State Consumer Disputes Redressal Commission
M/S Icici Bank Ltd vs Gajanan Shamkar Khadke on 3 June, 2020
1 F.A.No.:460-2017
MAHARASHTRA STATE CONSUMER DISPUTE
REDRESSAL COMMISSION, MUMBAI, CIRCUIT BENCH
AT AURANGABAD
Date of filing -24/04/2017
Date of order 03/06/2020
FIRST APPEAL NO: 460 OF 2017
IN COMPLAINT CASE NO.:365 OF 2016
DISTRICT CONSUMER FORUM: Aurangabad
M/s.ICICI Bank Ltd.
Registered office at Adalat Road,
Besides Raghuveer Motors,
Through It's authorized signatory,
Mr. Mohan Edake, Aurangabad. ............Appellant
V/s.
Gajanan Sakharam Khadake
R/o. Plot No. 52, Gut No.103 ,
Nr. renuka High School , Satara Parisar ,
Aurangabad. ............Respondent
Coram : (1) Smt. S. T. Barne, Hon`ble Presiding Judicial Member
(2) Shri. K. M. Lawande, Hon`ble Member Present: (1) Adv. Shri. U. N. Shete for the appellant (2) Respondent in person.
- :: ORAL JUDGMENT :: -
(Delivered on - 03/06/2020) Per Shri. K. M. Lawande, Hon`ble Member (1) Being aggrieved by the judgment and order of the District Consumer Dispute Redressal Forum, Aurangabad in Consumer Complaint 365/2016 decided on 15/03/2017, the appellant filed this appeal.2 F.A.No.:460-2017
(2) The appellant is the opponent and the respondent is the complainant in the consumer complaint. They are hereinafter referred as per their status in the original consumer complaint and the District Consumer Dispute Redressal Forum is hereinafter referred as District Forum for the sake of convenience.
(3) It is the case of the complainant that in 2003, he obtained a loan of Rs.2.5 lacs from the opponent Bank with a floatable rate of interest of 9.25%. It is alleged that in year 2004 the complainant received a phone call from opponent Bank for fixation of rate of interest. And in response to that complainant deposited Rs.1,214 /-
with the opponent Bank through DD No. 107709. The opponent bank revised the rate of interest at a fixed rate of 7.5%. It is alleged that the opponent Bank did not apply the fixed rate of interest. Instead the Bank increased the rate of interest. The complainant inquired with Bank when it was informed to him that Bank is not tracing the documents and asked the complainant to submit the documents with him. The complainant could not trace out the documents which were with him immediately. He could trace out those documents in year 2012. Thereafter the complainant submitted those documents to opponent Bank. The concerned officer Vishal Deshmukh mailed the documents to the main branch and Informed complainant that it will take some time and further asked the complainant to get the rate of interest fixed at 10.75% for 3 years. Accordingly, the complainant paid Rs. 1136/- and got the rate of interest fixed to 10.75 %. The complainant thereafter kept pursuing the Bank to apply the rate of interest at the rate of 7.5% from 2003. The complainant is told that his proposal is sent to higher authorities and nothing can be done. The complainant has also filed complaint with customer care of the Bank at Hyderabad. He has also issued legal notice which is also not replied by the opponent Bank. The complainant has not paid monthly 3 F.A.No.:460-2017 installments from last five months. The opponent Bank is pressing hard to pay the installments on phone and through SMS. Therefore the complainant has filed this consumer complaint seeking directions to opponent Bank to charge rate the rate of interest at 7.5 % from 2003 to 2016 and direct opponent bank to refund the excess amount to the complainant paid with interest and to pay Rs.1,50,000/- to complainant for physical and mental agony.
(4) The opponent Bank appeared before the District Forum. The Bank has submitted written statement and denied the adverse allegations. It was submitted by the opponent Bank that the opponent is reputed financial organisation known for transparent and genuine services to their customers. The opponent Bank denied fixation of rate of interest in year 2004.The opponent Bank accepted the submission of complainant about fixation of rate of interest in year 2012 at 10.75%.The opponent contended that the complainant has filed false and frivolous complaint with intention to grab money from opponent and requested dismissal of the complaint.
