State Consumer Disputes Redressal Commission
1.State Bank Of India vs Dr. I. Rajya Lakshmi on 18 November, 2021
BEFORE THE TELANGANA STATe cONSUMER DISPUTES REDRESSAL
cOMMISSION:HYDERABAD
FA NO.79/2019 AGAINST CC No.216/2017 ON THE
FILE OF DISTRICT FORUM-II, Hyderabad.
Between
1.State Bank of India, H.No.5-8-342/2 to 5, Near Raghavaratna Towers, Chirag Ali Lane Branch, Abids, Hyderabad - 500 001(T.S.), Rep. through its Branch Manager.
2. State Bank of India, Administrate Office, Unit-1, 2nd Floor, Bhagyodaya Building.
Patny Centre, Secunderabad, (T.S.) Rep. through its Asst. General Manager, Reg. No.5. .Appellants/ Opposite Parties 1 & 2 And Dr.I.Rajya Lakshmi, D/o. Sri Itikala Sanjeeva Rao, Aged about: 49 yrs, R/o.D.No.5-8-293, Sri Sai Krupa, Mahesh Nagar, Chirag Ali Lane, Abids, Hyderabad 500 001. . Respondent/ Complainant Counsel for the Appellants Sri C.H.Govardhan Rao Counsel for the Respondent Party in person cORAM Hon'ble Sri Justice M.S.K. Jaiswal, President.
THURSDAY, THE EIGHTEENTH DAY OF NOVEMBER, TWO THOUSAND TWENTY ONE Oral Order:
1. This is an appeal filed by the appellants/opposite parties against the order dt.27.11.2018 of the Dist. Consumer Forum-1I, Hyderabad made in C.c.No.216/2017.
2. For the sake of convenience, the parties are described as arrayed in the complaint.
3. The brief facts of the case as set out in the complaint are as follows:
The case of the complainant in brief is that she is the account holder of opposite party no.l vide S.B.Account bearing no.305357 13873. She was holding three fixed deposits having the following account numbers:
30582148677 30556083356 30653638855 It is her submission that she approached the opposite party Bank for sanction ofloan against the fixed deposits for her education. Accordingly, the opposite party sanctioned three separate loans for the following sums:
1. Rs.6,50,000/-
2. Rs.4,75,000/-
3. Rs.1,75,000/-
on the security of the three fixed deposits lying with them. She claims that the opposite party informed her that the interest earned on the fixed deposits matches the interest repayable by her on the loan amounts and as such there is no further burden on her. She has cited the Citizen Charter of State Bank of India to provide banking services to individual customers and ensure that customers get fair treatment in the dealings with the bank. She requested the opposite party bank whether there was any deficit of payment but they never bothered to respond to her query.
Representation was made by her on 6.12.2016 calling upon the opposite party to furnish information with regard to the fixed deposits invested by her vis-a-vis, the loan secured by her and the rates of interest.
It is her contention that the opposite party bank is trying to close the loan accounts availed by the complainant by adjusting the proceeds of the fixed deposits which would cause her immense financial loss and injury. The complainant clearly sought information from the opposite party no.1 bank with regard to the details relating to the fixed deposits belonging to her and the loan secured by her. The failure the of the on part opposite party bank in not responding to her request and not rendering the service in adherence to the banking norms amounts to deficiency in service and hence the present complaint is filed.
4. The opposite parties filed their common written version resisting the complaint stating that this is not a consumer dispute as defined in the Consumer Protection Act and the Forum does not have jurisdiction to entertain this complaint. The complainant also has failed to make out a proper case of deficiency against the opposite parties. It is further submitted that the complainant approached the opposite party no.1 with regard to rates interest on the secured loan and whether the interest earned by her on the fixed deposits matches the interest repayable by her on the loan account.
explained the With regard to the above, they state that the complainant was
reasons of difference between the interest earned by her on the FDRs and interest repayable by her on the loan account and also about the recovery of TDS. Hence there is no deficiency in service as alleged by the complainant and she is not entitled to the reliefs prayed for.
