C Arul Amuthan vs Indian Overseas Bank on 4 April, 2019

[Cites 4, Cited by 0]

Central Information Commission

C Arul Amuthan vs Indian Overseas Bank on 4 April, 2019

1. The issues under consideration arising out of the second appeal dated 01.10.2017 include non-receipt of the following information raised by the appellant through his RTI application dated 01.07.2017 and first appeal dated 15.08.2017:-

(i) Public funds handling by IOB, and take necessary action against the NPA's for maximum recovery similarly IOB will take necessary action against their Branches for violations of procedures, rules and not following their credit sanction advice terms and conditions kindly provide information total number of violations identified and corrective actions by IOB during financial year 2012-13, 2013-14,2014-15,2015-16.

(ii) Public funds handling by IOB, and take necessary action against the NPA's for maximum recovery similarly IOB will take necessary action against their Branches for violations of procedures, rules and not following their credit sanction advice terms and conditions kindly provide information whether IOB had taken any action against IOB Ramalinga Nager Branch, Coimbatore 641011 for violation in procedures, terms and conditions for loan sanctioned and operation of Pothys Colour chemicals account.

(iii) Kindly provide information JOB will accept Agricultural land as a collateral for the new fresh CC loan account.

(iv) The Principal Borrower of Mr.V.Sundararajan of Pothys Colour chemicals, CIBIL report details given below (about Mr.V.Sundararajan IOB taken CIBIL report ) • Presence of a tradeline with worst status in the past 6 month • Low proportion of Satisfactory trade • No presence of revolving trade line Kindly provide information based on the above CIBIL report , IOB Ramalinga Nager Branch , Coimbatore 641011 volunteer to give a fresh CC loan Pothys Colour chemicals.

(v) Kindly provide information based on the taken over account PG Dyes & chem. past performance from Catholic Syrian Bank, Tirupur and CIBIL report of Mr.V.Sundararajan , a fresh loan was sanctioned to Pothys Colour chemicals by IOB Ramalinga Nager Branch , Coimbatore 641011.

(vi) IOB Ramalinga Nager Branch , Coimbatore 641011 sanctioned the CC loan to Pothys Colour chemicals , kindly provide information whether Credit sanction advice terms and conditions were properly followed by principal borrower and IOB Ramalinga Nager Branch , Coimbatore 641011.

(vii) IOB, Ramalinga Nager Branch, Coimbatore 641011 had given credit sanction advice to Pothys Colour chemicals with terms and conditions.

Kindly provide information whether IOB, Ramalinga Nager Branch officials had given undue advantage to the Principal borrower Mr.V.Sundararajan of Pothys Colour chemicals to violate and not to follow the credit sanction advice terms and conditions including inspection and routine bank operations and procedures.

(viii) IOB, Ramalinga Nager Branch , Coimbatore 641011 accepted Agricultural Land as collateral (JOB Panel advocate legal opinion confirms - Agricultural Land) and issued fresh CC account to Pothys colour chemicals loan. kindly provide information any violation of IOB' s policy or unjustified advantage given to Mr.V.Sundararajan- borrower.

(ix) IOB, Ratnalinga Nager Branch, Coimbatore 641011 covered the stocks insurance through Universal Sampo General Insurance Co Ltd. kindly provide information stocks Insurance value properly covered for the entire CC Limit along with margin stocks from date of sanction of CC loan till SARFAESI Act recovery action of the Pothys Colour chemicals and IOB's guidelines on inspection of stocks.

(x) IOB , Ramalinga Nager Branch, Coimbatore 641011 covered the insurance of Pothys Colour chemicals CC account stocks. Kindly provide information Insurance covered including the margin (stocks) shown in the stock statement submitted for DP limit.

(xi) IOB , Ramalinga Nager Branch, Coimbatore 641011 issued Final recall Notice on 26.07.2012 against Pothys Colour chemicals kindly provide information whether Final recall Notice severed to Pothys Colour chemicals credit sanction advice address and all partners and Guarantors addresses.

(xii) IOB, Ramalinga Nager Branch, Coimbatore 641011 issued SARFAESI Act 13 (2) notices on 10.08.2012 against Pothys Colour chemicals kindly provide information whether SARFAESI Act 13 (2) severed to Pothys Colour chemicals credit sanction advice address and all partners and Guarantors addresses.