(5) The District Forum allowed the complaint and directed the opponent to prepare a chart with due EMI at 7.5 % fixed rate of interest and paid EMIs from 07/02/2004 to 07/06/2015.The opponent Bank is directed to calculate the amount recovered in excess with over and above 7.5% fixed rate of interest and directed to refund the excess amount recovered to complainant with 9% interest from the dates of recovery. The opponent Bank is also directed to pay Rs. 10,000/- towards the compensation and Rs.5000/- towards the cost of litigation.
(6) Being aggrieved by the impugned judgment and order, the opponent bank filed this appeal. The main grounds of appeal are 4 F.A.No.:460-2017 that the parties are bound by the terms and conditions of the loan agreement. The complainant had not denied the loan agreement. The opponent bank followed due procedure of law in applying the rate of interest on the complainant's account and timely informed the complainant, about change in the rate of interest. Though the complainant had applied for changing rate of interest to a fixed rate, the complainant paid inadequate conversion fees to the opponent Bank. The District Forum failed to appreciate the facts on record in proper perspective and passed the erroneous order contrary to law. The District Forum erred in holding that the opponent Bank with intention to make wrongful profit charged the complainant with 15.0% interest.
(7) Advocates Shri. U.N. Shete argued for the opponent Bank and the complainant argued in person.
(8) From the respective submissions of the parties, following points arose for our consideration. We have noted them along with findings thereon for the reasons to follow.
Sr.No. Point Finding
(i) Whether the opponent Bank imparted deficiency in service towards the complainant ? - In Affirmative
(ii) Whether there requires interference in the impugned judgment and order of the District Forum ? - In Negative
(iii) What order ? - As per final order 5 F.A.No.:460-2017 REASONING Points-1,2&3:-
(9)(i) The ld. Advocate Shri Shete argued for the opponent. He did not deny that the complainant is a consumer of the opponent Bank but denied that the opponent Bank imparted deficiency in service towards the complainant. He further argued that the consumer complaint is not filed within the limitation prescribed by the law. The complainant has stated that the cause of action arose in the year 2004. The complainant is also stating that he submitted the documents in year 2012 and the opponent Bank did not act on it.
However, the complainant has filed the consumer complaint in year 2016.
The learned advocate for opponent further argued that the parties to agreement are bound by terms and conditions therein. There is loan agreement signed by the parties when the loan is sanctioned. The complainant already agreed to pay the interest as per the said agreement. Therefore he cannot deviate from it. The opponent Bank is following the guidelines of RBI in charging the applicable interest to complainant's account. Though it is alleged by the complainant that rate of interest was to be fixed at 7.5 % in year 2004 by the opponent, however complainant has not paid the full conversion fees. Therefore opponent could not revise the rate of interest. There is no document on record to show that opponent fixed the rate of interest at 7.50%. On the contrary, the rate of interest is fixed to 10.75% in year 2012 at the request of complainant. If earlier the rate of interest would have fixed, the complainant would not have agreed to pay at higher rate. The complainant is repaying the loan at this 10.75% fixed rate of interest. No prudent man will get the rate fixed at higher rate, if the earlier rate of interest would have been low. There is no grievance of complainant on this rate of interest fixed in year 6 F.A.No.:460-2017 2012. The complainant has filed this complaint at belated stage in year 2016 when he has a cause of action in year 2004, or in year 2012 when he submitted the documents as claimed by him after tracing. The complaint is liable to be dismissed on the point of limitation. The District Forum failed to consider all these substantial facts and decided the complaint .The ld. Advocate concluded for the intervention in the impugned judgment and order of District Forum.
9 (ii) The advocate for the opponent relied upon the judgments-
(i) Hon'ble Supreme Court in - Indian Bank vs. M/s. Blue Jaggers Estate Ltd , 2010 AIR SCW 4757 (SC), wherein the Hon'ble Apex Court held that, after enjoying the facility for more than a decade, the respondent cannot turn around. The court cannot loose sight of the fact that the Bank is trustee of public fund. It cannot compromise with the public interest for benefiting private individuals. Those who take loan and avail financial facility from the Bank are duty bound to repay the amount strictly in accordance with the terms of the contract.
