Chandigarh

StateCommission

CC/52/2018

Ethos Ltd. - Complainant(s)

Versus

The Federal Bank Limited - Opp.Party(s)

Geeta Gulati, Adv.

03 Mar 2020

ORDER

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

 

 

Complaint Case No.	:	52 of 2018
Date of Institution	:	05.02.2018
Date of Decision	:	03.03.2020

 

 

Ethos Ltd. (earlier Kamla Retail Ltd.), S.C.O. 88-89, Sector 8-C, Chandigarh thorugh its authorized Signatory, Chief Financial Officer, C. Raja Sekhar. 

……Complainant

Versus

 

1. The Federal Bank Limited, Sector 8-C, Chandigarh through its Chief Manager.
2. The Federal Bank Limited, SCO 867, First Floor, Manimajra, Chandigarh through its AGM and Regional Head.

              .... Opposite Parties

 

Complaint under Section 12 of the Consumer Protection Act, 1986.

 

 

BEFORE: JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT.

               MRS. PADMA PANDEY, MEMBER

                MR. RAJESH  K.  ARYA, MEMBER       

 

Argued by:

 

Ms. Geeta Gulati, Advocate for the complainant.

Sh. Nitin Grover, Advocate for the opposite parties.               

 

PER  RAJESH  K. ARYA, MEMBER

                   The facts in brief are that the complainant is in business of the retail chain for Swiss watches and has its retail stores at various locations including at the International and Domestic airports in India. In India the complainant company for the banking requirements for its business operations initiated banking relationship with the respondent Bank in the year 2008 and for availing credit facilities were maintaining various current accounts with the said bank. The complainant for the ease of making payments by the client through credit or debit card, required POS machines at their premises, for which, the opposite parties sanctioned vide letter dated 13.07.2010. As per the sanctioned terms, the opposite parties Bank were not to charge the monthly rent from the complainant for using the POS machine and the complainant was also given the discount @1% plus service tax prevalent at the time.

2.                The opposite parties for providing various services to the complainant company deducted charges from the current accounts of the complainant on cash transactions, POS rent, anywhere banking charges, charges for making demand drafts and other miscellaneous charges. The charges have been deducted from the year 2011 till financial year 2015-16, as per details (Annexure C-2). However, when represented by the complainant, the opposite parties reversed an amount of Rs.5,61,010/- in the year 2015. However, amount deducted as POS rent was not reversed, which was against the terms of the sanction letter (Annexure C-1) and also did not reverse the anywhere banking charges. It was stated that opposite parties also levied penal interest on renewal of cash credit limit for the financial year 2013-14, 2014-15 and 2015-16, for which no satisfactory explanation was given. The complainant sent representation for reversal of Rs.18,35,588/- on 17.09.2015 (Annexure C-3) but the same was not replied. Again penal interest was levied on renewal of cash credit limits since the financial year 2013-14 on the ground that there was delay in submission of documents for renewal by the complainant without any proof qua the same. The opposite parties reversed an amount of Rs.15,21,103/- in the financial year 2013-14, 2014-15. It was further stated that the opposite parties vide letter dated 5.10.2015 (Annexure C-4) informed the complainant for reversal of bank charges for renewal between June 2015 – September 2015 completely, however, the same was made conditional upon renewal of the cash credit limits by the complainant. It was further stated that the opposite parties vide letter dated 0.10.2015 informed about the concession on the interest rate to be charged on the cash credit limit and also reversal of penal interest charged for the financial year 2014-2015.

