DATE OF FILING : 10.6.2016

IN THE CONSUMER DISPUTES  REDRESSAL FORUM, IDUKKI

Dated this the  28th  day of   September,  2018

Present :

SRI. S. GOPAKUMAR PRESIDENT

SRI. BENNY. K. MEMBER

CC NO.171/2016

Between

Complainants       :  1.   Tom Illimoottil,

     Illimoottil House,

     Velliyamattam P.O.,

     Thodupuzha, Idukki.

2.  Biji Tom, 

     Illimoottil House,

     Velliyamattam P.O.,

     Thodupuzha, Idukki.

    (Both by Adv:  K.M. Sanu)

And

Opposite Parties                                          :   1.  The Secretary,

       Velliyamattam Service Co-operative

Bank Ltd.3958,

      Velliyamattam P.O.,

      Pannimattam, Idukki.

  2. The President,

      Velliyamattam Service Co-operative

Bank Ltd.3958,

      Velliyamattam P.O.,

      Pannimattam, Idukki.

     (Both by Advs: C.M. Tomy,

Benoy Joseph & V.C. Sebastian)

  3. The Special Sale Officer,

      Alakkodu SCB Group,

     Office of the Assistant Registrar of

Co-operative Societies (General),

     Thodupuzha,

      Thopdupuzha P.O., Idukki.

 

O R D E R

 

SRI. S. GOPAKUMAR, PRESIDENT

          1st complainant is the husband of second complainant.  the complainants availed a loan of Rs.1 lakh each from the opposite party bank in the month of 

   (cont.....2)

-  2  -

March 2006 for their agricultural purpose.  Due to the failure in their banana plantain cultivation, the complainants failed to remit the loan instalments properly.  Hence the 1st complainant remitted all the pending interest along with Rs.26000/- as the principal amount and the second complainant remitted the whole interest in the loan.  The 1st and 2nd complainants renewed their balance loan dues as a new loan of Rs.74000/- and Rs.1 lakh respectively.  Eventhough they repeated their cultivation, but due to the fall in the market value of crops and low yielding, they failed to remit the loan instalments and under this circumstances, the complainant approached the Debt Relief Commission and filed a petition for getting some relief from there.  But the Debt Relief Commission rejected their application on the reason that as per the renewal loan application, the loan is granted for business purpose.  Only at that time, the complainant came to know that the opposite party bank authorities entered in their records that loan was granted for business purposes.  Complainant further averred that, they never took such a loan from opposite party bank.  Moreover, they renewed the earlier loan and the earlier loan was sanctioned for agricultural purpose and when its renewal, the purpose continues and it cannot be convert to a new loan, or new purpose.

          For remitting the loan amount, complainant joined 2 number chits of opposite party bank for an amount of Rs.50000/- each and remitted much more instalments.  But one day, without the permission of the 1st complainant, the opposite party bank adjusted the chit amount into the loan account.

          The complainants further stated that, opposite party bank calculated interest over interest and penal interest and other charges in their loan and it is against the prevailing circulars and the bank is bound to withdraw from realizing the additional charges and penal interest in the above loans.  As per the bank statement, the loan dues of 1st complainant is Rs.1,65,982/- and the loan dues of 2nd complainant is Rs.2,51,918/-.  But it is illegal to calculate such a huge amount in the loan account and the opposite party bank now issued notices to the complainant for attaching and auctioning their landed properties.  Against this, the complainants approached the Forum and filed this petition seeking reliefs such as to direct the opposite party bank to calculate the loan dues with its normal interest and reschedule it and also direct them to allow to pay cost and compensation.     (cont.....3)

-  3  -

          Upon notice, opposite parties entered appearance and filed detailed reply version by denying the averments in the complaint. Opposite party further contended that the 1st and 2nd complainants borrowed Rs.1 lakh each on 25.4.2006 for purchasing some landed properties.  At the time of applying the two loans, 1st complainant pledged his sale deed having No.1584/94 of SRO Arakkulam as collateral security and executed ‘Gehan’ in favour of the opposite party bank.  On the date of availing loan, complainants purchased landed property having an extent of 40.60 ares in the name of 2nd complainant by way of sale deed having No.646/16 of SRO Arakkulam.  Thereafter the 1st complainant remitted Rs.41,620/- on 18.9.2017  in his loan account as interest and principal amount and availed a new loan on the same day, of Rs.74000/- and the 2nd complainant remitted the interest in her loan.  The purpose of loan stated in the loan application is business.

