IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOLLAM

DATED THIS THE    11^th  DAY OF AUGUST 2022

Present: -        Sri. E.M.Muhammed Ibrahim, B.A, LLM. President

          Smt.S.Sandhya   Rani. Bsc, LLB ,Member

         Sri.Stanly Harold, B.A.LLB, Member

    CC.No.149/2019

1.  Rakhi Nair,     40 years,

           W/o Biju, Sreeshailam,

           Kilikolloor P.O., Kollam                                      :           Complainants 

 (By Adv.G.Gopakumar)

2. B.Biju, aged 45 years,

         S/o Bhaskaran Nair,

        Sreeshailam,

       Kilikolloor.P.O,

      Kollam.

(By Adv.G.Gopakumar)

V/s

1. Assistant General Manager,

Rasmecc, State Bank of India,                                  : Opposite Parties

Kollam.

(By Adv.Benoy Bal)

2. Assistant General Manager,

State Bank of India, Kollam Branch,

Near Railway Station, Kollam.

(By Adv.Benoy Bal)

ORDER

Sri. E.M.MUHAMMED IBRAHIM , B.A, LLM,President

This is a case based on a complaint filed U/s 12 of the Consumer Protection Act 1986.

The averments in the complaint in short are as follows:-

The 1^st opposite party is a central government employee and wife of the 2^nd opposite party.  He has been maintaining the salary account with the SBI, Kollam branch.  On 27.01.2010 he availed Home loan of Rs.20,00,000/- from RASMECC  SBI.  As per the 3^rd paragraph of the loan sanctioning order the interest to be

charged is fixed 9% per annum and  if there any change in interest it will be 2.75% less than the advance rate (SBAR) of the State Bank.  As per the terms of the loan agreement the petitioners agreed to repay the loan at the rate of Rs.18,491/- in 222 monthly instalment.  The first year of the loan was moratorium period.  During this period the complainant paid interest alone regularly.  Subsequently the complainant has authorized the opposite party to recover the monthly instalment from her salary.  After paying Rs.18,07,442/- towards the loan the SBI intimated the complainant on 02.10.2018 that there is a difference in the interest charged to the loan.  She rushed to the bank on 03.10.2018 and consulted with the authorities.  The official concerned who talked with the complainant informed that the charging interest advance rate (SBAR) was closed and now MCLR system is being followed from the month of February 2013 and hence more interest has been charged from the complainant.  Furthermore if the complainants intends to change the MCLR type they have to pay Rs.2,360/- including GST as service charge.  As instructed by the concerned employee the 1^st opposite party has put her signature on the concerned application form and also put her signature in the voucher for withdrawing the service charge.  As on that date the complainant paid Rs.18,07,000/-.  But the amount credited to the principal amount was only Rs.17,18,147/- as the installment was adjust towards the higher rate of interest charged by the bank the amount credited towards the principal amount was only Rs.17,18,147/- .  The bank has advertised in the website and newspaper that they have charged only 8.30%  interest for the home loan throughout the loan period and there are certain discount for the interest to the employed person who are maintaining salary account.  In the advertisement given by the opposite party bank Malayala Manoram Daily on 07.10.2018 it was stated that they are charging only 8.30% interest for the home loan.

Though the complainant’s requested the opposite party bank authorities the loan should be brought  under MCLR scheme from the date on which it was implemented and shall adjust the excess amount towards the principal amount.  But there was no response from the bank authorities.  Hence on 27.10.2018 the complainant filed an application praying to allow the option from the date of coming into force of MCLR scheme.  But no action has been taken by the opposite party in their application.  As no reply has been received the complainant on 25.10.2018 filed petition before the banking Ombudsman, Kerala.  The opposite party bank against the terms of agreement has obtained Rs.5,60,636/- from the complainants.  Though the above fact was brought to the notice of the opposite party bank authorities they are not prepared to set right the above defect and credit the excess amount charged from the complainants to the principal amount and thereby the committed deficiency in service and unfair trade practice.  The above act of the opposite party bank authorities has caused much inconvenience and mental agony to the complainants apart from financial loss.  Hence the complainants are claiming compensation to tune of Rs.50,000/-. 

