State Consumer Disputes Redressal Commission
Arms (A Division Of Asset ... vs Thakur Dass And Others on 19 February, 2016
2nd Additional Bench
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB
DAKSHIN MARG, SECTOR 37-A, CHANDIGARH
First Appeal No. 168 of 2013
Date of institution: 18.2.2013
Date of Decision:19.2.2016
ARMS (A division of Asset Reconstruction Company (India) Limited,
having its branch office at A-668 3rd Floor, Lajpat Nagar, Pakhowal Road,
Near Carplus Showroom, Ludhiana through Sh. Aditya Vikram, Assistant
Manager-Legal & Authorized Officer of Assets Reconstruction Company
(India) Ltd., (ARCIL-Arms)
Appellant/Op No.2
Versus
1. Sh. Thakur Dass and Smt. Bhagwanti Rai, both resident of House
No. 305, Mohalla Himmatpura, Ward No. 10, Dhuri, District Sangrur,
Punjab.
Respondent No.1/Complainant
2. The Manager, ICICI Bank, Main Branch, Sangrur (Punjab).
Respondent No.2/Op No.1
First Appeal against the order dated 4.1.2013
passed by the District Consumer Disputes
Redressal Forum, Sangrur.
Quorum:-
Shri Gurcharan Singh Saran, Presiding Judicial Member
Shri Jasbir Singh Gill, Member
Mrs. Surinder Pal Kaur, Member
Present:-
For the appellant : Sh. Nitin Grover, Advocate
For respondent No.1 : Sh. H.S. Ahluwalia, Advocate
For respondent No.2 : Sh. Vikas Duggal, Advocate for
Sh. Sandeep Suri, Advocate
First Appeal No. 168 of 2013 2
2nd Appeal
First Appeal No. 514 of 2013
Date of institution: 3.5.2013
The Manager, ICICI Bank, Main Branch, Sangrur (Punjab).
Appellant/Op No.1
Versus
1. Sh. Thakur Dass and Smt. Bhagwanti Rai, both resident of House
No. 305, Mohalla Himmatpura, Ward No. 10, Dhuri, District Sangrur,
Punjab.
Respondent No.1/Complainant
2. ARCIL : Securitisation and Assets Reconstruction Company, A-668
3rd Floor, Lajpat Nagar, Pakhowal Road, Near Carplus Showroom,
Ludhiana through its Chairman/Authorized Signatory
Respondent No.2/Op No.1
First Appeal against the order dated 4.1.2013
passed by the District Consumer Disputes
Redressal Forum, Sangrur.
Quorum:-
Shri Gurcharan Singh Saran, Presiding Judicial Member
Shri Jasbir Singh Gill, Member
Mrs. Surinder Pal Kaur, Member
Present:-
For the appellant : Sh. Vikas Duggal, Advocate for
Sh. Sandeep Suri, Advocate
For respondent No.1 : Sh. H.S. Ahluwalia, Advocate
For respondent No.2 : Sh. Nitin Grover, Advocate
Gurcharan Singh Saran, Presiding Judicial Member
ORDER
This order will dispose of both the above mentioned two appeals as both are arising out of impugned order dated 4.1.2013 First Appeal No. 168 of 2013 3 passed in Consumer Complaint No. 42 dated 16.1.2012 by the District Consumer Disputes Redressal Forum, Sangrur(in short the "District Forum") vide which the complaint filed by complainants was partly allowed against Ops jointly and severally with the direction to Op No. 1 to collect the title deed of House No. 305. It was further ordered to comply with the order within 60 days of its communication to the parties, failing which Op No. 1 will pay interest @ 9% p.a. on Rs. 30,000/- from the date of this order.
