Date of Filing:29/01/2019
Date of Order:20/06/2020
BEFORE THE BANGALORE I ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SHANTHINAGAR BANGALORE - 27.
Dated: 20thDAY OF JUNE2020
PRESENT
SRI.H.R. SRINIVAS, B.Sc., LL.B. Rtd. Prl. District & Sessions Judge And PRESIDENT
SRI. Y.S. THAMMANNA, B.Sc, LL.B., MEMBER
SMT.SHARAVATHI S.M, B.A, LL.B., MEMBER
COMPLAINT NO.212/2019
COMPLAINANTS | 1 | MS. PRIYA RAJ T.G., D/o M.thangarajan, Aged about 37 years |
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| 2 | DR.T.G. DIVYA RAJ, D/o M.Thangarajan, W/o AbhishekBalachandran, Aged about 33 years, |
| 3 | MRS.GIRIJA THANGARAJAN, W/o M.Thangarajan, Aged about 57 years, |
| 4 | MR.THANGARAJAN, S/o R.Marthandan, Aged about 68 years, All residing at: No.16, Nidhin Nest, Ravi Prakash Nagar, KonenaAgrahara,H.A.L Post, Bengaluru-560 017. (Sri S.Suresh Kumar, Adv. For Complainant) |
Vs
OPPOSITE PARTY | | THE MANAGER, SOUTH INDIAN BANK LTD., Brigade Road Branch, Bengaluru 560 001. (Sri M.Anantha Kumar, Adv. For OP) |
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ORDER
BY SMT.SHARAVATHI S.M, MEMBER.
1. ThisComplaintisfiled by the ComplainantsU/S Section 12 of Consumer Protection Act 1986, against the Opposite Party (herein referred in short as O.P) alleging the deficiency in service and to refund a sum of Rs.2,12,400/- being the amount received by OP as pre payment charges along with interest at 24% from the date of legal notice dated 09.03.2018 and for Rs.5,00,000/- towards damages for causing mental agony, fraud and illegalities and for such other reliefs as this Hon’ble Forum deems fit.
2. The brief facts of the complaint are that:the Complainants arein the business of building constructions and for business operation, they had availed the overdraft loan facility from South India Bank Ltd, Brigade Road Branch, Bangalore 560 001to the tune of Rs.60,00,000/- sanctioned on 16.02.2016 with interest rate at 12% per annum. When OP was requested several times to reduce the interest portion, there was no response. OP charged exorbitant sumof Rs.1,80,000/- plus interest charges as pre-payment penalty and the same was deducted from their account.
3. It is further contended that being aggrieved by this, dated 09.03.2018, calling upon OP to reimburse the excess interest amountat Rs.2,12,400/- which amount is 3% at the overdraft (O.D) facility, along with commercial interest for nonperforming obligation on their part at the rate of 24% per annum.
4. Upon service of notice, OP appeared through their counsel and filed version. It is contended that the complaint is not maintainable, it is vexatious, frivolous, incorrect, false and liable to be dismissed for the reason that there is no deficiency of service committed by the OP. According to the receipt of the complainant the OP bank sanctioned over draft facility of Rs.60,00,000/- to the complainants as per the sanction order dated 16.02.2016. Complainant after going through all the terms and conditions, the rate of interest the pre-closure charges etc., have accordingly accepted the same and have signed the said sanction order in February 2018. The complainant represented that they intend to shift their account to another bank as the rate of interest with the OP is very high. The said overdraft facility was taken over by other financial institutions on 08.02.2018. As per the time terms and conditions, OP bank collected the pre-closure charges from the complainants. The complainantsdid not opposeand paid the pre-closure charges. There is no deficiency as such or whatsoever committed by OP. Opbank actedonly the terms and conditions of the sanction order which is as per the guidelines issued by the Reserve Bank of India. The rate of interest to be charged for a particular facility has been clearly mentioned in the sanction order itself. Therefore, there is no deficiency of service on the part of OP is in rendering service. Hence prayed to dismiss the complaint with exemplary cost.
