O R D E R<br /> <br /> <br /> <br /> SRI.D. KRISHNAPPA, PRESIDENT:<br /> <br /> The grievance of the complainants against the Ops is, that he had availed a loan of Rs.75.00 lakhs from the Ops which was sanctioned on 01/10/2007 for purchase of a property in 7th Block Koramangala from KSIIDC. After negotiation with the vendor of the property and also with the KSIIDC and after sanctioning of loan he was required to surrender the original title deeds of the property purchased as guarantee for the loan sanctioned by creating security. As per terms of the agreement loan was to be released in favour of KSIIDC after final negotiation, but unfortunately deal between themselves and KSIIDC was struck midway and they had to drop the proposal to purchase property. They brought this to the notice of the Ops through their letter dated 17/03/2009 but to their surprise the second Op had debited the loan installments since November 2007 till March 2009 from their account in an amount of Rs.14,36,980/- towards installments though loan amount was not disbursed. Op as per the loan agreement was required to release the loan amount in favour of KSIIDC but because of dropping of the purchase of the property amount was not disbursed and stated that disbursal could have been at the time of registration. That the stand taken by the Ops that a Demand Draft for the loan sanctioned was kept ready for paying it to the vendor is not proper and stated that Ops could not have paid the loan amount to the vendor when the property itself was not transferred. That he made a representation to the Ops on 17/03/2009 for which, Ops have given untenable reply on 13/03/2009. Thereafter, Op by refunding Rs.1,44,472/- out of the total amount Rs.14,36,980/- debited to their account, claimed to have adjusted the balance towards interest on the loan sanctioned in sum of Rs.12,92,508/- and therefore calling this act of the Ops in adjusting amount towards interest, when that loan amount was not disbursed as deficient has prayed for a direction to Ops to refund Rs.12,92,508/- with interest and to award compensation of Rs.2,50,000/- and cost.<br /> <br /> 2. Ops have appeared through their advocate and filed common version contending that the complainants are carrying on oil business as a partnership firm therefore, the transaction being a commercial one complaint is not maintainable. Ops have further admitted to had sanctioned loan of Rs.75.00 lakhs to the complainants for purchase of a property at Koramangala from KSIIDC, repayable in 240 monthly equal installments. It is further stated that first Op issued a Demand Draft dated 19/03/2008 for Rs.75.00 lakhs drawn in favour of KSIIDC and that complainants were required to get the property registered in their name and deposit original title deed as security with them but the complainants failed to get the property registered due to some reason and therefore had requested them through a letters dated 18/01/2008 and 24/12/2009 not to cancel the DD further agreeing to pay the installments without any default and in view of such request held upon sanctioned loan and reissued DD in favour of KSIIDC. Then finally when the complainants were not able to get the property registered requested the first Op to cancel the DD through their letter dated 17/03/2009, by that time the complainants had paid 17 EMI’s amounting to Rs.14,36,918/- till March 2009. Since the first Op had earmarked the loan sanctioned on the request of the complainants they have adjusted Rs.12,92,508/- towards interest and refunded the principal part of Rs.1,44,482/- to the complainants on 06/05/2009. It is further stated that they are entitle for interest on the fund earmarked by way of demand draft drawn in the name of KSIIDC as they last liquidity of fund. Therefore, stating that complainants were liable to pay interest since they had issued DD for Rs.75.00 lakhs in the name of the vendor and therefore, have prayed for dismissal of the complaint. <br /> <br /> 3. In the course of enquiry into the complaint, the complainants and an officer of Op No.1 have filed their affidavit evidence reproducing what they have stated in their respective complaint and version. Complainants along with the complaint have produced a copy of loan sanctioned order with copy of terms and conditions of the loan, copy of schedule fixing the quantum of EMI’s and copies of few correspondences that took place between them including copy of legal notice the complainants got issued and reply given by Op No.1. Ops have produced copies of two letters the complainants addressed to them. We have heard the counsel for the complainants and perused the written arguments filed by counsel for the Ops.<br /> <br /> 4. On the above contentions, following points for determination arise.<br /> <br /> 1. Whether the complainants prove that Ops have caused deficiency in their service in charging them for interest without disbursing the loan amount?<br /> <br /> 2. To what relief the complainants are entitled to?<br /> <br /> <br /> 5. Our findings are as under:<br /> <br /> Point No.1 : In the negative<br /> Point No.2 : See the final order<br /> <br /> REASONS<br /> <br /> 6. Answer on point No.1: As admitted by the complainants themselves loan of Rs.75.00 lakhs was sanctioned in their favour by the Ops vide sanction order dated 01/10/2007. But Ops though have contended it was a commercial loan and therefore, complaint is not maintainable but their own documents and contentions show that loan sanctioned to the complainants was a housing loan and not a loan sanctioned for any other commercial purpose. Therefore, the complainants are not consumers as contended by the Ops cannot be heard. Having found that there is no dispute regarding sanctioning of loan, we shall come to the vital point has canvassed by the complainants whether the loan which was sanctioned was disbursed or not.