D.o.F:26/11/2010

D.o.O:20/05/2015

IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD

                                          CC.NO.249/10

                  Dated this, the 20^th      day of  May 2015

PRESENT:

SMT.P.RAMADEVI           : PRESIDENT

SMT.BEENA K.G               : MEMBER

SMT.SHIBA.M.SAMUEL    : MEMBER

1.Prasanna Kumari.A

D/o  A.Gopalakrishna Bhat.

2. A.Gopalakrishna Bhat,                                     : Complainants

S/o Late Thimmayya Bhat

Both are R/at Aranthady House,

Kaliyoor,Vorkady Po,Kasaragod.

(Adv.M.Vittala)

1.Syndicate Bank, Vorkady Branch,

Represented by its Manager.                       : Opposite parties

2.The Chairman, Syndicate Bank, Manipal.

(Adv.Sadananda Kamath)

                                                                             ORDER

SMT.BEENA K.G               : MEMBER

    Complainants are  alleging deficiency in service on the part of opposite party bank  as they rejected  the educational loan application of the complainant on the ground that  complainant No.2 is  a Judgment debtor of opposite party bank  irrespective of guidelines of RBI.

  2.     Opposite party No.1 filed  version  admitting the application of the complainant for an educational loan  under ‘Synd Vidya ‘scheme.    But the loan was not sanctioned because the 2^nd complainant was an intentional defaulter of opposite party.  Opposite party further states that  complainant No.2 is liable to  repay the loan obtained by  a Thimmappa Bhat  and others  and recover the said amount  the opposite party bank was filed  OS 13/1995 on the file of the  Sub Court Kasaragod  and  deceased  Thimmappa Bhat,  the complainant No.2 here in and his brothers filed  OS.No.63/1995 for declaration and  in alternative  for correct determination of  amount due. And counter claim  for repayment  of the excess amount if any  made by the plaintiffs to the defendant bank .  Both the aforesaid case  jointly tried  by the Hon’ble  Subordinate Judge Kasaragod  and was decreed  and OS 13/97  filed by opposite party Bank  was dismissed  and presently  the same is pending  before Hon’ble High Court in appeal filed by opposite party bank  as per the customs usage and practice  .  Opposite party bank has  directed by  RBI and  his head office  whenever such a dispute  is pending  no fresh loan could be given  to such parties  until former disputes  ends finally.  The application  filed by the complainant  is  not considered  for the same reason  and it is purely accepted  precedent and practice  of the bank  and there is neither any personal vendetta nor any  deficiency in service  as it has been tried to be made out  in this complaint.

3.      Complainant filed proof affidavit Exts.A1 to A13 is marked.  Complainant No.2 was examined as PW1.  Opposite parties neither filed affidavit  and faced cross examination nor produced any documents.   Both sides heard and documents perused.

4.  The main question raised for consideration are:

1. Whether the non sanctioning of educational loan amounts to deficiency in service?
2. If so what is the relief?

5.  Issue No.1:  That the complainant No.1 is a student  admitted to  engineering course at Karnataka state  and got admission  on general merit  complainant No.2 is her father.  They applied for  education loan before  Ist opposite party  but the same was refused  by them on the ground  that the complainant No.2 is a judgment debtor and hence educational loan cannot be granted.   The main contention of opposite parties  is that  PW1 is a defaulter and hence  loan cannot be granted  to his daughter  who is a student.  The document Ext.A13  is a common judgment  in Os NO. 63/95 and Os.No 13/97  of Sub Court of Kasaragod.  OS.No. 63/95 was  filed by the  brother  of PW1  and OS.No. 13/97 was filed by  Ist opposite party for recovery of the amount.  Ext.A12 is decree in Os.No.13/97. The suit filed by the brother of complainant No.2 ie, OS.No. 63/95 was decreed in favour of the complainant.  Coupled reading of these documents  show that  claim of Ist opposite party was rejected and PW1  is the 6^th defendant  In Os.No 13/97.  In Ext.A9 opposite parties have  clearly alleged that  request of complainant No.1 cannot be considered at all as PW2 is a JD.  While perusing the documents  produced by the complainant  clearly shows that  the contention of  opposite party is baseless and  with ulterior motive.  Further the documents  Ext.A1 to A8  shows that  complainants were made to  run from  pillar to post  for the  educational loan benefit.  But it was rejected  only as  per Ext.  A9.   Evenafter issuance of  notice narrating  all facts as per  Ext.A10  opposite parties were not  ready to  open  their mind to help  a needy student.  This is evident from  Ext.A11 reply. Hence the act of opposite parties  amount to deficiency in service  and dereliction of duty  casted upon  nationalized banks  by government and RBI.

6.  The opposite parties  have neither stepped into witness box  nor produced any  document to  show that  their act in  rejecting the claim of complainant  for educational loan  is justifiable  under banking norms.  The evidence of PW1  also  clearly proves that  he is entitled for  compensation also.  Hon’ble High Court of Kerala  as per dictum laid down in WP ( c) No.270/2012 reported in  2012(1)KLT 755 has declared that  loan should have been  granted to the student  on their own application and without  surety of parent . Hence even if the parents are judgement debtors loan for education  of  needy student  should be granted.  In the instant case by applying their own mode opposite parties have  refused educational loan.  Thus it is clearly  against the dictum  of Hon’ble High Court. 

  7.  Further Hon’ble High Court was also held in 2011(2) KLT 922 that education loan should not be refused  on the ground that  it was granted to the other member.  Further the dictum  laid down in  2009(3)KLT 69 also envisage  that  guidelines issued  by RBI  are binding on bank.  In the instant case  without considering the  eligibility of a student,  loan was reject.   The act of opposite party amounts to deficiency in service and  unfair trade practice  which caused severe mental pain  financial loss, and emotional insult to the complainants.    The opposite parties  are bound to compensate the same  .

   In the result complaint is allowed directing the  opposite parties 1&2 to pay compensation of Rs.1,00,000/-(Rupees one lakhs )with cost of Rs.5,000/- to the complainant within 30 days from the date of receipt of copy of this order.  Failing which opposite parties   shall  pay interest @ 12%  on Rs.1,00,000/-  from the date of complaint  till payment.

Exts.

A1-1/2/10-request issued by complainant to OP.1

A2-application filed by complainant under RTI Act

A3-copy of reply given by OP.1

A4-copy of appeal memo

A5-&A6- reply of OPs

A7-copy of guidelines of education loan

A8-copy of letter with application of complainant No.1

A9&A11-letter from Ops  to complainants

A10-letter issued by PW1 to Ops

A12-copy of suit  filed  before Sub Court Kasaragod

A13-copy of  Sub Court judgement

PW1-. A.Gopalakrishna Bhat

MEMBER                                                                MEMBER                                        PRESIDENT