(xiii) IOB, Ramalinga Nager Branch , Coimbatore 641011 issued SARFAESI Act 13 (2) notices on 10.08.2012, against Pothys Colour chemicals. Based on the SARFAESI Act 13 (2) notice IOB Ramalinga Nager Branch, Coimbatore 641011 taken possession of the securities and given paper advertisement for E-AUCTION CUM SALE NOTICE UNDER SARFAESI ACT, 2002 under SARFAESI Act. Kindly provide information about the exact insured, Hypothecated stocks including margin stocks taken possession by IOB, Ramalinga Nager Branch, Coimbatore 641011 and exact value stock insurance covered during period.

(xiv) IOB, Ramalinga Nager Branch, Coimbatore 641011 issued SARFAESI Act 13 (2) notices on 10.08.2012, against Pothys Colour chemicals. Based on the SARFAESI Act 13 (2) notice IOB Ramalinga Nager Branch, Coimbatore 641011 taken possession of the securities (including stocks) and given paper advertisement for E-AUCTION CUM SALE NOTICE UNDER SARFAESI ACT, 2002 under SARFAESI Act. Insured and hypothecated stocks taken possession Kindly provide information whether IOB liquidated entire possession taken stocks and exact amount adjusted against the Pothys Colour chemicals Outstanding loan amount.

(xv) IOB, Ramalinga Nager Branch, Coimbatore 641011 during Pothys Colour chemicals, NPA recovery process under SARFAESI Act 13(2) and 13(4) & paper advertisement for E-AUCTION CUM SALE NOTICE UNDER SARFAESI ACT, 2002. kindly provide me information whether entire insured, hypothecated stocks including margin taken possession and advice exact quantity including margin stocks.

(xvi) Kindly provide me information, any shortage, during possession of insured, hypothecated stocks including margin stocks during SARFAESI Act recovery process from Pothys Colour chemicalsby IOB Ramalinga Nager Branch, Coimbatore 641011 or any insurance claim done by IOB. (xvii) IOB, Ramalinga Nager Branch, Coimbatore 641011 had given credit sanction advice to Pothys Colour chemicals with terms and conditions. As per credit sanction advice terms and conditions insurance cover by IOB through agency for Rs 1,40,00,000 (one crore and forty lakhs) for the period of 2009-10 and 2010-11 but suddenly reduced to RS 76,00,000 (seventy six lakhs) for the period of 2011-12 and subsequent years. Kindly provide information to the following points

a) Kindly provide information any change in CC limit during the change of insurance coverage period 2010-11 and 2011-12 of Pothys Colour chemicals.

b) Kindly provide information any change in DP limit during the change of insurance coverage period 2010-11 and 2011-12 of Pothys Colour chemicals.

c) Kindly provide information any change in Stocks positions and godown during the change of insurance coverage period 2010-11 and 2011-12 of Pothys Colour chemicals.

d) Kindly provide information all the stocks statements (godown) received on time by IOB during the change of insurance coverage period 2010-11, 2011-12 and 2012-13 of Pothys Colour chemicals.

(xviii) Kindly provide information IOB,Ramalinga Nager Branch , Coimbatore 641011 properly analysis the stocks statements (Godown) before release of every month DP (CC) Limit and interests charged (normal and OD on DP limit) as per credit sanction advice terms and conditions of Pothys Colour chemicals.

(xix) IOB, Ramalinga Nager Branch, Coimbatore 641011 sanctioned and allowed to operate the Pothys Colour chemicals CC account by the Principal Borrower Mr.V.Sundararajan., .Based on the stock statements and reports, allowed him to operate the CC account (DP limit). Kindly provide information the submitted stock statements shown the imported and ingenious stocks separately in all stock statements. (xx) Based on the stock statements and reports submitted by Mr.V.Sundararajan, IOB allowed him to operate the Pothys colour chemicals CC account ( DP limit).kindly provide information whether. IOB, Ramalinga Nager Branch, Coimbatore 641011, properly inspected the actual stocks and properly verified the actual sales, purchase and actual bank financial statements and reports as per credit sanction terms and conditions before release of (CC limit) DP limit for account operations every month.

