Karnataka

Kolar

CC/150/2023

Smt.Ashwathamma.A - Complainant(s)

Versus

The Manager, M/s. Vastu Housing Finance - Opp.Party(s)

Naveen.A.N.Gowda

29 Nov 2024

ORDER

BEFORE THE KOLAR DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, OLD D.C. OFFICE PREMISES, KOLAR – 563 101.

 

Dated:29^nd DAY OF NOVEMBER 2024

 

Present:-  1) Sri. Y.S. Thammanna. B.Sc., LL.B…..PRESIDENT

                 2) Sri. Raju. K.S., B.Sc., LL.M., PGDCLP…MEMBER

CONSUMER COMPLAINT NO:150/2023

 

COMPLAINANT/S  :-   1)   Smt. Aswathamma. A.

                                                  W/o Late. Ananda Reddy,

                                                  Aged about 64 years,

                                                  Residing at No.234,

                                                  Rajkumar Road,

                                                  Kyasamballi Village,

                                                  Kyasamballi Hobli,

                                                  Bangarpet Taluk,

                                                  Karnataka-563121.

 

                                                 2)    Smt. Manjulatha. V.

                                                  W/o Late. Murali. A,

                                                  Aged about 38 years,

                                                  Residing at No.234,

                                                  Kyasamballi Village,

                                                  Kyasamballi Hobli,

                                                  Bangarpet Taluk,

                                                  Karnataka-563121.

 

                                      (Rep. by Sri. Naveen A.N. Gowda. ,Advocate)

 

-V/s-

 

OPPOSITE PARTIES :-     1)  The Manager,

M/s VASTU HOUSING FINANCE,

Head Office Unit No.203 & 204,

2^nd Floor, “A” Wing,

Navbharat Estate,

Zakaria Bunder Road,

Sewri (West),

Mumbai-400015.

 Maharashtra.

 

2)   The Branch Manager,

Vasthu Housing Finance Corporate Ltd,

Near Total Gas,

Gouripet, Kolar.

                                              (Rep. by Sri. S.I. Shankar, Advocate for OP.No.1 & 2)

 

3)   The ICICI Prudential Life Insurance

Company Limited,

No.487/1, 1^st Floor,

Above Indian Overseas Bank,

Chinmaya Mission Hospital Road,

Opposite Fab India Indiranagar,

1^st State Bangalore-560038.

  

                                                (Ex-Parte )

                                               

Date of Filing of Complaint	15/12/2023
Date of Issue Notice	15/12/2023
Date of Order	29/11/2024
Duration of Proceedings	00 Year 11 Month 14 Days

 

Judgment by

Sri. Raju. K.S. Member

 

1. The complainant filed this complaint U/s 35 of the C.P Act 2019 seeking for a direction to the OP.No.1 to 3 are jointly and severally waive the loan amount of Rs.16,78,086/- and seeking direction to OP.No.1 & 2 to refund the sum of Rs.2,50,000/- paid on 08.02.2024 and Rs.23,488/- paid on 29.05.2023 and return the original title deeds deposited with them, along with compensation of Rs.2,50,000/-. 

 

2. The case of the complaint is that, the complainant No.1 is the mother and complainant No.2 is the wife of one Murali. A.  The said Murali. A was availed                  Rs.15,00,000/- loan from OP.No.1 and their branch office at Bangalore.  The said loan carries 16% P.a floating interest and same is to be repaid in 144 equated monthly installments each having sum of Rs.23,488/-.  The OP.No.1 sanctioned the said loan amount on 30.07.2022 under loan account No.LP00000000988883.  The  said Murali A has paid Rs.46,475/-to the OP.No.1 towards life insurance for the purpose of securing the loan amount.  The OP.No.1 being the Master Policy holder has availed one Life Insurance Policy from OP.No.3 by paying Rs.31,333/- in the name of Murali A.  Remaining Rs.15,142/- has paid to HDFC ERGO Insurance Company and availed fire and allied perils Insurance Policy in the name of Murali.  For availing the above said loan of Rs.15,00,000/- said Murali. A has mortgaged a house property situated in Kyasamballi Village, Bangarpet Taluk, Kolar District.

