BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BAGALKOT.

C.C.No.102/2017

                     Date of filing: 04/10/2017

                                                                  Date of disposal: 09/10/2018

P R E S E N T :-

- V/S -

JUDGEMENT

By Smt. Sharada. K. President.

1.      This is a Complaint filed by the complainant under Section 12 of the Consumer Protection Act, 1986 (herein after referred to as Act) against the Opposite Party (in short the “OP”) directed the OP to issued No Due Clearance Certificate to the complainant and not deduct the outstanding balance amount and to pay Rs.50,000/- towards harassment, mental agony and Rs.5,000/- towards the cost of the proceedings and any other reliefs etc.,

2.      The facts of the case in brief are that;

          The complainant is a permanent resident of Khaji Budhihal, Tq: Jamkhandi, Dist. Bagalkot and he had raised a Car loan for Rs.3,81,000/- as per the Loan Agreement Deed, with the OP Bank which was sanctioned on 17.12.2009 and further the complainant has to repay the said loan to the OP Bank in 84 monthly installments for Rs.6,000/- each. Accordingly, he had repaid the entire loan without any gap and closed the said loan in the month of December-2016.

          It is further case of the complainant that, after closure of the said loan, he had asked the OP to issue the NO Due Certificate and other documents if any. But, OP Bank has not returned the above said documents to the complainant Utter Surprise, the OP Bank has issued a letter dtd: 23.01.2017 and stating that, the car loan has been completed, but there is still a outstanding balance of Rs.81,853/- as on 23.01.2017, for the reason that, remitting lesser EMI than advised and interest rate fluctuations. We request you to close the loan immediately.

It is further contended that, as per loan Agreement at Para No.3, the OP has fixed the rate of interest and also fixed the Floating Rate of Interest as below;

Floating Rate of Interest;

8% for 1^st Year 10% for 2^nd & 3^rd  Year, interest on the loan will be charged at 0.25% p.a. over SBAR which is currently 14.5% p.a.     

After fixing the floating Rate of Interest then only the OP Bank has fixed the EMI amount of Rs.6,000/- per month for 84 installments. Hence, reason quoted in their letter on dtd: 23.01.2017 is absolutely false and vexatious one and further contended that, if there are any changes in the interest rate, the OP Bank could have intimate or informed about the same to the complainant. If it is notified and published in the newspaper by the OP Bank, it will be not noticed to the Public. Because most of the Public will not observe this matter in the newspapers. As per their own statement, the fluctuation of interest might have been made through entry of interest charged in the pass book of the complainant or the OP might have been sent the statement of account to the complainant. But, the OP did not do so.

Finally, the complainant has issued a legal notice to the OP through his Advocate, but the OP replied vaguely and further the OP has admitted in his letter that, the Car loan repayment has been completed. Now it is the boundan duty of the OP Bank to provide the No Due Clearance Certificate and other documents to the complainant. Hence, these attitude and acts of the OP, it clearly shows that, there is deficiency in service and also amounts to Unfair Trade Practice under the provisions of C.P. Act. Hence, the complainant is constrained to file this complaint.     

3.      The Forum registered a case and issued notice to the OP. After service of the notice, the OP has appeared through his counsel and filed his written version and contended that, the complaint of the complainant is false, frivolous and the same is not admitted by this OP except those which are specifically admitted and further contended that, the complainant has availed the car purchase loan of Rs.3,81,000/- from the OP which was sanctioned on 17.12.2009 on such terms and conditions mentioned in the arrangement letter followed by the Loan-cum-Hypothecation Agreement and Guarantee Agreement. The loan was to be repaid in 84 monthly installments of Rs.6,000/- each.

          It is false to contend that, the complainant has repaid the entire loan without any gap and closed the said loan in the month of December – 2016 and he has asked no due certificate and other documents from the OP and further     OP contended that, the complainant was unaware of the floating rate of interest is far from truth. The complainant used to obtain his loan account details from time to time and the bank was all the while informing him the change in rates of interest was also published in all the leading newspapers and it was also made known to public through newspapers, radio, television and all other social media. It is also a known fact that, the rate of interest on loans as well as on deposits is Governed as per the Guidelines issued by the Reserve Bank of India from time to time. None of the banks have any discretion to either increase or reduce the rate of interest.

       It is further contended that, in all the documents executed by the complainant in favour of OP there is a clear mention of the floating rate on interest and the complainant has executed the said documents agreeing for the said terms and conditions. The complainant cannot now contend about the revised rate of interest which is clearly in contravention of the agreement already executed by him in favour of the bank and there is no any deficiency in service on the part of the OP. Hence OP prayed for dismissal of the complaint with costs.

4.      The complainant has filed his chief affidavit along with documents which are marked as Ex.C-1 to Ex.C-7 in support of his case. The documents are as follows;

On the other hand OP has filed his affidavit on behalf of his case and produced 4 documents which are marked as Ex.R-1 to R-4 are as follows;

5.      On the basis of above said pleadings, written argument of both parties, oral and documentary evidence, the following points arises for adjudications are as follows;

1. Whether the complainant proves that, there is Un-fair trade practice on behalf of OP as per C.P. Act ?

2. Whether the complainant is entitled for relief ?

3. What order?

6.      Our findings to the above points are as under:

1. Point No.1 Affirmative.
2. Point No.2 Partly Affirmative.
3. Point No.3 As per the final order for the following:

R E A S O N S

7.     POINT NO.1 & 2:-  Since both the points are inter-link and identical, hence we proceed both the points together;

          The complainant has filed this complaint against the OP submitting that, he had availed a car loan on dtd:17.02.2009 for Rs.3,81,000/- from OP’s Bank as per the agreement and further stated that, he has repaid the loan amount within 84 installments of Rs.6,000/- per month and further the complainant having an account bearing No.30994373400 with OP Bank and he had maintain sufficient balance in his account and as such every month OP had deducted Rs.6,000/- from the complainant’s account, as per instruction given by the OP and complainant had paid 84 installments without hindrance, after laps of 84 months, the complainant has asked the OP Bank to returned the documents which have been secured for the Car Loan, like Car key, R.C. and also demanded No Due Certificate. But, OP was not returned the same instead of this OP and stated that, there is still outstanding balance of Rs.81,853/- in your account as on 23.01.2017, even though, the repayment is completed. Because, remitting lesser EMI than advice and interest rate fluctuation.

