Complaint filed on: 25.07.2013

                                                      Disposed on: 18.02.2017

BEFORE THE IV ADDL DISTRICT

CONSUMER DISPUTES REDRESSAL FORUM, BENGALURU

 1^ST FLOOR, BMTC, B-BLOCK, TTMC BUILDING, K.H.ROAD, SHANTHINAGAR, BENGALURU – 560 027       

CC.No.1377/2013

DATED THIS THE 18^th FEBRUARY OF 2017

PRESENT

SRI.H.Y.VASANTHKUMAR, PRESIDENT

SRI.D.SURESH, MEMBER

SMT.N.R.ROOPA, MEMBER

Complainant: -                     

M/s. ABS Aircon Engineers pvt. ltd.

No.63/4, Basava Sadana,

Vishwanatha Rao Road,

Madhavanagar,

Off. Race Course Road,

Bengaluru-560001

Rep by its Director,

Sri. Vindo Saladi

s/o Late Prakash Rao. S

    By Adv.Sri.M.V.Murthy

V/s

Opposite parties:-    

1.  Yes Bank ltd.

Rep by its Branch Manager

Plot No.27, 1^st Floor,

80 feet road, Indiranagar,

New Thippasandra,

Bengaluru-560075

2.  Corporate & Registered Office,

Rep by its Manager,

Nehru Centre, 9^th floor, Discovery of India, Dr.A.B.Road, Worli,

Mumbai-400018.

By Advocates Rangarajan

                    & Prabhakaran

ORDER

Under section 14 of consumer protection Act. 1986.

SRI.H.Y.VASANTHKUMAR, PRESIDENT 

            The Complainant has been alleging the deficiency in service against the Opposite parties/Yes Bank ltd., in collecting Rs.8,16,220/- & other charges towards the foreclosing of the sanctioned loan against the RBI guidelines and has been claiming the refund of Rs.11,14,698/- with interest from 30.11.11 with compensation of Rs.1 lakh.

          2. The case of the Complainant in brief is that after he opened his current account on 15.09.11, the Opposite party No.1/Yes Bank offered to sanction cash credit facility, term loan facility, bank guarantee facility to the total extent of Rs.3,70,000,00/-. He accepted the said offers and the Opposite parties agreed and undertook to take over previous credit facilities existed at Union Bank of India (UBI), Vijayangara branch. The Opposite parties collected Rs.1,85,000/- towards handling charges and processing fee and collected 6 original title documents for scrutiny to create equitable mortgage thereon. The outstanding loan amount with UBI under 3 heads amounting to Rs.1,99,54,404/-, Rs.1,89,54,404/- and Rs.10,000,00/- were discharged by the Opposite parties through 2 pay orders for second and third loan amount and the remaining amount sanctioned was retained with the Opposite parties. Because of subsequent development on account of negotiation, he decided to continue the business with UBI and requested the Opposite parties to cancel above 2 pay orders through request letter dtd.17.10.11 along with the letter of UBI for cancellation of the said pay orders. The Opposite parties cancelled the two pay orders on 24.10.11 and demanded him to pay towards the closure of the loan account and after issue of no due certificates. The said demanded amount under the heads:

He questioned the demanded amount stating it as illegal and untenable. Because of the created situation, the Opposite parties forcibly collected Rs.12,85,268/- towards 5 various heads relating to the same transactions. The Opposite parties had already collected Rs.1,85,000/- towards the processing and handling charges and collecting of the same amount for the second time is against the RBI direction. Excess amount towards the interest was collected at the rate of 13% p.a. Hence the Opposite parties become liable to repay/refund the amount collected from him against the bank rules and guidelines of RBI.

Despite his demand made orally and through e-mails went in vein. He got issued the legal notice dtd.18.04.13 but it was not replied nor complied by the Opposite parties. Hence this case is filed.

          3. The Opposite parties no.1 & 2 filed their common version, disputing the maintainability of the complaint on the point of limitation, pecuniary jurisdiction and non-joinder of UBI. The Opposite parties have denied the allegations made against them contending that the processing fee collected earlier was conducting due diligence of the company and it was a non-refundable in nature as accepted by the Complainant himself under clause 3(g) of facility letter. The Complainant is not the consumer as defined in the Act and he was carrying business for his commercial purpose. The amount prayed for in the complaint together with interest at 18% p.a. from 30.11.11 till realization becomes more than 20 lakhs and hence this forum has also no pecuniary jurisdiction to try this complaint and the court fee paid is also in sufficient. The reliefs sought for is purely civil in nature and cannot be decided by this forum in summary proceedings. This complaint filed for recovery proceedings is to avoid proper court fee and to harass the Opposite parties. The terms & conditions stipulated in the facility letter are having binding force against the Complainant and thereby there were no materials to prove the alleged deficiency in service. It is false, frivolous and vexatious complaint which becomes liable to be dismissed with costs.

          4. The Complainant and the bank official have filed their affidavit evidences relying on Ex-A1 to A18 and Ex-B1 to B4 documents respectively. Written arguments were filed by both the parties. Arguments were heard.

          5. The consumer disputes that arise for consideration are as follows:

1. Whether the Complaint is not maintainable on the grounds raised by the Opposite parties ?
2. Whether the Complainant establishes the alleged deficiency in service in demanding the foreclosure charges for closing of the sanctioned loan facility ?
3. To what order the parties are entitled ?