 

3. The said Murali. A was died on 21.04.2023.  After untimely death of said Murali. A the OP.No.1 had issued notice dated: 18.09.2023 and 04.12.2023 under section 13(2) of SARFAESI  Act by giving direction to complainants to shift all movable properties/articles situated in their Kyasamballi House and also directed to handover vacant possession of the above said house pledged with them.

 

4. The OP.No.1 & 2 on account of non-payments of installments classified the loan availed by the late. Murali. A as non-performing asset and initiated to take the property under section 13(2) of SARFAESI Act for the tune of Rs.16,63,592/-.  Further the complainants submit that, late Murali. A has paid Rs.46,475/- towards Insurance premium through OP.No.1 and the said loan was secured by the Insurance Policy, the above said loan amount is to be repaid by the OP.No.3 to OP.No.1..

 

5. Later, after the enquiry the complainants came to know that, the OP.No.3 has declined to accept the Life Insurance Policy behind back of the complainants as well as deceased Murali A proposed by the Late. Murali. A through OP.No.1

 

6.  Due to malafide intention the Ops failed to discharge their legal obligation in honoring the policy of Insurance and adopting illegal methods towards recovery of the above said loan amount from the complainants and caused deficiency in service.  Due to act of the Ops the complainants suffered financial loss and mental agony.  Hence the complainants pray to allow the complaint as prayed in the complaint.

 

7. After serving of Notice the Ops filed their respective versions.  The OP.No.2 has taken specific contention that, the deceased Murali. A has took the Rs.15,00,000/-loan amount from OP.No.1 T. Dasarahalli, bangalore brach office by pledging their Kyasamballi Village house property. Further alleged that OP.No.1 T. Dasarhalli branch is also necessary party to this proceedings. Further the OP.No.2 has admitted other conditions of the loan availed by the Murali. A. Further the OP.No.2 has denied the collection of Insurance premium amount of                Rs.46,475/- from the Murali. A for the purpose of purchase of Life Insurance towards securing the loan amount.  Further the OP.No.2 has said that, they have issued notice dated: 18.09.2023 and 04.12.2023 under section 13(2) of SARFAESI Act since the above said loan has been classified as NPA on 05.09.2023.  Further the OP.No.2 has denied the allegation of complainants that, they will initiated illegal means to take possession of the property by threatening.

 

8. Further the OP.No.2 submits that, while disbursing house loan amount the OP.No.1 & 2 have deducted a sum of Rs.31,333/- towards buying Insurance for protecting credit loan amount and same is paid to ICICI Prudential Life Insurance i.e OP.No.3.  The OP.No.3 after verification and considered health issue of deceased Murali. A and declined to issue Life Insurance Policy and transferred the said amount of Rs.31,333/-to OP.No.1 account by intimating to the said Murali. A.  The OP.No.1 has adjusted said amount to the loan account on the request of complainants.  The complainants filed this complaint for the purpose of unlawful gain and an intention to escape from repayment of loan by suppressing the real facts.  Being Housing Financial Company the OP.No.1 & 2 having good reputation in rendering service to customers.  Further in view of the notice issued under section 13(2) and 34, 35 of the SARFAESI Act this court is not having jurisdiction to entertain the complaint.  Hence prayed this Commission to dismiss the complaint.

 

9. In support of claim of the complainants the complainant No.2 has filed affidavit in lieu of chief examination and further examination affidavit with documents.  The OP.No.1 has examined one Manjunath Branch Manager of OP.No.2 by filing chief examination affidavit and further examination affidavit with documents.  Both complainants and OPs have filed their respective written arguments and submitted oral arguments.

