D.O.F:03/12/2020
D.O.O:20/04/2023
IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KASARAGOD
CC.161/2020
Dated this, the 20th day of April 2023
PRESENT:
SRI.KRISHNAN.K : PRESIDENT
SRI.RADHAKRISHNAN NAIR.M : MEMBER
SMT.BEENA.K.G : MEMBER
P.Jayaraj, aged 39 years.
S/o. M. Damodaran Nambiar,
Shivadam, Chekyarppu, : Complainant
Haripuram (P.O),
Kasaragod District- 671531
And
The Branch Manager,
Corporation Bank, : Opposite Party
Kanhangad Branch,
Kasaragod District- 671315
(Adv. K. Sanjayan Nambiar)
ORDER
SRI.RADHAKRISHNAN NAIR.M : MEMBER
The complaint is filed for compensation alleging service deficiency on the part of the opposite party.
The facts of this case in brief is that the complainants obtained a housing loan of Rs.5,68,000/- from the opposite party bank in the year 2011, by depositing the original title deed documents of his property. The tenure of the loan was24 years.Subsequently,after informing the manager of the opposite party about the urgency of getting back the title deeds, the complainant paid the entire balance amount on 15.02.2020 and requested for return of the title deeds document. Even though the opposite party sought one week time to return the documents it was not done, in spite of written request dated 09.03.2020.The opposite party told the complainant that he is the guarantor of the loan of Mrs. Sridevi and the documents would be released only after clearing her entire loan. The complainant brought to the notice of the opposite party that the above title deed documents were not given as security for that loan and if any amount to be realised it could be done without detaining the title deeds or by attaching his salary. But the title deed documents were not returned to him. Since he was in urgent need of the documents, he was constrained to pay the loan amount of Mrs.Sridevi on 12.03.2020.The opposite party returned the title deed documents only after 27 days.
The act of the opposite party in unlawful detaining of the documents,which were not given as security to the loan of Mrs.Sridevi amounts to unfair trade practice and service deficiency on the part of the opposite party,due to which the complainants suffered mental agony and hardships, apart from financialloss. Hence this complaint is filed for direction to the opposite party to pay Rs.90,000/- towards the compensation and Rs.15,000/-as costs.
The notice sent to the opposite party was duly served, but they remained absent.Therefore the name of the opposite party was called and set ex parte on 04.02.2021.
There after the opposite party entered in appearance and filed IA91/2021, IA 92/2021, and IA 93/2021 to set aside ex parte order, condone the delay in filing the version and to receive the Version respectively. All the IA’s are allowed on terms on 30.09 2021and directed the opposite party to pay Rs.500/-as costs to the complainant. But the opposite party did not comply the order by paying Rs.500/-to thecomplainant.Therefore this commission vacated the orders in IA 91/2021, IA 92/2021, and IA 93/2021 and recorded “no version “on 11.11.2021.
The Complainant filed proof affidavit in lieu of chief examination and documentsExt.A1 to Ext.A3 are marked. The Ext.A1 is the complainant’sBank Pass Book No.SB 006800101010975 of the corporation Bank.Ext.A2 is the Remittance slip dated 15.02.2020 for Rs.1,61,000/- Ext.A3 is the copy of letter 09.03.2020 issued by the complainant to the opposite party. Another document produced by the complainant is marked as Ext A4, which is a receipt dated 12/03/2020.
Even though no version is recorded due to noncompliance of the orders in IA’s 91/2021, 92/2021, 93/2021, the opposite party actively participated in the proceedings of the case. The PW1 was cross examined and documents Ext.B1 to B13 are marked during cross examination.
Ext.B1 is the loan application Form submitted by the complainant,Ext.B2 is the loan Agreement, Ext.B3 is the Loan agreement of Smt.Sridevi, Ext .B4 is the copy of notice issued to Smt. Sridevi ,Ext.B5 is the unserved notice addressed to the complainant, Ext.B6 is the postal A/D card, Ext B7 is a copy of the RR notice dated 16,10.2018 U/S.69(2).,Ext.B8 is a copy of the RR notice dated 28.11.2018 U/S.7, Ext.B9 is a copy of the RR demand notice dated 22.12.2018 U/S.34, Ext.B10 is the statement of assets and liabilities, Ext B11 is the letter dated 12.03.2020 issued by Smt. Sridevi to the opposite party,Ext.B12 is the closed loan account of the complainant, Ext.B13 is the closed loan account of Smt. Sridevi.