3.                It was further stated that dissatisfied by the services provided by the opposite parties Bank, the complainant company decided to seek services of Bank of Maharashtra for the facilities of working capital limits required for the business by the complainant and informed the opposite parties vide letter dated 22.09.2015 about the repayment of the outstanding amount in the cash credit account as per the books of the complainant.  A request was made for reversal of penal interest charges and other bank charges deducted by the opposite parties and for issuance of No Due Certificate. Further vide letter dated 06.10.2015 (Annexure C-7), the complainant requested the opposite parties to remit an amount of Rs.10,71,49,456/- in the cash credit account of the complainant and foreclosure of the cash credit account. However, the opposite parties vide letter dated 12.10.2015 (Annexure C-8) raised a demand of Rs.17,76,251.69 for issuance of NOC. The complainant paid an amount of Rs.21,08,636/- under protest for getting the foreclosure of the bank account because it had to open an account with the Bank of Maharashtra. The opposite parties issued No Due Certificate on 27.11.2015 (Annexure C-11). After the closure of the account, the complainant vide letter dated 25.1.2016 (Annexure C-12) requested the opposite parties for the reversal of the bank charges. It was further stated that the opposite parties vide email dated 4.11.2016 informed the complainant about sanction of taking over of cash credit facilities by J&K Bank and for reversal of bank charges for Rs.10 lacs as full and final settlement of the complainant’s outstanding claims. It was further stated that the opposite parties also offered for reversal of bank charges to the tune of 60%, however, in actual, the said proposal was less than 60%.

4.                It was further stated that though the opposite parties on one hand were reversing old Bank charges, it, on the other hand, was regularly levying bank charges on the current accounts and on the credit card machines of the complainant. It was further stated that the opposite parties vide letter dated 09.02.2017 sent a proposal to the complainant for taking over of cash credit limit from J&K bank and also proposed to do reversal of charges to the extent of Rs.10 lacs but the said reversal was made conditional to be affected upon takeover of the cash credit limit. (Annexures C-13 and C-14).

5.                It was further stated that the opposite parties did not clear their stand on the reversal of the bank charges of Rs.21,08,636/- as claimed by the complainant. The complainant sent a detailed email on 10.07.2017 (Annexure C-15) requesting therein to reverse excess charges of Rs.21,08,636/-. The Complainant also served a legal notice dated 08.11.2017 upon the opposite parties (Annexure C-16) but to no avail.

6.                It was further stated that the opposite party’s unilaterally decision of arbitrarily deducting Bank charges and subsequently reversing some amount and making conditional offer for reversing the charges in case the opposite parties are allowed to take over the credit facility provided by other bank amounted to unfair trade practice.

7.                By filing this complaint, the complainant is seeking directions to the opposite parties to reverse the bank charges amounting to Rs.21,08,636/- besides awarding an amount of Rs.5 Lakhs as compensation for unfair trade practice and deficiency in providing service and Rs.25,000/- as litigation expenses.

8.                The opposite parties, in their joint reply, have raised following preliminary objections:-

1. That the present complaint is liable to be dismissed on the ground that it has not been signed and verified by the authorized officer/person of the complainant as the complainant failed to annex the resolution/authorization of the signing authority.
2. That the complaint is barred by limitation as the complainant has sought refund of Rs.21,08,636/-, which it deposited on 07.11.2015 and NOC was issued on 27.11.2015 and now after expiry of two years, the complaint filed for refund is time barred.
3. That the complaint is liable to be dismissed as the complainant has indulged in vexatious and speculative litigation and has claimed exorbitant compensation from the opposite parties.

9.                However, on merits, admitting the factual matrix of the case, it has been stated that all the POS machines incurred some cost of running, maintenance etc., which is to be borne by the customer in the shape of monthly rent and in case, there are proper monthly transactions through said POS terminals, the Bank considered the request for waiver of the said monthly rent which was done in the present case vide sanction letter dated 13.07.2010. It was further stated that the opposite parties charged monthly rent/charges as per Merchant Agreement w.e.f. 1.04.2011 on the basis of performance and transactions of the POS machines as there were no/few transactions with the said machines.

10.               It was further stated that charges such as Cash Transactions, Any Where Banking Charges, Demand Draft charges and other Miscellaneous Charges were charged as per the banking norms, which are applicable in the current accounts from time to time, which are subject to revision.

11.               It was further stated that as per the loan agreement, the opposite parties rightly charged penal charges in the cash credit account due to non-submission of the renewal documents on time or incomplete submission of renewal documents by the complainant.

12.               It was further stated that as per banking norms and to maintain the healthy customer relation, the opposite parties after taking approval from the Head Office reversed some of the charges.  It was further stated that the waiver is totally discretion of the Bank and it is not the matter of right as there is no agreement with the complainant in this regard.

