State Consumer Disputes Redressal Commission
State Bank Of India. vs Smt. Sushma Kansal. & Ors. on 11 March, 2020
H. P. STATE CONSUMER DISPUTES REDRESSAL
COMMISSION SHIMLA
First Appeal No. : 260/2018
Date of Presentation : 24.09.2018
Order Reserved on : 28.08.2019
Date of Order : 11.03.2020
......
State Bank of India near M.C. Office Rajgarh Road Solan Tehsil
and District Solan H.P. through its Chief Manager.
...... Appellant/Opposite Party No.4
Versus
1. Sushma Kansal wife of Sh. Jogwinder Pal Kansal R/o Kansal
Niwas House No.10 Ward No.10 near Nanak Villa Tank
Road Solan Tehsil & District Solan (H.P).
......Respondent No.1/Complainant
2. Government of India Prima Minister Office through
Secretary PMO South Block Raisina Hills New Delhi-110011.
......Respondent No.2/opposite party No.1
3. Government of India Ministry of Finance through Secretary
Finance New Delhi-110011 (Deleted vide order dated
27.06.2018).
......Respondent No.3/opposite party No.2
4. Reserve Bank of India Government of India through its
Governor Shahid Bhagat Singh Marg Fort Mumbai-400001.
......Respondent No.4/opposite party No.3
Coram
Hon'ble Justice P.S. Rana (R) President
Hon'ble Ms. Sunita Sharma Member
Hon'ble Mr. R.K. Verma
Whether approved for reporting?1 Yes.
For Appellant : Mr. Arvind Sharma Advocate.
For RespondentNo.1 : Ex-parte.
For Respondents No.2&3 : Mr. Jagjeet S. Bagga Advocate.
For Respondent No.4 : Mr. Vijay Pal Singh Gill Authorised
person.
1
Whether reporters of the local papers may be allowed to see the order? Yes.
State Bank of India Versus Sushma Kansal & Ors.
F.A. No.260/2018
JUSTICE P.S. RANA (R) PRESIDENT:
O R D E R :-
1. Present appeal is filed against order dated 25.08.2018 passed by Learned District Consumer Forum/ Commission in consumer complaint No.141/2017 titled Sushma Kansal Versus Government of India & Ors. Brief facts of consumer complaint:
2. Complainant Smt. Sushma Kansal filed consumer complaint under Consumer Protection Act pleaded therein that complainant purchased Sovereign Gold Bond from opposite party No.4 for consideration amount of Rs.203067/-
(Two lac three thousand sixty seven) on dated 17.03.2017. It is pleaded that on dated 25.10.2017 complainant was in dire need of money for payment of fees of her son. It is pleaded that complainant demanded loan from State Bank of India Solan Branch but SBI Solan branch refused to grant loan. It is further pleaded that State Bank of India Solan Branch committed deficiency in service by way of not sanctioning loan amount despite the fact that Sovereign Gold Bond to the tune of Rs.203067/-(Two lac three thousand sixty seven) stood deposited in branch of State Bank of India Solan (H.P). It is pleaded that opposite party No.4 committed deficiency in service.
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State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018
3. Complainant sought relief to the effect that opposite parties be directed to refund value of Sovereign Gold Bond of Rs.203067/-(Two lac three thousand sixty seven) to complainant alongwith interest @ 12% per annum from receipt of amount till actual payment. In addition complainant sought relief for compensation to the tune of Rs.100000/-(One lac) for mental torture and harassment. In addition complainant sought payment of Rs.11000/-(Eleven thousand) as fee of legal notice. In addition complainant sought relief of payment of Rs.25000/-(Twenty five thousand) as litigation costs. Prayer for acceptance of consumer complaint sought.
4. None appeared on behalf of opposite party No.1 and opposite party No.1 was proceeded ex-parte by learned DCF/DCC. Name of opposite party No.2 was deleted by learned DCF/DCC vide interim order dated 27.06.2018. Name of opposite party No.2 was deleted as per application filed by complainant for deletion of name of opposite party No.2 from memo of parties.
5. Per contra version filed on behalf of opposite party No.3 pleaded therein that complainant is not consumer because whether loan should be sanctioned or not is prerogative of loaner. It is pleaded that complainant has no legal right for grant of loan. It is pleaded that RBI exercises 3 State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018 powers and discharges its Statutory functions under Reserve Bank of India Act 1934 Banking Regulation Act 1949. It is further pleaded that RBI does not render any service to consumer. It is pleaded that Sovereign Gold Bond could be used as collateral security for loan amount. It is further pleaded that Sovereign Gold Bond in question were invested by complainant in account maintained by opposite party No.4. It is pleaded that opposite party No.3 did not commit any deficiency in service. Prayer for dismissal of consumer complaint against opposite party No.3 sought.
