BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM<br /> VAZHUTHACAUD, THIRUVANANTHAPURAM.<br /> PRESENT<br /> SRI. G. SIVAPRASAD : PRESIDENT<br /> SMT. BEENAKUMARI. A : MEMBER<br /> SMT. S.K.SREELA : MEMBER<br /> O.P.No. 134/2005 Filed on 28.04.2005<br /> Dated : 30.09.2008<br /> Complainant:<br /> S. Balachandran Nair, Travancore Travels, Alathara Complex, Kazhakuttom P.O. <br /> (By adv. Kazhakkuttom K.S. Narayanan Nair)<br /> <br /> Opposite parties:<br /> 1.The Thiruvananthapuram Service Co-operative Bank Ltd. No. T 131, Press Road, Statue, Thiruvananthapuram represented by<br /> (By adv. S. Suresh Kumar)<br /> <br /> 2.The President of the Thiruvananthapuram Service Co-operative Bank Ltd. No. T 131, Press Road, Statue, Thiruvananthapuram.<br /> <br /> 3.The Secretary of Thiruvananthapuram Service Co-operative Bank Ltd. No. T 131, Press Road, Statue, Thiruvananthapuram.<br /> <br /> 4.The Manager of Thiruvananthapuram Service Co-operative Bank Ltd. No. T 131, Press Road, Statue, Thiruvananthapuram. <br /> <br /> This complaint is disposed of after the period so specified under the Consumer Protection Act, 1986. Though the case was taken up for orders by the predecessors of this Forum on 25.05.2006, the order was not prepared accordingly. This Forum assumed office on 08.02.2008 and re-heard the complaint. This O.P having been heard on 14.08.2008, the Forum on 30.09.2008 delivered the following:<br /> ORDER <br /> SRI. G. SIVAPRASAD: PRESIDENT<br /> <br /> The facts leading to the filing of the complaint are that complainant availed a loan of Rs. 100000/- from the opposite party bank on 26.08.2004 as SDS No. 897 repayable within 280 working days at the rate of Rs. 400/- per day. A cheque for Rs. 112000/- as principal and interest and other documents were furnished as security. On 22.02.2005 complainant shifted his office to Kazhakuttom and requested the opposite parties to note down his new address and assured them of daily remittance at their counter. Complainant need to pay interest only upto the date of closing and total amount payable was less than Rs. 108600/-. Opposite parties offered further concession also. Complainant was assured that he will be released from his suretyship to two other borrowers who in turn stood as surety to the complainant. While complainant requested to continue the daily remittance facility opposite parties' agent and goondas threatened to kill him unless the account is closed. Complainant was frightened and with great hardship he remitted the balance amount of Rs. 63000/- on 23.02.2005 to make Rs. 108600/-. Opposite parties did not close the account and insisted the complainant to pay entire interest. Finally complainant paid Rs. 3400/- more on 03.03.2005 in addition to Rs. 108600/- already paid making the total amount paid as Rs. 112000/-. Opposite parties did not return the cheque and other documents furnished by the complainant as security even after closing the account. Complainant became a guarantor solely because he was given a loan or made a borrower along with two others. Opposite parties refused to return the documents stating that the loan taken by two others wherein complainant was a guarantor have also to be paid off to return the cheque and other documents. Opposite parties have committed deficiency in service and they are liable to compensate the complainant. Hence this complaint claiming permission to continue the facility and return of Rs. 66400/- and cheque and other documents or Rs. 2000/- along with half of the interest (Rs. 6000/-) along with return of other documents and compensation of Rs. 100000/-. <br /> Opposite parties entered appearance and filed version contending that complainant was a loanee who had drawn business loan from the opposite party bank under special terms and conditions. As complainant shifted the business he closed his loan account after paying the over-dues. Opposite party had collected only the over-dues as per the terms of loan. Complainant stood surety for another such type of loan. The allegation of threat and coercion alleged in the complaint are denied. Complainant voluntarily at free will had closed the account as he was not able to continue the loan transaction. Complainant's loan and his guarantee to other loan are different matters. Being the guarantor complainant is jointly and severally liable to pay if the loan under his guarantee is defaulted. Complainant's guarantee is co-extensive of the liability of the principal debtor. There is no cause of action for this complaint. Complainant drew loan and closed the same. Hence prayed for dismissal of the complaint with costs to opposite parties. <br /> The points that would arise for consideration are:-<br /> (i)Whether the complainant is entitled to get back the lumpsum amount of Rs. 66400/- from the opposite parties?<br /> (ii)Whether complainant is entitled to get back cheques and other documents collected by opposite parties from the complainant?<br /> (iii)Whether there has been deficiency in service on the part of opposite parties?<br /> (iv)Other reliefs and costs.<br /> To support the contention in the complaint, complainant has filed an affidavit of himself as PW1 in lieu of examination in chief and marked Exts. P1 to P6. On behalf of opposite parties, the Secretary of the 1st opposite party has filed a proof affidavit and marked Exts. D1 to D4. <br /> Points (i) to (iv):- Admittedly, the complainant had availed a loan of Rs. 100000/- from the opposite parties on 26.08.2004 as SDS No. 897. It has been the case of the complainant that the said loan amount is repayable in 280 working days at the rate of Rs. 400/- per day and that a cheque for Rs, 112000/- as principal and interest and other documents were furnished as security. It has also been the case of the complainant that by 22.02.2005 complainant had shifted his office to new address and requested the opposite parties to note down and assured opposite parties of the daily remittance at their counter, but opposite parties turned down his request and insisted complainant to repay the loan and