Andhra Pradesh

Chittoor-II at triputi

CC/64/2018

Tokala Sumana, W/o K.Sathish Kumar - Complainant(s)

Versus

The Senior Branch Manager - Opp.Party(s)

V.Upendra Reddy, P.Sireesha

26 Jun 2019

ORDER

Filing Date: 10.10.2018

Order Date:26.06.2019

 

 

 

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II,

CHITTOOR AT TIRUPATI

 

 

      PRESENT: Sri.T.Anand, President (FAC)

               Smt. T.Anitha, Member

 

 

 

WEDNESDAY THE TWENTY SIXTH DAY OF JUNE, TWO THOUSAND AND NINTEEN

 

 

 

C.C.No.64/2018

 

 

Between

 

 

Smt. T.Sumana,

W/o. K. Sathish Kumar,

Hindu, aged about 34 years,

Private Employee,

 

Sri. K.Sathish Kumar,

S/o. K.Sudhakar Reddy,

Hindu, aged about 38 years,

Private Employee,

 

Both residing at:

 

D.No.1/62, Srinivasapuram,

Tiruchanoor Road,

Tirupati – 517 501.                                                                          … Complainants.

 

And

 

 

1.         The Senior Branch Manager,

Central Bank of India,

25 G Car Street,

Tirupati – 517 501.

 

2.         The Senior Regional Manager,

Central Bank of India,

P.B.No.727, Benz Circle,

Bunder Road,

Vijayawada – 520 010.                                                       …  Opposite parties.

 

 

 

 

 

            This complaint coming on before us for final hearing on 19.06.19 and upon perusing the complaint and other relevant material papers on record and on hearing Sri.V. Upendra Reddy, counsel for the complainants, and Sri.K.Jagadeeswar, counsel for the opposite parties, and having stood over till this day for consideration, this Forum makes the following:-

 

ORDER

DELIVERED BY SRI. T.ANAND, PRESIDENT (FAC)

ON BEHALF OF THE BENCH

           

            This complaint is filed under Section-12 of C.P.Act 1986, seeking direction to opposite parties, to handover the original documents submitted in the loan application, to pay compensation for causing mental agony due to deficiency in service to a tune of Rs.4,00,000/-, and to pay litigation expenses of Rs.20,000/-.

            2.  The facts in brief are as follows:– The complainants availed housing loan of Rs.10,00,000/- on 16.07.2008, vide loan account No.3024031893, from opposite party No.1, for purchase of residential plot and for construction of house by way of deposit of title deeds, and in this regard an undertaken was also given that they are going to construct the house within a period of two years after obtaining necessary permissions and approvals, and further agreed to pay commercial rate of interest, in case of violating the conditions. Subsequently, complainant came to know that National High Ways Authority of India (NHAI) is going to acquire a part land in survey No.326/3A, in the said proposed house plot, and accordingly NHAI acquired land for laying road along with several other lands of different owners, and notified through an office award No.13/NHAI/2011 dt:08.09.2011, and as such complainants could not carry out construction of house, as per the undertaken given to the bank. The NHAI also acquired part of land and paid compensation of Rs.1,30,020/- to the complainants vide proceedings Roc.No.F/384/NHAI/Tiruchanoor/2007 dt:23.03.2012, issued by Revenue Divisional Officer, Tirupati. The complainant was regular in payment of loan installments as per repayment schedule and discharged the loan amount also. The complainant in 2011 paid Rs.8,00,000/- in different spells and discharged the loan amount, and finally the loan amount was closed on 22.06.2018 after paying Rs.9,476/- The same is reflected in the statement of account dt:28.06.20128, but the opposite parties failed to return the original documents along with title deeds hypothecated to the bank without any legal right. As per the loan account statement, the rate of interest charged by the bank is 8.30% per annum. After closure of loan account on 22.06.2018, opposite parties raised an issue with regard to rate of interest. They issued a letter dt:02.08.2018 to the complainants to pay a sum of Rs.16,59,023/- by charging commercial rate of interest and penal charges. Inspite of several representations made by the complainants, opposite parties did not respond and so a legal notice dt:04.08.2018 was issued to the opposite parties, for which also there was no reply from the opposite parties. The claim of the opposite parties is false and baseless. The complainant claimed total compensation of Rs.4,00,000/- under various heads for the alleged deficiency in service and financial loss caused by the opposite parties. Withholding the original documents by the opposite parties, even after discharge of loan account, amounts to deficiency in service on the part of opposite parties. Hence, complainants prayed to allow the complaint by giving proper directions as referred above.

