State Consumer Disputes Redressal Commission
Abdul Sattar vs State Bank Of Patiala on 21 January, 2015
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, DAKSHIN MARG, SECTOR 37-A, CHANDIGARH.
First Appeal No.1535 of 2014
Date of institution : 25.11.2014
Date of decision : 21.01.2015
Abdul Sattar son of late Khushi Mohammad, resident of Mohalla
Hazanwala, Jarg Road, Malerkotla, District Sangrur.
.......Appellant/Complainant
Versus
1. State Bank of Patiala through its Branch Manager, Main
Branch, Talab Bazar, Near Hanuman Mandir, Malerkotla,
District Sangrur.
2. SBI Life Insurance Company Limited through its Branch
Manager, 1st Floor, Improvement Trust Complex, Near SBOP
(ADB) Branch, Near Truck Union Malerkotla, District Sangrur.
........Respondents/Opposite Parties
First Appeal against the order dated
14.10.2014 of the District Consumer
Disputes Redressal Forum, Sangrur.
Quorum:-
Hon'ble Mr. Justice Gurdev Singh, President.
Mrs. Surinder Pal Kaur, Member.
Present:-
For the appellant : Shri A.K. Garg, Advocate.
JUSTICE GURDEV SINGH, PRESIDENT :
This appeal has been preferred by the appellant/complainant, Abdul Sattar, against the order dated 14.10.2014 passed by District Consumer Disputes Redressal Forum, Sangrur (in short, "District Forum"), vide which the complaint filed by him under Section 12 of the Consumer Protection Act, 1986 (in short, "the Act"), for directing First Appeal No. 1535 of 2014. 2 the respondents/opposite parties to close his loan account, to issue NOC, to return the original sale deed and documents relating to his father's property; to pay Rs.75,000/-, on account of mental agony and physical harassment; and Rs.11,000/-, as litigation expenses, was dismissed.
2. The complainant alleged, in his complaint, that he himself and his father applied for home loan to opposite party No.1 on 7.5.2004 and a sum of Rs.1,20,000/- was credited in their loan account after his father handed over the original sale deed and the other documents to the officers of opposite party No.1 as security. At the time of the disbursement of the loan amount, this opposite party without their consent and knowledge detected Rs.17,533/- from the loan amount and issued the demand draft of that amount in favour of opposite party No.2, by telling his father that in case of any mishappening, opposite party No.2-Insurance Company shall pay the entire loan amount, along with interest. His father had been repaying the loan amount by way of regular monthly instalments and died on 11.10.2009. Information regarding his death was given to opposite party No.1 and death certificate was also sent to it with the request to recover the outstanding loan amount from opposite party No.2 and to return the original sale deed and documents and issue the certificate in his favour but it failed to do so.
3. The complaint was contested by the opposite parties, who filed independent written replies. Opposite party No.1 in its written reply admitted that the complainant and his father had applied for the house loan and loan account was opened in their names after they First Appeal No. 1535 of 2014. 3 deposited the original sale deed and executed various loan documents. It also admitted that the information regarding the death of his father was given by the complainant. While denying the other allegations made in the complaint, it pleaded that it was on the request of the borrowers dated 8.5.2004 that the said amount of Rs.17,533/- was deducted from their loan account and was remitted to opposite party No.2 for covering them under SBI Life Super Surakhsha Plan. The complainant committed breach of the terms and conditions of the Loan Agreement and became a defaulter. He failed to pay the instalments, as agreed by him and his father and their loan account was declared as NPA on 22.7.2008. The proceedings have already been started under the Securitization and Reconstruction of Financial Assets Enforcement of Security Interest Act, 2002 (in short, "SARFAESI Act") on 18.11.2008 and, as such, the District Forum has no jurisdiction to entertain the complaint and the same is barred under Section 34 of that Act. It had written letter to opposite party No.2 on 7.11.2009 for remitting the insurance amount for crediting the same in the account of the borrowers. That opposite party informed it, vide letter dated 27.11.2009, that it has not been able to find any record coverage of the loan account of the borrowers and later on it was found that the draft had been lost by that opposite party. Thereafter it credited the sum of Rs.17,533/- in the account of the borrowers on 15.4.2011. It also pleaded that the complainant does not fall under the definition of 'consumer' and the complaint filed by him is barred by time. The complaint is not maintainable in the present form. No cause of action has accrued to First Appeal No. 1535 of 2014. 4 the complainant to file the same and he is not entitled to the sale deed without the clearance of the loan amount nor he is entitled to any such 'No Due Certificate'. It prayed for the dismissal of the complaint with costs.