13.               It was further stated that against the demand of Rs.21,08,636/-, the opposite parties offered reversal of Rs.10 lacs as full and final settlement of old dues, which the complainant did not accept and as such, the complainant is not entitled for the same as there was no revival of relationship between the parties.

14.               It was further stated that the complainant paid the amount as due and accordingly, the opposite parties issued a No Due Certificate in respect of working capital loan account.

15.               Lastly, it was stated that the opposite parties were neither deficient, in rendering service nor did they indulge into unfair trade practice. The remaining averments, made in the complaint, were denied.

16.               The complainant filed rejoinder, wherein it reiterated all the averments, contained in the complaint, and repudiated those, contained in the written statement of the opposite parties.

17.               The parties led evidence, in support of their cases.

18.               We have heard the Counsel for the parties and have also carefully gone through the evidence and record of the case and the written arguments of both the parties. 

19.               As regards the first preliminary objection raised by the opposite parties that the present complaint is liable to be dismissed on the ground that it has not been signed and verified by the authorized officer/person of the complainant as the complainant failed to annex the resolution/authorization of the signing authority, it may be stated here that all the pages of the complaint filed by the complainant have duly been stamped and signed by the authorised signatory, namely, Sh. C. Raja Sekhar, CFO of Ethos Ltd.. Not only this, the said authorised signatory has also filed his detailed affidavit in support of averments made in the complaint and evidence. Further perusal of record shows that letters [Annexures C-5, C-7, C-9, C-10, C-12, C-17, C-17(b) and  C-17(d)], addressed to the opposite parties were signed by sh. C. Raja Sekhar, Chief Financial Officer on behalf of the complainant (Ethos Ltd.).  

20.               Not only above, there is also on record of the complaint file, a Resolution passed at the meeting (Board Meeting No.07/2016-17) of the Board of Directors of the Company held on 04.11.2016 at 02:30 P.M. at Pullman New Delhi Aerocity, Asset No.2, Delhi Aerocity, GMR Hospitality District, Indira Gandhi International Airport, New Delhi – 110037, duly signed by Sh. Anil Dhiman, Company Secretary  of Ethos Limited, vide which, Mr. Yoshovardhan Saboo, Managing Director, Mr. C. Raja Sekhar, Chief Financial Officer and Mr. Anil Dhiman, company Secretary, have been severally authorized to institute/file a suit, petition, application, rejoinder, appeal etc., before any Tribunal/Court on behalf of the Company and sign and verify the appeal, petitions, applications, affidavits, make statements, give evidence, swear on oath, compromise or withdraw the same, file replies, reply affidavits, undertake defence, sign vakalatnamas, appoint advocates and do all that may be necessary for the effective discharge of the powers granted hereunder for and on behalf of the Company.

21.               Thus, the contention that there is no Resolution on record filed by the complainant authorizing Sh. C. Raja Sekhar, Chief Financial Officer to file the present complaint is not sustainable on the basis of material available on record. Accordingly, the complaint filed is fully maintainable in the eyes of law. The objection raised in this regard stands rejected.

22.               Now coming to the second preliminary objection that the complaint is barred by limitation as the complainant has sought refund of Rs.21,08,636/-, which it deposited on 07.11.2015 and NOC was issued on 27.11.2015 and now after expiry of two years, the complaint filed for refund is time barred, it may be stated here that there is a continuing cause of action in this case. The complainant kept on putting its grievance before the opposite parties – Bank qua levying of machine rent and other charges etc. vide their letters/emails dated 13.10.2015 (Annexure C-9), 07.11.2015 (Annexure C-10), 25.01.2016 (Annexure C-12), 17.11.2016 & 04.11.2016 (Annexure C-13), 10.07.2017 (Annexure C-15) and legal notice dated 08.11.2017 (Annexure C-16). Thus, the complaint having been filed on 05.02.2018 before this Commission is very well within the limitation period of two years and not time barred. The objection raised in this regard stands rejected being not sustainable in the eyes of law.

