R.Vijayakumar, Member

          This is a complaint filed Under Section 12 of Consumer Protection Act. The complainant filed this complaint for releasing the pledged gold items from the opposite party’s custody and for getting compensation Rs.500/- and cost Rs.3000/-.

(2)

        The complainant’s case is that the reluctance from the side of opposite party to release the pledged ornaments caused heavy financial loss, irreparable injury and hardships to the complainant.

          Even though the complainant was ready to pay the principal amount and interest demanded by the bank, the bank was not ready to return the gold ornaments.

          The opposite party’s case is that the complainant had not paid any amount to the opposite party. The complainant had never approached the opposite party and she was not ready to settle the account by remitting the principal amount with interest as agreed. The opposite parties never evaded the complainant with any excuses.

          The complainant filed affidavit. From the side of the complainant PW1 examined. Exts.P1 to P5 marked.

          From the side of opposite parties DW1 examined. Exts.D1 to D6 series marked.

          Heard both sides.

(3)

The points that would arise for consideration are:

1. Whether there is any deficiency in service from the part of opposite party?

2. Compensation and cost

Points (1) and (2)

                 The complainant availed a loan from the second opposite party on 29/08/06 for Rs.78,000/-. The complainant paid back the monthly interest without any default. Later the repayment was defaulted due to some financial problems. On 20/04/07 the complainant approached the second opposite party for releasing the gold ornaments on remittance of principal amount and interest. But the second opposite party made the complainant to believe that the pledged items were under the custody of first opposite party. On 23/01/07 the complainant received a registered notice from second opposite party for releasing for the pledged gold ornaments. Thus the complainant approached the second opposite party but he refused to give back the ornaments. On 14/02/07, the complainant sent legal notice to the opposite parties which was replied by second opposite party but without giving exact details of the amount that she had to be remitted. The complainant sent the second legal notice dated 18/04/07 demanding the exact details of the amount that she has to be paid. But the second opposite party in his reply notice did not mention any details of the amount to be paid by the complainant. In these circumstances the complainant was forced to file this complaint for getting relief.

(4)

The opposite party’s case is that as per terms and conditions of the agreement the complainant has to pay the principal amount and interest to the opposite parties. But the complainant had not paid any amount to the opposite parties towards the loan account. The statement made by the complainant in her complaint that the complainant was ready to remit the loan amount with interest is not true. The opposite party has not demanded any excessive amount from the complaint and never evaded the complainant with excuses. The first opposite party in reply to the second legal notice issued real picture of the complainant’s pledge account. The complainant had not approached the first opposite party for getting details of the loan account is not true No.700439 mentioned by the complainant is not an account number. It is only pledge number. It is admitted that if the complainant is ready to remit principal amount and interest as per terms and conditions of the pledge, the complainant can take back the pledged items. The opposite parties are not conducting illegal money lending business as alleged by the complainant there is no deficiency in service from the part of opposite parties.

          Admittedly the complainant had availed a loan for Rs.78000/- pledging 100.26 gms of gold ornaments. After payment of some of the monthly installments regularly and promptly, the complainant defaulted in repayment due to some financial problems.

(5)

          The main dispute raised by the complainant is that even though the complainant approached the opposite party and expressed her willingness to settle the account the opposite party was not ready to furnish detailed statement of accounts and exorbitant amount was demanded by the opposite parties.

          The opposite party contended that complainant had not approached the opposite parties to release the pledged gold items remitting the principal amount along with accrued interest.

          The leaned counsel for the complainant argued that the complainant approached opposite party o n 20/07/06 and 25/01/07 but the opposite parties refused to release the gold ornaments and hence she was forced to sent legal notice on 14/02/07. But the opposite party sent a vague reply without giving corrected details of the loan account. Details of the loan account was not furnished to her even after she had sent second legal notice. Exts.P2, P3, P4 and P5 are evident show that the complainant expressed her willingness to take back pledged ornaments.

          We have perused Exts.P2 to P5 documents. P2 and P3 are legal notices sent by the counsel for the complainant and P4 and P5 are the reply notices. On perusal of the documents we find that even though the complainant’s

(6)

willingness to release the pledged ornaments was expressed in the legal notices no exact rate of interest or exact amount to be paid by the complainant was furnished by the opposite parties in their reply notices or had given a statement of accounts. The act of opposite parties who are legally bound to give exact details of the loan account to the complainant can be considered only as a deliberate act which amounts to deficiency in service from their part.

                                   DW1 deposed while in cross examination that the pledged gold items have been auctioned as the loan period was expired. He had also stated that auction process was done at the Head office of the opposite party’s institution, Trichur, Valappad and the date of auction was not known to him. The intimation regarding the auction proceedings was given to the complainant also.

                                      The opposite party holds right to auction pledged gold ornaments only as per strict legal proceedings. Sale should be conducted only in proper manner. A proper proclamation notice should be issued information should be given to the also.

                                           In this case even though DW1 deposed that proper notice was given to the complainant, he kept mum when the leaned counsel for the complainant put the question whether any documentary evidence produced to show the same? Even though DW1 himself had claimed that he is a competent witness and is ready to produce documentary evidence to show that the notice was issued he had not

(7)

produced any document regarding the same. From the above mentioned facts it is obvious that no proper notice regarding auction of the pledged gold ornaments was issued to the complainant. The act of opposite party is a  clear  deficiency in service from their part.

          The learned counsel for the complainant submitted before the Forum that the complainant is a customer of the bank. The loan facility was provided to the complainant only after accepting valid consideration. Banking means acceptance, for the purpose of lending, investment of deposits of money from public repayable on demand or otherwise provided in Sect.(b) of Banking Regulation Act 1949. Here in this case the opposite parties are also doing the same business and RBI directives regulate them. The leaned counsel also relied on the decision of the Hon’ble Supreme Court in standard chartered Bank v.s Dr.B.N.Raman 2006 KHC 879, 2006 (s) SCC 727: JJ 2006 (6) SC 368 where in it is upheld that the banking institution and banking service of all kind will come under the purview of the Consumer Protection Act.

                                         We find force in the arguments of the learned counsel for the complainant.  The opposite party has no right to refuse the request of the complainant for the release of pledged gold remitting principal amount and interest. They have no right to auction the pledged items without exercising strict legal

(8)

Proceedings. The opposite parties have right to extract interest only at the rate which can be legally admissible.

                       Considering all the facts, circumstances and evidence produced before us, we are of the considered opinion that there is gross negligence and deficiency in service from the part of opposite party. The points found accordingly.

                       In the result, the complaint is allowed in part. As the gold ornaments are auctioned the opposite party is directed to pay value of the pledged gold ornaments at the current market price deducting loan amount Rs.78000/- and interest payable as per RBI guidelines up to 14/02/07.The opposite parties are further directed to pay compensation Rs.500/- and cost Rs.1500/-

                             Dated this the 31st day of July 2012

                                                                   G.Vasanthakumari:Sd-

                                                                   Adv.Ravi Susha     :Sd/-

                                                                   R.Vijayakumar      :Sd/-