<br /> <br /> 7. The complainants themselves have admitted that they had transacted with the KSIIDC for purchase of a property, for that purpose they had availed loan from the Ops and that loan amount was to be paid directly by the Ops in favour of KSIIDC. The copy of schedule-I produced by the complainants prove that loan of Rs.75.00 lakhs sanctioned by the Ops was to be paid in favour of KSIIDC and that was repayable by the complainants in 240 monthly equal installments. From this schedule it is clear that amount was to be paid to the KSIIDC through DD. Ops have contended that they had prepared a DD in favour of KSIIDC and the complainants who were negotiating with the vendor were to give title deeds to the Op No.1 as security and get the DD delivered to KSIIDC. The complainants have further admitted that proposal of purchasing the property struck in the midway and therefore they brought this fact to the notice of the Ops through their letter dated 17/03/09. Therefore it is an admitted fact that loan of Rs.75.00 lakhs was converted into a DD drawn in favour of KSIIDC was kept with Op No.1 for delivering it to KSIIDC on the complainants creating security by way of mortgaging property by way of deposit of title deeds. Ops admitting to had prepared a DD for the loan amount in the name of vendor stated to had kept it ready for delivery on the complainants complying the other formalities. It is further stated by them that the complainants through their letters dated 18/01/2008 and 24/12/2009 requested them not to cancel the loan and also not to cancel the DD. The complainants have not denied this statement of the Op and also affidavit evidence filed by them. The Ops in support of their contention have produced copies of two letters addressed by the complainants to them on 18/01/2008 and 24/12/2008. In these letters the complainants have requested the first Op to hold the DD of Rs.75.00 lakhs till February 20th 2008 as the vendor is delaying the registration further agreeing for debiting EMI’s regularly. Again in the second letter also they have informed first Op of their inability to go for registration of the property and requested the 1st Op to hold the payment till they confirm, further admitting their liability to pay whatever the interest and EMIs towards the above said loan are due. Under these letters it is confirmed that the complainants were aware of the DD, prepared in the name of KSIIDC and kept it ready for delivery soon after the compliance of loan conditions by the complainants. Thus it is manifest that the complainants themselves did not take the DD or make use of the DD because of some hurdle in finalization of the sale transaction.<br /> <br /> 8. The Ops as a reply to the legal notice of the complainants got issued to them made clear to the complainants stating that disbursal of the draft for Rs.75.00 lakhs was held at their instance that DD amount was earmarked at their end towards the disbursal which could not be utilized and they lost liquidity of funds in the interim period and therefore, stated they were entitle for interest for the interim period. It is therefore found that the first Op who had prepared the DD in the name of the complainants vendor, on the request of the complainants, vide their two letters referred to above requested Op No.1 to hold DD in their custody and they kept the DD with them until they receive letter of the complainants dated 17/03/2009 informing the failure of the purchase proposal. Therefore, the question is whether taking a DD for the loan amount in the name of KSIIDC would amounts to disbursal of the amount or not. We have found that DD was prepared by the first Op on the request of the complainants themselves. It was also in their knowledge as evident from their letters. Ops in their reply to the legal notice made clear that the DD was taken in the name of the vendor of the complainants, that amount was though with the first Op but that amount was earmarked for disbursal at any time on the instructions of the complainants. Thus Op No.1 could not have made use of that money for any other purpose and therefore, we agree that Ops last liquidity on that amount and the Op could not have earn any interest on that amount. Therefore, the complainants cannot escape from paying interest on that amount. Even the complainants through their letter produced by the Op have admitted their liability stating that he is liable to pay whatever interest and EMI towards the above said loan. The complainants therefore cannot now contend to the contrary and claim for refund of that amount.<br /> <br /> 9. Counsel appearing for the complainants has relied upon 4 decisions reported in 1 (2008) CPJ NC page 211, 1 (2005) CPJ NC page 27, III (2009) CPJ NC page 299 Rajasthan State Consumer Disputes Redressal Commission, Jaipur and II (2006) CPJ NC Page 13 which have no bearing on the facts of the case.<br /> <br /> 10. The first Op who had debited Rs.14,36,980/- to the account of the complainants towards repayment when cancelled the DD on the letter of the complainants dated 17/03/2009 refunded Rs.1,44,472/- out of that amount which was appropriated towards principal amount and adjusted the balance of Rs.12,92,508/- towards interest at the agreed rate of 12% on the loan sanctioned for the period from date on which DD was taken till cancellation of the DD. The complainant has not questioned that interest appropriated as either excess or arbitrary. We under these facts and circumstances find no merits in this complaint. The complaint is devoid of merits lacks bonafides and is liable to be dismissed with cost. With the result, we answer point No.1 in the negative and pass the following order.<br /> <br /> O R D E R<br /> <br /> Complaint is dismissed with cost of Rs.3,000/- payable to first Op<br /> <br /> <br /> Dictated to the Stenographer. Got it transcribed and corrected. Pronounced in the Open forum on this the 19th August 2010.<br /> <br /> <br /> <br /> <br /> MEMBER MEMBER PRESIDENT<br /> <br /> <br /> <br /> <br /> <br /> <br /> <br /> <br />