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Bank penalised for enforcing a defective Agreement and whimsically adjusting the pension amount against the loan.

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI

REVISION PETITION NO. 3797 OF 2017
(Against the Order dated 22/08/2017 in Appeal No. 907/2015 of the State Commission West Bengal)

BRANCH MANAGER, PUNJAB NATIONAL BANK
PINDRUI BRANCH, VILLAGE & POST PINDRUI, P.S. PINGLA, DISTRICT-PASCHIM MEDINIPUR
WEST BENGAL ...........Petitioner(s)
Versus
SACHINANDAN SAMANTA
S/O. LT. BHUBAN CHANDRA SAMANTA, VILLAGE SITIBINDA, P.O. SAHARDA, P.S. PINGLA, DISTRICT-PASCHIM MEDINIPUR
WEST BENGAL ...........Respondent(s)

BEFORE:
    HON'BLE MR. ANUP K THAKUR,PRESIDING MEMBER
    HON'BLE MR. C. VISWANATH,MEMBER

Dated : 18 Sep 2018

ORDER

The present Revision Petition is filed under Section 21(b) of the Consumer Protection Act, 1986 by the Petitioner against Order passed by the State Consumer Disputes Redressal Commission, Kolkata (hereinafter referred to as the “State Commission”) in Appeal No. 907/2017 dated 22.08.2017.
Brief facts of the Case are as follows:-

The Respondent/Complainant, a retired Govt. Employee had taken an over- draft (OD) loan of Rs. 1,80,000/- from the Petitioner/Opposite Party on 31.08.2006, by keeping Kisan Vikas Patras (K.V.P.) for an amount Rs. 2,00,000/- as collateral security under the limit proposal at 9.5% rate of interest. The said loan was to be liquidated after maturity of KVPs lastly on 21.01.2014. It was alleged in the Complaint that Petitioner tried to recover money from Respondent/Complainant’s pension account, although no such instruction was given to him. Petitioner has also encashed the KVP of the Respondent on 28.01.2014 and thereafter on 24.02.2014 without liquidating the loan or refunding the excess amount of Rs. 40,000 as committed earlier. It was further alleged by the Respondent that the Petitioner received Rs. 42,227/- after encashment of KVPS in an illegal manner. Thereafter, the Petitioner sent a notice on 20.08.2014 to the Respondent claiming excess amount of Rs. 2,000/- every month from the Complainant’s pension account. Upto January 2015, a total of Rs. 8,000/- has been deducted by the Petitioner Bank from the Respondent’s Pension account. Hence, Complaint was filed by the Respondent before the District Forum where he has claimed a refund of Rs. 51,000/- with a direction to the Petitioner to liquidate the loan account of the Respondent and also issue no dues certificate in his favour. Further, Respondent may be awarded Rs. 40,000/- towards damages, compensation, harassment and mental pain.

Petitioner filed his written statement in the District Forum, in which he has stated that the Respondent has no jurisdiction to file this Complaint before the District Forum. The Complaint was not maintainable and liable to be rejected. It is further stated that the Respondent was mistaken that the said loan was a demand loan. It was actually an OD loan, where balance remained even after adjustment of KVPs. Excess interest, therefore, was to be recovered from the Respondent by exercising Bank Rights and Rules. Petitioner informed the Respondent to set-off the matter lastly by sending a letter dated 20.08.2014, but the Respondent filed a case before the District Forum. District Forum, vide order dated 24.07.2015, dismissed the Complaint without cost on the ground that Respondent has failed to establish the deficiency of service on the part of Petitioner Bank.
On this, the Respondent filed an Appeal before the State Commission, against the orders passed by the District Forum. State Commission, vide order dated 22.08.2017, partly allowed the Appeal of the Respondent with cost of Rs. 2,000/- to be paid by the Petitioner. Petitioner was further directed to refund Rs. 51,000/-with a Compensation of Rs. 7,000/- for mental agony and harassment sustained by the Respondent.

Being aggrieved by the order of the State Commission, the Petitioner has filed the present Revision Petition. The grounds for filing the Revision Petition are as follows:-
• The Respondent has failed to adhere to the terms and conditions of the Agreement.
• State Commission has not considered the material available on record.
Heard the Learned Counsel for the Petitioner. According to him, the Respondent took an over-draft loan through application signed over limit proposal of Rs. 1,80,000/- with 9.5% flexible interest. He also pledged his K.V.Ps of Rs. 2 lakhs, maturing on 07.11.2013 and 21.01.2014. The Respondent had a misunderstanding that the loan taken was a demand loan, while the loan was taken by the Respondent was an over-draft loan for his business. The Respondent was reminded several times for repayment, but it went invain. Counsel for the Petitioner argued that the Bank had made the terms of loan very clear in the agreement. The Bank has no personal gain in over-charging interest and was bound by RBI guidelines.

The main dispute is regarding the calculation of interest on the overdraft-amount. The State Commission noted that different documents mention different types of calculation of interest. The limit proposal against Government Securities, mentions 9.5% with no remark as to whether it is fixed or floating. In the account statement of the Current Account, type of interest was shown as fixed. However, in the Agreement of loan it was entered as variable interest of 9.5%. The agreement was executed in a printed pro-forma in standard language, applicable to every type of loan and without a very careful reading, it skips the attention of the loanee. The Bank should have conveyed to the Respondent about the rate of interest and its type and calculation in very specific terms. Different types of interest in different documents gives ample scope for misinterpretation. The terms and conditions of the Loan Agreement ought to have also been read over and clearly explained to the Complainant.

The second major lapse on part of the Petitioner has been the adjustment of loan from the monthly pension of the Respondent. The Petitioner adjusted the loan from the Respondent’s monthly pension. This is neither fair, as the Respondent claims, nor proper. This is contrary to Section 11 of the Pension Act 1871. There have been several judgements to this effect. In Radhey Shyam Gupta Vs. Punjab National Bank (Supra), the Apex Court held that retiral benefits such as pension and gratuity, even when received by the retiree, do not lose their character and continue to be covered by proviso (g) to Sec. 60 (1) of the CPC and continue to enjoy immunity against attachment. In State of Jharkhand Vs. Jitendra Kumar Srivastava, the Apex Court reiterated that gratuity and pension are not bounties. An employee earns these benefits by dint of his long, continuous and faithful service. It is hard earned benefit which accrues to an employee and is in the nature of ‘property’. Such right to property cannot be taken away without due process of law as per the provisions of Article 300A of the Constitution of India. It was held that the attempt of the appellant State Government to take away a part of pension or gratuity or even leave encashment without any statutory provision could not be countenanced. In the unreported judgement of a Division Bench of the Kerala High Court in WA 1628 of 2014 in WP 9C) 923 of 2014 the employer Bank sought to adjust alleged dues from the deceased employee against the gratuity payable to his legal heirs.

From a perusal of the evidence, it was found limit proposal against Govt. Securities showed 9.50% rate of interest without any indication as to the type of interest. It is further found that Petitioner has taken a very incorrect step by adjusting the loan from the monthly pension of the Respondent, which was the only means of earning livelihood for him and his family
In view of the above, the present Revision Petition is dismissed and order passed by the State Commission is confirmed.

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