            3.  Opposite party No.1 filed the written version and the same is adopted by opposite party No.2, and they contended as follows – At the outset, complaint allegations are denied. It is admitted that complainants availed Rs.10,00,000/- towards house loan on 16.07.2008, vide loan account No.3024031893 from opposite party No.1, for purchase of residential plot and for construction of house, by way of deposit of title deeds, by giving undertaking that they could construct the house within a period of two years after obtaining permissions and approvals, and also agreed to pay commercial rate of interest, in case of violation of condition that construction of house should be completed within the stipulated period of two years. It is denied that after sanction of house loan by the opposite parties, complainants came to know that NHAI authorities are going to acquire land in survey No.326/3A, in the said proposed house plot, and accordingly NHAI acquired land for road purpose along  with land of others, and notified through an office award No.13/NHAI/2011 dt:08.09.2011, and that complainants could not carry out construction of house due to acquisition proceedings, and that NHAI finally acquired part of the said land and paid compensation of Rs.1,30,020/- to the complainants. The complainants are called upon to prove that they are regular in EMI payment, as per repayment schedule, and paid Rs.8,00,000/- to discharge the loan debt in the year 2011, and that loan account was finally closed on 22.06.2018 by receiving Rs.9,476/-, and in evidence thereof opposite party bank, issued loan account clearance statement of account dt:28.06.2018, and that as per the statement of account there was no dues to the opposite party  bank, and that opposite party bank, did not choose to return the original documents and title deeds inspite of receiving entire loan amount. The allegation in para.4 of the complaint that as per the loan account statement, the rate of interest is 8.30% and that opposite parties did not raise any dispute with regard to rate of interest from 2008 to May 2018, and thereafter only raised objection about rate of interest, and that they demanded illegally commercial rate of interest by way of addressing letter dt:29.06.2018 to complainant on the entire loan amount of Rs.10,00,000/- from the date of sanction, and further they addressed another letter dt:02.08.2018 to pay a sum of Rs.16,59,023/- by calculating at commercial rate of interest and levying penal charges are all false and complainant is called upon to prove the same. It is denied that they caused mental agony to the complainant by making wrong claim. There is no deficiency in service on the part of opposite parties in not handing over the original documents to the complainant. The complainants are called upon to prove that they sustained financial loss and inconvenience due to the acts of opposite parties in not handing over the original documents even after discharge of loan amount. It is stated that Central Bank of India, is a nationalized bank, having its head office at Mumbai, and several branches all over India. The complainants jointly availed house loan for house construction in the purchased plot within two years, for which Rs.10,00,000/- was sanctioned towards loan under HL. Account No.3024031893 dt:16.07.2008. As per the terms of the loan, the complainants herein have to pay commercial rate of interest, if they fail to construct the house in the purchased plot within two years. Accordingly, the complainants gave undertaking letter to pay commercial rate of interest, in case house is not constructed within the stipulated period of two years from the date of sanction of loan i.e. 16.07.2008. The opposite party bank, never discharged the said loan, as alleged by the complainant. While so, the bank officials inspected the complainant site and noticed that the complainants did not construct the house in the said plot. The opposite parties are not aware of alleged land acquisition proceedings. Moreover, the land acquisition proceedings were initiated in the year 2011, but the loan was sanctioned in the year 2008. As per the terms of the loan, the complainants have to construct the house within a period of two years. But they did not construct the house within the stipulated period, and hence the bank authorities entitled to charge commercial rate of interest at the rate of BPLR + 4% from the date of sanctioning of loan i.e. 16.07.2008, which is 13% and subsequently it is revised on periodical basis, and the present BPLR is 15%. The complainants have to pay the loan from 2008, which ends on 31.07.2018. The opposite parties issued reminder on 29.06.2018 to complainants, to pay the entire amount after applying commercial rate of interest for calculating due account within one month. Having received the said notice, complainants gave reply with false allegations. Subsequently, the opposite parties issued a legal notice dt:06.08.2018 to the complainants, calling upon them to pay the entire outstanding amount as on 03.08.2018. The opposite party branch manager acted as per RBI rules and banking regulations. The 1^st opposite party is working as Senior Manager since June 2018 in opposite party bank. As per the terms of the loan agreement, complainants have to pay commercial rate of interest from the date of sanction of the loan. Therefore, the loan account of complainants is not closed. Basing on the account copy, complainants are making false claim that there are no dues. The bank has never issued any no due certificate to the complainants. Opposite party bank, issued legal notice to pay the entire amount due. Hence, there is no deficiency in service on the part of opposite parties. The bank charged least rate of interest on such housing loans. RBI classified housing loan upto certain limit under priority sector. Banks provide finance under housing loan scheme for those, who does not own a plot for house constructions. The rate of interest for such loan is very low compared to other mortgage loans. The Government of India also provides income tax concessions for house loan borrowers. In order to contain prices and speculative in real markets, RBI has placed some restrictions on banks finance to real estate sector. Accordingly, bank loan for purchase of plots other than for housing purpose are treated as commercial real estate and these loans attract high rate of interest compared to other mortgage based loans. In order to restrict malpractices, banks charge commercial rate of interest in all such loans, where plot was purchased under housing loan scheme and house is not constructed within specified time. The complainant T.Sumana, being daughter of Retd. Senior Manager of Andhra Bank, should have known about the bank processes. After availing the loan, complainants neither submitted the approved building plan to the bank nor informed the bank about the L.A. proceedings, though in their legal notice dt:04.08.2018, they mentioned that they obtained necessary approvals for construction of house in plot No.7. It is obvious that there is enough land left even after acquisition, to construct the house. The Senior Manager of opposite party bank inspected the property on 18.06.2018 and found that plot is vacant. Immediately, he spoke to the borrower T.Sumana’s father and during the conversation, he informed her father about charging commercial rate of interest for the loan as per bank rules. Sensing trouble the borrowers directly transferred Rs.1,60,000/- to loan account from other bank on 21.06.2018 and paid Rs.9,476/- cash on 22.06.2018 through some person, to make the outstanding loan zero and down loaded the copy of statement, and hence the allegation that borrowers / complainants claim that they have promptly repaid the loan is false. The loan term is scheduled for 10 years. The repayment period should end on 30.06.2018. If they have promptly paid EMIs, the balance in June 2018 should not exceed Rs.20,000/-. Immediately, after knowing about charging commercial rate of interest, they paid lumpsum amount of Rs.1,60,000/-. Hence, there is no deficiency in service on the part of opposite parties and therefore prayed to dismiss the complaint.