 

10. The points that would be arised for our consideration are as follows:

 

1. Whether the complainants have proved the deficiency of service on the part of OP.No.1 & 2?

 

2.  Whether the complainants have proved the deficiency of service on the part of OP.No.3?

 

3. Whether the complainant is entitle for the relief as sought for?

 

4. What order?

Our findings on the aforesaid points are as follows:-

1. Point No.1:-  In Affirmative.
2. Point No.2:-  In  Affirmative.
3. Point No.3:-  In Partly Affirmative.
4. Point No.4:-  As per the final order.

 

 

•  

 

11. Point No. 1 & 2:- Since the Point No.1 & 2 are co-related to each other and same is discussed and answered simultaneously.
12. In this complaint there is no dispute with regard to the complainant No.1 son and complainant No.2 Husband one Murali. A has availed Rs.15,00,000/- loan from OP.No.1 T. Dasarahalli Branch office, under loan account No.LP00000000988883 on 30.07.2022.  Further there is no dispute the said Murali. A has agreed to repay the loan with interest @16% P.a in 144 equated monthly installments each having Rs.23,488/-.  Further said Murali. A has mortgaged 1800 Sq.ft house property constructed in survey No.87 Kyasamballi Village, Bangarpet Taluk, Kolar District.  Further there is no dispute, the said Murali. A has paid Rs.46,475/- to OP.No.1 towards purchase of Life Insurance at the time of availing loan amount.

 

13. Out of Rs.46,475/- the OP.No.1 has paid Rs.31,333/- to OP.No.3 towards purchase of Life Insurance in the name of said Murali. A.  The OP.No.1 is the Master Policy holder.  Remaining Rs.15,142/- has paid to HDFC ERGO Insurance Company and availed fire and allied perils Insurance Policy.

 

14. The said Murali. A was died on 21.04.2023.  The complainants No.1 & 2 are co-applicants for the above said loan amount availed by the Murali. A.  Due to non-payment of the loan amount to OP.No.3, the said loan account was classified as NPA on 05.09.2023.  Thereafter, on 18.09.2023 and 04.12.2023 OP.No.1 had issued notice under section 13(4) of SARFAESI Act as per annexure-C & D. 

 

15. The OP.No.1 is the head office of OP.No.2 as well as their T.Dasrahalli Branch Office, Bangalore and the OP.No.1 responsible for any Business activities conducted during the course of their business by both OP.No.2 and their T. Dasrahalli Branch. Hence there are no necessity to implead the Vasthu Housing Finance, T. Dasarahalli Branch office as party to this complaint.

 

16. That the OP.No.2 has took specific contention in para 18 of the version that   in view of the notice issued U/s 13(2) of the SARFAESI Act this court is not having jurisdiction to entertain the complainant. Since the Consumer Protection Act 2019 is the beneficial Act and U/s 100 the provisions of the Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.  Hence this complaint is adjudicated in present form before this forum.

 

17. After the death the Late Murali.A and after the demand of repayment by OP.No.1 that the complainants contacted the OP.No.1 & 2 and brought to the notice of OP.No.1 & 2 that the said Murali. A has availed Insurance Policy by paying Rs.46,475/-.  Thereafter, the complainants came to know that; the Life Insurance Policy availed by the said Murali. A is declined by OP.No.3 due to the health condition of the Late Murali. A.  As per OP.No.2 version                Para16 that the said Rs.31,333/- was transferred to OP.No.1 account and as per request of complainants same is adjusted by the OP.No.1 & 2 towards loan account of Murali. A on 31.07.2023.

 

18. From the scrutinization of pleadings it appears that, the OP.No.1 has deducted Rs.31,333/- from the loan account of Murali. A towards purchase of Insurance Policy from OP.No.3 with an intention to safeguard the loan amount of the borrower in case of any untoward incident.  But OP.No.3 found that some health issues suffered by the Murali. A and declined to accept the policy proposal and refunded the said Rs.31,333/- to OP.No.1 account. 