23.               As regards the preliminary objection that complaint is liable to be dismissed as the complainant has indulged in vexatious and speculative litigation and has claimed exorbitant compensation from the opposite parties, it may be stated here that the objection raised is an afterthought and merely a technical objection. The complainant is simply seeking reversal of Bank charges of Rs.21,08,636/- besides Rs.5 Lakhs as compensation for unfair trade practice & deficiency in providing service and Rs.25,000/- as litigation expenses, which in our considered opinion, cannot, in any manner, said to be exorbitant. Thus, the objection raised also stands rejected being not sustainable in the eyes of law.

24.               Now coming to the merits of the case, it may be stated here that the complainant is claiming reversal of Rs.21,08,636/-, which it deposited with the opposite parties, under protest, towards the alleged illegal demand raised on account of POS rent, Penal charges, cash charges, AWB charges, DD charges and other Charges.  

25.               Annexure C-2 is the chart placed on record by the complainant showing POS rent and charges and reversals made by the opposite parties during the financial years 2011-2012 to 2015-2016.

26.               Perusal of this chart (Annexure C-2) shows that the opposite parties have charged POS rent of Rs.2,90,463/- i.e. (Rs.1,20,175.00 + Rs.70,805.00 + Rs.99,483.00) on POS machines from the complainant. In our considered opinion, the opposite parties have levied POS rent contrary to their own sanction letter of POS machines dated 13.07.2010 (Annexure C-1). In the sanction letter, it was stated by the opposite parties, inter-alia, as under:-

“We are glad to inform you that the competent authority has accorded sanction for installation of POS machines at the concessional charges. The detail of which are as follows”

                   Monthly Rental:                         Nil

                   Merchant Discount rate:           1% + Service Tax (S.T.)”

27.                  Clearly, as per the sanction letter of POS machines (Annexure C-1), the monthly rental was Nil. Nothing was to be charged from the complainant for POS machines towards rent as stipulated in this letter. However, the opposite parties raised a demand of Rs.2,90,463/- towards POS rent, which was totally arbitrary, illegal and contrary to their own sanction letter. Condition (g) in the Merchant Agreement (Annexure R/5) cannot override their own sanction letter of POS machines dated 13.07.2010 (Annexure C-1). In our opinion, the opposite parties could not levy such charges towards POS rent on to the complainant, which they are certainly liable to reverse.

28.               Not only above, as per the chart (Annexure C-2), the opposite parties also levied the following charges on Cash Credit Account of the complainant, which according to the complainant are totally illegal and arbirary:-

1. Penal Charges:

Rs.24,64,201/- i.e. (Rs.10,52,755.00 + Rs.10,94,199.00 + Rs.3,17,247.00) for F.Y. 2013-2014 to 2015-2016.

2. Cash Charges:

Rs.7,01,530/- i.e. (Rs.6,359.00 + Rs.6,95,171.00) for F.Y. 2013-14, 2014-2015 & 2015-2016.

3. AWB Charges:

Rs.2,06,253/- i.e. (Rs.95,897.00 + Rs.1,10,356.00) for F.Y. 2011-2012, 2012-2013 & 2013-2014.

4. DD Charges:

Rs.1,65,006/-  for F.Y. 2011-2012 & 2012-2013.

5. Other Charges:

Rs.90,248/- i.e. (Rs.78,809.00 + Rs.8,224.00 + Rs.3,215.00) for F.Y. 2011-2012, 2012-2013, 2013-2014, 2014-2015 & 2015-2016.

29.               Vide chart (Annexure C-2), the complainant has given clear cut break up of charges imposed by the opposite parties on its Cash Credit Account maintained with the opposite parties – Bank.

30.               It is also on record that the limit of the aforesaid cash credit account was to be renewed every year and the complainant has been promptly complying with the financial discipline by submitting all information including balance sheets as and when required by the opposite parties. The complainant had been time and again requesting the opposite parties to reverse the aforesaid charges, which were wrongly and illegally charged by the opposite parties without any basis thereof. The complainant again vide its letter dated 17.02.2015 (Annexure C-18) requested the opposite parties to reverse the excess interest charged of Rs.5,25,002.69 as there was no delay in submission of documents. The opposite parties – Bank vide their letter dated 31.03.2015 (Annexure C-20) sanctioned refund of Rs.6,87,032/- towards penal interest.