2. Complainants filed complaint against Ops on the averments that he approached Op no. 1 in the year 2003 regarding house loan. After fulfilling the necessary requirements, Op No. 1 had sanctioned a loan of Rs. 2.50 lacs vide loan account No. LBSAN00000534723 to be repaid in 120 monthly instalments and title deed of the house was taken by Op No. 1. Complainants were regularly paying the instalments of loan as per rules and regulations as per directions of Op No. 1. In the year 2010, complainants had settled the loan account with Op No. 1 as per the statement issued by Op No. 1 and they had promised to return their title deeds. Thereafter, complainants had been visiting op No. 1 for return of title deeds but with no result. They also got some amount deposited on 11.6.2011, 7.7.2011 and 8.8.2011 in lieu of return of the title deed. In the month of November, some unknown persons representing themselves to be employees of Op No. 2 threatened complainants to dislocate them from the house and to sell their house. Then complainants sent legal notice dated 16.12.2011 to Op No. 1 for clarification of the loan account No. LBSAN00000534723 but Op No. First Appeal No. 168 of 2013 4 1 did not bother it rather complainants received a notice dated 26.11.2011 delivered on 7.12.2011 regarding the loan account from Op No. 2. Then complainants sent a legal notice dated 29.12.2012 for withdrawl of the notice dated 26.11.2011 but Op No. 1 did not bother it. Complainants had no knowledge regarding any agreement for recovery of loan between Op Nos. 1 & 2. The loan agreement was for a specific stipulated period of 120 months but Op no. 1 had breached the contract and executed an agreement with Op no. 2 for recovery of the loan amount without any notice to complainants, which amounted to deficiency in service on the part of Ops. Accordingly, the complaint was filed restraining Op No. 2 to recover any amount from the complainants and withdrawing the notice dated 26.11.2011. Ops be further directed to pay Rs. 50,000/- on account of mental torture, agony and inconvenience and Rs. 11,000/- as litigation expenses.
3. Complaint was contested by Ops. Op No. 1 in its written reply/version took the preliminary objections that the complaint was false, frivolous, vague and vexatious, therefore, liable to be dismissed. Op No. 1 had already sold the loan case to Op No. 2 in the month of December, 2010 as per assignment agreement dated 30.6.2009 executed between Op Nos. 1 & 2; complainants had no cause of action to file this complaint; the Forum had no jurisdiction to entertain this complaint as no wrongful loss was caused to the complainants and proper remedy available before the complainants was to approach the Civil Court; complaint was not valid complaint as defined under Section 2(d) of the Act as there was no relationship between the complainants and Ops and that there was no cause of First Appeal No. 168 of 2013 5 action or locus-standi to the complainants to file this complaint. On merits, it was admitted that in August, 2003, complainants had approached this Op and requested for grant of house loan. A sum of Rs. 2,50,000/- was sanctioned to the complainants vide loan agreement No. LBSAN00000534723, which was repayable in 120 installments out of which first 36 installments were of Rs. 3733/- and last 84 installments of Rs. 2740/-. It was denied that in December, 2010, complainant had settled his account. It was denied that any amount was deposited by the complainant on 11.6.2011, 7.7.2011 and 8.8.2011 for return of title deeds. In fact the amount was deposited by the complainant in his loan account with malafide intention to create evidence. The complainant was defaulter, number of times he was requested to pay the balance but the complainant did not listen to the request of this Op and in December, 2010, the loan case of the complainant was sold to Op No. 2 as per assignment agreement dated 30.6.2009 and complainant was informed to pay the due instalment to Op No. 2 w.e.f. 1.1.2011 and all the communication and correspondence pertaining to the loan agreement be addressed to Op No. 2. As per assignment agreement dated 30.6.2009, Op No. 2 had paid the settlement amount of the complainants to Op No. 1 and consequently, the loan account of the complainants was finally closed on 31.12.2010. Now Op No. 1 has no concern with that account, therefore, there was no deficiency in service on the part of this Op. Complaint was without merit, it be dismissed.
4. Op No. 2 in its written reply/version stated that Sh. Aditya Vikram is authorised Officer to file reply on behalf of Op No. 2. First Appeal No. 168 of 2013 6 Preliminary objections were taken that the complaint was not maintainable before this Forum; complaint was barred under the provisions of SARFAESI Act and Consumer complaint was not maintainable. Op No. 1 had transferred the account of the complainant in favour of Op No. 2 according to assignment agreement; no cause of action had accrued to the complainants to file this complaint. The relief sought by the complainant is beyond the terms and conditions of the loan agreement; there was no deficiency in service on the part of Op No. 2; complainant had alternative remedy to approach Hon'ble DRT in view of the judgment of the Hon'ble Supreme Court in "United Bank of India versus Satyawathi Tondon and others" reported in 2010(2) DRTC 457 (SC). On merits, it was stated that complainants had raised a house loan of Rs. 2,50,000/- to be paid in 120 equal monthly instalments and in December, 2010, Op No. 1 had transferred this account to Op no. 2 on the basis of assignment agreement dated 30.6.2009 Complainant had failed to adjust the outstanding amount. Accordingly, notice under Section 13(2) of the SARFAESI Act was issued to the complainant. Complaint was not maintainable before the Consumer Fora. A sum of Rs. 2,39,748.56p was payable by the complainant to Op No. 2 as on 2.4.2012. There was no deficiency in service on the part of this Op. Complaint was without merit, it be dismissed.