5. Before the District Forum, evidence affidavit of the complainant filed.
Exs.Al to A14 documents are marked on behalf of the complainant. On behalf of the opposite parties, evidence affidavit of Sri Mirza Yousuf Ali Baig , Branch Manager of opposite party filed. Exs.B1 to B26 are marked on behalf of the opposite parties.
The District Forum partly allowed the complaint directing the opposite parties to pay compensation of Rs.50,000/- and Rs.25,000/- towards costs to the complainant. The opposite parties are directed to settle the accounts of the complainant - the fixed deposits of the complainant and the loan secured by her and furnish the information to her in response to Exs.A4 8& A5 before making recoveries from her.
6. Aggrieved by the order of the District Forum, appellants/opposite parties preferred this appeal The Forum below believed the version of the respondent/complainant without going into the details and technicalities of the issues involved.
The Forum below ought to have considered that the respondent/complainant had approached the appellant/opposite party no.1 bank with regard to rates of interest on the secured loan availed by her and whether the interest earned by her on the fixed deposits matches and was there no deficit on the amount repayable by her.
The Forum below failed to consider that the respondent/complainant did not submit Form 15 H and therefore this appellant/opposite party no.1 bank deducted the amount towards TDS. This information was given to the respondent/complainant to enable her to file exemption certificate under Form 15 H or 16 G. 4 The Forum erred in awarding a sum of Rs.50,000/- towards compensation and Rs.25,000/- towards costs based on an unreasoned order.
7. The point that arises for consideration is whether the impugned order passed by the District Forum is liable to be confirmed, set aside, modified or interfered with in any manner? To what reliefP
8. Admittedly the respondent/complainant is an account holder of the appellant/opposite party no.1 bank and has got fixed deposits to the tune of Rs.14,88,722/-. She availed a loan of Rs.13 lakhs on the security of the fixed deposits. The rate of interest at that time was at 9.25% p.a. and this is not in dispute. The rate of interest for the loan availed by the complainant against FDRs is 10% p.a. It is therefore evident from the complaint itself that the rate of interest earned by her on the FDRs is less than the interest payable by her on the loan availed by her. On the face of it, the respondent/complainant is well aware of this difference and the appellant/opposite party bank is obligated to send statements regularly to their customers. A perusal of the Exhibits filed vide B19, B20 and B21 reveals that the rate of interest earned by the respondent/complainant for the fixed deposits was reduced to 6.85% for the account bearing nos.30582148677 and 30556083356. The interest earned by her for the Fixed Deposit bearing no.30653638855 is 6.75% p.a. These rates are based on the prevailing banking rate of interest. At this juncture it is very necessary to refer to Ex.B15. This is a copy of the Term Deposit bearing 30653638855. The principal amount was Rs.1,98,722/- and date of maturity is given as 18.10.2011. On this receipt, the respondent/complainant has availed a loan and explicit instructions have been provided by the appellant/opposite party bank which are reproduced below:
Kindly furnish us with your instructions for renewal or disbursement of the principal amount of the thereon upon maturity of the deposit. In deposit and interest due the absence of your instructions, the bank will automatically renew the deposit for a similar term at the interest rate prevailing at the time of renewal to safeguard you from any loss of interest."
Interest on this deposit is subject income tax."
of TDS as per CBDT Rules of This has been signed by the respondent/complainant and she cannot claim ignorance of the fact that the term
deposit is subject to a fluctuating rate of interest. This fixed deposit was given the maturity date as on 14.2.2014. As on this date the respondent/complainant should have approached the bank and sought for the necessary information. However, a perusal of Ex.A4 5 reveals that she made her representation only on 6.12.2016 and sought clarification for furnishing details and for recovery in her secured loan account. There has been no prior communication on record by the respondent/complainant to evidence the lact that she approached the appellant/opposite party bank when the fixed deposit was to have matured.
