Hanumantha Rao v. IDBI Bank,Rep by its Branch Manager, District Consumer Disputes Redressal Commission, Judgment, Law, casemine.com

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Case Number

CC/70/2019

Advocates

K P Saradhi

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Smart Summary

Factual and Procedural Background

The complainant, a customer of the Opposite Party bank, availed a home loan for the purchase of flat no. A12402, Sanskriti Township, Pocharam, Hyderabad. In October 2018, he foreclosed the loan and requested the return of his original title deeds. The Opposite Party failed to return these documents and later informed the complainant that the original documents were destroyed in a fire accident approximately one year prior. The Opposite Party stated it was attempting to obtain duplicate copies. The complainant alleged that the Opposite Party deliberately withheld information about the destruction of the documents at the time of foreclosure, constituting willful non-disclosure. As a result, the complainant claims he is unable to sell the property or purchase another. The complaint was filed seeking relief on these grounds.

The Opposite Party admitted the loan and foreclosure but denied negligence, asserting the destruction of documents was due to an accidental fire at the premises where the documents were stored. They submitted that the documents were kept with due care at a government-owned facility and that the fire accident was widely publicized, negating any claim of willful negligence. The Opposite Party offered to provide certified copies of the sale deed, which the complainant allegedly refused. The Opposite Party prayed for dismissal of the complaint.

Both parties filed evidence affidavits and documents, and submitted written arguments. The matter proceeded to consideration of the key issues.

Legal Issues Presented

Whether the acts of the Opposite Party in not handing over the original documents of the property and issuing a No Objection Certificate (NOC) in favour of the complainant amounts to negligence, deficiency in service, and unfair trade practice?
If so, what relief is appropriate?

Arguments of the Parties

Complainant's Arguments

After foreclosure of the housing loan, the Opposite Party failed to return the original property documents and did not issue a NOC.
This failure has prevented the complainant from selling or purchasing property.
The Opposite Party deliberately withheld information about the destruction of the documents by fire at the time of foreclosure, constituting willful non-disclosure and unfair trade practice.
The complainant suffered mental agony and loss due to the Opposite Party’s actions.

Opposite Party's Arguments

Admitted the loan and foreclosure but denied failure to hand over original documents.
Documents were destroyed due to a fire accident caused by a short circuit at the storage premises, which was beyond their control and not due to negligence.
The destruction was an act of God; the Opposite Party is not liable for compensation.
Offered certified copies of the sale deed, but the complainant refused to accept them.
The fire accident was widely publicized, negating any claim of willful non-disclosure or ignorance by the complainant.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court examined the documentary evidence submitted by both parties, including loan sanction and closure documents, incident reports of the fire accident, and ownership documents. It was undisputed that the complainant had repaid the loan in full. The Opposite Party’s contention that the original documents were destroyed in a fire accident at the premises where they were stored was supported by documentary evidence, including police reports and media coverage. The court noted the Opposite Party’s procedural practice of depositing such documents at a government-owned facility and found no evidence of negligence in their custody.

However, the complainant’s contention that the Opposite Party failed to disclose the destruction of original documents at the time of foreclosure was accepted. The court held that this non-disclosure amounted to an unfair act. On balance, while the destruction of documents was accidental, the Opposite Party’s failure to inform the complainant at the relevant time was improper. Therefore, the court answered the first point in favour of the complainant.

Regarding relief, the court directed the Opposite Party to issue a NOC and provide all possible certified documents related to the loan and property. It further ordered publication of a notice in leading newspapers confirming the complainant’s clear title over the property. The court awarded compensation and costs to the complainant and imposed a penalty for non-compliance with the order.

Holding and Implications

The complaint is partly allowed.

The Opposite Party is directed to:

Issue a No Objection Certificate (NOC) and provide certified copies of documents relating to the complainant’s loan account and property.
Publish a notice in leading English and vernacular newspapers regarding the destruction of the original documents, specifying loan account number, property details, and confirming the complainant’s clear title.
Pay Rs. 1,00,000/- as compensation and Rs. 10,000/- as costs to the complainant.
Comply with these directions within two months, failing which a further Rs. 50,000/- will be payable as punitive damages.