5. The parties were allowed by the learned District Forum to lead their evidence.
6. In support of his allegations, the complainant had tendered into evidence legal notices Exs. C-1 & 2, postal receipts First Appeal No. 168 of 2013 7 Exs. C-3 & 4, loan sanction application Ex. C-5, application Ex. C-6, statement of A/c Ex. C-7, notice Ex. C-8, receipt Ex. C-9, envelope Ex. C-10, receipts Ex. C-11 to 18, affidavits Exs. C-19 & 20, receipts Exs. C-21 to 53. On the other hand, Op No. 1 had tendered into evidence affidavit Ex. R-1, account statement Ex. R-2, letter Ex. R-3, intimation letter of ARCIL Ex. R-4. Op No. 2 had tendered affidavit Ex. R-5, power of attorney Ex. R-6, loan documents Ex. R-7, loan agreement Ex. R-8, notice Ex. R-9, postal receipt Ex. R-10, notice Ex. R-11, reply to notice Ex. R-12, postal receipts Exs. R-13 & 14, account statement Ex. R-15.
7. After going through the allegations in the complaint, written version filed by Ops, evidence and documents brought on the record, the complaint was allowed as referred above.
8. Aggrieved with the order dated 4.1.2013, First Appeal No. 168 of 2013 has been filed by Op No. 2 whereas First Appeal No. 514 of 2013 has been filed by Op No. 1.
9. We have heard the learned counsel for the parties.
10. In the appeal, it has been argued by the counsel for both the appellants that complainants/respondent No. 1 had availed house loan to the tune of Rs. 2,50,000/- from OP No. 1 i.e. ICICI Bank, which was sanctioned on 31.8.2003 and it was to be repaid in 120 EMIs. Some payments were made by complainants/respondent No. 1 towards EMIs but he could not maintain the financial discipline. Lateron Op No. 1 by assignment agreement dated 30.6.2009 had transferred this account to Op no. 2. This Op No. 2 issued a notice under Section 13(2) of SARFAESI Act on 26.11.2011 demanding the First Appeal No. 168 of 2013 8 outstanding amount of Rs. 2,19,042.92p and after that the complainants/respondent No. 1 filed this complaint. Op No. 2 in its written statement had taken a specific objection that present complaint is not maintainable and in case complainants/respondents have any grievance against appellants/Ops then they should proceed the matter according to the provisions of SARFAESI Act by approaching Debt Recovery Tribunal (DRT). Instead of approaching the DRT under which a specific provisions has been, the complainants have filed this consumer complaint, which is not maintainable. Whereas the District Forum in the impugned order held that assignment agreement was violative of Section 5 of the SARFAESI Act, 2002. Section 5 authorises any Securitisation Company or reconstruction company to acquire financial assets of any bank or financial institution. In view of specific authorised given by the complainants in the loan agreement. Counsel for complainants was unable to rebut what was violative of Section 5 of the Act, while transferring the assets to Op No. 2. However, counsel for Op No. 2 has referred to Clause 9.2 of the loan agreement, which reads as under:-
"9.2 Inspection, Assignment, etc.
(a) The BORROWER shall permit inspection of all books of accounts and other records maintained by him and/or by ICICI Bank in respect of ICICI Bank Loan to the persons authorised by ICICI Bank. The BORROWER shall also permit similar inspection by such other companies, other banks, institutions, credit bureaus or bodies as ICICI Bank First Appeal No. 168 of 2013 9 may appoint or authorise for the purpose of this LOAN or any other loan/overdraft.
(b) ICICI Bank shall be entitled to sell, assign, securities or transfer ICICI Bank's right and obligations under this Agreement and any security in favour of ICICI Bank/ the security trustee nominated by ICICI Bank (including all guarantee/s) to any person of ICICI Bank's choice in whole or in part and in such manner and on such terms and conditions as ICICI Bank may decide. Any such sale, assignment, securitisation or transfer shall conclusively bind the BORROWER and all other persons.
(c) ICICI Bank shall be entitled to disclose a credit bureau, regulatory authority or to any subsidiaries/affiliates of ICICI Bank or any other person (whether in course or assignment, securitisation, transfer or otherwise) all or any other credit or other information (including with respect to defaults) of the BORROWER."
