Per Shri B.A.Shaikh, Hon’ble Presiding Member.
1. Both these appeals are taken up today for orders as though they were listed for orders on 13/02/2018 but holiday is declared on 13/02/2018 and appellant’s advocate has also passed a pursis that the final order in both appeals may be passed today.
2. Both these appeals are filed by original opposite party i.e. Central Bank of India which is herein after referred to as an appellant. The two identical orders have been passed in two identical consumer complaint Nos. 416/2008 (New) and 417/2008 (New) having corresponding old numbers as 284/2002 and 285/2002, by District Consumer Forum of Nagpur on 02/05/2009, by which both the complaints have been partly allowed.
3. The facts in brief giving rise to both appeals are as under.
The original complainant Nos.1 to 6 are herein after referred to as respondent Nos.1 to 6 respectively for the sake of convenient. The respondents opened current account with various five branches of the appellants as stated in detail in both the complaints. The appellants however deducted from their respective accounts, various amounts under the head “Deposit Insurance Credit Guarantee Charges” (for short DICGC), during the years 1997-1998 and 1998-1999 without taking consent in writing from them. The appellants various branches debited Rs.10,88,932/- and Rs.11,58,528/- under DICGC from the various accounts of respondents respectively during the years 1997-1998 and 1998-1999. The appellants did not refund the said amount to respondents despite of making request to them from time to time orally and in writing, by respondents. Therefore the respondents filed two consumer complaints before the District Consumer Forum below under Section 12 of Consumer Protection Act, 1986 respectively for the years 1997-1998 and 1998-1999, seeking direction to the appellants and its branches which were arrayed in the complaint as opposite party Nos.1 to 5. The directions sought for to the appellants and its branches were to the effect that they shall refund the aforesaid amounts with interest and compensation of Rs.1,00,000/- in each of the said two complaints.
4. Both the complaints were resisted by the appellant and its branches by filing common reply. They came with a case in brief that the joint complaints filed by six complainants are not maintainable under law and they are also barred by limitation. Moreover the guarantee fees are recovered from respondents in accordance with the Reserve Bank of India and as per practice followed by all National Banks in India. Moreover all the respondents are registered Small Scale Industries Units (SSM) and covered under DICGC Scheme. The appellant paid fees to DICGC and it has been recovered from the respondent’s account by them. Therefore it was prayed by the appellants and its various branches that both the complaints may be dismissed.
5. The District Forum below after hearing both parties and considering evidence brought on record passed the impugned orders and thereby came to the conclusion that the joint complaints are maintainable and that the amounts are recovered without any express consent from the original complainants/respondents herein and therefore the respondents are entitled to get refund of the same. The Forum also found that the appellants various branches are not entitled to recover any such charges from the respondents for the years 1997-1998 and 1998-1999. Therefore the Forum directed the appellants and its branches to refund the aforesaid amounts with interest @ 9% P.A. from the date of complaints and also to pay to respondents in each of the complaint compensation of Rs.10,000/- for physical and mental harassment and litigation cost of Rs.10,000/-.
6. As observed above these appeals are filed by Central Bank of India through its Regional Manager feeling aggrieved by said orders. We have heard advocate Mr.Lahiri appearing for the appellants. None appeared at the time of final hearing for respondents to make oral submission. However the learned advocates of both parties already filed written notes of arguments which we have considered. We have also considered the other material placed before us by the appellants.
7. The learned advocate of the appellants during the course of arguments has placed reliance on two documents. The first document is dated 26/03/1998 which is alleged to have been written by the appellant’s M.I.D.C. Butibori branch to respondent No.5. As per said letter written by the above branch of the appellants to respondent No.5, one of the term and condition shown is that the advance shall be covered under DICGC and guarantee fees shall be recovered as per rules. The second document is dated 19/06/1995 and it is a circular issued by Reserve Bank of India to all the banks. It shows that absorption of guarantee fee payable to DICGC for loan over Rs.25,000/- to the borrowers, excluding those covered under the paragraph 2 above, is left to the discretion of the bank. As per para No.2, small and marginal farmers, artisans, IRDP beneficiaries, S.C.-S.T, beneficiaries under DRI Scheme and beneficiary under SLR Scheme, housing loan, pure consumption loan and for other borrowers loans up to Rs.25,000/- to S.C., S.T. and weaker section are covered for recovery of the charges under DICCGC.
8. The learned advocate of the appellants therefore submitted that as the DICGC charges have been recovered as per the aforesaid circular of Reserve Bank of India and as per the practice adopted by bank and that the Forum erred in directing the appellants and its branches to refund the said charges with interest and compensation. He requested that the impugned order may be set aside as it is illegal.
9. On the other hand, the learned advocate of the respondents in his written notes of arguments supported the impugned order and submitted that the appeals may be dismissed.
10. We find that the circular of Reserve Bank of India referred to above itself is very clear that it is optional to cover the loans over Rs.25,000/- for payment of the charges under DICGC. It is not the case of the appellants that the loan paid to the respondents under current account was below Rs. 25,000/-. Moreover the case of the respondents is also not covered under the para No.2 of the aforesaid circular of the Reserve Bank of India.
11. Thus as per the circular of Reserve Bank of India it was the discretion of the bank for absorption of the guarantee fee payable to DICGC for loans over Rs.25.000/- to the borrowers. However before exercising the said discretion, it was necessary for the appellants to bring to the notice of respondents that they are going to charge them under the said scheme. No such document is produced that the respondents were made aware of the same. Only one of the document dated 26/03/1998 is produced in appeal showing that the respondent No.5 was granted the loan facility subject to covering the same under DICGC and that guarantee fee will be recovered as per rules.
12. However there is no document to show that the said letter of sanction dated 26/03/1998 was handed over to respondent No.5. No document is produced to show that the loan facility to rest of the respondents was also granted informing them that the guarantee fee will be recovered from them as per rules. The details of guarantee were not given by appellant to any of the respondent.
13. In our view had any such material change of policy brought to the notice of the respondents in writing before the amount was recovered from them and had consent in writing obtained from them then they would have been made responsible for payment of the said charges. We find that in the absence of any such direct intimation to the respondents about proposed recovery of the amount from their respective account under DICGC scheme, the recovery of that amount for the years 1997-1998 an 1998-1999 amounts to adoption of unfair trade practice by the appellants and rendering of deficient service by the appellants and its branches to the respondents.
14. Therefore we hold that the aforesaid two documents relied on by learned advocate of the appellants are of no help to appellants to show that the recovery is made from the respondents in accordance with law. In the result both the appeals deserve to be dismissed.
// ORDER //
i) Both appeals bearing Nos. A/09/477 and A/16/44 are hereby
dismissed.
- No order as to cost in both appeals.
- The copy of this order be furnished to both parties free of cost.