4. Opposite party No.2 in its written reply gave reply to only those allegations, which have been made against it in the complaint. It averred that it had not received any premium or proposal for the grant of insurance cover on the life of the father of the complainant and, as such, no Certificate of Insurance was issued in his name. In the absence of such insurance cover, it was not liable to pay the entire loan amount or other insurance benefits either to the complainant or towards the clearance of the housing loan. It is a different legal entity and is not responsible for the acts of omission and commission on the part of opposite party No.1. It was not a privy to what transpired between the complainant and that opposite party. There was no contractual relationship with the father of the complainant. The granting of the loan and the issuance of insurance policies are two different businesses regulated and governed by different statutes and regulations. There was no unfair trade practice, negligence or deficiency in service on its part. There was no relationship of customer and service provider between it and the complainant or his father. The complainant has no locus-standi to file this complaint against it. It prayed for the dismissal of the complaint with costs.
5. Both the sides produced evidence in support of their respective averments before the District Forum, which after going through the First Appeal No. 1535 of 2014. 5 same and hearing learned counsel on their behalf dismissed the complaint, vide aforesaid order.
6. We have heard the learned counsel for the appellant/complainant and have carefully gone through the records of the District Forum, which were called at the time of admission of the appeal.
7. It has been submitted by the learned counsel for the complainant that it has been wrongly held by the District Forum that it has no jurisdiction to entertain and try the complaint. It failed to take cognizance of the fact that the sum of Rs.17,533/- was deducted from the loan account of the complainant and his father and was remitted to opposite party No.2 for covering them under the insurance policy and after that premium amount was so deducted and paid to opposite party, the outstanding loan amount was to be paid by opposite party No.2. Even if the story of opposite party No.1 is believed that the demand draft sent to that opposite party was lost, even then by virtue of the ratio of the judgment reported in 2013(3) PLR 393 (Archana Sharma v. Union of India) that opposite party was bound to pay the outstanding loan amount and, as such, the proceedings could not have been started by opposite party No.1 under the SARFAESI Act. Thus, there is sufficient ground for admitting the appeal to be heard on merits.
8. From the documents placed before the District Forum and the contentions made by opposite party No.1 in the written reply and the application given by it before the District Forum for the dismissal of the complaint itself, it becomes very much clear that the proceedings First Appeal No. 1535 of 2014. 6 had already been initiated in respect of the transaction of the loan in dispute under Section 13(2) of the SARFAESI Act. In the application so filed by opposite party No.1, it was stated that the only remedy of the complainant is to file an appeal before the Debt Recovery Tribunal. The question as to whether proceedings can be initiated under the Act once the provisions of the SARFAESI Act have been invoked by the Bank was never considered in the judgment so relied upon by the learned counsel for the appellant. It was the writ jurisdiction of the Hon'ble High Court, which was invoked for challenging the possession notice served by the Bank. The matter is no more res integra. It was held by the Hon'ble National Commission in 2013(1) CLT 531 (Shiv Shankar Lal Gupta v. Kotak Mahindra Bank Ltd. & others) that where case is pending against the complainant under the SARFAESI Act, the law puts a crimp in invoking the jurisdiction of Consumer Commission. While interpreting Section 34 of that Act, which bars the jurisdiction of the Civil Court to entertain any suit or proceeding in respect of any matter, which a Debt Recovery Tribunal or the Appellant Tribunal is empowered by the Act to determine, it was held that the Civil Court mentioned in that Section also includes the Tribunals and the Commissions dealing with the civil matters. The District Forum while recording a finding against the complainant also relied upon the judgment of the Haryana State Commission rendered in 2014 CPJ 225 (Canara Bank v. Bhagwati Electronics) wherein it has been held that where the proceedings have been initiated against the complainant under the SARFAESI Act for recovery of the loan First Appeal No. 1535 of 2014. 7 amount, the same cannot be challenged before the Consumer Forum and the remedy only lies before the Debt Recovery Tribunal by way of an appeal. It was rightly concluded by the District Forum that it had no jurisdiction to entertain the complaint once the recovery proceedings have been started by the Bank under the SARFAESI Act. We do not find any illegality in that finding and, as such, we do not find any ground for admitting this appeal to be heard on merits and the same is dismissed in limine.
(JUSTICE GURDEV SINGH)
PRESIDENT
(MRS. SURINDER PAL KAUR)
January 21, 2015 MEMBER
Bansal