 

 

19. The OP.No.3 has to be bought the notice of the declining the Insurance proposal to the deceased Murali. A.  It is the mandatory duty of the insurance company to issue notice to the insured person before declining the policy. Once the op no.3 accepts the premium paid by the insured its obligation strarts. Until the policy cancels by due procedures by issuing notice to insured person by giving opportunity to explain towards termination of the insurance policy the policy is in force.  In this complaint the OP.No.3 failed to appear before this Commission after serving of notice and placed exparte.  Thereafter on 20.06.2024 Op.No.3 appeared through Sri. RRG advocate and got permission to submit their side argument.  Thereafter, the OP.No.3 not filed any documents or written arguments to substantiate there is no deficiency in service from their side.  In spite of sufficient opportunity took by the OP.No.3 failed to produce cogent evidence to substantiate there is no deficiency in service on their side.  The OP.No.3 supposed to file notice issued for declining the proposal of deceased Murali. A or notice of transfer of premium amount of Rs.31,333/- immediately after declining the proposal.

 

20. It is bounded duty of the OP.No.3 to issue mandatory notice and give opportunity to the proposer Murali.A before declining the Insurance proposal.  In this complaint the OP.No.3 has straight away declined the proposal and transfer the Insurance premium amount to the Master Policy holder OP.No.1 without any intimation to the deceased Murali or to the complainants.  Even the OP.No.3 not filed any documents which tend to show that, they have issued notice of declining to the Master Policy holder OP.No.1.

 

21.   If at all the OP.No.3 has issued any notice before declining the Insurance proposal to the deceased Murali. A, then the deceased having opportunity to make alternative arrangements.  Thereby, OP.No.3 shows sheer negligence on the part of performing their duty.  Hence the OP.no.3 is available to the complainants under deficiency of service and liable to compensate for their negligence.

 

22. So far, considered the OP.No.1 & 2 liability the OP.No.1 being the Master Policy holder would immediately inform the deceased Murali. A or complainants with regard to receiving the Insurance premium amount transferred by the OP.No.3.  Instead of informing to complainants or Murali. A the OP.No.3 kept this Rs.31,333/- in its suspense account  transferred by OP no.3. Further the OP.No.1 has transferred and adjusted this Rs.31,333/- towards loan account on 31.07.2023 i.e after death of Murali. A and after approach of complainants. Since the OP no.1 having no right to kept the money belongs to complainants or deceased Murali A without informing to them.

 

23.   If the OP.No.1 has informed immediately to complainants or Murali. A immediately after declining the proposal by OP.No.3 and immediately after receiving the premium amount than the complainants as well as deceased having opportunity to make alternative arrangements towards bought the new Insurance Policy for securing the debit availed.  The act of the OP.No.1 in not informing decline of the proposal by OP.No.3 and kept the premium amount in suspense account until death of Murali. A is nothing but unfair trade practice and negligence on their part.  Further the Act of the OP.No.1 is attracts the deficiency of service.

 

24.  If at all the complainants or deceased Murali. A having information of declining the proposal then they could make   alternative arrangements to secure the loan amount.  The OP.No.1 being the Master Policy holder has to look for securing the loan amount by availing suitable Insurance Policy.  Instead of securing the loan and informing to the complainants or deceased Murali. A the OP.No.1 kept the Insurance premium amount in suspense account without informing.  This act of the OP.No.1 is attracts unfair trade practice and deficiency in service against complainants as enumerated in complaint.  Hence without hesitation we fastened the liability of the OP.No.1 to 3 towards complainants claim for deficiency in service, accordingly we answered Point No.1 and 2 in affirmative by fixing the liability.