(xxi) Based on the stock statements and reports submitted by Mr.V.Sundararajan, IOB allowed him to operate the Pothys colour chemicals CC account (DP limit). Kindly provide information whether. IOB, Ramalinga Nager Branch, Coimbatore 641011 verified stocks statements and reports in the following areas

a) From the date of sanction (7.10.2009) the CC limit till 31 march 2010 ( year 2009- 10), the outstanding shown as ZERO in the stock statement during the period ie., all the sales during the period are cash sales , kindly provide information whether IOB properly verified actual stocks, Sales, Purchase. and Cash flow Bank statement during inspection and release of CC (DP) limit every month during 2009-10 financial year

b) From the date of sanction ( 7.10.2009) of CC limit till 31 march 2010 .,the outstanding is ZERO shown in the stock statements during the period whether IOB charged any interest for exceeding DP limit during period (year 2009-10 financial year)

c) In the 26 Oct 2009 stock statement shows the stock as Rs 55,86,900 but there is no purchase shown in month statement whether IOB verified stocks and purchase before release of the CC limit (DP Limit) or verified during monthly inspection provide the information

d) From the date of sanction ( 7.10.2009) the CC limit till 31 march 2010 during the period cash withdrawal from CC account Rs 16.60.050 kindly provide information whether IOB verified the purchase, and stock statements properly for the accountability of the amount withdrawn from the CC limit as per credit sanction advice terms and conditions

e) From the date of sanction ( 7.10.2009) the CC limit till 31 march 2010 (year 2009- 10).Rs 51,01,359 funds diverted to other than business activities, kindly provide information whether JOB taken any action for violation of the Credit sanction advice terms and condition or action taken during monthly inspection please provide right information of the action

f) From the date of sanction (7.10.2009) the CC limit till 31 march 2010 (year 2009- 10).Rs 51,01,359 funds diverted to other than business activities kindly provide information whether IOB verified the purchase , sales and stock statements properly for the amount released from the CC limit

g) From 1 April 2010 to 31 December 2010, the outstanding is ZERO shown in the stock statements during the period whether IOB charged any interest for exceeding DP limit during period

h) From l April 2010 to 31 December 2010, the outstanding is ZERO shown in the stock statements during the period ie., all the sales during the period are cash sales, kindly provide information whether IOB properly verified actual stocks, Sales, Purchase. And Cash flow Bank statement during inspection and release of CC (DP) limit every month ) From l April 2010 to 31 December 2010, the outstanding is ZERO shown in the stock statements and total sales shown during the period as Rs 1,48,11,200 but cash received during period in the bank CC account was Rs 41.93.040 only kindly provide information the entire cash sales not reflected in the IOB bank statement whether JOB taken action against Principal borrower or any action by the bank kindly provide the copy of the action.

j) From l April 2010 to 31 December 2010 during the period Rs 59,45,085 funds diverted to other than business activities , kindly provide information whether IOB taken any action for violation of the Credit sanction advice terms and condition please provide copies of the action

k) From l April 2010 to 31 December 2010 during the period Rs 59,45,085 funds diverted to other than business activities , kindly provide information whether IOB verified the purchase , sales and stock statements properly for the amount released from the CC limit or verified by IOB officials during monthly inspection

1) From 1 April 2010 to 31 December 2010 during the period cash withdrawal from CC account Rs 31,42,550 kindly provide information whether IOB verified the purchase , and stock statements properly for the accountability of the amount withdrawn from the CC limit

m) From 1 April 2010 to 31 December 2010, the outstanding ZERO shown in the stock statements and total sales shown during the period as Rs 1,48,11,200 but cash received during period in the bank CC account was Rs 41.93.040, cash withdrawn during the same period from the bank CC account was Rs 31,42,550 net reflection of cash received in the bank cc account only Rs 10,50,490 against the total sale during the period Rs 1,48,11,200. Kindly provide information whether IOB credit sanction terms & conditions properly followed and other banking norms and procedures properly followed by IOB , Ramalinganagar branch , Coimbatore -641011 or verified by IOB officials during monthly inspection, provide right information

n) From 1 April 2010 to 31 December 2010, the outstanding shown ZERO in the stock statements and total sales shown during the period as Rs 1,48,11,200 but cash received during period in the bank CC account was Rs 41.93.040, cash withdrawn during the same period from the bank CC account was Rs 31,42,550 net reflection of cash received in the bank cc account only Rs 10,50,490 against the total sale during the period Rs 1,48,11,200.and other than business activity transaction Rs 59,45,085 Kindly provide information before renewal of the pothys colour chemicals account whether IOB Ramaling branch obtained clarification from the principal borrower Mr. V, Sundararajan about the divert the sales funds and violation of credit sanction conditions and terms, provide me copies

o) From 1 April 2010 to 31 December 2010, the outstanding shown ZERO in the stock statements and total sales shown during the period as Rs 1,48,11,200 but cash received during period in the bank CC account was Rs 41.93.040, cash withdrawn during the same period from the bank CC account was Rs 31,42,550 net reflection of cash received in the bank cc account only Rs 10,50,490 against the total sale during the period Rs 1,48,11,200.a.nd other than business activity transaction Rs 59,45,085 Kindly provide information before renewal of the pothys colour chemicals account whether IOB Ramaling branch obtained copies of all mandatory Income Tax returns (2009-10) and other mandatory returns and forms from the principal borrower Mr. V, Sundararajan . Kindly provide the copies of the mandatory returns

