By Sri. K. Gheevarghese, President:
The complaint filed against the Opposite Party for refund of the excess interest received by the Opposite Party Bank.
2. The complaint in brief is as follows:- The Complainant availed Rs.2,35,000/- on 26.10.2007 from the Opposite Party bank as loan in account No. KCC 4539. The Opposite Party's Bank has not specified the interest for the loan amount at the time of issuance of the loan. Any how the Complainant expected the interest would be 8.5%. The loan amount was closed on 08.07.2010 remitting Rs.3,27,547/-. On close perusal of the payment the Complainant could understand that the Opposite Party levied interest more than 13% which is absolutely against the directions and prevailing norms of the Reserve Bank of India and NABARD. The Opposite Party's Bank collected an excess of 4.5% interest from the Complainant. The excess percentage of interest collected from the Complainant is a deficiency in service. There may be an order directing the Opposite Party to refund the excess interest of 4.5% collected from the Complainant along with cost and compensation.
3. The Opposite Party filed version in short it is as follows:- The issuance of the loan to the Complainant on 26.10.2007 in the account No. KCC4539 is admitted. The Complainant produced the required documents and the loan amount was received agreeing to the terms and conditions of interest. The excepted interest for the loan amount that is 8.5% is not correct. The allegation of the Complainant that the Opposite Party imposed more than 13% of interest for the loan amount is incorrect. The Opposite Party can act upon the directions of the head office bank and other authorities. The excess interest collections beyond the stipulated terms and conditions are not possible and in effect the Opposite Party has not done it. The Complainant was sanctioned Rs.3,00,000/- and Rs.2.35,000/- was drawn by the Complainant at the time of issuance of the loan procedure for imposing interest was 13 ½ % plus 2% as penal interest for overdue amount. The loan amount sanctioned to the Complainant was to be repaid within the period of 12 months.
4. The guidelines received by this Opposite Party were taken in to account and enacted accordingly. During the Kharif and Rabi season the short term loan borrowers up to Rs.3,00,000/- were given 2% subsidy. The loan of Complaint was in Rabi Season and interest levied upon the amount during this period was 7%. The subsidy and other concessions are for those who make the payment in time. The benefits are not extented to the overdue loan. Any how the Complainant was given Rs.5,270/- and Rs.3,714/- on 29.03.2008 and 28.06.2008 respectively as interest subsidy upon the guidelines of Government of India. The interest levied upon the loan amount of the Complainant varies from time to time. The penal interest at the rate of 2% was also charged since the loan amount became due. From 15.07.2007 to 14.07.2008 the interest imposed is 13 ½ %. The interest calculated for the remaining period is as follows:
15.7.2007 to 31.8.2008 - 14%
1.9.2008 to 14.2.2009 - 15%
15.2.2009 to 14.7.2009 - 12 ½ %
15.7.2009 to 8.7.2010 - 12%
The bank has not collected any excess amount calculating interest beyond the terms agreed at the time of issuance of the loan. The complaint filed is only on experimental basis and hence it is to be dismissed with cost.
5. The points in consideration are:-
Is there any deficiency in service on the part of the Opposite Party on the receival of the interest towards the loan amount?
Relief and cost.
6. Points No.1 and 2:- The evidence in this case consists of the proof affidavit of the Opposite Party Exts.A1 to A8 and B1 to B19. The Complainant has no oral testimony in this case except the documents produced. The oral testimony of the Opposite Party is also taken in to consideration.
7. The dispute in issue is in respect of the interest of the loan amount availed by the Complainant. According to the Complainant the interest charged upon the loan amount would be 8.5% and the interest for the loan amount was not informed to him earlier Ext.A1 is the photo copy of the loan Pass Book. The sanctioned loan is Rs.3,00,000/- and the interest is 13 ½ %. The repayment conditions of the loan is tenable 5 years and yearly review. The application for the loan dated 26.10.2007 which is marked as Ext.B1 it also specified that the rate of interest is 13 ½ %. Ext.A8 is the loan agreement produced by the Complainant. Column 3(a) details the rate of interest for the loan amount that is 13 ½ % the column No.4 of the agreement also express that 2% is the penal interest for the defaulted amount. The Complainant has no case that the Opposite Party imposed interest for the sum of principle cum interest. The Opposite Party on examination as OPW1 deposed that the compound interest was levied on yearly basis. The loanee in this case availed the loan amount in Rabi season for the over due amount penal interest of 2% was imposed on the loan amount. The Opposite Party produced the circular issued from the head office of the bank. Directing the Opposite Party to collect interest abide by the directions of the NABARD, RBI and Government of India. The documents produced by the Opposite Party also mention that the interest collected by the Opposite Party was not in violation of the terms agreed between the borrower and the bank. It is strange to note that the memorandum of agreement by the agricultural loan signed by the Complainant is produced as a documents by the Complainant that is Ext.A8. The clause 3(a) empowered the bank to collect interest for the borrowed sum at the rate of 13 ½ % which also reads that the lending institution can fix rates from time to time and the penal interest of 2% for the defaulted amount is also specified in the agreement. The terms and conditions are agreed by the Complainant. The contention of the Complainant that he was not aware of the imposed interest and other penal charges is not supported by any evidence. More over the Complainant has not brought out in evidence relying on the plea as such that the interest collected from the Complainant are in contrary to the directions of the reserve bank of India or the sponsored bank. In the light of the above inferences it is found that the Opposite party has not acted beyond the terms and conditions agreed upon nor any amount as excess interest beyond the terms was received from the Complainant. Hence the complaint is dismissed no order as to cost.
Pronounced in open Forum on this the day of 31st October 2011.
Date of filing:03.11.2010.
PRESIDENT: Sd/-
MEMBER : Sd/-
MEMBER : Sd/-
/True Copy/
PRESIDENT, CDRF, WAYANAD.
A P P E N X I X
Witness for the Complainant:
Nil.
Witness for the Opposite Party:
Nil.
Exhibits for the Complainant:
A1. Copy of Loan Pass Book.
A2. Copy of Loan Chalan. dt:08.07.2010.
A3. Copy of South Malabar Kisan Credit Card.
A4. Letter. dt:29.04.2010.
A5. Lawyer Notice. dt:02.06.2010.
A6. Notice.
A7. Copy of Letter. dt:11.04.2011.
A8. Memorandum of agreement for agricultural loans.
Exhibits for the Opposite Party:-
B1. Agriculture Loan Application dt:26.10.2007.
B2. Specimen signature card for borrowal A/c. dt:26.10.2007.
B3. Intimation of terms and conditions of loans sanctioned.
B4. Advice regarding deposit of title deeds. dt:23.10.2007.
B5. Copy of Schedule 'A'.
B6. Authorisation letter from Mortgagor. dt:18.10.2007.
B7. Production Plan for short term farm sector loan under Kisan Credit Card.
B8. Letter. dt:26.10.2007.
B9. Statement.
B10. Copy Circular No.65/2007. dt:07.07.2007.
B11. Copy Circular No.75/2008. dt:10.07.2008.
B12. Copy Circular No.101/2008. dt:26.08.2008.
B13. Copy Circular No.25/2009. dt:10.02.2009.
B14. Copy Circular No.77/2009. dt:04.07.2009.
B15. Copy Circular No.66/2007. dt:09.07.2007.
B16. Copy Circular No.71/2008. dt:27.06.2008.
B17. Copy Circular No.152/2008. dt:24.11.2008.
B18. Statement. dt:14/07/2011
B19. Copy of Manual of instructions.