The opposite parties 1^st and 2^nd resisted the complainant by filing a detailed written version by raising the following contentions.  The complainant is not maintainable either in law or on facts.  The complaint is bad for non-joinder of necessary parties.  The complainant is not a consumer as contemplated under section 2(d) of the Consumer Protection Act.  The salary account is not in the name of the 1^st complainant.  But in the joint name of the complainants.  However the opposite party would admit that housing loan account 31047466557 was sanctioned on 22.01.2010 and the security documents were executed by the complainants jointly on 04.02.2010 and the loan account was opened on 05.02.2010.  As per the agreement that the interest rate during the first year from the date of first disbursement is 8% per annum and the interest during the next

two years is 8.50% per annum.  The interest rate after the completion of 3 years will be charged at floating rate of interest at 2.75% below State Bank Advance Rate (SBAR).  The total installments for the repayment of the loan are 222 months which will start after 18 months from the first disbursement of the loan amount.  But the above said 18 months is moratorium period.  After moratorium period the EMI is Rs.17,903/- for which the interest rate 8.5% and the EMI for the balance 204 months is Rs.18,491/- for which the rate of interest is floating.  The rate of interest pertaining to the loan account for the complainants are strictly in tune with the agreement signed by them.  Apart from rate of interest lot of charges over the years as per the agreed terms and conditions and the same was conveyed to the complainants through the statements of account issued to them.  The opposite party would further admit that the complainants gave standing instruction to the bank for debiting the installments from the salary account of the 1^st complainant.  On 01.04.2016 the Reserve Bank of India implemented the Marginal Cost of funds based Lending Rates (MCLR) and from that date onwards the interest rate was calculated on its basis for fresh loans and the existing loanees were provided an option to switch over to the MCLR.  Regular intimations regarding the change of interest has been communicated to the complainant in an automated process and the bank used to send SMS also regarding rate of change of interest in the loan to all customers.  Apart from that all the information are available in public domain ie. Bank’s Official Website, News Papers and notice board of the bank which has been easily accessed by any of the customers if needed.  The opposite party would further admit that the complainants contacted the 2^nd opposite party on 03.10.2018 and they requested to switch over from SBAR to MCLR.  The bank immediately processed the request and on 05.10.2018 an amount of Rs.2,360/- being the onetime charge for switch over was debited from the salary account of the complainants and on the very same day the rate of

interest was switched over from SBAR to MCLR.  The complainant was given an option to switch over to MCLR without change in interest rate but with linkage to MCLR without payment of the above mentioned switch over charge.  But the complainant herself has opted for the first option and has signed the document stating the same.  The opposite party would deny the claim of the complainants that on 03.10.2018 the total amount remitted  into the principal amount was Rs.17,18,147/-.  In fact the outstanding balance in the loan account was Rs.17,18,147/- as on 30.09.2018.  The averments regarding the advertisements in news paper dailies and interest rates mentioned therein are absolutely false.  The opposite party bank from time to time used to charge interest at the rate stipulated by the Reserve Bank of India.  The complainant on 11.10.2018 has not requested the opposite parties  to consider that the complainants shall be switched over to MCRL with retrospective effect and they have not requested to apportion the  interest illegally received by the bank towards the outstanding loan amount.  The opposite parties never charged any interest illegally from the complainants and the complainants are not entitled to get any amount as interest or otherwise from the opposite parties.  In fact the complainants herein submitted the application for witch over on 03.10.2018 and at the time of submitting the application the bank has informed their inability to extend the facility retrospectively.  The averments contrary are false.  The Banking Ombudsman after considering the petition filed and reply submitted by the opposite party bank found that the allegations leveled against the opposite party bank are absolutely false and hence the complaint was closed.  The opposite parties would further deny the  allegation of  illegal snatching of  Rs.5,60,636/- from the complainant.  There is no deficiency in service or any unfair trade practice on the part of the opposite party bank.  There is no consumer dispute with the complainant and the opposite parties so as to invoke the jurisdiction this Forum.  The allegation of the complainant that they

had suffered mental torture and monitory loss and they are liable to pay compensation etc. are absolutely false.  They are not liable to get any compensation.  The complainant itself is an afterthought and filed only to explore the possibility to extracting money from the opposite parties.  Opposite party further prays to dismiss the complaint with costs.     

In view of the above pleadings the points that arise for consideration are:-

1. Whether there is any deficiency in service or any unfair trade practice on the part of the opposite parties?
2. Whether the complainant is entitled to get the relief sought for ?
3. Reliefs and Costs?