The decision directly affects the parties by providing relief to the complainant for the Opposite Party’s failure to disclose the destruction of documents and for not issuing the NOC. No new legal precedent was established beyond the application of principles related to deficiency in service and unfair trade practice in the context of loan foreclosure and document handling.

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Hanumantha Rao v. IDBI Bank,Rep by its Branch Manager

(PER HONBLE Sri.G.V.S.Prasad Rao, MEMBER ON BEHALF OF THE BENCH)

1. Brief averments of the complaint are as follows: The complainant submits that he is a customer of the Opposite Party bank and availed home loan for purchase of flat no.A12402, Sanskriti Township, Pocharam, Hyderabad. Further submits that in October 2018, the complainant has foreclosed the said loan and the Opposite Party failed to return the original title deeds of the complainant and on further follow ups the Opposite Party bank has informed the complainant that the said documents were destroyed in the fire accident one year back and the Opposite Party is trying to get duplicate copies of the same. The complainant further submitted that the Opposite Party has deliberately not disclosed the matter of the destruction of the documents when the complainant has informed the Opposite Party for the foreclosure of his loan and after paying the loan informing the same is willful non-disclosure of facts. Had the Opposite Party informed about the destruction of the original documents, the complainant states that he would not have opted for foreclosure and further submits that as the Opposite Party failed to hand over his original documents he is unable to sell his property and purchase another property. Hence this complaint.

2. In their written version, the Opposite Party submitted that the averments of the complaint as to availing the loan and he foreclosing the loan are true and the Opposite Party further submitted that the said documents were destroyed due to fire accident were the said documents were kept and it is the procedure of the bank to deposit all such documents at the central Government owned concern namely Stock Home Securities and the factum was revealed and widely published in print media and the complainant cannot plead ignorance and innocent of the fire accident as news of the said fire accident due to short circuit in the said building as such there is no willful negligence on the part of the Opposite Party in handling the original title deeds of the complainant and the said documents were destroyed in an act of God and as such there is no liability on the part of the Opposite Party to pay any compensation as demanded by the Opposite Party and denied all the other averments. The Opposite Party further submitted that it is ready and willing to handover the certified copies of the original sale deed of the said property, however the complainant was reluctant to accept the same. Therefore, it is prayed to dismiss the complaint.

3. The complainant filed evidence affidavit and got marked the documents as Ex.A1 to A5. The Opposite Party filed evidence affidavit and Ex.B1 to B3 were marked on their behalf. Both parties filed their respective written arguments.

4. Now the points for consideration in this case are:

1) Whether the acts of the Opposite Party in not handing over the original documents of the property and issuing a NOC in favour of the complainant amounts to negligence, deficiency in service and unfair trade practice?

2) If so, To What relief?

