DISTRICT CONSUMER DISPUTES REDRESSAL FORUM:BHADRAK
Dated the 30th day of January, 2017
C.D.Case No.43 of 2014
Sri Sudam Sahu
S/o:Masdhusudan Sahoo,At-Bijeipada,Po-Birikala
Ps-Joda, Dist-Keonjhar
At Present: C/O Hemanta Kumar Barik
At: Mathasahi
Po/Ps/Dist: Bhadrak
……………………. Complainant
(Versus)
- Branch in-charge
H.D.F.C Bank Ltd.
A/62/1 Nayapalli
Pin- 751012, Odisha
- Branch in-Charge
H.D.F.C Bank Ltd.
At: Gupta Complex
Bypass, Bhadrak
Po/Dist: Bhadrak
………………………..Opp. Parties
For the Complainant: Sri Sanjaya Ku Majhi & Associates, Advocates
For Opposite Parties: Sri Manoj Kumar Panda & Associates, Advocates
Date of hearing : 23.11.2016
Date of order : 30.01.2017
SRI BASANTA KUMAR MALLICK, MEMBER
This dispute arises out of the complaint filed by the complainant alleging deficiency of service and unfair trade practice.The facts disclosed in the complaint are to the effect that complainant is a loanee/borrower of H.D.F.C Bank, Bhadrak Branch in availing a transport vehicle loan of Rs 12,10,000/- repayable in 46 monthly installments @ Rs 34,550/- per installment as EMI. In the process of sanction and disbursement of loan, complainant has executed all relevant papers in putting his signature only as per instruction of the Branch in charge. Although there is provision as per guide line issued by Reserve Bank of India to the banking companies to supply copies of loan cum Hypothecation agreement, repayment schedule & Loan sanction letter, in spite of repeated verbal request made by complainant the Branch Head (O.Ps) did not supply the same, rather made verbal commitment to provide those documents by post in the present address. But to ill luck, complainant has not yet received any paper as stated above from the
O.Ps. Besides above, complainant has also submitted as many as 50 numbers of blank cheques under the instruction of O.Ps without mentioning date and amount before release of loan and also verbally informed to pay Rs 34,550/- per month as EMI. Complainant, in compliance to the instructions of O.Ps, has been paying the EMI within the due date. But due to closer of mines and for his serious health condition, complainant become irregular in payment of EMIs on due dates as a result of which O.Ps charged penal interest on the outstanding amount exorbitantly instead of charging on the overdue portion of the loan. Moreover, complainant has requested the OP Bank times & again to provide the loan amount statement since the date of opening, but the O.Ps turned a deaf ear to his requests. Furthermore, complainant has alleged that the O.Ps have not accounted for the payment of Rs 35,000/- vide receipt number 28987953 on dt. 26.03.2013, the reason is not clarified by the O.Ps. Apart from above, complainant, on default in repayment, proposed the O.Ps for one time settlement to clear the outstanding loan at a go which is turned down by O.Ps and threatened over phone to repossess the vehicle. As the complainant has not been supplied with the sanction letter and loan cum hypothecation agreement, he is in darkness as to what is the normal and penal rate of interest changed on loan by the O.Ps. Because of non-co-operating attitude of the O.Ps, the complainant finding no other way filed dispute in the Forum alleging deficiency of service and unfair trade practice and seeking relief on the points of allegation.
O.Ps resisted the claim and contested the case. In the written version, O.Ps have challenged the maintainability of the dispute citing some decisions of different State Commissions and stating as the relation between complainant & O.Ps is debtor and creditor, not as consumer and service provider, and hence the complainant has no locus standee to sue the opposite parties and also claiming the complainant is not a consumer within the meaning of C.P Act, 1986 as laid down under section 2(d). It is also stated by the O.Ps that the allegations made in the complaint are vague and vexatious and suffers from manifold legal misconceptions and factual debilities. It is also stated by the O.Ps that in the event of default in payment of equated monthly installments, or bouncing of cheques, complainant is liable to pay overdue charges and bouncing charges as per the terms of loan cum hypothecation agreement executed between the customer and banker at the time availing the loan. Accordingly the bank has charged penal interest including late payment charges of Rs 1,70,461/- and cheque bouncing charges 15,750/- and including the unpaid loan installments (E.M.I), total outstanding against the complainant as on 20.10.2014 is Rs 6,40,530/-. O.Ps have also raised that whatever amount of loan, including late payment charges etc., is outstanding in the loan account is genuine and according to the terms of loan agreement executed between the parties. As regards supply of sanction letter and copy of loan agreement to complainant, O.Ps contented to have supplied the same by post at the later stage of disbursement of loan. Hence the dispute is not maintainable in the eye of law nor in facts and liable to be dismissed.