6. Per contra separate version filed on behalf of opposite party No.4 pleaded therein that there was no privity of contract between complainant and opposite party No.4 to treat Sovereign Gold Bond as security for grant of loan. It is pleaded that opposite party No.4 is bank created under Statute and could not act on the basis of any advertisement. It is further pleaded that there is no recital in Sovereign Gold Bond that opposite party No.4 was under legal obligation to grant loan. It is pleaded that there was no privity of contract to grant loan against Sovereign Gold Bond between complainant and opposite party No.4. It is pleaded that opposite party No.4 did not commit any deficiency in service. Prayer for dismissal of consumer complaint against opposite party No.4 sought.
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State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018
7. Complainant filed rejoinder and reasserted allegations mentioned in consumer complaint. Learned District Consumer Forum/Commission dismissed consumer complaint against opposite parties No.1 to 3. Learned DCF/DCC ordered opposite party No.4 to pay Rs.25000/-(Twenty five thousand) as compensation for committing deficiency in service by way of not providing loan to complainant against Sovereign Gold Bond. Learned DCF/DCC further ordered opposite party No.4 to pay litigation costs to the tune of Rs.5000/-(Five thousand) within 30 days from receipt of copy of order. Feeling aggrieved against order passed by Learned DCF/DCC State Bank of India filed present appeal before State Commission.
8. None appeared on behalf of co-respondent No.1 before State Commission. Co-respondent No.1 was proceeded ex-parte by State Commission on dated 12.11.2018. We have heard learned Advocates appearing on behalf of appellant and co-respondents No.2 & 3 and authorised person of co- respondent No.4 and we have also perused entire record carefully.
9. Following points arise for determination in present appeal.
1. Whether appeal filed by State Bank of India is liable to be accepted as mentioned in memorandum of grounds of appeal and whether loan should be sanctioned or not is prerogative of loaner and whether opinion of SBI that complainant was ineligible for sanction of loan could be questioned before Consumer Authority? 5 State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018
2. Final order.
Findings upon point No.1 with reasons:
10. Complainant filed affidavit in evidence. There is recital in affidavit that deponent purchased Sovereign Gold Bond to the tune of Rs.203067/-(Two lac three thousand sixty seven) from opposite party No.4 and Sovereign Gold Bond certificate dated 17.03.2017 was also issued by opposite party No.4 in favour of deponent. There is recital in affidavit that on dated 25.10.2017 deponent was in dire need of money for payment of fees of her son and deponent approached opposite party No.4 for grant of loan to the value of Sovereign Gold Bond. There is recital in affidavit that SBI refused to sanction loan. There is recital in affidavit that deponent also issued legal notice but despite legal notice SBI did not sanction loan and committed deficiency in service. State Commission has carefully perused all the annexures filed by complainant.
11. Sh. Ravi Rawal filed affidavit on behalf of opposite party No.3. There is recital in affidavit that deponent is working as Assistant General Manager posted in RBI at Shimla (H.P). There is recital in affidavit that complainant did not purchased Sovereign Gold Bond from RBI at any point of time. There is recital in affidavit that complainant did not pay any consideration amount to RBI at any point of time. There is recital in affidavit that complainant does not fall within 6 State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018
definition of consumer qua RBI. State Commission has carefully perused all annexures filed by RBI.
12. Shri Rajesh Gupta Chief Manager SBI Solan Branch (H.P) filed affidavit in evidence. There is recital in affidavit that loan scheme against Sovereign Gold Bond has been introduced and implemented by SBI in all branches w.e.f. 01.06.2018. There is recital in affidavit that in the event of granting loan against Sovereign Gold Bond bank is under legal obligation to formulate following policies : (1) Procedure and proforma agreement for loan (2) Policy for recovery of loan (3) Policy for creating charge on such security document (4) Time frame in which the amount shall be repaid. There is recital in affidavit that loan could not be sanctioned in the absence of completion of above formalities cited supra as public money is involved. There is recital in affidavit that on dated 09.10.2017 procedure and regulations for grant of loan did not exist. There is recital in affidavit that prior to 01.06.2018 there was no scheme to grant loan against Sovereign Gold Bond. There is recital in affidavit that complainant has purchased Sovereign Gold Bond on dated 17.03.2017 and there is no agreement between complainant and SBI to treat Sovereign Gold Bond as security for loan. There is recital in affidavit that SBI had no intention to harm and harass complainant at any point of time. There is recital 7 State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018 in affidavit that SBI is statutory bank created under specific Stature. State Commission has carefully perused all annexures filed by SBI.
13. Submission of learned Advocate appearing on behalf of SBI that loanee could not claim loan as of legal right and it is discretion of loaner to sanctioned loan or not is decided accordingly. State Commission is of the opinion that whether loan should be sanctioned or not is prerogative of loaner bank. State Bank of India has specifically stated that complainant was ineligible for sanction of loan. It is held that opinion of SBI that complainant was ineligible for loan could not be questioned before Consumer Authority. See 2019(I) CPJ 7A (CN) (UP) titled SBI Versus Umesh Singh. See 1995(3) CPR 228 SCDRC Kerala titled Kerala Financial Corporation Versus P.M. Rajeev. See 2003(IV) CPJ 88 NC titled Madhya Pradesh Financial Corporation Versus Raju Lal Tamrakar.