            4.  Complainant No.1 filed the chief affidavit and got marked Exs.A1 to A9. On behalf of opposite parties, the Senior Manager of opposite party branch filed the chief affidavit and got marked Exs.B1 to B8.

            5.  The point for consideration is whether there is deficiency in service on the part of opposite parties in withholding the original documents despite discharging the loan account by the complainants? If so, to what extent the complainants are entitled to the reliefs sought for?

            6. Point:-  There is no dispute that complainants availed house loan from opposite party No.1, to the extent of Rs.10,00,000/-, for purchase of plot and to construct house on it. It is also not in dispute that undertaking was given by the complainants to the opposite party at the time of taking loan that they will pay commercial rate of interest, in case they failed to construct house on the said plot within a period of two years from the date of sanction of loan. Ex.A1 is notice issued by branch manager of opposite party No.1 to the complainants dt:29.06.2018, wherein he requested the complainants to pay commercial rate of interest on entire loan amount of Rs.10,00,000/- from the date of sanction immediately at the rate of 13% BPLR, which is subsequently revised to 15%.  Ex.A2 is letter dt:21.07.2018 addressed by the complainants to opposite party branch manager, calling upon him to return the original title deeds and relevant documents contending that they have paid stipulated EMIs regularly and finally the loan was also fully paid and that the claim of the bank charging commercial rate of interest is not justified. Ex.A3 is letter issued by the opposite party bank to complainants referring their earlier notice dt:29.06.2018 stating that non construction of house after purchase of plot by availing house loan will attract commercial rate of interest as per bank policy and further in view of undertaken given by the complainants to repay the loan with commercial interest, if house construction is not completed within two years from the date of sanction of loan, they are entitled to charge commercial rate of interest and therefore claimed Rs.16,59,023/- towards loan account and the same is liable to be paid by the complainants. Ex.A4 is legal notice dt:04.08.2018 issued by the counsel for complainants to opposite party No.1, demanding return of the original documents forthwith to the complainants, and that non returning of original documents after discharge of loan is illegal. Ex.A5 is legal notice issued by the opposite party counsel to the complainants dt:06.08.2018 calling upon them to pay entire outstanding loan of Rs.16,59,029/- within 7 days from the date of receipt of the notice. Ex.A6 is legal notice dt:28.08.2018 issued by the  counsel for complainants to the opposite party counsel, cautioning criminal and civil action against the opposite parties. Ex.A7 is statement of loan account dt:28.06.2018. Ex.A8 is copy of land acquisition proceedings of competent authority i.e. RDO, Tirupati dt:23.07.2012. This document is filed in order to show that part of land in which house site is situated, is acquired by NHAI, and due to the land acquisition proceeding initiated by NHAI, they could not construct the house in the house site, as part of the house site is acquired under land acquisition proceedings. 