31.               Thereafter vide letter dated 01.05.2015 [Annexure C-21 (b)], the complainants submitted various documents i.e. Audited Balance sheets, projection for next two financial years, ITR, VAT & CST returns, SME Basic loan application, New worth statement of Directors etc., to the opposite parties for renewal of cash credit loan account. Again opposite parties vide letter dated 11.06.2015 [Annexure C-21(c)] sought more information and documents from the complainant, which was duly supplied vide letter dated 16.06.2015 [Annexure C-21(d)]. Again information and documents were sought by the opposite parties vide letter dated 18.07.2015 [Annexure C-21(e)] to which, the complainant duly replied vide letter dated 23.07.2015 [Annexure C-21(f)]. Despite, fulfilling each and every formality and submitting each and every information/documents promptly, levied penal interest charges of Rs.3,17,248/- in the months of July 2015 & August 2015, which the complainant vide its letter dated 09.09.2015 [Annexure C-22], requested the opposite parties to reverse and not to levy them further in the month of September 2015.

32.               Perusal of Annexure C-3, which is a letter dated 17.09.2015, written by the complainant to the opposite parties, transpires that the opposite parties reversed an amount of Rs.5,61,010/- against cash charges of Rs.7,10,530/-. Not only this, the opposite parties also reversed the amounts of Rs.6,11,907/- and Rs.9,09,196/- against the penal interest levied to the tune of Rs.10,52,755/- & Rs.10,94,199/- for F.Ys. 2013-14 & 2014-15 respectively.

33.               Subsequently, vide letter dated 05.10.2015 (Annexure C-4), the opposite parties on the request of the complainant reduced the rate of interest on the CC limit to 13%. While doing so, the opposite parties also intimated the complainant as under:-

“Also the penal interest charged on account of current non renewal between June’15-Sep’15 has been permitted to be reversed in full and instead PF will be charged retrospect.”

34.               Clearly, the opposite parties reversed the penal interest charged on account of current non-renewal between June 2015 to September 2015 in full.

35.               Being aggrieved on account of charging of aforesaid penal interest and bank charges etc., the complainant vide letter dated 22.09.2015 (Annexure C-6) informed the opposite parties as regards takeover of credit facilities by Bank of Maharashtra and requested the opposite parties to issue No Dues Certificate, form CHG-4 for satisfaction of charges and No Objection Certificate for creation of charges in favour of bank of Maharashtra. The complainant again reiterated its request for issuing aforesaid documents vide letter dated 06.10.2015 (Annexure C-7).

36.               Perusal of aforesaid letter dated 06.10.2015 (Annexure C-7) transpires that at the footnote of this document, the opposite parties had stated that reversal of charges/penal interest will be as and when sanctioned by the Head Office. This note bears the stamp of the opposite parties. However, the opposite parties vide their subsequent letter dated 12.10.2015 (Annexure C-8), while replying to the request of the complainant for issuance of NOC, showed its inability to issue NOC to the complainant as there existed  the balance outstanding of Rs.17,76,251.69 in their books as on 12.10.2015.

37.               Thereafter, vide letter dated 13.10.2015 (Annexure C-9), the complainant agitating the charging of excess penal interest in cash credit account and also Bank charges levied by the opposite parties in their current account, again requested the opposite parties to issue No Due Certificate with other two documents but to no avail. Lastly, the complainant deposited the entire charges of Rs.21,08,636/-  on 07.11.2015 under protest as demanded by the opposite parties vide letter dated 07.11.2015 (Annexure C-10).

38.               It is also on record that after receiving the entire payment, the opposite parties issued No objection certificate/no due certificate on 27.11.2015 (Annexure C-11).   

39.               Thereafter vide letter dated 25.01.2016 (Annexure C-12), the complainant showed its disappointment as the opposite parties did not reverse the bank charges and penal interest despite communicating and requesting for last three years and assurance given by the opposite parties for reversal and again requested the Bank to refund those charges.