Heard the counsels of both the parties and perused material evidence on record. It is undisputed that the complainant is a borrower of OP Bank and has availed loan of Rs 12,07,360/- as against the sanctioned amount of Rs 12,10,000/- for acquisition of a truck bearing Registration No. OR-09N-8757 & such loan was repayable in 46 equated monthly installments @ Rs 34,550/- commencing from 01.01.2010 to 01.09.2014. It is also a fact that the complainant has
Given more than 46 numbers of post date cheques, bearing signature of complainant to the O.ps. Now the complainant is alleging to have not received the copy of the sanction letter and loan cum hypothecation agreement which is mandatory to be supplied by the opposite parties as per guideline issued by the Reserve Bank of India, the regulatory authority of all the Banks operating in the country. The complainant has requested many a time, personally meeting the branch-in-charge of OP Bank for obtaining the copy of the documents as mentioned but failed to get the same as the officer in charge of the OP Bank did not pay any heed to his personal requests. Contrary to the statement and averments made in the complaint, O.Ps defended in stating that they have supplied the copies of the documents, as above, by post but did not adduce any evidence in support of their claim. As the O.Ps claim to have supplied the documents as required by complainant, they failed to furnish documentary evidence in support their claim which leads to believe that the O.Ps have not at all supplied the documents to complainant. Hence the contention of O.Ps on this particular point of allegation without substantiating with any evidence does not hold good.
On the issue of maintainability, the O.Ps have contended that the loan agreement executed between the parties contains the terms & conditions to the effect that all disputes relating to financial transaction shall be filed within Mumbai Jurisdiction. Contrary to the contentions of O.Ps, complainant submitted, in course of hearing, that the question of Mumbai Jurisdiction is vague & meaningless condition. The relevant section of C.P Act bears the provision that the dispute is required to be adjudicated their where the cause of action arose. Since the cause of action arose at Bhadrak, this Forum has reasonable ground to admit and hear the case. Secondly as regards the terms and conditions of the loan agreement where in the Jurisdiction clause is incorporated, complainant submitted that the OP bank is a banking company, having its corporate office in Mumbai, is also having the branches all over the country for its business operation, inclusion of such a condition in the loan agreement does not permit the OP bank, for its own convenience, to concentrate all the disputes in Mumbai Jurisdiction. Such a clause in the loan agreement is intended to deprive the customers/borrowers of OP bank from their constitutional rights to raise their voice against unfair & illegal trade practice. A customer, if seeks Justice from Court of law against unlawful and unfair acts of the bank, can not file a dispute in Mumbai Jurisdiction covering hundreds and thousands of kilometers from different parts of the country which is not only expensive but next to impossible also. It is felt by the Forum that the OP bank has incorporated such a condition to humiliate the customers of OP bank by which the innocent borrowers seeking Justice against the unlawful and illegal actions, will be prejudiced. We know our power is too limited but prefer to go beyond our power preview to suggest for repeal of such conditions for interest of Justice. Hence the contention of O.Ps on the maintainability ground is rejected outright.
O.Ps have further submitted that the complainant is not a consumer within the meaning of Section 2(d) of C.P Act as the relation between the complainant and O.Ps is debtor and creditor. On the other hand complainant submitted that he is a consumer within the meaning of C.P Act as laid down in Section 2(o), a customer of banking institution, either depositor or a borrower, is not confined within financial transactions but he is also entitled to enjoy certain privileges and service from the said institution as he pays service charges to the bank which is
directly levied by the banks. Similarly in the present case the complainant is a borrower and has paid service charges in course of processing of loan proposal and hence the complainant is supposed to avail required services from the O.Ps as a consumer. The Act itself is very much clear that the consumers are supposed to avail required services from O.Ps as consumer in connection with banking institution as provided in section 2(O) of cp Act, 1986. Thus the Forum is opinion that the present case is entertainable and can be adjudicated in this Forum in the present Form. Hence the objection of the O.Ps is not sustainable.