            7.  As against the documents filed by the complainant, opposite parties filed the following documents – Ex.B1 dt:16.07.2008 is the undertaking letter given by the complainants, agreeing to pay commercial rate of interest in case of not constructing the house in the plot within a period of two years from the date of sanction of the loan. Ex.B2 is notice dt:29.06.2018 issued by opposite parties to the complainants. The said document is also marked by the complainants. Ex.B3 is reply notice given by the complainants dt:21.07.2018 to opposite party No.1, and the same document is also marked by the complainants. Ex.B4 is letter dt:02.08.2018 addressed by the opposite party to the complainants, which is also marked by the complainants. Ex.B5 is notice dt:04.08.2018 issued by complainants to opposite party and the same is also marked by the complainants. Ex.B6 is office copy of legal notice dt:06.08.2018 issued by the opposite party to the complainants, and the same is also marked by the complainants. Ex.B7 is reply notice dt:28.08.2018 given by the complainants to the opposite parties. Ex.B8 is statement of loan account showing that the complainants are due a sum of Rs.16,94,576/- as on 23.11.2018.

            8.  On perusing the documents, it is clear that there is no dispute with regard to exchange of notices issued between the parties and also correspondence between both sides. As per the contention of complainants, they have discharged entire loan on 22.06.2018 by making last payment of Rs.9,476/-, as reflected in Ex.A7, which is statement of account filed by the complainants. But according to the opposite parties, as per Ex.B8 statement of account, the complainants are due a sum of Rs.16,93,986/- as on 23.11.2018. As seen from Ex.A7 payments made by the complainants till 22.06.2018 are shown and balance as on 22.06.2018 is also shown as ‘0.00’. But as seen from Ex.B8, loan is not closed as contended by the complainants and it is continued even till 23.11.2018, i.e. on the date of filing of the complaint. It is an admitted fact that undertaking was given by the complainants to bank that they will pay commercial rate of interest, in case house is not constructed on the plot within two years from the date of sanction of the loan. It is the submission of the complainant counsel that complainants could not construct the house within the stipulated period as NHAI issued land acquisition proceedings, which covers the land in which house plot of the complainants is situated. As per the contention of the opposite parties, the land acquisition proceedings were initiated in 2011 and the house loan was availed in the year 2008 and house could have been constructed within two years from that date i.e. before 2011. So, the complainants cannot take advantage of the fact that due to land acquisition proceedings, they are unable to construct the house within two years, as the complainants have undertaken to pay commercial rate of interest, if the terms and conditions with regard to construction of house is violated, and so they cannot now question the opposite parties for charging commercial rate of interest on the entire loan amount of Rs.10,00,000/-. Whatever may be the cause, we are of the view that there is dispute with regard to discharge of loan account. As per the bank, the complainants are liable to pay Rs.16,94,576/-, but as per the complainants they have already discharged the loan as on 22.06.2018 by paying Rs.9,476/-. Admittedly, no due certificate was not issued by opposite party bank. This dispute cannot be looked into by the Consumer Forum. What we have to see is whether there is deficiency in service on the part of opposite parties in withholding the documents, even after discharge of the loan account. When the very question of discharge of loan is in dispute, the question of deficiency in service on the part of opposite parties may not arise. Accordingly, we are of the view that, we are unable to say for the present that there is deficiency in service on the part of opposite parties, as the dispute with regard to discharge of loan account, will not come under the purview of Consumer Forum. Accordingly, this complaint is dismissed.

