IN THE CONSUMER DISPUTES REDRESSAL FORUM, ALAPPUZHA

Friday  the 28^th   day of  February, 2014

Filed on 25.07.2012

Present

1. Smt. Elizabeth George (President)
2. Sri. Xavier Antony (Member)
3. Smt.Jasmine.D. (Member)

in

C.C.No.257/2012

between

     Complainants:-                                                                 Opposite Party:-

1. Muhammed Yousuf. C.A.                                          Union Bank of India

52, Daya Manzil                                                          Alappuzha Branch

P.H. Ward, Alappuzha                                                Kabeer Plaza, CCSB Road

                                                                                    Mullackal, Alappuzha – 688 011

1.  Ajmal C.Y.        –do-                                                 Represented by its Branch Manager

                                                                                    (By Adv. C. Parameswaran)

O R D E R

SMT. ELIZABETH GEORGE (PRESIDENT)

            The case of the complainant is as follows:-

The first complainant had availed a financial loan from the opposite party as trade loan for the Hardware shop being conducted by the 1^st complainant as  his means of livelihood by way of self employment.   As per the demand of the opposite party, the complainant had deposited with the opposite party, the title deed of the property of the 1^st complainant having an extent of 02.26 Ares in Resurvey No.52/1 (Old Survey No.400/9/2) in Aryad South Village in Ambalappuzha Taluk.  Due to unforseen contingencies and the slump in the volume of business, the first complainant could not repay the said loan correctly consequently the loan account has became NPA in the terms of the opposite party.  As a coercive measure, the opposite party had initiated proceedings under SARFAESI Act demanding interest and penal interest.   At the time of availing the said loan, a mortgage was created and the opposite party had warned the 1^st complainant of proceeding against the said property.   Since the said property was the sole residential property of the complainant, he had somehow arranged the funds and had remitted Rs.2,60,000/- on 10.1.2012.  The 1^st complainant had cleared off this liability on the fervent hope that they will be releasing the title deed pertaining to the security asset.   But the opposite party by saying lame excuses had not released the original title deed which was deposited with them.  The 2^nd complainant also had availed a financial loan for his studies (education loan) and against the norms, opposite party had insisted surety for loan transaction.  Now the course is completed and the 2^nd complainant is looking for a suitable placement.   But the opposite party even much prior to the cessation of grace period making illegal demands.    The opposite party is demanding the 2^nd complainant to issue 60 signed cheque leaves to them, which is not at all envisaged in the scheme.   The 2^nd complainant is ready and willing to repay the money as and when he gets a placement.  The retention of the original document even after paying off the liability and obtaining surety for educational and demand  for repayment of educational loan during grace period and prior to placement all are sequal to deficiency in service of  the opposite party.   The complainant had undergone unendurable mental agony and the opposite party is liable to make amends for.  On 4.7.2012 and thereafter the 1^st complainant had demanded back the original document.  But all the demands made by the 1^st complainant had fallen in deaf ears.  There is deficiency in service on the part of the opposite parties, hence the complaint is filed.

             2.  The version of the opposite party is as follows:-

  The complainants are enjoining educational credit facility of Rs.2,00,000/- with the opposite party.   The wife of the first complainant and mother of the 2^nd complainant Hamsath stood as guarantor for the aforesaid educational loan granted to the complainant by the opposite party.   It is submitted that the first complainant  had extended the mortgage of the immovable property extending 2.26  Ares in Survey No.52/1 of Aryadu South Village standing in the name of the first complainant by extending the mortgage by deposit of title deed.  As per the letter evidencing the deposit of title deeds/memorandum dated 1.8.2009 executed by the first complainant, it is covenanted that the mortgage relating to the said property will hold  good to the educational loan of Rs.2,000,000/- granted to the 2^nd complainant.  The complainants had further executed a demand promissory note and educational loan agreement on 1.8.2009 and mother of the 2^nd complainant had executed on 1.8.2009 an agreement of guarantee.   Hence, the complainants  as well as their assets are liable to be proceeded against for recovering the debt due under the aforesaid education to the opposite party.  The opposite party is in the process of initiating legal action for recovering the outstanding balance in the educational loan by enforcing its security interest.    In view of the mortgage dated 1.8.2009 and in terms of the security documents dated 1.8.2009, the complainants are liable for the outstanding balance due to the opposite party in the educational loan account and the opposite party is entitled to retain the title deeds of the property in issue and also to proceed against the same for realizing the debt.  The allegation that opposite party is demanding 2^nd complainant to issue 60 signed cheque leaves etc. are false and hence denied.  The opposite party had not committed any error in retaining the title deeds under issue.  The complainants are not entitled to any of the reliefs as prayed for in the complaint. 