(ii) Hon'ble Supreme Court in - M/s. Grasim industries Ltd. & Anr.
Vs. M/s. Agarwal Steel, reported in 2010 AIR SCW 232- wherein the Hon'ble Supreme Court held that, when a person signed a document, there is a presumption, unless there is proof of force or fraud that he has raised the document properly and understood it and only then he has affixed his signatures thereon, otherwise no signature on a document can ever be accepted.
(iii) Hon'ble Supreme Court in -Sindicate Bank Vs. Veeranna & others, reported in AIR 2003 SUPREME COURT 2122, 7 F.A.No.:460-2017 wherein the Hon'ble court observed that, the rate of interest was enhanced as per the agreement between the parties and there was no question of taking separate consent from the defendants again.
(iv) Hon'ble National Commission in - ICICI Bank Ltd., vs. Ramakant Dnyandeo Gaikwad, Revision Petition 1033/2017, decided on 12.11.2018. The National Commission held that, there is no hesitation in holding that, complainant having being charged interest in terms of the agreement dt. 01.03.2005 and the second agreement i.e. the agreement dt.06.02.2015 having not been executed by the Bank, no excess interest was charged from the complainant.
(v) Hon'ble National Commission in - ICICI Bank (Home Loan) & Anr. Vs. Ganga Singh Shekhawat in R.P.2641/2013 decided by 24.02.2015 by N.C. The Hon'ble National Commission relied upon the judgment of Hon'ble Apex Court in AIR 2001 SC 3095 - Central Bank of India Vs. Ravindra & others, where it was observed by Apex Court as under-
"With effect from 15.02.1984 Sec. 21A has been inserted in the Act which takes away power of the court to reopen a transaction between a banking company and its debtor on the ground that the rate of interest charged is excessive. The provision has been given and overriding effect over the Usury Loans Act, 1918 and other provincial law in force relating to indebtorness."
(10) (i)The complainant argued in person that the Bank is in a dominant position against the complainant .The Bank is custodian of the documents related to transactions in their Bank. In year 2004, 8 F.A.No.:460-2017 the complainant paid requisite amount towards the conversion fees to get a fixed rate of interest at 7.5 %. The opponent bank approved the rate of interest fixed as 7.5% but failed to apply it to the complainant's account. The complainant pursued the opponent Bank to apply the fixed rate of interest but they neglected on the grounds that documents which are concerned with fixation of rate are not traceable. This is an irresponsible act of the opponent which is claiming itself as a reputed Bank in the country. The complainant submitted these documents to the opponent Bank in 2012, when traced by him at his residence. Till the opponent bank is hesitant to act up on their own agreement of fixation of rate of interest at 7.5 %. The opponent Bank could not deny the agreement as to change of interest to a fixed rate at 7.5% in 2004. The opponent has taken a defence that the complainant paid less conversion fees. However, the entry in the account statement, maintained by the opponent themselves, reveal payment of requisite fees by the complainant .The opponent could not adduce evidence on a particular amount paid less by the complainant. It was necessary on the part of the opponent to fix the rate at 7.5% and implement that rate for the monthly recovery from the complainant.
(ii) The complainant argued further that the complainant is pursuing the opponent since year 2004.It was informed to him that it will take an year to apply the fixed rate of interest and later it was informed that documents are not being traced by the opponent Bank. After submission of those documents when traced by the complainant in year 2012, it was informed to the complainant that proposal is submitted with higher office. Further, in year 2012 it was told to complainant to get rate fixed at 10.75% as it will take more time to get the rate 7.5% fixed. The complainant has also moved the opponent's head office to address his complaint. However, he could not get the 9 F.A.No.:460-2017 relief. He also issued legal notice to the opponent which was not replied by the opponent .Therefore, the complainant knocked the doors of the District Forum. The District Forum rightly adjudicated the matter and decided the complaint which requires no interference . 11 (i) On one side, the opponent Bank contended that the complainant paid less amount towards conversion fees required for changing rate of interest as fixed one in year 2004.However, the opponent has not explained on what was the deficient amount. There is no document adduced in evidence by the opponent bank showing that the opponent Bank asked for any certain amount from complainant and the complainant failed to respond. The complainant has alleged that he paid that amount of Rs.1250/- through the DD to opponent Bank. The statement of accounts which is at page 7 of arguments of complainant shows that the complainant paid amount of Rs. 1214/- to the opponent Bank on 31/01/2004. Therefore, in our opinion, the opponent Bank could have asked the complainant to pay the deficit amount required for the said change of rate of interest or otherwise had adjusted that amount by way of debit to the complainant's account.
