This Case was heard in the Ld. Lower Court (DCDRC, Jalpaiguri) being Case No. CC/12/2021 while the judgement was passed on 3/8/2022 by the then President of the Ld. Lower Court, who is now the Presiding Member of the State Consumer Disputes Redressal Commission, Siliguri Circuit Bench. Hence, for the sake of natural justice he is not to hear the same Case which came to the State Forum (State Consumer Disputes Redressal Commission, Siliguri Circuit Bench) being first Appeal vide A/50/2022 on the same issues. Hence, the request was made to the President of the WBSCDRC vide his Office No.57/SCB/1E/15/2023 dated 09/2/2023and the Hon’ble President, WBSCDRC (vide his 285(24)/SC/2j-14/08 (Vol. I) dated 17/02/2023) was kind enough to have given his kind approval/permission to form/constitute the Single Bench. Accordingly, Single Bench was constituted with the undersigned as Presiding Member.

Initially, Sri Uday Chand Guha and Smt. Ankita Guha Ghose approached with SBI, Jalpaiguri Town Br. (henceforth to be referred as SBI, JTB) for availing H.B. Loan to tune of Rs.21.50 lakhs and they have filled up Comprehensive Application Form (CAF) to that effect. The Appellant/O.P. sanctioned Rs.21.50 lakhs H.B. Loan and transferred the said amount to the SBI A/c No. 39679387952 of the Respondents. In addition, SBI Life also sanctioned Rs.1,02,698/- under RiNn Raksha Policy against the same property. Thus, the total quantum of loan stands to 21,50,000 (H B Loan) + 1,02,698/- (RiNn Raksha Policy) = Rs.22,52,698/. The combined EMI was fixed at Rs.17,398/- out of which Rs.16,621/- was against H B Loan and Rs.777/- was against the said RiNn Raksha Policy.    

Now, the Respondents expressed their unwillingness to continue the said RiNn Raksha Policy of SBI Life within free-look period and urged the Appellant to stop/discontinue the deduction of the said amount of Rs.777/- against the said RiNn Raksha Policy.

But the Appellant/OP (Bank) was deducting EMIs in RiNn Suraksha Policy despite their unwillingness to continue the same since they (the Respondents/Complainant) have expressed their unwillingness within Free Look period/option. But the Appellant/OP was deducting EMIs to the tune of Rs.777/- in respect of RiNn Raksha Policy of SBI Life along with deduction of HBL EMI of Rs.16,621/- clubbed/combined process of Rs.17,398/-.  Being aggrieved by the modus operandi of the Appellant/OP, the Complainant moved to the Ld. Lower Court i.e., DCDRC, Jalpaiguri alleging unfair trade practices, deficiency in services, etc. The Ld. Lower Court finally allowed the Petition of the Respondents/Complainant ex-parte against the Appellant/OP with costs along with the direction to cancel the home loan coverage under SBI Life RiNn Suraksha Policy vide master policy no. 70000018311 dated 24/11/2020 and refunded the EMI component of said RiNn Raksha policy after the cancellation of the above policy and adjustment of interest already paid.

Ld. Lower Cour in addition directed the Appellant/OP to pay a sum of Rs.20,000/- (Rupees twenty thousand) only for mental pain and agony and with Rs. 5,000/- (Rupees five thousand) only towards legal cost with interest @ 8% per annum till the date of payment.

 SBI (J.T.B) being the Appellant/OP has preferred this appeal to the Siliguri Circuit Bench of W.B.S.C.D.R.C. (case no A/50/2022) before the completion of said execution appeal case for compliance of the Order of  the Ld. Lower Court dated 03/8/2022 in connection with CC/12/21.

Decisions with Reasons

The Appellant/OP SBI (Jalpaiguri Town Branch) being aggrieved at the Order of the Ld. Lower Court moved to this end for revision of the Order of the Ld. Lower Court dated 3/8/22 of CC 12/21. It may not be out of place to mention that there is no dispute regarding the sanctioning of H.B. loan to the tune of Rs. 21.5 lakhs and repayment of EMIs to that end but problem arises regarding the loan in connection with RiNn Raksha policy amounting to Rs.1, 02, 6,98/- in connection with RiNn Raksha Policy against the Policy No.70000018311 dated 24/11/2020) and EMI of Rs.777/- as the loan against RiNn Raksha Policy (total EMI of R.17,398/- out of which EMI Rs.777/- was in respect of RiNn Raksha Policy). Initially, the Appellant/OP was reluctant to stop discontinuation of the deduction of EMI of Rs.777/- in respect of RiNn Raksha Policy of SBI Life and continued deducting EMIs @ Rs.777/- per month for the consecutive 17 (seventeen) months even after the Order passed by Ld. Lower Court dated 03/08/2022.  There are two components of the EMIs being Rs. 16,621/- as EMI of the House Building Loan against Rs. 21.50 lakhs of SBI (JTB) and another is insurance component of Rs.777/- as EMI of RiNn Raksha Policy of SBI Life against the insurance loan Rs. 1,02, 698/-= total loan 22,52,698, total EMI Rs. 17,398/- by the SBI Bank and SBI Life who were indifferent discontinuing the said EMI of Rs.777/- relating to the insurance premium of the RiNn Raksha Policy on the plea computerized accounting system stating interalia  since it is not technically possible. But finally, it is learnt that SBI Life credited the amount of Rs.13,209/- (777 x 17 months) in compliance with the Order of the Ld. Lower Court dated 03/8/2022 to the said SBI account of the Respondents on 11/11/22, but it is not clear whether the amount so credited was with adjustment of interest already paid or not. It is to be noted that the Appellants complied the Order of the Ld. Court at a very delayed stage and that too, after receiving Notice from this end.  