On the other hand OP has filed his written version and stating that, the contention of the complainant is false there is agreement in the said car loan, it is very clear that, there was a floating rate of interest and complainant had agreed for said terms and condition to execute the same and further submits that, the complainant is aware of the fact that, the complainant obtained his loan account details from time to time and bank was also informing him the average rate of interest. Moreover, the change in the interest rate was also published in all leading newspapers as well as the other communication media like TV and Social Media, as per the guidelines of Reserve Bank of India, there was a fluctuation in rate of interest, bank have no any discretion to either increase or reduce the rate of interest.     

There is no dispute that, the complainant is the customer of the OP and he availed a car loan and he had repaid 84 installments to the OP, the fore most dispute arises here is after paying entire 84 installments, OP is saying there is still outstanding balance in the account of the complainant. Ongoing through the records on file, which have been produced by the both sides i.e. Bank statement, it clearly shows that, the complainant has paid an amount of Rs.6,000/- per month for 84 installments, when we scanned on the agreement executed between the parties in the first page itself, the floating rate of interest has been mentioned as 8% for first year, 10% for second year and for the third year an additional interest rate 0.25 will be charged. While mentioning these interest, the headline is “floating rate of interest” and there is a small star which cannot be visible if we see that, keenly we can find out that, there is a star and it says that, the conditions apply the same document which has been produced by the OP, in this document, it clearly shows that, such rate of interest has not been mentioned the agreement itself is incomplete.

As stated in the agreement point No.4 repayment it says that, the loan is to be repaid in 84 equited monthly installment of Rs.6,000/- per month till the entire loan with the interest is fully paid. The first installment commence from the month following the month of purchase of above said article/vehicle.  

In another agreement i.e. Loan-cum-Hypothecation Agreement also shows that, the rate of interest as stated supra and in page No.2 point No.6 and 2^nd paragraph its says that, Notwithstanding the above bank is entitled to increase the rate of interest without any variation in the SBAR. Such revised rate of interest shall always be construed as agreed to be paid by the borrower and here by secured. Borrower shall be deen to have to notice of change in rate of interest whenever the changes in SBAR or without change in SBAR are displayed/Notified at/by the branch/Publishing newspaper/Metro entry of interest charges in the passbook/statement of accounts send to borrowers, such being the clause, the OP has failed to produce any of the document, like newspaper or else of the Circular of SBAR and even the OP has failed to send the statement of accounts to the complainant, there is no single document accept that, the OP has communicated the variation of rate of interest to the complainant, the OP’s has also not denied that, the complainant has paid the EMI properly as stated in the complaint and further the OP stated that, there is a balance amount in the complainant account, such being the fact, why did they en-cashed the point No.3 of Agreement Letter which says that, the art of interest is subject to revision from time to time and you shall be deemed to have the notice in the rate of interest whenever it is due to changes in SBAR or without changing in SBAR displayed/Notified at/by the branch/publish in a newspaper/made through entry of interest charge in the passbook statement of account sent to you etc., and you are liable to pay revised rate of interest. The bank has the option to increase or reduce the EMI are extend the repayment period consequent upon changes in rate. In the event of the default in payment or any irregularity in account, the bank reserves the right to leave a higher rate of interest as it deems fit. Such being the contention in an agreement, what else avoid the OP to collect increased EMI from the complainant it should be finished within 84 months only.

The bank have to look after the customers, who are very punctual for repayment of their loan and they have to communicate the variation in rate of interest and happenings during the pendency of loan they might have paid the loan amount within a stipulated time and in this case, the OP has not informed the complainant about the outstanding balance amount towards the loan. If OP had informed the complainant, through the notice, the complainant might have paid this amount along with EMI itself. When, the complainant is set his mind for repayment of loan amount in 84 installments/months, he has been paid the 84 installments properly, there is a Un-fair Trade Practice and deficiency in service on the part of the OP that, without informing or leading the customer as per the agreement only. Even, the complainant also not signed, whenever, wherever the OP is need of signature. Hence we come to the conclusion that, the complaint is concluded by giving partial relief. Hence, we answer Point No.1 in the Affirmative and Point No.2 partly in the Affirmative.   

Point No.3:  In view of our findings on the above points, we proceed to pass the following;

O R D E R

1. The complainant is directed to pay half of the balance amount of Rs.49,203/- (forty nine thousand two hundred and three only) to the OP.

2. Further OP is directed to issue the No Due Clearance Certificate to the complainant.

3. Further OP is directed to pay compensation of Rs.5,000/- towards mental agony and harassment to the complainant.

4. Parties have to bear their own cost.

5. Send the copies of this Order to the parties free of cost.        

(Dictated to the Stenographer, transcribed by him, corrected and then pronounced by me in the Open Forum on this 0^th day of October, 2018).