CITIBANK N A vs Avijit Dasgupta

THIS Revision Petition, by Citibank N.A., is directed against order dated 24.09.2008 passed by the Delhi State Consumer Disputes Redressal Commission (for short "the State Commission") in First Appeal No. 870 of 2008. By the impugned order, the State Commission has affirmed the order, dated 12.02.2008, passed by the District Consumer Disputes Redressal Forum, K.G. Marg, New Delhi (for short "the District Forum") in Complaint No. 727 of 2003, preferred by the Respondents/Complainants. By the said order, while holding that there was deficiency in service on the part of Petitioners No. 1 to 3, in disbursing home loan to the Respondents, the District Forum had directed the Petitioners to pay to the Respondents: (i) Rs. 6000/ - towards 10% penal charges, deducted for refund of the stamp papers; (ii) Rs. 3000/ - towards the difference/increase in value of the stamp papers purchased; (iii) Rs. 30,000/ - towards rent for the accommodation for seven months (wrongly shown as two months in the order of the District Forum); (iv) Rs. 2,00,000/ - as compensation for mental agony and harassment as also on account of deficiency in service; and (v) Rs. 10,000/ - towards litigation expenses.

IN short, the case of the Respondents was that having sanctioned the housing loan in principle vide their letter dated 28.08.2004 and asking the Respondents to purchase the stamp papers for execution of the sale deed in respect of a bigger flat against which the loan had been obtained; Respondents'' opting for insurance policy as desired by the Petitioners; and Petitioners'' deducting EMIs against the loan, the cancellation of loan at the last moment on 22.12.2004 and jeopardizing the sale transaction amounted to deficiency in service on the part of the said Petitioners.

ON consideration of the material placed before it, the District Forum was of the view that if the documents, as alleged by the Bank, were not complete or were inadequate, which was stated to be the sole reason for non -disbursement of the loan amount, the Petitioners should have immediately informed the Respondents and further without disbursing the loan amount, they should not have started deducting the EMIs from the account of the Respondents, unless it was satisfied that all the documents were complete and there was no hurdle, legal or otherwise, in release of the loan amount. Bearing in mind the fact that the Respondents had sold out their flat in anticipation of disbursement of the loan amount, sanctioned by the Petitioners vide their letter dated 28.08.2004 (page 24 of the paper -book) and consequent purchase of a bigger flat from the said loan amount, which was never disbursed to them, the District Forum held that there was deficiency in service on the part of the Petitioners. Accordingly, the Complaint was allowed, with the aforesaid directions. Being unsuccessful before the State Commission, the Bank and its Associates are before us.

WE have heard learned counsel for the parties. Ms. Suruchi Suri, learned Counsel appearing for the Petitioners, has strenuously urged that since the Respondents had failed to furnish No Objection Certificate (NOC) from the Society, despite their undertaking to furnish the same, no deficiency in service can be attributed to the Petitioners, particularly, when grant or refusal of loan is the sole discretion of the Bank. It is contended that the loan was only sanctioned in principle and its actual disbursement was subject to furnishing of the NOC, which was never furnished and, therefore, non -disbursal of loan was on account of the negligence of the Respondents/Borrowers and not the Petitioners. It is asserted that having failed to take cognizance of the undertaking dated 26.08.2004, the State Commission has committed serious illegality and, therefore, the impugned order deserved to be set aside.

PER contra, learned Counsel appearing for the Respondents, while supporting the impugned order, submits the provisional sanction of the loan, communicated to the Respondents vide Bank''s letter dated 28.08.2004, was after full verification of all the requisite documents and the factum Society''s land being mortgaged with DCHFC was in the knowledge of the Bank at the time of sanction of loan and the last minute cancellation of loan, on the ground that NOC from the Society was not furnished, was unjustified and clear deficiency in service on the part of the Bank. It is stressed that because of the conduct of the Bank, the Respondents had almost lost the deal for the house, for which loan was raised.

HAVING carefully perused the documents on record, we are of the view that the Revision Petition is bereft of any merit.

WE find from the record that after issue of provisional sanction letter dated 28.08.2004, the Respondents handed over to the Bank an undated, signed cheque in the sum of Rs. 10,30,850/ - (Rs. 10,00,000/ - as collateral security for the loan and Rs. 30,850/ - as one time premium for life insurance), which was a pre -condition for disbursal of the loan. It is the case of the Respondents that it was agreed that conveyance deed for the house shall be got registered on 09.09.2004 and the cheque for Rs. 10,00,000/ - in the name of the vendor shall be delivered to them on the said date but no one turned up on behalf of the Bank with the cheque, with the result that the documents could not be registered. Thereafter, there was no communication from the side of the Petitioners regarding the fate of the loan till 05.10.2004, when in response to Respondents letter dated 23.09.2004, whereby they had asked the Bank to disclose the reason for non -disbursal of the loan, the Respondents were asked to furnish the documents as per the list, stated to have been furnished to them by the officials of the Bank. The Respondents protested to the demand of documents vide their legal notice dated 13.10.2004 and demanded from the Petitioners, compensation of Rs. 25,00,000/ - as compensation for the mental torture, financial loss etc. along with refund of Rs. 8,463/ - debited to their Savings Bank account towards EMIs. Responding to the said legal notice, vide their letter dated 22.12.2004, the Bank informed the Respondents that their loan had been cancelled. A cheque in the sum of Rs. 10,30,000/ - was annexed with the letter as refund of the security amount received by them from the Respondents on 02.09.2004. We are unable to appreciate that if, as per version of the Bank, the loan had not finally been sanctioned, what was the occasion for the Bank to receive not only the said amount of Rs. 10,30,000/ -, but also debit EMIs, due against the loan, to Respondents/Borrowers'' account. In view of the said admitted factual position, we do not find any ground to interfere with concurrent finding of fact recorded by both the Fora below that if the documents furnished by the Respondents were incomplete, the Bank should have immediately intimated the Respondents and without ensuring that the loan had been disbursed, the Bank should not have started deducting EMIs from the account of the Respondents. Having failed to do so, the decisions of the Fora below, holding the Petitioners to be deficient in rendering service, cannot be faulted with.

BEARING in mind the observations of the Hon''ble Supreme Court in Mrs. Rubi (Chandra) Dutta v. M/s United India Insurance Co. Ltd., 2011 2 CPJ 19 ], to the effect that the concurrent findings of the Fora below are not to be interfered with unless there is some prima facie jurisdictional error appearing in the impugned order or the order has resulted into miscarriage of justice, we do not find any ground to interfere with the impugned order, in exercise of our Revisional Jurisdiction under Section 21(b) of the Consumer Protection Act, 1986.

THE Revision Petition is dismissed but without any order as to costs.