14. State Commission has also carefully perused Sovereign Gold Bond Annexure-C2 placed on record. Sovereign Gold Bond scheme 2016-17 is quoted in toto :-
Government of India SOVEREIGN GOLD BONDS SCHME 2016-17 Certificate No.SGB000001014503569 - 1014503637 (Investor ID: 201700093799) Issue date 17-Mar-2017 Certified that Sushma Kansal is the registered holder of 69 units of Sovereign Gold Bonds 2016-17. The Sovereign Gold Bond will bear interest 2.5 percent per annum on initial 8 State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018 investment of Rs.203067.00 payable at half yearly intervals on 17-Mar and 17-Sep every year. The bonds are redeemable on 17-Mar-2025 with the opinion of early redemption from fifth year on interest payment dates.
Application Receiving Office.
SOVEREIGN GOLD BONDS Stamp of issuing office.
15. State Commission is of the opinion that there is no privity of contract between complainant and SBI to treat Sovereign Gold Bond as security for loan amount. As per scheme bank was under legal obligation to execute following documents (1) Procedure and proforma agreement for loan (2) Policy for recovery of loan (3) Policy for creating charge on such security document (4) Time frame in which the amount shall be repaid. No proforma agreement for loan executed inter se parties in the present matter as required under the scheme notified by Central Govt. of India. Central Govt. of India has issued notification on dated 23.02.2017 Annexure- OP3 placed on record. Clause-13 of scheme deals with loan against Sovereign Gold Bond. Clause -13 of scheme is quoted in toto :-
Clause- 13. Loan against Bonds:
(i) The Gold bonds under this Scheme may be used as collateral security for any loan.
(ii). The Loan to Value ratio as applicable to any ordinary gold loan mandated by the Reserve Bank of India shall also apply to the Gold Bond under this Scheme.9
State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018
(iii). The lien on the bond shall be marked in the depository by the authorized banks.
16. State Commission is of the opinion that word "May" used in Clause-13 of Sovereign Gold Bond Scheme 2016-17 is discretionary in nature and not mandatory in nature. State Commission is of the opinion that SBI has discretion to use Sovereign Gold Bond as collateral security for any loan or not. In the present matter SBI has exercised discretion and did not use Sovereign Gold Bond as collateral security for loan. In view of fact that discretion entirely lies with SBI in view of word "May" in the scheme which is optional in nature and not mandatory in nature. State Commission is of the opinion that SBI has not committed any deficiency in present matter.
17. Submission of learned Advocate appearing on behalf of SBI that order of learned DCF/DCC wherein learned DCF/DCC ordered SBI to pay compensation to the tune of Rs.25000/-(Twenty five thousand) warrants interference by State Commission is decided accordingly. In view of word "May" used in Clause-13 of Sovereign Gold Bond Scheme 2016-17 issued by Central Govt. of India State Commission is of the opinion that order of learned DCF/DCC relating to compensation warrants interference by State Commission. 10
State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018
18. Submission of learned Advocate appearing on behalf of SBI that order of learned DCF/DCC wherein learned DCF/DCC imposed costs to the tune of Rs.5000/-(Five thousand) upon SBI also warrants interference by State Commission is decided accordingly. State Commission is of the opinion that order of learned DCF/DCC relating to costs also warrants interference in view of fact that in Clause-13 of Sovereign Gold Bond Scheme 2016-17 which deals with loan against Sovereign Gold Bond scheme 2016-17 word "May" has been written in positive manner in the scheme which is entirely discretionary in nature and not mandatory in nature.
19. Submission of learned Advocates appearing on behalf of co-respondents No.2&3 and co-respondent No.4 that order of learned DCF/DCC is in accordance with laws and in accordance with proved facts and does not warrant any interference by State Commission is decided accordingly. State Commission is of the opinion that in view of fact that word "May" has been mentioned in Sovereign Gold Bond Scheme notified by Central Govt. of India on dated 23.02.2017 order of learned DCF/DCC warrants interference by State Commission in the ends of justice and on the principles of natural justice. In view of above stated facts point No.1 is decided accordingly.
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State Bank of India Versus Sushma Kansal & Ors. F.A. No.260/2018 Point No.2: Final Order
20. In view of findings upon point No.1 above appeal filed by SBI is allowed. Order of learned DCF/DCC announced in consumer complaint No.141/2017 dated 25.08.2018 is set aside and consumer complaint is dismissed in toto. Sovereign Gold Bond Certificate Annexure-C2 dated 17.03.2017 issued by SBI in favour of complainant and notification issued by Central Govt. of India dated 23.02.2017 Annexure-OP3 shall form part and parcel of order. Parties are left to bear their own litigation costs before State Commission.
21. Certified copy of order be sent to learned DCF/DCC for information forthwith and file of State Commission be consigned to record room after due completion forthwith. Certified copy of order be transmitted to parties forthwith free of costs strictly as per rules. Appeal is disposed of. Pending application(s) if any also disposed of.
Justice P.S. Rana (R) President Sunita Sharma Member R.K. Verma Member 11.03.2020 K.D 12