            9.  In the result, complaint is dismissed. No costs.

Dictated to the stenographer, transcribed and typed by him, corrected and pronounced by me in the Open Forum this the 26^th day of June, 2019.

 

       Sd/-                                                                                                                      Sd/-                                  

Lady Member                                                                                               President (FAC)

 

APPENDIX OF EVIDENCE

 

 

Witnesses Examined on behalf of Complainant/s.

 

PW-1: Smt. Tokala Sumana (Chief Affidavit filed).

 

Witnesses Examined on behalf of Opposite PartY/S.

 

RW-1: Sri. K. Upendra Reddy (Chief Affidavit filed).

 

EXHIBITS MARKED ON BEHALF OF THE COMPLAINANT/s

 

Exhibits (Ex.A)	Description of Documents
	Photo copy of Notice issued by Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati) regarding “ Your House Loan A/c. 3024031893 availed on 16.07.2008” to the Complainants. Dt: 29.06.2018.
	Photo copy of Reply (Ref: Your Letter Date: 29.06.2018) given by the Complainants regarding “Charging of commercial rate of Interest on our Housing Loan and hurting of objectionable language” to the Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati). Dt: 21.07.2018.
	True copy of Notice issued by Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati) regarding “ Notice for repayment of Housing Loan A/c. 3024031893 availed on 16.07.2008 with commercial interest” to the Complainants. Dt: 02.08.2018.
	Office copy of Legal Notice given by the Complainants to the O.P.No.1. Dt: 04.08.2018.
	Office copy of Legal Notice issued by Opposite Parties Counsel to the Complainants. Dt: 06.08.2018.
	Office copy of Legal Notice given by the Complainants Counsel to the Opposite Parties Counsel. Dt: 28.08.2018.
	Original copy of Statement of Account from 16.07.2008 to 26.06.2018 of Central Bank of India, Tirupati for Mrs. Tokala Sumana, Complainant , showing ‘Zero’ balance of the loan account. Nomination Date: 28.06.2018.
	Original copy of Proceedings of the Competent Authority (L.A) & Revenue Divisional Officer, Tirupati regarding Land Acquisition. Dt: 23.07.2012.
	Photo copy of Undertaking Letter given by the Complainants to the Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati). Dt: 16.07.2008.

 

EXHIBITS MARKED ON BEHALF OF THE OPPOSITE PARTY/s

 

Exhibits (Ex.B)	Description of Documents
	True copy of Undertaking Letter given by the Complainants to the Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati). Dt: 16.07.2008.
	True copy of Notice issued by the 1st Respondent to the Complainants. Dt: 29.06.2018.
	Photo copy of Reply (Ref: Your Letter Date: 29.06.2018) given by the Complainants regarding “Charging of commercial rate of Interest on our Housing Loan and hurting of objectionable language” to the Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati). Dt: 21.07.2018.
	True copy of Notice issued by Opposite Party No.1 (The Senior Branch Manager, Central Bank of India, Tirupati) regarding “ Notice for repayment of Housing Loan A/c. 3024031893 availed on 16.07.2008 with commercial interest” to the Complainants. Dt: 02.08.2018.
	True copy of Legal Notice given by the Complainants to the O.P.No.1. Dt: 04.08.2018.
	Office copy of Legal Notice issued by Opposite Parties Counsel to the Complainants along with original Postal Receipts 2 in Number. Dt: 06.08.2018.
	Office copy of Reply Legal Notice given by the Complainants Counsel to the Opposite Parties Counsel. Dt: 28.08.2018.
	Original copy of Loan Ledger Extract (Statement of Account from 16.07.2008 to 12.12.2018 of Central Bank of India, Tirupati for Mrs. Tokala Sumana, Complainant, Nomination Date: 12.12.2018).

 

 

                                                                                                                        Sd/-       

                                                                                                                President (FAC)

                                  // TRUE COPY //

// BY ORDER //

 

Head Clerk/Sheristadar,

          Dist. Consumer Forum-II, Tirupati.

       

 

  Copies to:-   1.  The complainants.

                        2.  The opposite parties.