          While so, the 1st complainant joined 2 number of chits, of the opposite party bank of Rs.50000/- each ending in 40 months and remitted Rs.11,457/- in each chit and defaulted further payments of chit instalments.  After giving sufficient notices to the 1st complainant, the opposite party bank transferred the chit amount to his SB account and adjusted the amount to the pending loan arrears.  

          The opposite party further contended that, since the complainants are failed to clear the loan dues, opposite party initiated further arbitration proceedings against the complainants before the Assistant Registrar, Co-operative Department, Thodupuzha as ARC No.1527/14, 1528/14 and on 28.6.2014, the matter was decided in the favour of opposite parties and further opposite party initiated execution proceedings against the complainant and after issuing proper notices to the complainants, the bank took the possession of the property belongs to the 1st complainant which is pledged in the loan as collateral security.  Thereafter bank issued notices to the complainants intimating them to the auction of the property which will be held on 14.7.2016.  After receiving this notice, complainant approached this Forum for delaying the proceedings of the opposite party bank, by suppressing all these facts.  Moreover, there is no consumer relationship with the complainants and hence 

  (cont.....4)

-  4  -

this Forum is having no jurisdiction to entertain this complaint.  Opposite party further contended that after taking possession of the property, complainant cut and sold so many valuable trees from the property.  Against this, opposite party filed petition and the Kanjar Police registered a crime against the complainant as 429/16 and it is pending trial.  Matter being so, no deficiency in service is happened on the part of the opposite parties as alleged in the complaint.  Hence the complaint is liable to be dismissed.  

          Evidence adduced by the complainant by way of proof affidavit and documents.  Complainant was examined as PW1 and Exts.P1 to P6 were marked.  Ext.P1 is the demand notice dated 3.6.2016.  Ext.P2 is the loan statement of accounts of both the complainants.  Ext.P3 is the circular dated 27.2.2006.  Ext.P4 is the copy of circular No.5/15.  Ext.P5(series) are the receipts.  Ext.P6 is the copy of circular No.6/18.

          From the opposite side, Manager-in-charge of 1st opposite party was examined as DW1.  Exts.R1 to R17 were marked.  Exts.R1 and R2 are the loan application and bond of 1st complainant dated 17.1.2016 and 25.4.2016 respectively.  Exts.R3 and R4 are the loan application and bond of 2nd complainant.  Exts.R5 and R6 are the loan application and bond of the 1st complainant.  Exts.R7 to R17 are the loan details of both the complainants.

          Heard both sides.

          The point that arose for consideration is whether there is any deficiency in service from the part of opposite parties and if so, for what relief the complainants are entitled to ?

          The POINT :-  We have heard the counsels of both the parties and gone through the evidence on record.  On perusing the records and deposition of the witnesses, we can see that the complainants approached the Forum on getting Ext.P1 auction notice from the opposite party society.  From this record, it is seen that, the opposite party bank initiated proceedings against the complainants for recovery of the loan amount and obtained a decree against them from their Arbitrator and the matter is under execution.  Ext.P1 is the execution notice, intimating the complainant regarding the auction of their landed property, which is pledged in the opposite party bank as collateral security.      (cont.....5)