The opposite party raised their case during cross examination of the PW1. They admitted that the complainants availed a loan of from them, by depositing the original title deed documents.The complainant was also the guarantor for the loan of Rs.50,000/- taken by his mother in law Mrs. Sridevi and for that loan no other security was taken except the guarantee of the complainant. The complainant and Mrs. Sridevi are jointly and severally liable to repay the above loan.Mrs. Sridevi was highly irregular in repayment of loan, who has paid no amount towards loan and the loan account has been classified as NPA with effect from 30.10.2018. In spite of several remainders to Mrs. Sridevi as well as to the guarantor complainant, no amount is paid. Also Revenue Recovery proceedings were initiated against Smt.Sridevi and the guarantor. Smt. Sridevi participated in Revenue adalath also. There after Smt.Sridevi together with the complainant submitted a letter to the opposite party requesting for on time settlement facility. The bank has offered one time settlement and the amount was fixed at Rs.63,630/- after writing off huge amount. Accordingly, Mrs. Sridevi has fully paid the amount on 18.03.2020.On the same day itself the title deed documents were returned to the complainant.
Since the complainant was the guarantor to the loan availed by Mrs.Sridevi, the bank has got a right of lien and charge over the property of the complainant so long as the loan amount remained unpaid. The complainant submitted request for return of documents only on 15.03.2020. The documents were returned on 18.03.2020.No delay is caused in return of documents. There is no merit in the complainant and therefore it is Iiable to be dismissed.
Based on the pleadings and evidence of the rival parties in this case the following issues are framed for consideration.
1. Whether there is any service deficiency or unfair trade practice on the part of the opposite party?
2. If so, what is the relief ?
For convenience, both these issues are considered together.
Here the specific case of the complainant is that even though the loan was closed on 15.02.2020,the opposite party did not return his title deed documents deposited as security for the above said loan, then and there. The opposite party detained the documents saying that the loan taken by Mrs. Sridevi for which the complainantwas guarantor was in due and the documents would be released only after clearing her entire loan. The complainant brought to the notice of the opposite party that the above title deed documents are not given as security for that loan and if any amount to be realised it could be done without detaining the title deeds or by attaching his salary. But the title deed documents were not returned to him. Since he was in urgent need of the documents, he was constrained to pay the loan amount of Mrs.Sridevi on 12.03.2020. The opposite party returned the title deed documents only after that.
The complainant submit that the act of the opposite party in unlawful detaining of the documents, which were not given as security to the loan of Mrs.Sridevi amounts to unfair trade practice and service deficiency on the part of the opposite party, due to which he suffered mental agony and hardships, apart from financial loss.
The opposite party would argue that since the complainant was the guarantor to the loan availed by Mrs. Sridevi, the bank has got a right of lien and charge over the property of the complainant, so long as the loan amount remained unpaid. The complainant submitted request for return of documents only on 15.03.2020. The documents were returned on 18.03.2020. No delay is caused in return of documents.
The complainant submit that it was after informing the manager of the opposite party about the urgency of getting back the title deeds, he paid the entire balance amount on 15.02.2020 and requested for return of the title deeds document. Even though the opposite party sought one week time to return the documents it was not done, in spite of written request dated 09.03.2020.
The complainant argue that the claim of the opposite party regarding lien would not stand. The bank cannot exercise the right of General lien on the title deed of the property, taken for a loan availed by borrower, for the reason that some other loan obtained by some other person in which the borrower is guarantor is in due.
