BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I,
Present:- Sri. V. Parthasaradhi Rao, B.A., L.L.B., President
Kum.S.R.Sumathi, B.A., B.L., Female Member
Sri.K.Subramanyam Reddy, B.A., B.L., Male Member
C.C. No. 04 /2009
Tuesday, the (24th) Twenty fouth day of March, Two thousand and Nine
G. Radha Reddy, S/o Chinnagantla Reddy,
Aged 38 years, Hindu, cultivation, residing at
Pichigundlapalle Village, Belupalle Post,
Baireddipalle Mandal, Chittoor District.
Indian Bank, Baireddipalle Branch,
Rep., by its Branch Manager,
Baireddipalle Post, Town & Mandal,
This complaint coming on before us for final hearing on 05.03.2009 and upon perusing the complaint, written versions, affidavits, material documents and on hearing Sri A.Jyothiram counsel for the complainant and Sri S.Vijaya Bhasar Rao counsel for opposite party and having stood over till this day for consideration, the Forum made the following:-
DELIVERED BY Sri.K.Subramanyam Reddy, B.A., B.L.,Male Member
ON BEHALF OF THE BENCH
1) This is a complaint filed by the complainant U/Sec. 12 of C.P.Act, 1986 for directing the opposite party to return the gold jewels (6 items) and for Rs. 40,000/- towards compensation for deficiency in service and Rs. 10,000/- towards litigation expenses.
2) The material averments in the complaint dt. 26.12.2008 in brief are as follows :-
The complainant submits that he is having agricultural lands in his village. On 26.09.2005 the complainant availed a Drip Loan by pledging Title Deed/ Pass Book of his landed property and subsequently he has discharged the same. The complainant again approached the opposite party for crop loan. On 13.02.2007 the opposite party agreed to give crop loan for Rs. 45,000/- from the opposite party/ bank by pledged title deed/ pattadar pass book of his agricultural lands and the said loan is subsisting.
The complainant further submits that on 20.02.2007 the complainant availed Rs. 55,000/- under agricultural jewel loan by pledging the gold jewels. Recently the Government of India passed a scheme i.e Agricultural Debt Relief Scheme, waiving loans of agriculturists and the complainant is also one of the beneficiary and his name was also displayed on the Notice Board of the opposite party. Immediately after noticed the same the complainant approached the opposite party to receive gold jewels along with necessary records. But the opposite party evading to return the same on some pretext or other. Hence the complainant got issued legal notice dt. 17.10.2008 to the opposite party demanding the opposite party to return the gold jewels, having received the legal notice, failed to comply the same. Thereafter the complainant personally approached the opposite party but in vain. On 10.12.2008, the complainant sent a requisition U/Sec. 6 of Right to Information Act, through his counsel by requesting the opposite party to furnish particulars of jewel loan waived under Agricultural Debt Relief Scheme passed by the Government of India, but failed to comply the same.
The complainant submits that the opposite party refused to return the gold jewels of the complainant by stating that the complainant has obtained Drip Irrigation Loan and also Crop Loan are pending and also the complainant stood as guarantor for the Drip Loan amount raised by another person and hence, the complainant is due all 3 loans to the opposite party. The opposite party stated that it has got a general lien over the securities including the jewels of the complainant and the opposite party can hold the gold jewels of the complainant till the loans due by the complainant are paid and discharges.
The complainant submits that the complainant already discharged Drip Irrigation loan and availed crop loan by pledging the Pattadar Pass Book/ title deeds of his lands. Hence if any default by the complainant under the above said crop loan, the opposite party may recover the said loan by filing a civil suit under Mortgage, but not applicable in this complaint. There is clear deficiency on the part of opposite party.
Hence the complainant approached this Forum for redressal of his grievances. Under the above said circumstances the complainant prayed this forum to direct the 1st opposite party
a) Directing the opposite party to return the gold jewels (6 items) under J.L.No.1072/07 dt. 20.02.2007 pledged by the complainant and waived the loan under Agricultural Debt Relief Scheme-08 to the complainant..
b) to pay an amount of Rs. 40,000/- towards damages for causing mental agony; and
c) to pay an amount of Rs. 10,000/- as costs of litigation.
3) The opposite party filed his Written Version on 16.02.2009 and admitted that the complainant availed crop loan and the same is pending, but no legal opinion is obtained and no equitable mortgage is created for this crops loan. It is also admitted fact that the complainant availed agricultural jewel loan and the same is waived off under agricultural loan waiver scheme granted by the Government of India.