6. Answers to the above consumer disputes are as under:

1) Negative

2) Does not survive for consideration.

3) As per final order – for the following      

REASONS

          7. Consumer Dispute No.1: The undisputed facts reveal that The Complainant/ABS Aircon Engineers Pvt. Ltd., had the credit facility for about Rs.4crores with Union Bank of India, Vijayanagara branch under 3 heads, during its 16 years of business in and around of south India, in air conditioning system. On 15.09.11 in response to the offer of Opposite party/Yes Bank Ltd, the Complainant opened the current account and got sanctioned the cash credit facility, term loan facility, bank guarantee facility to the extent of Rs.3,70,000,00/- towards taking over of the earlier credit facilities from UBI. In connection with this, the Complainant entered in to Ex-B1 & B2/A2 facility letters dtd.14.09.10 & 22.09.11 agreeing to the terms mentioned therein and also offered the title documents of several immovable properties as per Ex-B3/A4 letter dtd.28.09.11 for scrutiny. The Opposite party bank issued the letters Ex-A5 & A6 dtd.01.10.11 & 03.10.11 to UBI informing its sanctioned loan facility in favour of the Complainant and to take over all its credit facilities with underlying security of Complainant relating to the loan under 3 heads. The Opposite party bank issued the pay order for last two loan facilities for nearly Rs.2 crores on 01.10.2011 & on 03.10.2011 and the same were returned by the Complainant to Opposite party through letter Ex-A7 dtd.17.10.11 with a request to cancel the said pay orders with further request to release the deposited property documents. On the next day i.e. on 18.10.11 the UBI wrote letter/Ex-A8 to Opposite party requesting to issue no due certificate to them and to cancel all credit facilities granted to the Complainant including closing all its current account with a note that their bank has got exclusive charge of all these stocks and book debts of the Complainant company.

          8. The Opposite party bank wrote letter Ex-A9 dtd.24.10.11 informing the Complainant that the bank will not be able to cancel the enclosed pay orders as the same is towards taking over of CC/TL facilities with UBI and the same is accepted by UBI in view of 3 days internal credit policy approval and thereby demanded for foreclosing charges of 2% on the sanctioned loan amount, legal charges of Rs.32,000/-, valuation of property charges of Rs.24,000/- before issuing NOC. The Complainant had demanded the refund of the recovered amount from the Opposite party bank wide Ex-A10 letter dtd.11.01.12 and later approached the ombudsman wide email Ex-A13 dtd.11.10.12 and sent the legal notice Ex-A17 dtd.18.04.13 against the Opposite party seeking refund of Rs.9,29,478/- with interest at 18%.

          9. The transactions took place between the Complainant and the Opposite party are as per the account extract Ex-A15/B4.

          10. The nature of transaction held between the parties is to involve in large scale business all over south India as narrated by the Complainant company. The Opposite party bank has advanced about Rs.2crores of amount out of Rs.3.7crores of sanctioned loan amount. The explanation to sec.2(1)(d) says that the commercial purpose transaction cannot be termed as the service of the consumer. The Complainant cannot be termed as the consumer as he availed the facility for commercial purpose. Such transactions are for making profit by the said private limited company and thereby do not qualify as consumer u/s 2(1)(d) as observed in 2015 (I) CLT 620 (WB).

          11. The alleged financial loss and damages cannot become the subject of matter of this forum unless it is proved. It has to be proved relating to several questions which becomes civil in nature. The Complainant who had agreed to the terms & conditions of the facility letters has not stated which of the terms are violated by the Opposite party. The loan transactions were started and the Complainant availed the pay order amount for two transactions and was about to continue for the third transaction for the balance amount and because of the reasons which do not become violation of the terms of facility letters wanted to get the cancellation of pay orders.

          12. Through Ex-A7 letter the Complainant requested for cancellation of pay orders only and for return of the deposited title deeds without expressing its intention to close the sanctioned loan accounts. Three directors of Complainant through Ex-A10 letter dtd.11.01.12 stated that they were asked to pay penalty without using the credit facility but expressed that they are agreeable to pay processing fee, legal charges and all these points are to be agitated in the civil courts. The contractual terms & conditions made both the parties to prove or disprove several contentions taken in their repeated negotiation and they cannot be determined to form the opinion in this summary proceedings.

13. All the above facts clearly show that the Complainant who is a public limited company represented by number of Directors doing its business all over in South India, though does not come under the definition of consumer, filed this complaint involving various terms & conditions of contractual obligations without approaching the civil courts. This forum having the jurisdiction to conduct summary proceedings only cannot elaborately discussed, the disputed points within its limit. Hence as rightly objected by the Opposite party the complaint becomes not maintainable before this forum and the Complainant has no locus standi to seek the reliefs sought for in this complaint through this forum. Accordingly the Consumer Dispute no.1 is answered in the negative & the Consumer Dispute no.2 is answered as does not survive for consideration.  

          14. Consumer Dispute No.3: In view of finding of the Consumer Dispute No.1 & 2 the Complainant deserves to get the following:

ORDER

          The Complaint of the Complainant is here by dismissed with cost of Rs.5,000/-.

          Supply free copy of this order to both the parties. 

          (Dictated to the Stenographer, got it transcribed, typed by her/him and corrected by me, then pronounced in the Open Forum on 18^th day of February 2017).

Documents marked on behalf of Complainant:

Copies of Documents marked on behalf of Opposite parties