BEFORE THE III ADDITIONAL BANGALORE URBAN

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

                               BENGALURU – 560 027.

DATED THIS THE 14^th DAY OF JULY, 2022

CONSUMER COMPLAINT NO.465/2021

PRESENT:

SRI.RAJU K.S,

SMT.REKHA SAYANNAVAR,:MEMBER

S.Mahesh Babu,

S/o L.Siddaiah,

Aged about 52 years,

Residing at No.529,

Smt.K.V.Prema Kumari,

W/o S.Mahesh Babu,

Aged about 49 years,

Residing at No.529,

Bangalore-60040. ……COMPLAINANT-2

(Complainant Rep by Sri.Sudharsan Suresh, Adv)

V/s

The Janatha Co-operative Bank Limited,

Represented by its President,

The Chief Executive Officer

and General Manager,

The Janatha Co-operative Bank Limited,

The Manager,

The Janatha Co-operative Bank Limited,

Amarjyothi Nagar Branch,

Nagarbhavi Main Road,

Bangalore-560 003. ..…OPPOSITE PARTY-3

//JUDGEMENT//

BY SRI.SHIVARAMA K, PRESIDENT

The complainants have filed this complaint u/s 35 of the Consumer Protection Act-2019 seeking for a direction to the opposite parties to adhere to the original terms and conditions as provided for in the Deed of Mortgage dt.28.04.2010 and to retract and set-right the repayment schedule, in terms of the Deed of Mortgage and to pay a sum of Rs.10,00,000/- towards the mental agony caused to the complainants as compensation. 

2. The complainant no.2 is the wife of complainant no.1.  The opposite party no.1 is a registered Co-operative Society incorporated under the Karnataka Co-operative Societies Act, 1959.  The opposite party no.2 & 3 are the officers deputed by the opposite party no.1 and are in charge of its day to day affairs thereof. 

3. In spite of service of notice, the opposite party no.1 to 3 remained absent and they are placed ex-parte. 

 4.  To prove the case, the complainant no.1 (PW1) has filed affidavit in the form of his evidence in chief and got marked Ex.P1 to P5 documents.

5. The learned counsel for the complainants has filed written arguments. 

6. Heard the arguments.

         7. The points that would arise for consideration are as under:

i) Whether there is deficiency of service on the part of the opposite parties ?

    ii) Whether the complainants are entitled for the  

         compensation as sought ?

     iii) What order ?

 8.   Our findings on the aforesaid points are as follows:

Point No.1 :  In affirmative

Point No.2 :  Partly in affirmative

Point No.3 :  As per the final order for the following;

REASONS

9. POINT NO.1:- The complainant no.1 (PW1) has reiterated the fact stated in the complaint, in the affidavit filed in the form of his evidence in chief.  According to PW1, in the year 2010 in order to purchase a dwelling unit, had approached the opposite party no.1 for a financial accommodation to the tune of Rs.25,00,000/- and the opposite parties had commenced loan of Rs.25,00,000/- on 28.04.2010 and a registered Memorandum of Mortgage Deed came to be executed in between the complainants and opposite party no.1.  As per the Mortgage Deed, the complainants were required to repay the said amount of Rs.25,00,000/- in a fixed tenure of 150 months in equated monthly instalments of Rs.31,750/- each.  Further, the interest was fixed at the rate of 11.50% p.a.

10.  It is the contention of the learned counsel for the complainants that even though it is entered in the Memorandum of Mortgage Deed vide EX.P1 that the loan shall be repaid in 150 monthly equal installments, in the repayment schedule without the consent of the complainants number of installments has been unilaterally increased to 169.  On perusal of EX.P1 Mortgage Deed, it appears that it was agreed that the loan shall be repaid in 150 monthly equal installments.  EX.P2 is the statement of account for the period from 29.04.2010 to 24.08.2020.