40.               Surprisingly, vide their email dated 04.11.2016, the opposite parties informed the complainant as under:-

          “With regard to our sanction dt. 05.09.2016 for takeover of credit facilities from J & K Bank and your request for reverseal of previous charges, we are glad to inform you that our Bank has agreed, in principle, to reverse a lumpsum charges in the range of Rs.10,00,000/- (Ten Lac only) in full and final settlement of all your outstanding claims. This is in addition to cash handling charges concession of maximum Rs.10 L permitted in your current accounts for the period Mar.’16-Feb’17 with terms as stipulated therein. The lumpsum charges will be reversed on takeover and disbursal of limits and the company has to give undertaking that the limits will not be taken over or closed subsequently. We would also like to inform you that the rate of interest offer for the proposed facilities, as already conveyed to you, has been specially fine tuned by 0.25% as a part of the package.

          You are now requested to immediately convey your acceptance and initiate process for takeover of limits. As you are aware the S.O. was valid for 30 days and it needs revalidation. Please also arrange to comply with all the pre disbursal formalities as mentioned in the sanction.

          We look forward to a positive and prompt response from you side.”

41.               The aforesaid email was replied by the complainant vide email dated 17.11.2016 (Annexure C-13), whereby, it, intere-alia, stated as under:-

“……However, the proposal from you actually is for even lesser than 60%. Further, the bank is continuing to levy these bank charges on the current accounts as well as the credit card machines that we are maintaining with your bank. You will appreciate that all of this make it very difficult for us to put up this proposal for the approval of our Board.

You have also mentioned that we will need to give the bank an undertaking that the limits will not be taken over or closed subsequently, I am afraid that this is a rather sever condition that, I am quite sure you will understand, we will not be in a position to provide.

On next Board meeting will most likely be in the next month. I will request you to kindly send us the proposal for the bank charges previously as well as those levied in the current year.”

42.               The opposite parties sent proposal for taking over of limits from J&K Bank vide letter dated 09.02.2017 (Annexure C-14) whereby it informed the complainant that the reversal of old pending charges up to an aggregate amount of Rs.10 Lac would be affected as a onetime measure in final settlement of all residual issues and this reversal would be affected after takeover of limits and completion of SO formalities.

43.               Still vide email dated 10.07.2017 (Annexure C-15), the complainant reminded the opposite parties that it had terminated the relationship with the Bank on 07.11.2015 and requested to pay its dues of Rs.21,08,636/- fallaciously deducted by the opposite parties. Lastly, the complainant served a legal notice dated 08.11.2017 (Annexure C-16) upon the opposite parties and requested to remit the amount of Rs.21,08,636/- illegally charged by the opposite parties alongwith interest @18% p.a.

44.               We can infer from aforesaid correspondence that charges, which have been levied, are unjustified. The complainant has been requesting for the reversal of these charges since 2015. Apparently, the opposite parties reversed an amount of Rs.5,61,010/- against cash charges of Rs.7,10,530/- and also reversed the amounts of Rs.6,11,907/- and Rs.9,09,196/- against the penal interest levied to the tune of Rs.10,52,755/- & Rs.10,94,199/- for F.Ys. 2013-14 & 2014-15 respectively, which clearly meant that the opposite parties agreed that they levied superfluous charges. It may be stated here that these reversals were made after prolonged and repeated requests made by the complainant as referred to above. The complainant has given full detail of excess charges charged by the complainant in its emails, referred to above, written from time to time, to the opposite parties, which justified that the charges to the tune of Rs.21,08,636/- were levied arbitrarily and wrongly. However, the opposite parties have failed to justify charging of these charges from the complainant. The complainant provided each and every information in time to the opposite parties and also timely gave the Balance Sheets. It may be stated here that it transpires from Sanction Order dated 30.04.2014 (at Page 148 of the file annexed with the reply of the opposite parties), Penal interest was 2% and any other fee was 1% for delay in submission of audited annual accounts beyond seven months from close of the financial year and non-compliance of SO condition, whereas, in the instant case, there is no delay on the part of the complainant in submission of the audited annual accounts. The complainant supplied each and every information including documents etc. to the opposite parties immediately as and when demanded. For renewal of cash credit facility, the opposite parties satisfied themselves about the financials of the complainant and in case the complainant was not doing transactions, as alleged, the opposite parties would not have renewed the cash credit facility of the complainant. We are in agreement with the submission of the complainant that clause 7(g) of the Merchant Agreement (Annexure R-5) is a unilateral clause as it leaves no scope for the complainant to negotiate for amendment of the same and the rental and service charges would be at the discretion of the Bank. As discussed above, the sanction for renewal of credit facilities from the Bank was received in the month of May 2014 and the opposite parties charged penal interest for delay whereas actually there was no delay from the side of the complainant. The opposite parties – Bank has not brought on record any document to prove delay on the part of the complainant for leveling penal charges. Further the opposite parties have miserably failed to jusify the rent on the POS machine, as discussed above. Once there was no delay in providing the information and documents from the complainant, the charges levied by the opposite parties on account of POS rent, Penal charges, cash charges, AWB charges, DD charges and other Charges cannot be charged from the complainant.