5. Point No.1: This is a case wherein the complainant alleged that after foreclosing the housing loan taken by him, the Opposite Party has failed to hand over the original documents of the said property till date and issue a NOC is respect of the loan in his favour and as result of this he is unable to sell this property and purchase another property in its place, besides he is subjected to mental agony and pain. The learned counsel for the Opposite Party while admitting the fact that the complainant availed the housing loan and has opted for foreclosure and paid the loan amount, denied that the Opposite Party has failed to handover the original documents relating to the said property and submitted that it has arranged for the certified copy of the sale deed however the other related documents could not be arranged. On perusal of the documentary evidence, Ex.A1 is the copy of Email communication. Ex.A2 is the copy of Loan Sanction Letter dt.05.03.2016. Ex.A3 is the copy of Loan Closure Evidence from Bank. Ex.A4 is the copy of Incident Spot Panchanama dt.26.12.2017. Ex.A5 is the copies of Ownership related documents. The Opposite Party filed evidence and Ex.B1 is the copy of Paper cutting about the fire accident. Ex.B2 is the copy of General Dairy Details translated from Marathi issued by Police Station Rabale MIDC, Navi Mumbai District 23.12.2017. Ex.B3 is the copy of Incident Spot Panchanama translated from Marathi issued by Police Station Rabale MIDC, Navi Mumbai District 26.12.2017. In the instant case, the complainant stated that the Opposite Party has failed to handover the original documents of the property against which the complainant availed housing loan and has foreclosed the said loan account and did not issue a NOC except for providing the certified copy of the sale deed. And the Opposite Party has submitted that they were unable to hand over the original documents as the same were destroyed due to fire accident in the building were those documents were kept. We have perused the documents filed by both the parties and heard both the counsel. From the above circumstances, it is not disputed that the complainant has repaid the loan taken from the Opposite Party. The stand of the Opposite Party that their best efforts it was not possible for them to handover the original documents as the same were destroyed due to fire accident in the premises were those documents were kept with utmost care and the documentary evidence filed by the Opposite Party does not dispute this contention of the Opposite Party. In the said circumstances, how far can the contention of the complainant that the Opposite Party has failed to hand over his original documents be admitted when the Opposite Party submits that as a procedure the documents were kept with due care, however the same were destroyed due to a fire accident in the said building and the Opposite Party has arranged for a certified copy of the sale deed. The contention of the complainant is that the Opposite Party failed to return the original documents of the property deposited by the complainant. The contention of the Opposite Party is that it so happened that the said documents were not destroyed due to the negligence of the Opposite Party but due to fire accident that broke out in the said building due to short circuit. The other contention of the complainant is that the Opposite Party has not disclosed the said fact of the documents been destroyed in the fire accident when he went for the foreclosure of the loan is nothing but a willful non-disclosure of facts which is an unfair act on the part of the Opposite Party bank. The point is answered in favour of the complainant.

6. Point No.2: In the result, the complaint is partly allowed and the Opposite Party is directed to issue NOC and other possible documents relating to the loan account of the complainant like certified sale deed etc. The Opposite Party is further directed to publish about the destruction of the property documents of the complainant with details of loan A/c No., Schedule of Property and complainant details in leading English and Vernacular Newspaper stating that the complainant has clear title over the said property. The Opposite Party is further directed to pay an amount of Rs.1,00,000/- (Rupees One Lakh only) as compensation along with costs of Rs.10,000/- (Rupees Ten Thousand only). Time for compliance of this orders is two months from the date of receipt of the orders, in default the Opposite Party is liable to pay an amount of Rs.50,000/- to the complainant as punitive damages. Dictated to the Steno-typist, transcribed by her, corrected by me and pronounced by us in the Open Forum on this the 10th day of December, 2020. Sd/- PRESIDENT Sd/- MEMBER Sd/- LADY MEMBER APPENDIX OF EVIDENCE WITNESSES EXAMINED For Complainant For Opposite Party Affidavit filed Affidavit filed EXHIBITS MARKED For Complainant Ex.A1 Copy of Email communication Ex.A2 Copy of Loan Sanction Letter dt.05.03.2016 Ex.A3 Copy of Loan Closure Evidence from Bank Ex.A4 Copy of Incident Spot Panchanama dt.26.12.2017 Ex.A5 Copies of Ownership related documents Exhibits marked for the Opposite Party Ex.B1 Copy of Paper cutting about the fire accident Ex.B2 Copy of General Dairy Details translated from Marathi issued by Police Station Rabale MIDC, Navi Mumbai District 23.12.2017 Ex.B3 Copy of Incident Spot Panchanama translated from Marathi issued by Police Station Rabale MIDC, Navi Mumbai District 26.12.2017 Sd/- PRESIDENT Sd/- MEMBER Sd/- LADY MEMBER

Hanumantha Rao v. IDBI Bank,Rep by its Branch Manager

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Complainant's Arguments

Opposite Party's Arguments

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Hanumantha Rao v. IDBI Bank,Rep by its Branch Manager

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