Both sides have not adduced any oral evidence.  The complainant has got marked Exts.P1 to P5 documents.

Opposite parties have not adduced any documentary evidence also.

            Both parties have not filed any notes of argument.  The learned counsel for the complainant has not turned up and made any oral argument though sufficient opportunity was granted for the same.

Point No.1&2

For avoiding repetition of discussion of materials these two points are considered together. The relief sought for in the complainant is to refund Rs.5,60,636/- being the excess interest collected from the complainants towards the home loan availed by the complainants from opposite party bank.  The other reliefs sought for is Rs.50,000/- being compensation for mental agony and hardships and also the costs of the proceedings.  Accordingly complainants the opposite party bank has collected excess interest towards the loan account.  Ext.P1 is the loan agreement which would indicate terms and conditions of the loan, loan amount, rate of interest, EMI etc.  It is clear that EMI would include interest component also.  The interest rate during the first year from the date of disbursement of loan will be 8% per annum which is fixed rate.  The interest

during the next two years is 8.5 % per annum and interest rate after completion of the 3 years will be floating rate basis which is 2.75% below the advance rate of the State Bank (SBAR).  Ext.P2 is a photocopy of advertisement contained in a news paper.  Whatever may be the matter advertised the interest for the housing loan or any other loan will be levied according the stipulation regarding interest contained in the agreement executed between the parties.    Ext. P3 is a copy of the letter sent by the complainant to the opposite parties indicating the rate of interest charged.  This is a self-serving document which cannot be laid upon the find that the opposite parties have charged unethical rate of interest for the housing loan account against the terms of agreement. It is true that the complainant has filed Ext.P4 grievance petition before the Banking Ombudsman alleging that the bank officials have realized unethical rate of interest for the housing loan account.  Ext.P5 is a letter address to the complainants by the Assistant General Manager as reply to the grievance petition filing before the Banking Ombudsman wherein it is stated that rate of interest was undergone lot of changes over the years as per the agreed terms and conditions and the same was conveyed to the complainants through the statements of account issued.  Moreover change in the benchmark rate ie SBAR base rate and MCLR and the option to switch over along with charges is displayed in the bank’s website for information of the complainant and therefore the bank is not enable to consider the grievance petition of the complainant and to give retrospective effect to switched over the rate of interest to MCLR interest structure option on the home loan account.  In view of the materials available on record including Ext.P5 reply we find no illegality or irregularity in charging floating rate of interest as the same is in accordance with terms of agreement and also we find no illegality or impropriety in not switching over the interest rate retrospectively. 

Though the complainant would alleged that the opposite party has realized excess interest to the tune of  Rs.5,60,636/- towards the loan account there are no sufficient material to substantiate the same.  The complainant has not obtained

and produced the statement of accounts showing the excess interest was debited to the account against the terms of agreement.  None of the two complainants has mounted the box and given any oral evidence regarding the merit of the case.  The learned counsel for the complainant has also not turned up and made any oral argument to convince Forum/Commission regarding the merit of the case.

On evaluating the entire materials available on records we find no deficiency in service or any unfair trade practice on the part of the opposite party bank as it has acted in accordance with the terms of Ext.P1 agreement.  Therefore the complainant is not entitled to get any of the relief sought for the complaint.  The point answered accordingly.

Point No.3

            In the result the complaint stands dismissed.

            Parties are directed to suffer the respective costs.

Dictated to the Confidential Assistant  Smt. Minimol S. transcribed and typed by her corrected by me and pronounced in the  Open Commission this the   11^th  day of  August 2022.

  E.M .MUHAMMED IBRAHIM:Sd/-

S.SANDHYA RANI:Sd/-

STANLY HAROLD:Sd/-

Forwarded/by Order

                        Senior superintendent

INDEX

Witnesses Examined for the Complainant:-Nil

Documents marked for the  complainant

Ext.P1              : Loan agreement

Ext.P2              : Photocopy of advertisement contained in a newspaper  

Ext.P3              : Copy of the letter sent by the complainant to the opposite parties

Ext.P4              : Grievance petition before the Banking Ombudsman

Ext.P5              : A letter address to the complainants by the Assistant General Manager

Witnesses Examined for the opposite party:-Nil

Documents marked for opposite party:-Nil