 

25. Point No.3 :   In this complaint the OP.No.1         has demanded Rs16,78,086/- from the complainants vide their letter dated 23.08.2024. As discussed supra the                 OP.No.1 has not intimated to the complainant or to deceased Murali A about the decline of the insurance immediately after receiving the Rs.31,333/- from OP no.3.  Instead of that the OP.No.1 kept the money in suspense account even after death of Murali A. Hence the OP.No.1 due to act of their unfair trade practice U/s 2(47) of C.P Act 2019 liable to the complainants under deficiency of service. Hence we directed to OP.No.1 & 2 waive up the loan amount of                                  Rs16,78,086/-by closing the loan account No.LP00000000988883.  Further the OP.No.1 has return the Sum of Rs.23,488/- and Rs.2,50,000/- received after death of deceased Murali A from the complainants on 29.05.2023 and 08.02.2024 together with interest @ of 12% P.a from the respective dates to till realization. The OP.No.1 is also directed to return the all original title deeds deposited by the deceased Murali A at the time of availing the loan amount.

 

26. Further as discussed supra the OP.No.3 is directed to pay Rs.1,00,000/-compensation to the complainants for the deficiency of service. The OP no.3 is liable to compensate for the declining the insurance policy without giving opportunity to Murali A and even after cancellation of policy without intimation.

 

27. Further both OP.No.1 & 3 have to pay jointly and severally Rs.30,000/-compensation to the complainants for the mental agony and inconvenience suffered with                        Rs.10,000/- litigation cost. Accordingly we answered point No.3 in partly Affirmative.

 

28. Point No.4:- As discussed supra, for the foregoing reasons we proceed to pass the following:

ORDER

The complaint is allowed in part. 

The OP.No.1 & 2 are hereby directed to waive off the loan amount of Rs. 16,78,086/- by closing the loan account No.LP00000000988883 standing in the name of Late               Murali. A within 30 days from the date of this order. 

Further the OP no.1 is hereby directed to return the Sum of Rs.23,488/- and Rs.2,50,000/- received from the complainants on 29.05.2023 and 08.02.2024 together with interest @ of 12% P.a from the  respective dates to till realization.

The OP no.1 is also directed to return the all original title deeds deposited by the deceased Murali A at the time of availing the loan amount on 30.07.2022.

The OP.No.3 is hereby directed to pay Rs.1,00,000/- compensation to the complainants within 30 days of this order.

Further both OP.No.1 and 3 jointly and severally have to pay Rs.30,000/- compensation to the complainants for the mental agony and inconvenience suffered with Rs10,000/-litigation cost.

The Ops have to comply the above order within 30 days from the date of this order.  Otherwise, the Ops are liable to pay interest @9% P.a for the respective amounts.

(Dictated to the Stenographer, typed by him, the transcript corrected, revised and then pronounced in the open Commission on 29^th day of NOVEMBER, 2024)

 

    ( Raju. K.S)                                                 (Y.S. Thammanna.)

        MEMBER                                                              PRESIDENT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

:-ANNEXURE:-

 

List of documents filed by the complaint side:-

01	Copy of Loan Installment payment receipt.
02	Copy of EMI paid receipt.
03	Copy of Demand Notice dated: 24.08.2024.
04	Copy of Sanction Letter.
05	Copy of Death Certificate.
06	Legal Notice with Postal track consignment.

 

 

List of documents filed by the Opposite Party side:-

01	Copy of the Insurance of ICICI Prudential.
02	Copy of the Insurance HDFC Ergo General Insurance Co.Ltd.
03	Copy of the Statement of account.
04	Copy of the Foreclosure letter.
05	Copy of the Notice.
06	Copy of the Postal Receipts.
07	Copy of the track consignments.
08	Copy of the Statement of account.
09	Copy of the Loan agreement.
10	Copy of the Sanction letter.
11	Copy of Letter of authority.
12	Copy of Insurance issued by HDFC General Insurance Co.Ltd.
13	Copy of Demand promissory note.
14	Copy of Letter of continuity.
15	Copy of loan summary.

 

 

 

    ( Raju. K.S)                                                 (Y.S. Thammanna.)

        MEMBER                                                              PRESIDENT