5. In order to prove their respective case, the complainant and OP have filed affidavit evidence reiterating the contends of the complainant and their version respectively. Perused the documents produced by complainant and OP and the arguments. Thepoints arise for our consideration are:-
(1) Whether the complainants have proved
deficiency in service on the part of the O.P?
(2) Whether the complainants are entitled to
the relief prayed for in the complaint?
6. Our answers to the above points are:-
POINT 1&2: In the Negative
For the following:
REASONS
POINT No.1:-
7. On perusing the complaint, version, affidavit and evidence of both the parties and the documents filed,complainant No.4 has taken loan for the purpose of business of building construction. They availed over draft loan facility to the tune of Rs.60,00,000/- which was sanctioned by the OP on 16.02.2016.
8. It is admitted that complainant obtained and paid the loan and before the time prescribed for which OP has collected/debited Rs.1,80,000/- and interest charges as prepayment penalty. Complainant want the said amount to be refunded anddirect OPs to pay damages as the same amounts to deficiency in service and amounts to unfair trade practice.
9. The Reserve Bank of India circular dated 05.06.2012 bearing No.OBOD-No.Dir.BC/107/13.03.00/2011-12 andcircular dated 07.05.2014OBOD.Dir.BC.No.110/13-03-00/2013-14 clearly provides that the banks are not permitted to charge foreclosure charges, prepayment penalties only on home loan, term loan on floating rates and not apply applicable to business loans. In this case, it is clear from the complaint itself that the complainant borrowed Rs.60,00,000/- towards building constructions business. When such being case Op has collected Rs.1,80,000/- and interest charges as prepayment penalties. In our view the same do not constitutes deficiency in service or on fair trade practice. Hence we are of the opinion that there is no deficiency in service OP and hence we answer PONT NO.1 IN THE NEGATIVE.
POINT NO.2:
10. When we have answered Point No.1 in the Negative complainants are not entitle for any of the reliefs claimed in the complaint. Hence we answer POINT NO.2 ALSO IN THE NEGATIVE and pass the following:-
ORDER
- The complaint is hereby dismissed. Parties are directed to bear their own cost.
- Send a copy of this order to both parties free of cost.
Note: You are hereby directed to take back the extra copies of the complaints/ version, documents and records filed by you within one month from the date of receipt of this order.
(Dictated to the Stenographer over the computer, typed by him corrected and then pronounced by us in the Open Forum on this 20thDAY OF JUNE 2020)
MEMBER MEMBER PRESIDENT
ANNEXURES
1. Witness examined on behalf of the Complainant/s by way of affidavit:
PW-1 | SriThangarajan– Complainant. |
Copies of Documents produced on behalf of Complainant/s:
Ex P1:Letter dated 20.02.2018 sent to the OP.
Ex P2: Copy of the legal Notice dt:09.03.2018 to Op.1 to 3.
Ex P3: Postal Receipt.
Ex P4: Office copy of the legal notice dt:12.10.2018 to OP.No.4
Ex P5: Postal acknowledgment.
Ex P6: Copy of the Loan closure letter addressed to the Fed Bank Financial Services Limited Bangalore dated 05.02.2018.
Ex P7: Copy of the Statement of Account of Thangaraj.
Ex P8: Letter issued by the OP bank in respect of renewal of credit facility.
2. Witness examined on behalf of the Opposite party/s by way of affidavit:
RW-1: Sri Jabob, Chief Manager of OP Bank.
Copies of Documents produced on behalf of Opposite Party/s
Ex R1: Copy of the on demand promissory note.
Ex R2: Copy of the loan documents.
Ex R3: Copy of the declaration of mortgage.
Ex R4: Copy of the Memorandum of Title deeds.
Ex R5: Copy of the notice issued by the complainant.
Ex R6: Copy of the reply.
Ex R7: Coy of the Sanction/renewal of credit facility dated 16.02.2016.
Ex R8: Copy of the cheque issued by the complainant towards pre-closure.
MEMBER MEMBER PRESIDENT
A*