(ii) It reveals that the opponent Bank in their written statement denied that the Bank ever shifted to fixed rate of interest, the complainant alleged. However, the complainant submitted the document showing that the opponent bank changed the rate to a fixed rate at 7.5% in year 2004. The said document is at page 22 and 23 submitted by complainant along with the arguments. The opponent Bank has not denied said document or alleged that it is a false document or they have not executed it, at any point of time.
(iii) It appears that the complainant in his consumer complaint alleged that he submitted the documents of fixation of rate of interest to opponent Bank in year 2012. The complainant also alleged that the 10 F.A.No.:460-2017 officer of the opponent Bank, one Mr. Vishal Deshmukh informed him that the action on the submitted documents will take some time and asked him for getting fixed rate of interest fixed at 10.75%. It reveals that the Bank denied this allegation. However, the Bank would have filed the affidavit of the concerned officer when the complainant has filed his affidavit for the allegation.
(iv) The complainant alleged that he filed complaints with the Consumer Care Center of the opponent Bank and the said center not replied him at any time. The Opponent Bank denied all the allegations made by the complainant in it's written statement. For the denial on this point, the opponent would have placed the affidavit that the complainant has not filed any complaint or the complainant was replied any time.
(v) It appears that the complainant issued legal notice to opponent. However; it reveals that the opponent Bank not replied it. In our opinion, it is an adamant approach of the Bank towards it's customers by not replying on the grievances raised against it. Therefore, we are of the opinion that the complainant has continuing cause of action against the opponent Bank.
12.(i) The statement of account dated 16/11/2013 is before us, which is at page number 11 of the arguments of the complainant. It reveals from said statement that the tenure of loan is 180 months and period of loan from 0 7/ 04/03 to 07/11/2018, agreed mode of payment is as auto debit and rate of interest is 10.75%. In the said statement, there is an entry dated 31/01/2004 which is showing about receipt of Rs.1,214/- by the opponent Bank from the complainant through cheque No. 107709. This statement of 11 F.A.No.:460-2017 account and the entries are on record of opponent Bank which are not denied by the opponent Bank.
(ii) There is also a document in the form of a letter dated 27/02/2004 which is at page no.22 of the written arguments of the complainant. The said letter is addressed by the opponent Bank to the complainant, wherein the Bank has informed the complainant that the adjustable rate of interest applicable to the said loan has been revised and the receipt of Rs.1,214/- towards shifting of the rate of interest. The enclosure along with the said document dated 28/01/2014 which is at page no.23 of the written notes of argument of the complainant. In the said document the new rate of interest is sown as fixed at 7.5%. , the tenure of 137 months and revised EMI of Rs. 2,650/-. It is the contention of the opponent Bank that the complainant has paid less conversion fees. However, this argument is not acceptable when the Bank has accepted the conversion fees of Rs.1214 in year 2004 and communicated a revised rate of interest at 7.5% long back in the year 2004 to complainant. There is no communication revealed on record informing payment of less conversion fees.
(iii) There is also one Repayment Schedule dated 14/10/2016, which is at page No. 16 to 21 of the written notes of argument of the complainant which states that the actual rate of interest levied by the opponent Bank for various periods from 07/04/2003. It can be inferred from that the opponent Bank never applied rate of interest at 7.5 % to complainant's account, instead of it applied floating rate of interest from 9.75 % , 9.25%, 9.75 %, 10.75 % .10.25% , 10. 75 % , 11.75% ,12.25 %., 14.25 %, , 15.0%,15.75% , ,15.25 % ,14.25 % , 15.25 % , 16.0 % , 16.50 % , 17.25 % up to 07/03/2012.The statement also exhibits the applied rate of interest at 10.7 % up to 07/03/2015 and later at 10.5 % ,10.2 % ,9.85 %,9.8 % up to 07/10/2018.