p) During operation of the pothys colour chemicals account till NPA at IOB, whether IOB Ramalinga nager Branch officials violated their credit sanction advice terms and conditions and other routine banking operations and procedures violations etc. provide right information (xxii) IOB, Ramalinga Nager Branch, Coimbatore 641011 issued SARFAESI Act 13(2) notice on 10.08.12 against Pothys Colour chemicals and further initiated taking possession of securities (including stocks and collaterals) meanwhile IOB, Ramalinga Nager Branch, Coimbatore 641011 renewed the insurance policy for the stocks and collaterals for the period 29.10.12 to 28.10.13 and premium deducted from Pothys Colour chemicals, Non Performing Account (NPA) on 10.10.2012. kindly provide me the following information

a) Exact date of insurance officials and IOB officials inspected the NPA stocks in Godown before renewal

b) Exact details of the materials & quantity inspected and covered insurance by the insurance inspection officials and IOB officials at Pothys Colour chemicals Godown

c) Exact value of the stocks including margin stocks available on the renewal day at Pothys Colour chemicals Godown

d) Exact address of the Pothys Colour chemicals insurance covered Godown during the period 29.10.12 to 28.10.13 and previous years.

e) Exact value of the stock insurance covered for Pothys Colour chemicals by IOB during the period 29.10.12 to 28.10.13 and previous years.

f) The insurance covered for the entire CC (DP)limit value of Pothys colour chemicals during the renewal period 29.10.12 to 28.10.13 of NPA (xxiii) Pothys Colour chemicals Principal borrower Mr. V. Sundararajan net worth increased from 86.14 lakhs to 643.37 lakhs with in one (year) renewal period (refer your credit sanction advice period 2009 and late renewal 2010). kindly provide information whether IOB Ramalinga Nagar Branch, Coimbatore 641011 had taken any action against his extraordinary net worth during recovery process of the Pothys Colour chemicals loan account before sale or assignment of account to ARCIL (xxiv) Principal borrower Mr. V. Sundararajan of Pothys Colour chemicals net worth suddenly increased approximately 746% within a year (renewal) kindly provide information IOB had updated their records after obtained proper documents from Mr. V. Sundararajan and other partner & Guarantors of Pothys Colour chemicals (xxv) Extraordinary (net worth) financial change of Mr. Mr.V.Sundararajan, Principal borrower of Pothys Colour chemicals should be informed to the all the Guarantors of Pothys Colour chemicalsas per IOB's Code of bank's commitment to customers, (BCSBI), kindly provide copy of the financial change correspondences send by IOB Ramalinga Nager Branch , Coimbatore 641011 to all Guarantors of Pothys Colour chemicals before sale or assign to ARC.

(xxvi) Kindly provide information any action taken by IOB, Ramalinga Nager Branch , Coimbatore 641011 for shortage of insured , Hypothecated stocks against Principal borrower or criminal procedures followed or any insurance claim during SARFAESI Act recovery action of Pothys Colour chemicals (xxvii) Kindly provide me as Per SARFAESI Act 2002, the exact date and copy of SARFAESI Act notices severed to all partners and Guarantors of Pothys Colour chemicals and Pothys Colour chemicals company address before sale or assign the account to ARC (ARCIL) (xxviii) As Per SARFAESI Act 2002,Exact date and copy of sale or assignment to ARCIL information send to all partners and Guarantors of Pothys Colour chemicals under SARFAESI Act 2002, kindly provide the copy of the information send to all partners and Guarantors of Pothys Colour chemicals under SARFAESI Act 2002, it will enable them to negotiate with ARCIL for settlement or restructure or refinancing as per RBI regulations (kindly note till date ARCIL not send any communication to all Partners and Guarantors of Pothys Colour chemicals and Pothys Colour chemicals company address about settlement or restructure or refinancing as per RBI regulations) (xxix) Kindly provide information type of asset declared the pothys colour chemicals account by IOB, Before sale or assign the pothys colour chemicals to ARC (xxx) As Per SARFAESI Act 2002, forced sale value of the collaterals plus Under SARFAESI Act possession taken insured, hypothecated Stocks value (including margin stocks ) is very higher side than the outstanding dues to the bank by Pothys colour chemicals. Kindly provide information whether IOB, Ramalinga nager Branch properly followed SARFAESI Act recovery procedures.