Let us now discuss on the allegation raised by complainant about the payment tendered by the complainant which has not been accounted for. Complainant alleged that the deposit made to the credit of his loan account maintained with OP bank vide receipt No. 28987953 dt. 26.03.2013 amounting Rs 35,000/- has not been credited to his loan account. Contrary to such allegation, O.Ps submitted that such allegations are absolutely false and imaginary. In fact, the said amount in dispute has already been accounted for in the loan account of the complainant and the same is also reflecting in the statement of account. On perusal of statement of account, it is found that the said amount has been accounted for in the loan account of the complainant on 28.03.2013 with a special mention of value date as 26.03.2013. As such the allegation of the complainant is proved false.
Now it is worth mentioning that the complainant has alleged that the O.Ps have realized more amount than the actual due charging exorbitant rate of interest on the loan as penal interest. O.Ps contradicted the submission of complainant in saying that all amount of installments deposited by the complainant is not adequate to liquidate the said loan account so as to enable O.Ps to issue NOC. But as reveals from the statement of account of the said loan account, it is observed that the complainant has paid 10 installments @ Rs 34,550/- per installment starting from 01.12.2010 to 01.09.2011 on due dates, total amount of which comes to Rs 3,45,500/- & from 01.10.2011 complainant failed to deposit on due dates. As such, complainant has defaulted in payment of installments on due dates although subsequently complainant has deposited Rs 7, 44,100/- on 17 occasions. The total amount paid by complainant, as recorded, is Rs 10,89,600/- as against the total amount payable Rs 12,07,360/- in 46 monthly installments @ Rs 34,550/- as agreed upon between the parties. In this manner the complainant is still liable to pay Rs 1,17,760/- plus interest at the normal rate would be applied. Which has become overdue. More over in the event of default in payment of regular installments, O.Ps are supposed to charge penal interest. It is now a vital question what is the normal and penal rate of interest chargeable on loan? Whether the penal interest would the charged on overdue portion of the loan from the date of default to the date of payment or on the entire loan outstanding on the date of first default? As reveals from the statement of accounts, the rate of normal interest chargeable is @ 14.68% P.A but there is no mention about penal interest to be charged on overdue installments, and whether penal interest can be applied when the interest has been calculated on monthly rests. Charging interest @ 14.68% seems to be unrealistic as none of the banks (Nationalized and Commercials Banks) are charging such exorbitant rate of interest, even though the R.B.I has deregulated the interest rates and as such banks are at liberty to fix up/charge interest keeping in view of the cost of founds. Over and above such high rate of interest, O.Ps claim to realize late payment charges is an act of is exploitation of consumers.
As against balance outstanding of Rs 1,17,760/-, O.Ps are demanding the realizable loan outstanding of Rs 6,40,530/- including all charges. In spite of repeated requests, O.Ps did not respond to the complainant to supply a copy of loan agreement and loan sanction letter which indicates the ill intention of O.Ps resorted to unfair trade practice. This Forum has, at the time of hearing, instructed the O.Ps to furnish these two documents in original, but the O.Ps failed to submit the same which gave rise to suspicion and compels to believe that the interest charged on loans as reflecting in statement of accounts is totally unrealistic and not genuine. It is also believed that complainant has suffered financially by the unfair trade practice of O.Ps bank. O.Ps have taken advantage of the ignorance of the complainant who was fully unaware of the system and procedure of a bank loan, particularly from private banking system, and therefore could not demand the copy of loan documents before making payment of 1st EMI. As the O.Ps failed to submit loan sanction letter and loan agreement in spite of instructions issued from the Forum, it is believed that O.Ps are trying to suppress many thing which may disclose the truth and O.Ps may be adversely affected in charging of higher rate of interest, & late payment fee is held by the Forum as illegal and therefore the O.Ps are found resorted to unfair trade practice and deficient in providing proper service to the complainant. Hence it is ordered;
ORDER
The complaint be and the same is allowed in part against O.Ps. O.Ps are directed to close the said loan account of complainant on payment of Rs 3,50,000/- and make the vehicle hypothecation free. O.Ps are also directed to issue N.O.C immediately after payment of above amount by the complainant within 30 days from the date of receipt of this order. Non compliance of this order by the parties within the stipulated time shall warrant penalty of Rs 5,000/- to be deposited in the Forum. Disposed off with no cost.
This order is pronounced in the open Forum on this day of 30th January, 2017 under my hand and seal of the Forum.