close the account. Submission by the complainant is that as there was threat from opposite parties' goondas complainant remitted the balance amount of Rs. 63000/- on 23.02.2005 to make Rs. 108600/-, but the Secretary of the 1st opposite party demanded the interest for the full terms and that complainant paid Rs. 3400/- more on 03.03.2005 and closed the said account by Ext. P3. As per Ext. P3 the complainant remitted Rs. 112000/- on 03.03.2005 thereby the said account closed. Ext. P4 shows details of daily remittance. Submission by opposite party was that as the complainant was doing his business at medical college which is within the area of operation of the Bank, the above said loan was granted to him and that complainant shifted his business to Kazhakuttom which is not the area of operation of the opposite party bank and that complainant at free will had closed the account as he was not able to continue the loan transaction. Opposite parties submitted further that complainant is a guarantor to other loans and that complainant is jointly and severally liable to pay the loan under his guarantee is defaulted. Complainant's guarantee is co-extensive of the liability of the principal debtor. The main thrust of argument advanced by the complainant was to the effect that the complainant was not permitted to continue the loan facility and opposite parties demanded and collected the lumpsum of Rs. 66400/- from him but not returned cheque and other documents furnished by him as security. Complainant as PW1 has been cross examined by the opposite parties. In cross examination complainant admitted the preclosure of the said loan. Whether the said preclosure was done on threat from opposite parties not proved by the complainant despite of the allegation of threat and coercion alleged in the complaint denied by opposite parties in their version. Opposite party in her cross examination deposed that pre-closure of loan by the complainant was at his free will and not by insistance of opposite parties and that opposite parties admitted the closure of Rasheed's loan. For loan taken by Rasheed, complainant was the guarantor. As per Ext. D2 loan bond executed jointly by the complainant and guarantor complainant has obtained loan of Rs. 100000/- on 24.08.2004 from the opposite party for the purpose of business and complainant and guarantors agreed to pay the sum of Rs. 112000/- with interest at 13+3% per annum in 280 days instalments. As per Ext. P3 the complainant's account closed on 03.03.2005 on remittance of Rs. 112000/-. Complainant did not furnish any material showing the remittance of service charge of Rs. 2000/-. As per evidence on record opposite party had collected interest for the full term loan of 280 days while complainant had closed the said loan on 03.03.2005. From 24.08.2004 to 03.03.2005, complainant had used loan for 192 days, but opposite parties charged interest for 280 days. Complainant is not liable to pay interest for the full term of 280 days. Opposite parties are bound to collect the interest only for 182 days. Collection of interest till the closure of loan is legal, while demand for interest after 03.03.2005 till the full term of loan is illegal, improper and unfair. Complainant is entitled to get back the excess interest collected by the opposite parties for 88 days. It is admitted by DW1 that the loan taken by Mr. Rasheed stood closed. At the time of taking loan complainant had given a cheque for Rs. 112000/- as security. The normal course of loan period for other loanees is over. Complainant already closed his loan. There is no material on record to show that the other loans under complainant's guarantee is defaulted. In view of the above we find complainant is entitled to get back cheques and other documents collected by opposite parties as security from the complainant. Non-return of the said cheque and other documents to the complainant after the closure of loan would amount to deficiency in service. <br /> In the result, complaint is allowed in part. Opposite parties shall return to the complainant the excess interest collected for 88 days and release the cheques and other documents collected by the opposite parties from the complainant as security. Opposite parties shall pay the complainant Rs. 2000/- (Rupees two thousand only) as compensation and Rs. 1000/- (Rupees one thousand only) as cost of the complaint. Opposite parties shall comply the order within two months from the date of this order failing which the above said amounts shall carry interest at the rate of 12%. <br /> A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.<br /> Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Forum, this the day of 30th September 2008.<br /> <br /> G. SIVAPRASAD,<br /> President.<br /> <br /> BEENAKUMARI. A : MEMBER<br /> <br /> S.K. SREELA : MEMBER <br /> <br /> <br /> <br /> <br /> <br /> O.P.No. 134/2005<br /> APPENDIX<br /> I COMPLAINANT'S WITNESS : <br /> PW1 - Balachandran Nair<br /> II COMPLAINANT'S DOCUMENTS :<br /> <br /> P1 - Photocopy of advocate notice dated 12.03.2005.<br /> P2 - Photocopy of reply notice dated 13.04.2005.<br /> P3 - Photocopy of receipt of Soubhagya Deposit Scheme No. B <br /> 13281 dated 03.03.2005.<br /> P4 - Photocopy of Bank Statement.<br /> P5 - Photocopy of letter dated 18.03.2005 to the Registration, Co-<br /> operative Societies issued by the complainant.<br /> P6 - Photocopy of letter No. PKDA/1059/05 dated 17.06.2005.<br /> III OPPOSITE PARTIES' WITNESS :<br /> DW1 - Sreekumary<br /> IV OPPOSITE PARTIES' DOCUMENTS :<br /> D1 - Photocopy of application form for loan.<br /> D2 - Photocopy of loan Bond No. SDL 897 for Rs. 100000/-.<br /> D3 - Photocopy of agreement note of member No. A 935.<br /> D3(a) - Photocopy of agreement note of member No. A 937.<br /> D3(b) - Photocopy of agreement note of member No. A 936.<br /> D4 - Photocopy of cheque No. 096718 for Rs. 112000/- of Tvpm. District Co-operative Bank Ltd.<br /> D4(a) - Photocopy of letter from the 2nd opposite party to the 1st opposite party. <br /> <br /> <br /> <br /> PRESIDENT<br />