-  5  -

          The main allegation of the learned counsel for the complainant against the opposite party bank is that, the complainants availed the loan exclusively for agricultural purpose, while on its renewal, the opposite party bank converted it as business loan and through this the opposite party bank calculated exorbitant interest and added this to the principal loan amount.  This is a gross deficiency in service and opposite party bank is legally bound to write off the excess interest they calculated and other incidental charges.  As per Ext.P1, the loan dues as on 3.6.2016 is Rs.1,65,982/- and Rs.2,51,918/- respectively.  As per Ext.P2(series) loan details, the complainants availed a loan for Rs.1 lakh each on 25.4.2006 and the purpose of the loan is stated in the record as ‘Banana’.  As per this exhibit, the due date of these two loans were 24.4.2017.  Exts.P3, P4 and P6 are circulars of the Co-operative Registrar.  As per Ext.P6 circular No.6/18 dated 2.2.2018, the Registrar, Co-operative Department introduced a programme known as ‘\h-tI-c-fobw IpSn-ÈnI \nhm-cWw þ Hä-¯-hW XoÀ¸m-¡Â ]²Xn 2018’.  Through this circular, the head of the department directed their subordinate societies to include all the defaulted loan in this scheme and give maximum benefits to the customers and encourage them for closing the defaulted loans.  In this case, the version of the complainant is that, the opposite party bank had not given any chance to them for closing their loan in this scheme and the opposite party bank had not permitted them to close the loan dues in ‘One Time Settlement’ scheme. Hence the opposite party bank violated the direction of the Registrar of Co-operative Societies.  

          For finding a solution in this matter, we perused the documents which produced by the opposite party.  On going through these exhibits, we can see that on 17.1.2006, the 1st and 2nd complainants availed two loans of Rs.1 lakh each for the purpose of business as loan number OL3357 and OL3358 respectively.  For this purpose, both the borrowers executed ‘Gehan’ in favour of the opposite party society and deposited their title deed having No.1584/94 of SRO Arakkulam as collateral security against the loan (Exts.R1 to R4).  Exts.R5 shows that on 18.9.2007, the 1st and 2nd complainants availed loans of Rs.74000/- and Rs.1 lakh as loan Nos.OL3982 and OL3981 respectively for business purpose and executed guarantee deed in favour of opposite party bank 

     (cont.....6)

-  6  - 

by pledging their above said landed property (Exts.R5 to R8).  At this juncture, it is very pertinent to go through Exts.R12 to R14.  Ext.R12  to Ext.R14 are the loan details of 1st and 2nd complainants respectively.  In these exhibits, it is stated that loan date is 25.4.2006 and due date is 24.4.2007.  Loan numbers are OL03357/06-07 and OL-03356/06-07.  Purpose of the loan is land purchasing.  By comparing entries of these documents with Exts.R1 to R3, it is seen that Exts.R1 and  R3  are the loan applications of the above mentioned loans having numbers OL3357 and OL3356.  In these documents, the purpose of the loan is stated as purchasing property.  At the same time, Ext.P6, the account statement of same loan accounts shows that the purpose of the loan is ‘Banana’.  Rate of interest is not stated in none of the statement of accounts.  At the same time, Exts.R2 and R4 shows that interest is 12% per annum and Ext.R6 and R8 shows that 13% per annum.  As per these documents, the loan sanctioned in the year 2006-07 was for purchasing property purpose and loan sanctioned in the year 2007-08 was for business purpose.  But the statement of account issued to the complainants of the 2006-07 loan shows that the purpose is ‘Banana’.  We can presume it is for banana plantain cultivation.  From the evidence on record, it is clear that the pending loan are loan numbers OL3982/07-08 and OL3981/07-08.  As per Ext.R16, the loan account statement of loan No.3982/07-08, borrower is the 1st complainant, shows that the loan principal amount is Rs.74000/- interest is Rs.45508/-.  Penal interest is Rs.1841/-.  In total outstanding is Rs.1,21,349/- as on 23.10.2017.  In Ext.R17, the loan detail of loan No.3981/07-08, borrower is the 2nd complainant, shows that balance principal amount is Rs.1 lakh, interest is Rs.37262/- penal interest is Rs.334/- and total outstanding is Rs.1,37,596/- as on 23.10.2017.  On perusing these documents, it is very clear that, the statement of account of these both loans are for one and same period.  But the opposite party calculated interest for Rs.74000/- is Rs.45508/- and for one lakh rupees is Rs.37,262/-.  No clarification is given by the opposite parties to convince the Forum that how they calculated the amount or what is the rate of interest they have applied in both these loans.

