S.K.KUMARA SWAMY vs Indian Overseas Bank

THIS is a complaint under Section 17 read with Section 12 of the Consumer Protection Act. The complainants 1 to 4 each took an agricultural loan of Rs. 5 lakhs from the Bank of Tamilnadu, which has since been taken over by the opposite party, Indian Overseas Bank. Some additional loans were also taken by the complainants 1 to 3. As collateral security for the loans, Title Deeds of property worth 4 to 5 Crores were deposited with the Bank of Tamilnadu. After the Bank of Tamilnadu got merged with the opposite parties, Indian Overseas Bank, the complainants repaid all the loans on 28-6-1991. The payments were made at the Oppanakara Street branch of the Indian Overseas Bank, where the Title Deeds were deposited. But the Title Deeds were not returned in spite of repeated demands and even in spite of registered notice. It is further alleged that the loans were sanctioned at 12.5% interest. But subsequently the opposite parties have been collecting interest at 15% and 17.5% at various stages. As a result of this enhancement, a sum of Rs. 4,54,865/- has been paid as interest over and above the interest legally payable. THIS complaint has therefore been filed to recover the sum of Rs. 4,54,865/- paid as interest over and above the interest payable, to handover the documents of title deeds and compensation in the sum of Rs. 4 lakhs.

THE opposite parties in their counter admitted the loans borrowed by the complainants and the discharge of those loans. But it is contended that the complainants were duly informed by the then Bank of Tamilnadu of the enhancement at the rate of 15% for the quarter ended 30th September, 1985 and at 17.5% thereafter. THE complainants were fully aware of the same and agreed for charging at the enhanced rate. After amalgamation of the Bank of Tamilnadu with the opposite parties, Indian Overseas Bank, the complainants have executed a Debit Confirmation dated 11-12-1990 where they have acknowledged the debt due as on 19-2-1990 at the enhanced rate of interest. THE complainants have settled the outstanding due to the Bank out of their full will and wish without any protest and they cannot after more than one year, question or claim any deficiency of service on the ground of collecting excess interest. As regards the non-return of documents, it is contended that the complainants continued to owe to the Bank certain sum by way of interest on overdraft of Rs. 5 lakhs, made separately. Notwithstanding the above, the bank was ready to release the documents and written a letter dated 20-8-1992 asking the complainants to come and receive the Title Deeds. As it had to consider the question of releasing the Title Deeds in spite of the fact that there are some dues, some time has been taken. THEre was no deficiency of service or negligence. Exhibits A1 to A14 and B1 to B9 are marked. Proof affidavits are filed. The complainants have taken several loans from the Bank of Tamilnadu, which has subsequently got merged with the Indian Overseas Bank. After the amalgamation, all the loans have been settled and the amounts repaid on 28-6-1991. The case of complainants is that the loans were sanctioned at 12.5% interest p.a. But subsequently the interest has been collected at 15% and 17.5% at various stages, and the excess interest so collected come to Rs. 4,54,865/- which is claimed in this complaint. The contention of the opposite party is that as per the directions of the Reserve Bank, the complainants were duly informed by the then Bank of Tamilnadu under Exhibit Bl that interest would be charged on the agricultural loan at 15% for quarter ended 30-9-1985 and at 17.5% thereafter. It is only in accordance with this intimation, subsequent interest has been claimed at 15% and 17.5%. The complainants did not raise any protest. It is further pointed out that under Exhibit B2, dated 11-12-1990, the first complainant as Managing Director of the 4th complainant, Company has executed a Debit Confirmation letter admitting the outstanding at Rs. 1,83,104.95 including interest, charges, expenses etc. The complainants have also settled the account on 28-6-1991 and paid the entire debt with interest at the enhanced rate without any protest. As rightly contended by the opposite parties, they have voluntarily settled the claim and it is not open to them to contend that excess interest has been collected from them and the same must be refunded. This claim must therefore fail.

The other contention of the complainants is that the Title Deeds have not been returned to them eventhough all the debts were duly discharged. During the pendency of this complaint, the documents were produced by the opposite parties and they were received by the complainants on 28-1-1993 before the Commission and endorsement to that effect has been made. The delay in returning the documents, according to the opposite parties is that a sum of Rs. 39,526/- was due from the complainants on account of an overdraft to the extent of Rs. 5 lakhs, which was independent of other loans mentioned. The learned Counsel for the complainant denied having borrowed this amount of Rs, 5 lakhs. But the denial has no substance. Exhibit B8 is a letter written by the first complainant asking for a temporary overdraft of Rs. 5 lakhs from the Bank of Tamilnadu on 21-3-1985. On the same date, a draft has been issued for Rs. 5 lakhs under Exhibil B7 in favour of Mr. K. Subbiah and Exhibit B6 is the cheque issued by the first opposite party in favour of the Bank of Tamilnadu dated 21-3-1985. The denial of this claim is therefore without any substance. On account of the interest amount due from the complainants to the bank, the documents could not be released immediately. We therefore find no deficiency of service in that respect as well.

IN the result the complaint fails and is dismissed, but without costs. Complaint dismissed.