9. The loan application form filed vide Ex.B1 dt.25.8.2011 has been carefully studied by us and particular mention of Clause 7 is necessary. The respondent/complainant has read this application form and signed it agreeing to the terms and conditions clearly specified therein. Clause 7 states that "1/we agree that interest shall be charged by you on the daily balances outstanding in the account in respect of the said banking facilities at such rate/s as would be determined by the Bank from time to time". The Forum below concluded in the impugned order that the appellant/opposite party bank provided the complainant all the necessary statement of accounts and other annexures with regard to the rate of interest on the fixed deposits and the rate of interest chargeable for the loan secured by her and also tax deducted at source. Despite having provided the respondent/complainant with the necessary information, the Forum below grossly erred in concluding that the representations made by her vide Ex.A4 and A5 were not answered by the appellant/opposite party bank.
10. The impugned order has contradicted itself by stating that no doubt the appellant/opposite party bank furnished information under Ex.A3 and B17 to B26, but did not respond to Exs.A4 & A5. When all the necessary information was provided to the respondent/complainant and the fact that the FDRs are subject to a fluctuating rate of interest, holding them responsible and liable for deficiency in service is without any cogent material evidence.
Even according to the respondent/complainant, she invested Rs.14,88,722/- in fixed deposits and the rate of interest was then 9.25% p.a. She secured a loan of Rs.13 lakhs at 10% p.a. on the security of the fixed deposits. It is seen from exhibits B19, B20 & B21 that the interest rates were substantially reduced owing to the prevailing bank rate. Since the rates of interest for the fixed deposits is fluctuating, the Forum rightly observed in their order that whatever amount was earned by the respondent/complainant as interest on the fixed deposits cannot match the amount for repayment of the interest on he loan secured by her. This can only be done after taking all the statement of accounts into consideration and the prevailing rates of interest. Hence no direction can be given to the appellant/opposite party to confirm that no dues are payable by the respondent/complainant. The Forumn 6 whatever also rightly observed that the complainant has to invariably pay of accounts.
amount she is found liable to pay after the settlement
the respondent/complainant, yet
This point was decided against
mulcted
Exs.A4 8 A5, the Forum
merely the representations made under
on
with compensation and costs.
This
the appellant/opposite party bank
and if she cannot
information is already with the respondent/complainant and the fact that every three years comprehend these statement of accounts an auto renewal of term deposit, she would not have been soo there was to be clue less.
the bank by way of Fixed
11. The fact is that the investment made in instant case loan transaction. In the Deposit Receipts is separate from a are interlinked. Admittedly though these are two different transactions, they the fixed deposit the respondent/complainant has obtained a loan by pledging the Bank. These two transactions receipts which she has herself made with for the reason that one is dependent on though different cannot be bifurcated the security of the fixed deposit the another. So long as the loan against bank to pay the investor cannot call upon the receipt has not been discharged, bank.
which he or she made with the the maturity value of the fixed deposit interest both o n fixed deposit receipts It is also the fact that the rates of will be the loan which bankers charge which the bankers will pay and on the fact is that the banks different. Though it may appear to be innocuous, are lending from out of the money charge m o r e o n the loan even though they invested by the investor by way of the fixed deposit.
In the instant case what appears is that the respondent/complainant which was sanctioned to her as against has not cleared the loan outstanding Without clearing the loan it appears that the pledging of the fixed deposits.
demand to call upon the the intention of the respondent/complainant is to fixed deposit even though admittedly she banker to pay the proceeds of the towards principal or interest as against the has not paid any amount either the bank by pledging the fixed deposit receipts loan which she has taken from as security for the loan.
the surmise that she is clueless on the
12. The entire grievance is based on and the interest disparity. This stance taken balance/margin rates applied cannot be justified and the the respondent/complainant by appellant/opposite party bank cannot be imposed with costs despite having submitted all the material evidence. The respondent/complainant has been furnished the the fact that the bank should have constantly harping on and that they should have followed Debt statement of accounts periodically ambiguous and we find no Acknowledgement Protocol. These defences are on the part of the appellant/opposite party bank in having deficiency the procedures. Based on the detailed discussions, we find that the followed order of the Forum below as unreasonable and unsustainable.
District Forum is set
13. appeal is allowed. Order of the In the result, bank is aside. Parties to bear their own costs. The appellant/opposite party accrued interest, if entitled to withdraw the statutory deposit together with any.
PRESIDENT Dated:18.11.2021