11. Abovesaid clause will make it clear that Op No. 1 reserved its right to assign this loan to any person of their choice whole or in part and in such manner and on such terms and conditions as Op No. 1 may decide. Therefore, when the complainants have categorically authorised Op No. 1 to assign this loan case to any person of the choice of Op No. 1 then they can not raise any finger under what circumstances, there loan account was assigned to Op No. 2. The District Forum has also observed that when the entire loan was cleared by the complainants then there was First Appeal No. 168 of 2013 10 no reason to assign this loan account to Op no. 2. However, the counsel for the parties have referred to that as on 31.12.2010 a sum of Rs. 1,88,175.40p was outstanding. After that on various heads, it has been shown to be waived off but in fact it was transferred to Op No. 2. The statement of Op No. 2 Ex. R-15 shows that as on 31.12.2010 DR unpaid was Rs. 1,85,309/-. Counsel for the complainants has not been able to prove on the record that except payment of three cheques No. CAM3137867 dt. 13.6.11, CAM391266 dt. 8.6.11 and CAM3442770 dt. 9.8.11 i.e. just Rs. 15,000/-, no other payment was made by the complainants to Op No.
1. It has been stated that this amount was also transferred to Op No. 2, although counsel for Op no. 1 was unable to make a specific reference to the statement of account of Op No. 2 regarding receipt of this payment. Even if this payment was not adjusted, the matter can be taken up with Op No. 2. Counsel for complainants in its written arguments has stated that without giving prior notice to the complainant, account cannot be sold to ARCIL. However, during the course of arguments, counsel for complainants was unable to rebut Clause 9.2 referred above under which they had agreed and authorised Op No. 1 to transfer this account to any person of their choice. Therefore, without referring the statement of account, the District Forum cannot record the findings that entire loan account was cleared by the complainants, therefore, the account could not be transferred to Op no. 2 does not hold good.
12. The next point raised by the counsel for the appellants that once the proceeding under Section 13(2) of SARFAESI Act on First Appeal No. 168 of 2013 11 26.11.2011 whereas the complaint was filed after that. Once the proceedings under SARFAESI were initiated then Consumer Forum does not have the jurisdiction to entertain the complaint. In case complainants were aggrieved by any act of Ops or they are showing any excess outstanding amount then they were to approach DRT under SARFAESI Act, 2002. To support this claim, counsel for appellants have relied upon the judgments Revision Petitioner No. 721 of 2013 "Standard Chartered Bank versus Virendra Rai" decided by the Hon'ble National Commission on 1.4.2013. After relying upon the judgment "Traxpo Trading Co. Vs. The Federal Bank Ltd." I(2002) CPJ 31 (NC) that once the proceedings under the SARFAESI Act have been initiated then under Section 18 of the Act, the jurisdiction of this Commission is barred and accordingly, the proceedings before the District Forum were quashed by accepting the Revision Petition and complaint was dismissed. No contrary judgment was cited by the counsel for complainants.
13. In view of above discussion, when the District Forum did not have the jurisdiction to entertain the complaint then the District Forum should not have entertained the complaint. Accordingly, impugned order is hereby set-aside and both the appeals are accepted. Complaint filed by complainants is dismissed without prejudice to his right to avail any remedy available to him before the appropriate Forum/Court.
14. The appellant in F.A. No. 168 of 2013 had deposited an amount of Rs. 15,000/- & Rs. 15,000/- with this Commission in the appeal. These amounts with interest accrued thereon, if any, be First Appeal No. 168 of 2013 12 remitted by the registry to appellant by way of a crossed cheque/demand draft after the expiry of 45 days, from the despatch of the order to the parties; subject to stay, if any, by the higher Fora/Court.
15. The appellant in F.A. No. 514 of 2013 had deposited an amount of Rs. 25,000/- with this Commission in the appeal. This amount with interest accrued thereon, if any, be remitted by the registry to appellant by way of a crossed cheque/demand draft after the expiry of 45 days, from the despatch of the order to the parties; subject to stay, if any, by the higher Fora/Court.
16. The arguments in these appeals were heard on 15.2.2016 and the orders were reserved. Now the orders be communicated to the parties as per rules.
17. The appeals could not be decided within the statutory period due to heavy pendency of Court cases.
18. Copy of this order be placed on F.A. No. 514 of 2013.
(Gurcharan Singh Saran) Presiding Judicial Member (Jasbir Singh Gill) Member February 19, 2016. (Surinder Pal Kaur) as Member