11. EX.P3 is the repayment schedule.  In which, it is stated that loan was sanctioned on 29.04.2010 and it expires on 28.05.2024 and the loan was disbursed on 29.04.2010.  Further number of installments is stated as 169.  Hence, it is contended by the learned counsel that because of the increase made in the number of installments, the complainants were made to pay more amount including more interest.  In EX.P3 repayment schedule, the interest rate is stated as 11.50% p.a.  Hence, there is no dispute with regard to the interest rate is concerned.  According to PW1 as per repayment schedule, the complainants have to pay Rs.29,02,601/- and the consolidate amount shall be Rs.54,02,601/-.  Hence, there is an additional burden casted upon the complainants totally a sum of Rs.6,40,601/-.  Further as per the agreed terms in EX.P1 Memorandum of Mortgage Deed, the complainants were required to pay a sum of Rs.47,62,000/- and as per the terms of the agreement the loan  tenure shall be completed in November-2022 and because of domestic and moratorium imposed by the Reserve Bank of India, the loan would be extended till May-2023.  Because of increasing the number of installments the complainants have to pay total sum of Rs.54,02,601/-.  Further about the change in the repayment schedule, the complainants were not issued any prior intimation by the opposite parties.  Hence, the act of the opposite parties without consent of the complainants, amounts to unfair trade practice and it is a deficiency of service on the part of the opposite parties.  As per Section-2(11) of Consumer Protection Act, 2019 any fault or imperfection, which is required to be maintained or has been undertaken to be performed by a person in pursuance of a contract amounts to deficiency of service.  Since, the transaction in between the complainants and opposite parties was not a trade practice it does not attract the provision under Section-2(47) of Consumer Protection Act, 2019 within the meaning of unfair trade practice.  In support the contention of the learned counsel for the complainant relies the judgment reported in 2019 SCC Online NCDRC 1229 in between ICICI Bank Limited V/s Karam Chand and another dt.27.08.2019.  In the said case, the complainant took loan of Rs.4,00,000/- repayable in 120 installments which was calculated at 8.75% p.a. and later the opposite party bank has charged rate of interest by enhancing from time to time.  Under such circumstances, Hon’ble National Commission has held whenever there is any change in the floating rate, it should be inconformity to their Asset-Liability Management (ALM) Guidelines and the banks should reset the floating rates according to the above method at the time of review or renewal of loan accounts after obtaining the consent of the concerned borrower.

12.  In the case on hand, the opposite parties bank did not change the rate of interest and there is no dispute with regard to the rate of interest is concerned.  But the installment has been increased from 150 to 169 without the consent of the complainants.  Hence, we feel there is fault on the part of the opposite parties in increasing the installments without the consent of the complainants.  Further the bank being the service provider and the complainants have accepted the service of the bank, we feel the complainants are the ‘Consumer’ within the meaning of Section-2(7) of Consumer Protection Act, 2019.  Hence, there is deficiency of service on the part of the opposite parties.  Accordingly, we answer this point in affirmative. 

13.  POINT NO.2:- The complainants claimed direction to the opposite parties to adhere to the original terms and conditions as provided for in the Deed of Mortgage dt.28.04.2010. In the cited judgement, the Hon’ble Commission has confirmed the finding of the facts to the effect that the loan was sanctioned to the complainants on the fixed rate of interest at 8.75% and did not care the contention of the bank that there was understanding in between the complainant while entering into agreement with regard to the clearing rate of interest.  Hence, in the case on hand, we feel the opposite parties shall adhere to the original terms and conditions of the Deed of Mortgage with regard to the installments and any of the contentions raised by the complainants have not been rebutted by the opposite parties by producing any cogent evidence.   Further, the opposite parties shall set-right repayment schedule and shall comply the terms of the Deed of Mortgage.  Further, the complainants claimed a sum of Rs.10,00,000/- towards mental agony caused.  The complainants had also issued legal notice vide Ex.P4 to the opposite parties.  In spite of the notice been received, the opposite parties did not reply the notice and in the case on hand also not put appearance.  The act of the opposite parties made the complainant to strain mentally, thereby the opposite parties are liable to pay compensation for the mental agony undergone.  We feel, since the opposite parties did not appear in the case and not replied to the notice, they have to pay a sum of Rs.20,000/- mental agony undergone and a sum of Rs.10,000/- towards litigation cost.  Accordingly, we answer this point partly in affirmative. 

14. POINT NO.3:- In view of the discussion made above, we proceed to pass the following;

The complaint is allowed in part.

The opposite parties are directed to reschedule the loan by fixing 150 installments in repayment of loan as agreed in EX.P1 Mortgage Deed. 

Further the opposite parties are directed to pay a sum of Rs.30,000/- to the complainants towards mental agony undergone and litigation cost to the complainants.

The opposite parties shall comply the order within 30 days. In case, the opposite parties fail to comply the order within the said period, the above said amount of Rs.30,000/- carries interest at the rate of 9% p.a. from the date of order till realization.

Supply free copy of this order to both the parties and return extra copies of the pleading and evidence to the parties.

  (Dictated to the Stenographer, typed by her, the transcript corrected, revised and then pronounced in the open Commission on 14^th day of July, 2022)                                            

• REKHA SAYANNAVAR)    (RAJU K.S)         (SHIVARAMA, K)    
•  

//ANNEXURE//

Witness examined for the complainants side:

Sri.S.Mahesh Babu, the complainant has filed his affidavit.

Documents marked for the complainant side:

1. Xerox copy of memorandum of mortgage deed.

2. Xerox copy of loan repayment of details.

3. Xerox copy of repayment schedule.

4. Office copy of legal notice.

5. Copy of account statement from 01.01.2021 to 18.03.2022.

Witness examined for the opposite party side: 

Documents marked for the Opposite Party side:

• REKHA SAYANNAVAR)    (RAJU K.S)         (SHIVARAMA, K)    
•