SBI as bank and SBI Life as Insurance Company are two separate entities/organizations and RiNn Raksha Policy is mooted by SBI Life and not by SBI bank itself. Though the Respondent/Complainant filled up Customer Application Form (CAF) obtained RiNn Raksha Insurance Policies and availed Rs. 10,26,98/- as RiNn Raksha  policy loan from SBI Life & Rs. 777/- being EMI of RiNn Raksha  policy  in addition to the HBL of Rs. 21.50 lac & EMI of Rs. 16,621/- for HBL loan from SBI(JTB). Later they (respondents) somehow might have changed their mind and expressed their unwillingness to discontinue said RINn Raksha Policy and thereby not willing to pay EMI @ Rs.777/- per month against the RiNn Raksha Insurance Policy against the loan of Rs. 1, 02, 698/-. It is to be kept in mind that they have expressed their unwillingness within the free look period (within 15 days). As per settled principles of IRDA, if anybody, expresses his/her unwillingness to continue any Insurance Policy within the free look period, the said policy should be discontinued forthwith and the amount so deducted should be returned to the insured (Respondents).

Insurance is something which is a “matter of solicitation” and cannot be imposed upon the (loanee/respondents/Complainant) forcefully against his/her will. Though RiNn Raksha Policy is designed to protect the interests of the loan receiver (Respondents/Complainants) specially in case of eventualities/casualties, but if the Insured (Respondents/Complainants) are unwilling and express their unwillingness/displeasure to the respective Authority within the free look period to continue the said insurance policy, it is the duty of the Insurance Company (SBI Life) to stop deducting EMIs and return the money deducted as Insurance Premium to the insured forthwith. In this instant case, the Insurance Company (SBI life) continued deducting EMIs Rs.777/- from the respondents/Complainants (loan receiver) against the insurance loan of Rs. 1, 02, 6,98/- for the 17 consecutive months. The good sense prevailed upon the appellant/SBI life probably after receiving notice from the court and then only, they stopped deducting the said EMIs and subsequently they credited the amount of Rs. 13,209/- (Rs. 777x17 months) so deducted to SB accounts of the respondents.

Since the Appellant/OPs in the instant Case did not follow the instructions of IRDA and continued deducting the EMIs @Rs.777/- from the Respondents for 17 months they have violated the direction of the IRDA willfully. It is further a matter of great concern that the amount of Insurance Policy so deducted for 17 months by the Appellant/OPs was credited/transferred to the account of Respondents after getting the Notice from this end, not before that. It indirectly indicates that had the notice of the court been not served upon them, the Appellant/OP (SBI, JTB) would not have probably credited/transferred of the said amount of Rs. 13,209/- to the SB account of Respondent/Complainant/Insured. The Respondent filed Misc. Application vide No.4/2022 in the Ld. DCDRC, Jalpaiguri for compliance of the Order dated 03/8/22 in connection with Case No.CC/12/21 but since the Appellant/OP (SBI,JTB) already moved to the Ld. S.C.D.R.C., Siliguri, Ld. D.C.D.R.C., Jalpaiguri refrained itself from disposing the same Application. The Appellant/OP was in favour of continuing the said Insurance Policy on ‘as is whereas basis’, but it goes against the settled principles of IRDA as already pointed out earlier. The Ld. Advocate for the Appellant also pointed out that if the Insurance Policy is discontinued and payment thereby is stopped, then technical problem will arise as the software will not provide figure from the retrospective date. But it seems to be their internal problem which is to be solved by themselves by evolving a new system of technology/software and this may not be an excuse for continuing Insurance Policy and deducting EMIs thereto against the will/desire of the Respondents/Complainant. Again, it is reiterated, that the Insurance Policy may be meant  for the welfare of the insured (loan taker) but it is also to be kept in mind that insurance cannot be imposed against the will of the loanee /(Respondents/Complainant) and since there is a provision to cancel/discontinue the Insurance Policy within the free-look period as decided by the IRDA and  the Respondents have categorically expressed their unwillingness to discontinue the said Insurance Policy, payment of EMIs of Rs.777/- in this respect against the said Insurance (i.e. RiNn Raksha Policy) should have been stopped at the initial/beginning stage and the amount of said Insurance Policy so deducted, if any, should have been credited/transferred to the SB A/c. of Respondents/Complainant (Loanee/Insured).