The opposite party submits that the complainant has obtained crop loan from the opposite party is over due, for which the opposite party sent demand notices, but the complainant did not discharge the same, a sum of Rs. 56,166/- is due as on 31.10.2009. The complainant stood as guarantor for Drip Irrigation Loan availed by one Chinna Gantla Reddy son of Gangi Reddy of Pichigundlapalle and the same is due. Hence the opposite party shall have a lien on the ornaments pledged in respect of any other sum of sums of money which the borrowers may be liable to pay to the Bank, as such this opposite party has got right to hold ornaments of the complainant until he discharge the entire dues to the opposite party. There is no deficiency of service on the part of opposite party. Hence complaint may be dismissed.
4) On behalf of complainant the complainant filed his Chief Affidavit in support of pleas raised in the complaint and same is marked as deposition of PW-1 and he also relied upon 5 documents and same are marked as Ex.A1 to A5. Ex.A1 is the Notarized copy of S.B account pass book of the complainant in S.BNo.11036 issued by opposite party. Ex.A2 is the Notarized copy of Jewel loan car No. 824 dt. 20.2.07 issued by opposite party. Ex.A3 is the office copy of legal notice dt. 17.10.2008 with postal acknowledgement. Ex.A4 is the Office copy legal notice dt. 10.12.2008 issued U/sec. 6 of R.I.Act. Ex.A5 is the served copy of reply notice dt. 19.12.2008 by opposite party.
On behalf of opposite party the opposite party filed his Chief Affidavit in support of pleas raised in the Written Version and same is marked as deposition of RW-1 and he also relied upon 5 documents and same are marked as Ex.B1 to B5. Ex.B1 is the Application for Loan/ Overdraft against pledge of Gold ornaments executed by complainant. Ex.B2 is the true copy of statement of account in respect of crop loan of the complainant. Ex.B3 is the office copy of reply notice sent to the complainant’s counsel. Ex.B4 is the Agreement of guarantee executed by the complainant in favour of opposite party. Ex.B5 is the Xerox copy of Demand Notice dt. 28.11.2008 sent by opposite party to the complainant with postal acknowledgement
5) On the pleadings and on consideration of the material available and upon hearing the parties, the points that arises for consideration :
1) Whether the complainant is entitled for return of the pledged gold jewels from the opposite party after waiving gold loan of the complainant under the scheme of Government of India, under Agricultural Debt Relief Act-08 ? If so, whether there is any deficiency of service on the part of opposite party in retaining gold jewels of the complainant?
2) Whether the complainant is entitled for Rs. 40,000/- towards compensation for deficiency of service on the part of opposite party ?
3) to what result ?
6) Both sides filed Written Arguments.
7) Point No. 1 :-
In the case on hand it is an admitted fact that the complainant has availed crop loan for a sum of Rs. 45,000/- on 13.02.2007 from the opposite party bank and it is not discharged by the complainant and further the complainant stood as guarantor for the Drip Irrigation Loan availed by one Chinnagantla Reddy of Picchigundlapalle and same is over due. Again the complainant has availed an agricultural jewel loan for a sum of Rs. 55,000/- from the opposite party/ bank on 20.07.2007 by pledging gold ornaments. The Agricultural Jewel Loan availed by the complainant from the opposite party/ bank is waived by the Central Government of India under the scheme of Agricultural Debt Relief Act-08. But the opposite party has not returned the jewels to the complainant, even after waiving the gold loan under the Central Government scheme, stating that the complainant has availed a crop loan from the opposite party/ bank and the same is over due and further the complainant stood as guarantor for the Drip Irrigation Loan availed by Chinnagantla Reddy and the same is also over due and hence the Bank has got a general lien over the securities including the jewels of the complainant and as per the terms and conditions of the agricultural gold loan the opposite party/ bank has got general lien to retain the gold ornaments pledged with it, in respect of the other two debts, which the borrowers may be liable to pay to Bank, as such the opposite party has got right to retain the gold ornaments of the complainant until the complainant discharge the other dues to the opposite party/ bank.
8) The learned counsel for the complainant argued that at the time of availing agricultural jewel loan from the opposite party, the opposite party has not made it clear to retaine the jewels of the complainant till the discharge of the remaining loans; He further argued that the Drip Irrigation Loan and crop loan are availed by the complainant by creating equitable mortgage and hence if any default by the complainant the opposite party is at liberty to recover the same by filing a civil suit. Retaining Gold jewelley after the debt is cleared amounts deficiency in service by the opposite party.
The learned counsel for the complainant relied upon the following decision I(2009) CPJ- 123 (NC) – Thukaram Anantha Shet Vs Manager, Karnataka Bank Ltd., - where in their lordships held as follows :-
Consumer Protect Act, 1986 – Sections 2(1) (d)(ii) and 2(1)(g) – Jurisdiction – Bank – Non-return of pledged documents after repayment of loan, amounts to deficiency in service on part of bank – Petitioner entitled to approach Consumer Forum – State Commission erred in holding that dispute not adjudicable under C.P.Act – Considering pendency of appeals before Appellate Court, Appropriate reasonable order required to be passed – Loan taken on over draft facility fully paid – Bank directed to deliver documents pledged to complainant – Order to be complied as soon as civil proceedings finalized”.
