complaint.

            After receiving notices, OP filed version stating that the total amount disbursed to the complainant and to his son was Rs.1,88,940/- as per the fee structure an requests made by the borrowers during the period of the course.  For the loan availed, the complainant has agreed to pay interest at the rate of 10.5% per annum with quarterly rests.  The rate of interest for the loan availed by the complainant is subject to revision from time to time.  The complainant has also agreed to pay penal interest @ 2% per annum in the event of default in payment or any irregularity in the account, over the agreed interest rate for the overdraft amount and overdue period.  The course period was 3 years.  As per the education loan scheme, the moratorium of the loan is course period plus one year or six months after getting the job, whichever is earlier.  The course was completed on 15/08/2008 and hence the moratorium ended on 15/07/2009.  Therefore, the repayment should commence from August 2009, but the 1^st installment of the loan was remitted only in December 2009.  The allegation that the complainant has been regularly paying substantial amount every month and in fact he remitted more than the EMI amount is false.  After the payment of the 1^st loan installment in December 2009, there was not regular repayment in the loan account.  The amount of Rs.25,000/- paid by the complainant  on 04/03/2010 as stated in the complaint was the accumulated defaulted loan installments payable by the complainant in the loan account.  After that the payment there was no remittance in the subsequent months and the loan account became non-performing Asset (NPA) in October 2010.  The allegation that the complainant has remitted a total sum of Rs.3,90,000/- in the loan account is false.  The total amount remitted by the complainant is Rs.3,52,791. As on 01/10/2017, a sum of Rs.83,210/- is still due from the complainant and his son to this OP.  On the said sum the complainant and his son is liable to pay future interest and charges incurred by the OP.  The allegation that the complainant has paid an excess amount of Rs.1,00,000/- to the OP bank and that he is entitled to get back the said sum from the OP is false.  The OP had in fact extended the moratorium period of the loan from 12 months to 24 months in June 2012.  According to OP it has charged only simple interest for the loan during the moratorium period till July 2010 ie. The course period plus 2 years extended period of moratorium.  The complainant is therefore, not entitled for any interest subsidy for the loan availed by him in 2005.  Loan interest subsidy scheme was introduced by the government during the financial year 2009-10.  The said scheme is applicable only in respect of disbursements of loan made by the Banks on or after 1^st April 2009 for the academic year 2009-10, irrespective of the date of sanctioning.  The final disbursement of the loan availed by the complainant was made on 10/01/2008 and hence the complainant was not eligible for interest subsidy declared by the government.  This OP has not committed any deficiency in its services to the complainant.  The complainant is therefore, not entitled for any relief and prayed for dismissal of complaint.  During the pendency of this case, the original complainant Mr. Kunhiraman died and his son impleaded as additional complainant 2 vide order in IA dated. Both parties led their evidence. 

The power of Attorney holder of additional complaint filed chief affidavit and documents Ext.A1 loan agreement.  On behalf of OP, Branch Manager, SBI Payyannur Branch has filed his chief-affidavit and produced documents Ext.B1 to B6.  Both witnesses were subjected to cross-examination for the rival parties.  After that the learned counsel of OP filed written argument note.

            The point for consideration is whether there is any deficiency in service on the part of the OP bank for recovering the loan amount from the complainant?

            Complainant’s case is that as per the stipulation of the education loan, the loan liability is expected to be repaid on July 2010.  Even though complainant started to repay the amount in the year 2009 itself and he has been regularly paid the EMI amount and altogether remitted total sum of Rs.3,90,000/- to the OP.  Further submitted that as per the state and central governments’ circular the complainant was entitled to get loan subsidy.  Further alleged that OP is not entitled for compound interest as per the regulation of educational loan.  According to complainant though he had availed a loan of Rs.1,80,000/-, he had paid Rs.3,90,000/- towards the liability so he is entitled to get back Rs.1,00,000/- from the back with compensation for the deficiency of service and unfair trade practice committed by the bank.

            On  the other hand the learned counsel of OP stated that in accordance with the loan agreement Ext.B1 and B2, Rs.2,00,000/- was sanctioned as education loan to complainant’s son Mr. Rohit chirayil with rate of interest 10.25% per annum with quarterly rest.  Further the rate of interest is subject to revision from time to time.  Further stated that in the event of a default in payment or any irregularity in account, penal interest @ 2% per annum, over the agreed interest rate will be charged for the overdraft amount and overdue period.  Further Ext.B6 disbursal statement shows that the total loan amount disbursed was Rs.1,88,940/-.  Ext.B4 statement of account from 17/09/2005 to 30/10/2017 shows that as on 01/10/2017 the balance amount to be paid by the loanee amounts to Rs.83,210/-.  OP contended that the course of the loanee was completed on 15/08/2008 and hence the moratorium ended on 15/07/2009.  Therefore the repayment should commence from August 2009.  But the complainant remitted the 1^st installment only in December 2009 and after that there was no regular repayment in the loan account.  Further stated that the amount of Rs.25,000/- paid by the complainant on 04/03/2010 was the accumulated defaulted loan installments payable by the complainant in the loan account and after that there was no remittance in the subsequent months and the loan account became non performing Asset in October 2010. Further submitted that the complainant has remitted Rs.3,52,791/- in total towards repayment.  OP stated that OP has charged only simple interest for the loan during the moratorium period till July 2010 ie the course period plus 2 years extended period of moratorium.

            Another allegation of complainant is that he is eligible to get subsidy benefit as per the circular issued by central and state government.  With regard to this point, OP produced circular Ext.B4. On perusal of Ext.B4 circular No. PB/PL/5 proposed by Ministry of HRD, Govt. of India dated 07/07/2010.  Applicable Academic year states that the scheme shall be applicable only in respect of disbursement made by the Banks on or after 1^st April 2009 for the academic year 2009 -10.

            In this case there is no dispute that the course was completed on 15/08/2008 and the final disbursement of the loan availed by the complainant was on 10/01/2008.  Hence it is clear that the complainant is not eligible for interest subsidy benefit as per Ext.B4 circular.  From the material available on record, the complainant failed to establish that OP had received excess amount from him.  On the other hand the statement of account shows that the complainant has to pay Rs.83,210/- as on 01/10/2017.  Further from the Ext.B4 circular, complainant was not entitled to take the subsidy benefit as stated in the circular.

            Based on the discussion above, the complainant failed to prove his case.  Hence he is not entitled to get any relief from opposite party as there is no deficiency in service or unfair trade practice on the side of opposite party.

            In the result complaint is dismissed.  There is no order as to cost.

Exts.

A1-Statement account

Pw1-Indukaladharan CC-Witness of complainant

B1- Attested copy of educational loan application

B2- Agreement letter

B3- Agreement for term loan

B4- Computer printout of statement of account

B5- E-circular dated 07/07/2010

B6- Disbursal statement

      Sd/                                                                          Sd/                                                     Sd/

PRESIDENT                                                                   MEMBER                                                   MEMBER

Ravi Susha                                                               Molykutty Mathew                                     Sajeesh K.P

(mnp)

/Forward by order/

Assistant Registrar