45.               Not only above, when the opposite parties did not reverse the aforesaid superfluous charges of Rs.21,08,636/- illegally and arbitrarily charged from the complainant, despite numerous requests made by the complainant, the complainant deposited the aforesaid amount under protest and ended up the relationship with the opposite parties – Bank. Thereafter, the opposite parties – Bank again approached the complainant vide their email dated 04.11.2016 and agreed, in principle, to reverse lumpsum charges in the range of Rs.10,00,000/- (Ten Lac only) in full and final settlement of all outstanding claims, subject to the complainant giving an undertaking that the limits will not be taken over or closed subsequently. In our considered opinion, putting such a condition to reverse lumpsum charges in the range of Rs.10,00,000/- subject to giving the aforesaid undertaking, is clearly a restrictive trade practice on the part of the opposite parties – Bank as defined in Section 2(1)(nnn) of Consumer Protection Act 1986. Clearly such a condition imposed by the opposite parties – Bank is fatal and dangerous to the interest of the complainant as the consumer will not have the liberty to shift or close its account or credit facilities throughout in the event of unsatisfactorily customer services of the Federal Bank. The Bank should not adopt such a practice to enrich itself or safeguard its own interest and also should not jeopardize the financial interests of the borrower. The Bank has to function under the laid down guidelines and RBI’s directives. The Bank owes responsibility to ensure congenial financial atmosphere where business can grow and customers/borrowers can contribute for the growth of economy. However, in the instant case, the act of the opposite parties – Bank is a clear example of deficiency in service, unfair trade practice and restrictive trade practice, which every financial institution should not resort to. Thus, the opposite parties are directed to stop such restrictive trade practice forthwith. To the mind of this Commission, offer given by the opposite parties to give wavier of Rs.10 Lakhs out of Rs.21,08,636/-, means that charges are superfluous and the borrower (complainant) is rightly entitled to refund of amount of Rs.21,08,636/-.

46.               For the reasons recorded above, this complaint is partly accepted, with costs and the opposite parties are, jointly and severally, held liable and directed as under:-

1. To refund an amount of Rs.21,08,636/- to the complainant, illegally and arbitrarily charged by the opposite parties.
2. To pay an amount of Rs.2,50,000/- (Rupees Two Lakh and Fifty Thousand Only) to the complainant for deficiency in service and unfair trade practice.
3. To pay cost of litigation to the tune of Rs.25,000/- to the complainant.
4. The payments of awarded amounts at Sr. No.(i) to (iii), above, shall be made by the opposite parties, within a period of 45 days from the date of receipt of certified copy of this order, failing which, the amount mentioned at Sr. Nos.(i) shall carry interest @9% p.a. (simple) from the date of default i.e. after expiry of period of 45 days till realization, whereas the amounts mentioned at Sr. Nos.(ii) and (iii) shall carry interest @9% p.a. (simple) from the date of filing this complaint till realization.

47.               Certified Copies of this order be sent to the parties, free of charge.

48.               The file be consigned to Record Room, after completion.

Pronounced.

03.03.2020.

[JUSTICE RAJ SHEKHAR ATTRI]

PRESIDENT

 

 

 

(PADMA PANDEY)

        MEMBER

 

 

 

(RAJESH  K.  ARYA)

MEMBER

 

 

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