          At the same time, it is an admitted fact that, the opposite party adjusted the amount of Rs.22000/-  from the chit account of the complainant in their 

     (cont.....7)

-  7  -

respective loan accounts and also the complainant remitted an amount of Rs.50000/- each in these loan accounts as per the direction of this Forum.  But no current statement of account is produced by the opposite parties to convince the Forum that what is the actual loan dues in both these loans.  At this juncture, it is very pertinent to go through the deposition of DW1, the Secretary-in-charge of opposite party bank.  While on cross examination, he categorically stated that, the loan was granted in the year 2006-07 and it renewed in the year 2007-08.  He admitted the entry of Ext.P6 statement that the purpose of the loan is ‘Banana’.  He further deposed that he has not intimated the scheme of Ashwas 2015 to the complainants in writing.  He also admitted that it is mandatory to inform all their borrowers.   Here he failed to intimate such matter to the complainants and hence wilfully denied their chances to settle the loan account through different debt relief schemes.

          On evaluating the evidence on records in total, the Forum is of a considered view that, the opposite parties purposefully denied the chances of the complainant to close their loan dues by including their loans in various relief schemes, only on the reason that, these loans were having more than sufficient security by way of landed property.  Moreover no evidence is produced by the opposite party to convince the Forum that whether they properly intimated the matter of arbitration proceedings initiated against the complainant.  No arbitration award is produced.  Moreover, no specific, detailed updated statement  of account is produced to strengthen their plea of such a huge loan arrears.  Opposite party filed argument note and the Forum considered the same.

          Under the above circumstances, the Forum is of a considered view that, without clear and cogent evidence to substantiate the plea of loan dues as per Ext.P1 notice, Forum is not in a position to consider the arguments of the learned counsel for the opposite party.  No explanation is given by the DW1, how the purpose of loan entered as Banana in Ext.P6 statement of account.  

          On the basis of the above discussion, the Forum firmly believes that, the act the opposite party amounts to unfair trade practice and hence the complaint allowed in part.  Opposite parties are  directed to calculate interest at the rate of 12% per annum from the date of sanctioning of the loan and adjust the amount 

     (cont.....8)

-  8  - 

remitted by the complainants in their respective loans and issue such a loan account statements as on date of the complaint.  The complainants are directed to remit the loan dues as per the loan statement as stated above with 6 equal monthly instalments started from the next 30th day of receipt of the loan statement.  No order to cost and compensation.  

             Pronounced in the Open Forum on this the 28th day of September, 2018

 

                                                                                                

    SRI. S. GOPAKUMAR, PRESIDENT

 

 

 

SRI. BENNY. K., MEMBER

 

APPENDIX

Depositions :

On the side of the Complainant :

PW1              -   Tom Cyriac.

On the side of the Opposite Party :

DW1              -  Jogi Sebastian.

Exhibits :

On the side of the Complainant :

Ext.P1               -  demand notice dated 3.6.2016.  

Ext.P2             -  loan statement of accounts of both the complainants.  

Ext.P3             -  the circular dated 27.2.2006.  

Ext.P4             -  copy of circular No.5/15.  

Ext.P5(series) -  receipts.  

Ext.P6             -  copy of circular No.6/18.

On the side of the Opposite Party :

Exts.R1 &R2    -  loan application and bond of 1st complainant dated 17.1.2016

        and 25.4.2016 respectively.  

Exts.R3 & R4 - loan application and bond of 2nd complainant.  

Exts.R5 & R6 - the loan application and bond of the 1st complainant. 

Exts.R7 to R17 - the loan details of both the complainants.