12 F.A.No.:460-2017(iv) However, it also reveals further that the earlier documents concerned with the revision for fixed rate of interest in 2004 are also communicated by the complainant to the opponent Bank when he could trace his copies. It is also contended by the complainant that he has submitted these documents to the opponent Bank in 2012. The opponent did not deny these documents of revision of rate of interest in 2004. Therefore, the defence of the opponent Bank of non tracing of their own record/ documents and less deposition of the conversion fees is not justified.
(v) From the submissions of the complainant, it revealed that in 2012, the complainant for the second time contacted the opponent Bank to fix the rate of interest and the opponent Bank fixed it to 10.75 % for next 3 years.
(vi) Thus, it revealed that the Bank received Rs.1,214 /- towards the conversion fees in 2004 and agreed to levy a rate of interest at 7.5% in 2004. It is argued by the complainant that he pursued the opponent Bank to apply a rate of interest at 7.5% to his loan. However, the opponent Bank did not act upon it. It is contended by the complaint that the opponent Bank replied to him that the documents concerned with change rate of interest were not traceable to the Bank. Hence, the complainant submitted these documents to the opponent in 2012 and still the opponent Bank did not act upon it. On this contention of the complainant, we could not get the appropriate reply of the opponent Bank.
(vii) It is reveals from this statement of account that, in spite of agreement to fix the rate of interest at 7.5 % , the Bank continued to apply floating rate of interest , which is certainly not justified for the opponent Bank inferring their deficiency in service towards the 13 F.A.No.:460-2017 complainant. Therefore, corrections on the part of the Bank is required, to compensate the complainant by applying the fixed rate of interest at 7.5% from 27/02/ 2004 is justified.
(13) It appears that, the learned advocate for opponent relied upon the judgments in para-9 (ii) and argued that, complainant has entered into loan agreement in year 2002 and the opponent Bank is charging interest to him as per the terms of the loan agreement. It is contended by the opponent Bank that, complainant enjoyed the contract for many years. There is no case of fraud or coercion behind the loan agreement and therefore the complainant is liable to abide by the terms and conditions of the loan agreement. The advocate also relied upon the amended Sec.21 (A) of the Banking Act and argued that, courts are prevented from reopening of the transaction between the parties on the ground that, the interest charged is excessive. However, we do not agree with the arguments of the advocate of the opponent advanced on relying upon these judgments. Because, the facts of the case in hand are distinguishing. It is not the case of the complainant that, he is disputing the original loan agreement of year 2002. It is the case of the complainant that, there is further agreement in the year 2004 between the parties and the opponent Bank has failed to execute that agreement which is for the change of interest from floating rate to a fixed rate of interest at 7.5%. We are of the opinion that, in view of the subsequent agreement, the parties are bound to abide by the terms and conditions of the contract. As discussed earlier, the opponent Bank has not acted upon the agreement of the year 2004. Therefore, in our opinion the opponent bank is liable to abide by their agreement produced on record by the complainant.
(14) The District Forum has observed deficiency of service imparted by the opponent Bank towards the complainant and allowed the 14 F.A.No.:460-2017 consumer complaint vide there impugned judgment and order dated 15/03/2017 and directed the opponent Bank to reconcile the complainant's loan account by applying the fixed rate of interest at 7.5% for the period from 07/02/2004 to 07/06/2015 i.e. for 137 months. The District Forum further directed to refund the excess amount recovered by the opponent Bank from complainant time to time with 9 % interest. The District Forum also directed the opponent Bank to pay Rs. 10,000/- towards compensation and Rs. 5,000/- towards cost of litigation. In view of our aforesaid discussions, we agree with the findings and order of the District forum and therefore there requires no necessity to interfere in the order of the District Forum. Therefore we answer points accordingly and dismiss the appeal. Hence, the order, //Order//
1. The appeal bearing No.460/2017 filed by the ICICI Bank, Aurangabad is hereby dismissed.
2. The impugned judgment and order of District Forum, Aurangabad in C.C.365/2016 dated 15/03/2017 is hereby confirmed.
3. No order as to costs.
K.M.Lawande Smt. S.T.Barne
(Hon.Member ) (Hon. Judicial Member)
SBK