AI Structured Summary
Not yet generated for this judgment
Judgment
THE District Forum, Yavatmal, Maharashtra in case No 10/91 by its order of 26th August, 1992 had directed the grant of certain reliefs to the respondent-complainant which are briefly set out below: (a) That the revision petitioner-Bank should renew the FDR of the respondent-complainant from the 7th of December, 1990 for a period at the option of the respondent-complainant. (b) Rs. 22,000/- payable by the respondent-complainant under the cash credit facility should be repaid by him regularly with interest without being declared as a defaulter. (c) The amount of Rs. 20,040.32 withdrawn by the respondent-complainant from his current account with the Bank on 14.3.1991 should be treated as having been paid under the Cash Credit Scheme. (d) That the amount of Rs. 42,04232 together with the interest thereon due under the Cash Credit Scheme should be paid to the complainant. (e) The complainant should be paid Rs. 900/- as expenses for the hearings and Rs. 1000/- for mental pain and Rs. 2,000/-as compensation for total mental torture.
The State Commission by its order of 14th January, 1992 in Appeal No. 1/91 dismissed the appeal of the revision petitioner-Bank and granted Rs. 500/- as costs of appeal before the State Commission.
THE revision petitioner has assailed the orders of the District Forum and the State Commission on the ground that there has been no deficiency on its part and that the orders of the lower Forums deserve to be set aside. It has attacked the orders of the lower Forums on the following grounds: (i) The revision petitioner-Bank, at the request of the respondent-complainant, sanctioned cash credit loan facility of Rs. 30,000/- w.e.f. 9th of December, 1987. (ii) The cash credit loan was secured by the Bank by obtaining a fixed deposit of Rs. 42,000/- from the respondent-complainant and his wife on the 7th of December, 1987. (iii) Cash credit loan facility of Rs. 30,000/-was, in terms of the loan agreement, to be reviewed by the Bank after one year and as per the repayment schedule annexed to the cash credit and Hypothecation of the Amounts in the Deposit Accounts was ''Repayable on Demand''. (iv) The F.D.R. of Rs. 42,000/- on the security of which the cash credit loan facility was extended, was for a period of three years. Hence it would mature on 7th of December, 1990/-.
The revision petitioner on 30th November, 1990 informed the respondent-complainant that the cash credit Joan facility would cease on the 7th of December, 1990 and that the amount of the F.D.R.(which would mature for payment on that date) would be appropriated towards the amounts outstanding in the cash credit Joan facility in case the said account was not regularised on or before the 7th of December, 1990. (v) On the failure of the respondent-complainant to repay the outstanding loan a mount in the cash credit loan facility the revision petitioner-Bank adjusted the amount of the F.D.R. on maturity on the 7th December, 1990 thereby liquidating the cash credit loan account of the respondent-complainant.
AS per Clause 1 of the Hypothecation and Agreement of 9th December, 1987 the cash credit upto the limit of Rs. 30,000/- was granted according to the needs of the borrowers and as the bank deemed fit Further that under Clause 6 of the said Agreement in the event of failure of the borrower to comply with the Bank''s demand for repayment of the amount due under the cash credit account, the Bank was entitled to immediately adjust the amounts that may be standing to Ike credit of the party in the said deposit accounts, even though the deposits might not have matured for repayment.
IT is clear from the facts cited above that it was open to the revision petitioner-Batik not to renew the cash credit facility after a period of one yea rand to adjust the amount in the F.D.R. towards amount recoverable under the cash credit facility. The action of the Bank was strictly in accordance with the terms of the arrangement of cash credit loan facility account and no deficiency in service on the part of the revision petitioner-Bank has been established in relation to the respondent-complainant. We also fail to understand how the District Forum granted the reliefs above referred under Section 14 of the Consumer Protection Act. Unfortunately, the State Commission also does not appear to have applied its mind to the important aspects mentioned above while confirming the order of the District Forum.
THE orders of the State Commission and District Forum are, therefore, set aside and the revision petition is allowed. There is no order as to costs.