ORDER

BY SRI.H.R.SRINIVAS, PRESIDENT.

1.     This is the Complaint filed by the Complainant under Section 12 of Consumer Protection Act 1986, against the Opposite Party (herein referred in short as O.P) alleging the deficiency in service in not returning the  documents which was given to OP at the time of obtaining loan by reverse mortgage and for its due return, for Rs.5,00,000/- towards damages as compensation for causing inordinate delay in handing over the same, and depriving his right to make beneficial use of his property and for cost and other reliefs as this forum deems fit under circumstances of this complaint.

2.     The brief facts of the complaint are that, the Complainant is the owner of the residential house bearing No.3 khatha No.l34 situated at Garudachar Palya, K.R. Puram Hobli, Bangalore South Taluk, measuring East to West 30 feet, North to South 40 feet. It is contended that, he obtained loan from Op Rs.8,50,000/- by executing relevant documents by way of reverse mortgage and handing over the original title deeds of the said property.  It is his self-acquired property and no way connected with any other person and subjected to any other liability or indemnity. He discharged the said loan by paying Rs.17,30,000/- by issuing two cheques i.e. one for Rs.17,00,000/- drawn on Indian Bank, Kanakadasa Nagar Branch, Mysore and another for Rs.30,000/-  drawn on State Bank Of India, Vijayanagar, IIIrd Stage, Mysore. The loan has been completely discharged by paying entire outstanding. The property mortgaged has to be redeemed by OP and all the documents deposited with it has to be returned. Inspite of sending several demand letters and requesting to return the same, OP has not complied the same and returned the documents. He issued legal notice on 25.04.2018 which was served on OP whereas on 2.6.2018, OP has given untenable reply.  In view of non-returning of the original documents inspite of discharge of the loan, is prima facie illegal and there is deficiency in service which has caused him mental agony, stress and could not put the property for better use. Hence OP is bound to pay Rs.5,00,000/- as damages for causing the mental agony, physical strain and due to unreasonable delay in handing over the documents and prayed the forum to allow the complaint.

3.     Upon the service of notice, Op appeared before the Forum and filed its version by admitting the reverse mortgage transaction, repayment of the entire loan amount along with interest in that respect. It is further contended that the complainant also availed loan of Rs.3,66,000/- on 20.03.2014 with the help of his daughter Smt. Bhagyalakishmi who was working as Assistant General Manager of OP Bank by pledging gold ornaments.  Since both the loans became non-performing assets, OP issued notice to clear the above said loan and the complainant cleared the reverse mortgage loan whereas failed to discharge the gold loan liability and the gold loan transaction is still continuing and under Section 171 of the Indian Contract Act, the bank has a lien over the mortgaged property.

4.     Further it is contended that the said Bhagyalakhsmi who is the daughter of the complainant was working in OP’s branch at Mysore. There were lot of complaints against her and unauthorizedly and fraudulently she debited amount in various accounts of farmers.  The farmers and the customers gathered in large number on 04.12.2014 and there was demonstration in front of the bank. OP bank conducted the internal investigation and found unauthorized transaction aggregating to Rs.35,22,067/- committed by the said Bhagyalakshmi and based on the investigation, she was kept under suspension from 05.09.2014 and FIR was also lodged against her on 12.09.2014 by Saraswathi Puram Police Station Mysore. OP also requested the police to lodge supplementary FIR against the complainant who is the father of the said Bhagyalakshmi and FIR was lodged against him on 25.04.2018.  The demand of original title deeds of his property and for re-conveyance of the same and Rs.5,00,000/- as damages cannot be granted.  There is no deficiency on its part and inspite of it, complainant is demanding the same along with Rs.1,00,000/-.  They have right to retain the documents in lieu of non-payment of the gold loan under Section 171 of the Indian Contract Act. It has denied all the allegations made in each and every para of the complaint and prayed the forum to dismiss the complaint.