           3.  The points came up for consideration are:- 

1. Whether there is any deficiency in service on the part of the opposite parties?
2. Whether the complainant is entitled to get relief and cost?

                 5.  The first complainant availed a trade loan from the opposite party for the purpose of conducting hardware shop by depositing the title deeds of the property having an extend of 2.26 Ares in Resurvey No.52/1 of Aryad South Village.  Since the first complainant committed default in repaying the loan, the opposite party had initiated proceedings under SURFAISI Act.  Thereafter, the first complainant  cleared off his liability.   But the opposite party had not released the original title deed.   According to the opposite party, the complainants have taken education credit facility of Rs.2 lakhs from the opposite party by extending the mortgage of the immovable property of 2.26 Ares in Survey No.52/1 of Aryad South Village.  It is an admitted fact that the opposite party granted the educational loan of Rs.2 lakhs to the 2^nd complainant.  According to them, the first complainant had extended the mortgage of the immovable property standing in his name for the educational loan of Rs.2 lakhs granted to the 2^nd complainant.  Ext.B4 evidenced the same.   The opposite party has no case that the complainant has not cleared off the liability of his trade loan or not utilized the educational loan for the purpose of education for his son.  During the cross examination, it is admitted by PW1 that his son has completed the course and he is now employed also.  The retention of original documents after paying off the liability under trade loan and obtaining security for educational loan is not justifiable and it amounts to deficiency in service.  The opposite party cannot deny the benefits of the benevolent schemes like education loan to the complainant.  The bank is not justified in insisting collateral securities for educational loan flouting the express directions contained in the notification and circular of concerned authorities.   

6. In the instant case, the primary loan availed by the 1^st complainant is fully paid off. The educational loan is availed by the 2^nd complainant, the son of the 1^st complainant who is now an employee having repayment capacity. Moreover, there was strict prohibition from initiating security for educational loan up to Rs.4 lakhs.  The loan availed by the 2^nd complainant is only Rs.2 lakhs.  It cannot be presumed that the extended security was voluntarily offered by the complainants.  In this circumstances this Forum finds that there is no justification in withholding the original documents of the complainant as collateral security for the loan availed by the 2^nd complainant for educational purpose.  

In the result,  the complaint is partly  allowed.   

  1) The opposite party is directed to hand over the original title deeds of the 1^st complainant  kept on security for the loan of 2^nd complainant for educational purpose.

     2) The opposite party is directed to pay Rs.1000/-  (Rupees one thousand only) towards costs to the complainant.  In the nature of the case, the Forum is not inclined to grant any amount towards compensation. 

    The order shall be complied by the opposite party within one month from the date of receipt of this order.    

   Dictated  to  the   Confidential   Assistant   transcribed   by   her   corrected  by  me and

pronounced in open Forum on this the 28^th day of February, 2014.                                                                                                                               

    Sd/- Smt.Elizabeth George (President) :

    Sd/- Sri. Antony  Xavier (Member)      :

    Sd/- Smt.Jasmine.D. (Member)            :

Appendix:-

      Evidence of the complainant:-

     PW1                       -           C.A. Muhammed Yousuf (Witness)

Ext.A1                    -           Receipt for Rs.2,60,000/-

Evidence of the opposite party:-   

Ext.B1                   -           Copy of  receipt dated 1.8.2009

Ext.B2                   -           Copy of the loan agreement

Ext.B3                   -           Copy of the educational guarantee

Ext.B4                   -           Copy of the certificate dated 1.8.2009

// True Copy //                                

By Order                                                                                                                                       

Senior Superintendent

To

         Complainant/Opposite party/S.F.

Typed by:- pr/- 

Compared by:-