He also relied upon the following decision IV (2008) CPJ -94 –(NC) – Housing Development Finance Corporation Limited Vs Santha Sundararajan - where in their lordships held as follows :-
Consumer Protection Act, 1986 – Sections 2(1)(g), 14(1)(d) – Banking and Financial Services – Loan discharged – Inordinate delay in returning title deed – Title deed handed over during pendency of complaint – Deficiency in service proved – Rs.2.00 lakh awarded as compensation – Order upheld in appeal”
And also relied upon the following decision II (2008) CPJ -75 –(NC) – Haryana State Co-operative Housing Federation Limited Vs Ishwar Singh & others - where in their lordships held as follows :-
“Consumer Protection Act, 1986 – Sections 2(1)(g), 14(1)(d) – Banking and Financial Services – Loan – property mortgaged as collateral security – Loan amount repaid –‘No Dues Certificate’ issued – Complainant’s property sub-mortgaged by O.P.No.1 to O.P.No.2 – Employee of O.P.No.1 not deposited amount paid by complainant with O.P.No. 2 – Documents not released to complainant – Release of documents cannot be withheld when entire loan amount repaid – O.P.No.1 if failed to satisfy O.P.No.2, liability cannot be sought to be shifted to complainants – O.Ps. liable to return original title deeds – Compensation and cost awarded”.
The above decisions are not applicable to the facts of the present case, since the aspect of General lien in favour of opposite party is not discussed.
The learned counsel for the opposite party argued that the complainant has availed Agricultural Jewel Loan from the opposite party/ bank and that as per the condition No.7 of the loan application, the bank have a general lien on the ornaments pledged in respect of any other sum or sums of money, which the borrower may be liable to pay to the bank either solely or jointly with other persons at any office of the bank. Hence the opposite party/ bank has retained the gold jewels of the complainant as the complainant have not discharged the other loans availed by him from the bank.
9) The learned counsel for the opposite party further contends that U/Sec. 171 of Contract Act, the opposite party /bank has a right to enforce the general lien and the same is mentioned hereunder.
Sec. 171 of Contract Act :-
“171. General lien of bankers, factors, wharfingers, attorneys and policy brokers. – Bankers, factors, wharfingers, attorneys of a High Court and policy brokers may, in the absence of a contract to the contrary, retain as a security for a general balance of account, any goods bailed to them; but no other persons have a right to retain, as a security for such, balance, goods bailed to them, unless there is an express contract to that effect”.
In this regard the counsel for the opposite party relied upon National Commission Judgment reported in S.C and National Commission Consumer Law Cases (2005-2008) at Page No. 291 in a case between M. Mallika Vs State Bank of India and another – wherein their lordships held as follows :-
“Consumer Protection Act, 1986, Section 2(1)(g) – Transfer of Property Actg, 1882, Section 60- Contract Act, 1872, Section 171 – Banking service – General lien – Loan – Deposit of document – Non- return after the loan amount returned – Documents not released as the appellants stood guarantee for other firms – Held that notwithstanding the provisions under section 60 of the TPAct, the Bank was entitled to exercise its right of general lien under Section 171 of the Contract Act in order to protect the interest of the bank by ensuring right to retain the document so that other loan accounts of the bank are also cleared by borrowers or guarantor without forcing the bank to file suits”.
Their lordships in the National Commission have taken into consideration the Apex Court judgment in case of Syndicate Bank Vs Vijaya Kumar reported in 1992(2) SCC -330 :-
In Syndicate Bank Vs. Vijaya Kumar (supra) Supreme Court made following observiations about exercise of right of general lien of Bankers as under :
“By Mercantile system the Bank has a general lien over all forms of securities or negotiable instruments deposited by or on behalf of the customer in the ordinary course of banking business and that the general lien is a valuable right of the banker judicially recognized and in the absence of an agreement to the contrary, a Banker has a general lien over such securities or bills received from a customer in the ordinary course of banking business and has a right to use the proceeds in respect of any balance that may be due from the customer by way of reduction of customer’s debt balance.”
The above decision is applicable to the case on hand. In this case also the complainant have not discharged the other loans availed from the opposite party/ bank. Hence the bank has got general lien to retain the gold jewels of the complainant till the other loans are discharged. Hence there is no deficiency of service on the part of opposite party in non returning the gold jewels to the complainant.
Points 1 is answered against the complainant.
Point No. 2 :-
In view of my finding on point No. 1 the discussion of point No.2 does not arise.
Point No. 3 :-
In the result the complaint is dismissed without costs.