The Appellant/SBI (Jalpaiguri Town Branch/ SBI Life) have violated the principles of IRDA by continuing the deduction of EMIs of Rs. 777/- in respect of RiNn Raksha Policy even after Order of the Ld. Lower Court dated 03/08/2022. Since the Respondents have not opted to continue the said Insurance and communicated their unwillingness to the Appellant/OP/Bank/ SBI Life within the free-look period, So, I am of considered opinion that  the acts of the Appellant/OP (Bank/SBI Life) tantamount to gross negligence, deliberate deficiency in service  and ‘unfair trade practices’. The Appellant/Bank, it is learnt, has discontinued deducting EMI @ Rs.777 per month in respect of EMI of RiNn Raksha Policy loan, that has been discontinued at the delayed stage of 17 months which should have been done much earlier. Though the Appellant transferred the amount of Rs. 13,209/- (Rs.777x17 months) so deducted to the account of the Respondents/complainants, at a very delayed stage, after receiving the notice from this end, and not before that. There is no ambiguity/dispute regarding the actual House Building Loan of Rs.21.50 lakhs and payment of EMIs of Rs.16,621/- to that effect in respect of House Building Loan. Since the matter involves small amount of Rs.13,209/- (Rs.777/- x 17 months) but the issue is not smaller/lesser. The prayer of the Appellant partly succeeds.

It is well settled by the Hon’ble Supreme Court in Sunil Kumar Maity Vs. SBI & Another (2022) STL541(2022) CPJ 104(SC) Civil Appeal no. 432/2022 order dated 21/02/2022, that the revisional jurisdiction of the Higher Commission is extremely limited and the Higher Commission can not set aside the Order passed by the Ld. Lower Commission (i.e., NCDRC in r/o of the Order of SCDRC and SCDRC in r/o of the Order of the DCDRC) “unless there is any illegality, material irregularity or the jurisdictional error in the Order” passed by the Ld. Lower Commission.

In other landmark judgment, Hon’ble Supreme Court in Rajiv Shukla Vs. Gold Rush Sales and Others( SALT 701/2022, CPJ 8 (SC), 9 SCC 31 & Rati Dutta Vs. United India Insurance Company( SALT 303,CPJ 19(SC) 2011,11 (SCC) 269 that the Higher Commission has right to interfere of the findings   of the Ld. Lower Forum in revisional jurisdiction if the Ld. Lower Forum has exercised its jurisdiction not vested in it or has failed  to exercise the jurisdiction so vested or has acted in exercise of his jurisdiction illegally or with material irregularity.  

The Ld. Advocate on behalf of the Appellant remained absent on the two subsequent dates of hearing i.e., 19/7/23 and 17/8/23 but submitted the WNA on 05/7/23. So, it is assumed that Ld. Advocate on behalf of the Appellant has nothing to add except those what has been mentioned in the WNA.

In the instant Case, I am of considered opinion that the Ld. Lower Court has acted legally, with material regularity and within jurisdiction. So, the impugned Order of the Ld. Lower Court dated 03/8/22 is to be upheld and endorsed except regarding the quantum of the amount of penalty of Rs. 20,000/-. I am in favour of imposing of Rs. 10,000/- as penalty instead of Rs.20,000/- for gross negligence, deficiency in service and unfair trade practice by considering the involvement of the small amount of Rs.13,209/- (Rs.777/- x 17 months) expecting that bank will not recur such mistakes in future.   

                                                     Hence it is

                                                     ORDERED

That the Appeal is allowed in part ex-parte with no costs. The Appellant/Bank is directed to credit of the interest part of the EMIs @ Rs.777/- for 17 months if not already done/ if adjustment of the interest has not already been paid.

(2) The Appellant is directed to pay a sum of Rs.10,000/- (Rupees ten thousand) only as compensation for mental pain and agony for such gross negligence, deficiency in service and unfair trade practices within one month from the date of this Order failing which interest @ 8% per annum will be charged till the date of payment after one month.

(3) The Order of the Ld. Lower Court stands modified to the above extent and case(s) if any, pending in this respect in any other Court is/are also disposed of.

Let the Copies of this judgement/final order be sent/handed over to the Parties free of cost.

Let the judgement/order be sent to also the Ld. Lower Court (DCDRC, Jalpaiguri) immediately for information and necessary action.

Joint Registrar of this Bench is also directed to release/ hand over statutory deposits, if any, to the appellant(s) on request, in after proper/ verification identification.

This Case is hereby disposed of.