The complainant produced the decisions of different courts in various similar cases in support of his arguments. In the case reported in (2013) 6 AIIMR 38 (2014) 1 BC 409/ (2013 )5 MhLj 283/(2013) 0 Supreme (Bom) 1567 it is held that bank cannot exercise the right of General Lien on title deeds of property for loan availed by borrower as suit for recovery of amount on account of fraud is pending. Section 171 (of the Contract Act 1872) employs the expression goods bailed to them “.The word bailment” has been defined in Section148 of the said Act to mean delivery of goods one person to another person for some purpose ,upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the direction of the person delivering them.Section 160 of the said Act stipulates that it is the duty of the bailee to return the goods bailed,without demand ,or the purpose for which they were bailed having been accomplished. Similarly, under Section 172 of the said Act pledge has been defined as bailment of good as security for payment of a debt or performance of a promise. Under Section174 of the Act the pawnee cannot in absence of a contract to that effect retain the goods pledged for any debt or promise order that the debt or promise over which they are pledged.
Admittedly, the title deeds of the complainant were kept with the bank as a security towards the loan amount which is obtained for housing in his individual capacity. The bank was at liberty to recover the said loan and also at liberty to take legal recourse, in the event of default in repayment of the said loan. But after the entire amount of loan has been repaid, the bank has no right to retain the said title deed documents, merely because another loan taken by some other individual is in due, by exercising the right of lien.
Here the opposite party has no case that the complainant created any charge over the property covered by the title deeds, for the security of the loan obtained by Mrs. Sridevi.
Admittedly the complainant obtained loan in the year 2010. It was much after that Mrs.Sridevi obtained a loan. It was an agricultural loan and no document is demanded or received as security for that loan. It is true that the complainant was the guarantor for that loan. But no agreement is there connecting the title deeds of the complainant to that loan.
Here the housing loan was for 25 years and the bank has no case that he was a defaulter in repayment of that loan. The complainant foreclosed the above loan since he was in an urgency of getting back the title deeds. It was after informing the manager of the opposite party, the complainant paid the entire balance amount on 15.02.2020 and requested for return of the title deeds document. Even though the opposite party sought one week time to return the documents it was not done, in spite of written request dated 09.03.2020. The opposite party told the complainant that he is the guarantor of the loan of Mrs. Sridevi and the documents would be released only after clearing her entire loan. The complainant brought to the notice of the opposite party that the above title deed documents are not given as security for that loan and if any amount to be realised it can be done without detaining the title deeds or by attaching his salary. But the title deed documents were not returned to him. Since he was in urgent need of the documents he was constrained to pay the loan amount of Sridevi on 12.03.2020.
Eventhough the title deeds were to be returned to the complainant on 15.02.2020, at event of the repayment of the entire loan amount,the opposite party with held the title deed documents for a month till they are returned on 18.03.2020, which amount to service deficiency.
Considering the facts and circumstances of this case this commission is of the view that there is service deficiency on the part of the Opposite party. The complainants submits that due to the service deficiency on the part of the opposite party, he suffered mental agony and hardships, apart from financial loss. He estimates his damages to the tune of Rs.90,000/- But he did not produce any document to prove such a huge loss. This commission is of the view that an amount of Rs.20,000/- would be a reasonable compensation in this case.
In the result the complaint is allowed in part directing the Opposite Party to pay Rs.20,000/- (Rupees Twenty Thousand only) towards compensation and Rs.5,000/- (Rupees Five Thousand only) as cost to the complainant.
Time for compliance is 30 days from receipt of copy of this judgment.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Exhibits
A1: Bank Pass Book
A2: Remittance Slip
A3: Copy of letter
A4: Payment receipt
B1: Loan Application Form
B2: Loan Agreement
B3: Loan agreement of Smt. Sridevi
B4: Copy of notice issued to Smt. Sridevi
B5: Un served notice addressed to the complainant
B6: Postal Acknowledgment card
B7: Copy of RR notice dated 16/10/2018
B8: Copy of RR notice dated 28/11/2018
B9: Copy of the RR demand notice dated 22/12/2018
B10: Statement of assets and liabilities
B11: Letter dated 12/03/2020
B12: Closed loan account of the complainant
B13: Closed loan account of Smt. Sridevi
Witness Crossexamind
PW1: Jayaraj. P
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Forwarded by Order
Assistant Registrar
Ps/