(xxxi) Under SARFAESI Act 2002„ forced sale value the Pothys Colour chemicals collaterals is Rs 311 lakhs plus under SARFAESI Act possession taken insured , hypothecated stocks approximate value Rs 125 lakhs including margin stocks. Kindly provide information whether to hide the IOB's procedure and documents verification lapse, sold or assign the pothys colour chemicals account at very low price to ARC and making loss to IOB (public money) (xxxii) Sale or assign the pothys colour chemicals account to ARC, kindly provide information whether 10B received higher amount recovery than the OTS proposals received (xxxiii) Kindly provide information exact amount IOB incurred loss. by assign or sale of Pothys colour chemicals account to ARC (xxxiv) IOB to hide their procedure & documents verification lapses and credit sanction advice terms and conditions violations etc simply send a RTI reply to Partner and Guarantor stating that you're asking details about third party account and reluctant to provide Right information, Kindly provide information whether Partner or Guarantor having right to collect information under RTI Act about his/her CC account where public money involved.

(xxxv) Kindly provide information IOB Ramalinga Nager branch properly replied to the letters received from partner & Guarantor of Pothys colour chemicals about clarification, request for copies of documents, procedure & documents verification lapses, complaints etc on time and provide me the copies of the reply correspondences from IOB (xxxvi) I had written many complaints letters about Pothys Colour chemicals CC account procedure lapses, document verification lapses and other lapses to various compliant & Grievances authorities of IOB, from Authorized officer, IOB Ramalinga nager Branch, IOB-CRM, Coimbatore., IOB's Chief Customer service officer(CCSO), IOB's Ombudsman, IOB's General Manager-customer services, IOB's Regional Nodal officer for Grievance Redressal Coimbatore, IOB's Transparency officer., IOB's Board level committee to monitor recovery in NPA - Member, IOB's Customer service committee (CSC) - Chairman etc. ,during year 2012 to 2016 Kindly provide Right information whether IOB really processing the complaints and Grievances procedures. If so kindly provide the copies of the replies send to my complaints.

2. Succinctly facts of the case are that the appellant filed an application dated 01.07.2017 under the Right to Information Act, 2005 (RTI Act) before the Central Public Information Officer (CPIO), Indian Overseas Bank, Law Department Regional Office, Coimbatore, seeking the aforesaid information. The CPIO replied on 14.07.2017. Dissatisfied, the appellant filed first appeal dated 15.08.2017. The First Appellate Authority disposed of the first appeal vide order dated 08.09.2017. Aggrieved by this, the appellant has filed a second appeal dated 01.10.2017 before this Commission which is under consideration.

3. The appellant has filed the instant appeal dated 01.10.2017 inter alia on the grounds that the CPIO did not provide the requisite information and the CPIO is incorrect to state that an applicant may not ask questions about the nature and quality of actions of authorities.

4. The CPIO replied that the information sought by the appellant is voluminous in nature and culling out the same would disproportionately divert the resources of the public authority which is exempted under section 7 (9) of the RTI Act. Further, he stated that the appellant filed innumerable RTI applications raising queries in nature of clarification/explanation the disclosure of which would not serve any public interest. The FAA further gave point-wise information denying most of the information under section 8 (1) (d) and (e) of RTI Act.

5. The appellant and respondent represented by Mr. S.S. Venkatakrishnan, Regional Manager, Indian Overseas Bank, Coimbatore, attended the hearing through Video Conferencing.

5.1. The appellant submitted that he is a guarantor for the company Pothys Colour Chemicals and he has sought information relating to that company. Therefore, the respondent had wrongly denied him the information 5.2. The respondent submitted that the records sought by the appellant had been submitted to Asset Reconstruction Company and therefore they could not furnish the information. The respondent also referred to earlier decision of CIC dated 14.03.2017 in CIC/SH/A/2016/000797 in which the subject-matter of the instant appeal was covered.

6. The Commission after adverting to the facts and circumstances of the case, hearing the respondent and perusal of records, feels that the respondent has referred to CIC decisions on the same subject-matter. The instant appeal has multiple issues and due to paucity of time the parties could not conclude their submissions. In view of this, the matter is adjourned to 07.05.2019.

Copy of the decision be provided free of cost to the parties.

Sd/-

(Suresh Chandra) (सुरेश चं ा) Information Commissioner (सूचना आयु ) दनांक/Date: 04.04.2019

Unlock Advanced Research with PRISMAI

Central Information Commission