5.     In order to substantiate the case, Both Complainant and OP filed his affidavit evidence along with documents. Heard arguments. The following points arise for our consideration:-

1) Whether the complainant has proved

    deficiency in service on the part of the

                    Opposite Party?

2)  Whether the complainant is entitled to

                     the relief prayed for in the complaint?

6.     Our answers to the above points are:-

POINT NO.1:            In the affirmative

POINT NO.2:           Partly in the affirmative

                                For the following.

REASONS

POINT No.1:-

7.     It is not in dispute that, the complainant mortgaged the schedule property mentioned in the complaint which is a residential house by way of reverse mortgage and obtained loan from the OP bank. It is admitted by the OP that, the said loan has been discharged by the complainant by paying the principle as well as interest. It is also admitted that the reverse mortgage has been registered and the title deeds of the property is given to it and the same is with it.

8.     It is the specific case of the complaint that, inspite of discharging the reverse mortgage loan, OP has not re-conveyed the same and not returned the title deeds which it ought to have done for which this complaint is filed. 

9.     On the other hand, it is specific case of the OP that apart from the complainant obtaining the reverse mortgage loan, he also obtained loan of Rs.3,66,000/- by pledging the gold ornament. ExR1 is the document filed to that effect wherein the complainant has pledged 183.4 grams of gold ornaments totaling 24 items and obtained loan of Rs.3,66,000/- agreeing to pay interest at 10.75%. The market value of the said gold ornaments on that day was Rs.2,900/- per gram and the loan given was at Rs.2,000/- per gram. 

10.   To the allegations made by the OP that, they have a lien towards the non-discharge of gold loan borrowed by the complainant, the complainant has not offered any explanation. Even he has not stated that the said gold loan has been discharged.  OP has relied on the following decisions and contended that he has right to retain the title deeds of the property towards non-discharge of the gold loan and hence there is no deficiency of service. The following decisions are here below:-

“1) Supreme Court of India – in Syndicate Bank Vs Vijay Kumar & others.

2) In the Delhi High Court- in State Bank of India  Vs. Diwanji Buildwell (India) Pvt. Ltd., and Another – Revision Petition No.3988 to 3989/2014.

3) National consumer Disputes Redressal Commission, New Delhi – in Charnjeet Kaur Vs State Bnak of Patiala .

4) High court of Andhra Pradesh- in Mohan Enterprises, Peetani Sambaiah Vs Andhra Bank, Narsapur Branch-  in Writ Petition No.16399/2006

11.  On the other hand, it is the contention of the Complainant’s counsel at the time of arguments that, the pledged gold loan is more than sufficient to discharge the outstanding gold loan and hence the documents cannot be held as security or lien in respect of the said loan and in that respect, there is deficiency in service on the part of the OP and hence the prayed the forum to allow the complaint. He has also relied on the decisions.

“In the High Court of Karnataka at Bangalore Dt:10.11.1987 – The Mangalore Catholic Co-operative Bank Limited, Mangalore Vs M.Sundara Shetty – 1987 (1) KLJ - 21.

11.   As pointed above, the Complainant pledged 183.4 grams of gold worth Rs.5,30,000/- as on that day. The loan given to the complainant by the bank was only Rs.3,66,000/- and the complainant has agreed to pay interest at the rate of 10.75%. The loan was granted on 20.03.2014. Now as on date upon the information obtained over internet, the value of the 24 carat gold is Rs.3,208/- per gram and of 22 carat gold is Rs.3,030/-and if the said gold ornaments were to be auctioned in lieu of default of the complainant in not discharging the gold loan, OP can very well get his money along with interest.  It is astonishing to note that, though the loan has become Non Performing Asset (NPA), OP has not taken any action in auctioning the said gold ornaments to release its dues. In view of the pledging the sufficient quantity of gold ornaments to cover the outstanding loan dues, we are of the opinion that retaining the original documents of the house property of the complainant and not re-conveying the reverse mortgage deed amounts to deficiency in service.

12.   It is the further contention of OP that, the daughter of the complainant one Bhagyalakshmi was working in OP’s branch at Mysore and misappropriated a sum of Rs.35.33.067/- and FIR has been lodged against her and further supplementary FIR has been filed by the police including the name of the complainant.

13.   Ex. R3 is the FIR against said Bhagyalakshmi. A request letter has been made by OP to include the name of this complainant which was received by the police inspector as per the endorsement made on it. Whereas no FIR against this complainant has been produced by the OP to show before the forum that his name is also involved in the said criminal case. Further the said FIR is dated 12.09.2014 and the letter the OP has written is on 08.12.2014 to include the name of the complainant. So far no copy of the, additional FIR and the chargesheet against this complaint filed by police is placed before this forum  and that criminal case has been registered and pending against this complainant. Further the filing of the chargesheet or registering the FIR cannot be a ground for OP to retain the documents of the complainant.  Hence we  answer POINT NO.1 IN THE AFFIRMATIVE holding that, there is deficiency in service in retaining the title deed of the schedule property of the complainant and not re-conveying the same.

POINT NO.2:

14.   In view of the above answers, OP is bound to re-convey the reverse mortgage and set free the schedule property without any liability. OP is also bound to hand over all original title documents of the said property to the complainant within 30 days from the date of this order.  The complainant has sought Rs.5,00,000/- as damages towards non-conveying the property free from mortgage and not returning the title deeds.  Whereas the same has not been substantiated. Inspite of it, the complainant has been put to lot of inconvenience and he could not use the same to raise money for his personal reasons or to pay the amount to the OP towards discharging the gold loan.

15.   Hence, we are of the opinion that, if a sum of Rs.25,000/- towards damages for mental and physical sufferance and Rs.10,000/- towards litigation expenses if ordered to be paid by the OP to the complainant would meet the ends of justice.

16.   Further we clarify here that the complainant has an option to discharge the gold loan in case he prefers to do so by paying the money and get the gold ornaments pledged released in his favour.  In case he do not pay the same, OP is at liberty to put the same into open auction and realize its dues. If the same fails to satisfy the principle and interest, OP can very well take action against the complainant as known to law.  Hence we answer POINT NO.2 PARTLY IN THE AFFIRMATIVE and pass the following:-

ORDER

1. The Complaint is allowed in part with cost.
2. The OP i.e. IDBI BANK LIMITED, represented by its Branch Manager/Authorized Signatory is hereby directed to re-convey the reverse mortgage and set free the schedule property without any liability. OP is also directed to hand over all original title documents of the said property to the Complainant within 30 days from the date of receipt of this order.
3. Further OP is hereby directed to pay a sum of Rs.25,000/- towards inconvenience caused and  damages and Rs.10,000/- towards cost of the litigation and expenses.
4. The O.P is hereby directed to comply the above order at within 30 days from the date of receipt of this order and submit the compliance report to this forum within 15 days thereafter.
5. Send a copy of this order to both parties free of cost.

Note:You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order failing which the same will be destroyed as per the C.P. Act and Rules thereon.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open Forum on this 31^st MAY 2019)

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

Copies of Documents produced on behalf of Complainant/s:

Ex P1: 04.02.2012: Copy of the Loan Sanction Letter.

Ex P2: 14.02.2018: Copy of the acknowledgment of two cheques.

Ex P3: 18.12.2017: Copy of the letter.

Ex P4: Copy of the two Emails dated 19.02.2018 and 22.02.2018.

Ex P5: 25.04.2018: Copy of the legal nOtice.

Ex P6: 02.06.2018: Copy of reply.

Ex P7: Copy of the Statement of Account.

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

RW-1:Sri Ganesh Aithal, Branch Head and deputy General Manager of OP.

Copies of Documents produced on behalf of Opposite Party/s

Ex R1: 20.03.2014: Copy of the gold sanction letter.

Ex R2: Copy of the Transactions Inquiry.

Ex R3: Copy of the FIR filed against Smt. Bhagyalakshmi.

Ex R4: Copy of the Statement.

MEMBER                        PRESIDENT

A*