IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN FRIDAY, THE 28TH JANUARY 2011 / 8TH MAGHA 1932 WP(C).No. 25000 of 2006(A) --------------------------------------- PETITIONER(S): ---------------------- JIMMY GEORGE, THOTTUNGAL HOUSE, AVALOOKKUNNU P.O., ALAPPUZHA-688006., PRESIDENT AMBALAPUZHA TALUK, SCHOOL EMPLOYEES COPOP. SOCIETY LTD./, NO.A 1002. BY ADV. SRI.P.N.MOHANAN RESPONDENT(S): ------------------------ 1. THE CONSUMER DISPUTES REDRESSAL FORUM, ALAPPUZHA P.O., REP.BY ITS PRESIDENT-IN-CHARGE. 2. REETHAMMA MATHEW, ALAPPADY PARATHARA CHURCH ROAD, MULLAKKAL, ALAPPUZHA -688011. 3. REGISTRAR OF CO-OP.SOCIETIES, TRIVANDRUM. R1 & R3 BY BY GOVT. PLEADER SRI.P.M.MANOJ R2 BY ADV. SRI.D.AJITHKUMAR THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 28/01/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) NO.25000/2006 APPENDIX PETITIONER'S EXHIBITS P1:- COPY OF THE AGREEMENT EXECUTED BY THE 2ND RESPONDENT DTD. 15.4.1997. P2:- COPY OF THE CERTIFICATE DTD. 22.2.97 BY THE 2ND RESPONDENT. P3:- COPY OF THE CERTIFICATE DTD. 22.2.97 BY THE 2ND RESPONDENT. P4:- COPY OF THE CERTIFICATE DTD. 22.2.97 BY THE 2ND RESPONDENT. P5:- COPY OF THE CIRCULAR NO.35/03 DTD. 1.7.03 ISSUED BY 3RD RESPONDENT. P6:- COPY OF THE CIRCULAR NO.51/03 DTD. 30.8.03 ISSUED BY 3RD RESPONDENT. P7:- COPY OF THE ORDER DTD. 16.5.06 OF THE IST RESPONDENT. TRUE COPY P.A. TO JUDGE tss P.N. RAVINDRAN, J. ------------------------------- W.P.(C) No.25000 of 2006 ------------------------------- Dated this the 28th day of January, 2011 J U D G M E N T Ext.P7 order passed by the Consumer Disputes Redressal Forum, Alappuzha on 16.5.2006 directing the petitioner to refund the sum of Rs.7663/- together with interest at 10% per annum on the sum of Rs.3603/- from 14.2.2004 till the date of payment, Rs.1000/- as compensation and Rs.450/- as costs is under challenge in this writ petition. Ext.P7 order was passed on a complaint filed by the second respondent herein. It was contended that the second respondent was not given the benefits flowing from Exts.P5 and P6 circulars, when she closed the loan account on 14.2.2004. The second respondent alleged that the petitioner herein, the President of the Co- operative Society, had realised a sum of Rs.7663/- in excess from the second respondent. The Consumer Disputes Redressal Forum held that as per Exts.P5 and P6 circulars, the second respondent was entitled to waiver of interest, and therefore, the second respondent is entitled to refund of the excess amount paid by her by way of interest. 2. It is not in dispute that the second respondent did not settle the loan account under the one time settlement scheme. The W.P.(C) No.25000 of 2006 2 second respondent availed the loan on 15.4.1997. It was to be repaid in 48 instalments. She committed default in repayment of the loan and she closed the loan account only on 14.2.2004, after nearly 7 years. She did not while settling the loan account claim any benefit under the one time settlement scheme. A Division Bench of this Court has in Cheranalloor Service Co op. Bank Ltd v. Alfred (2010 (1) KLT 749) held that schemes for waiver of interest are not meant for persons who have closed their loan accounts before the issuance of the schemes, which are notified only to collect arrears and not to refund the amounts already collected by banks. In the light of the authoritative pronouncement of this Court, the second respondent who had closed the loan account without availing the benefit of the one time settlement scheme cannot be heard to contend that she is entitled to the benefit of the scheme, and therefore, the bank should refund to her the excess amount collected by it by way of interest. The Consumer Disputes Redressal Forum appears to have lost sight of the fact that one time settlement schemes are not meant to enable debtors to obtain refund of the interest already paid, but to enable banks and financial institutions to recover the arrears by giving reduction in interest to the debtors. In such circumstances, it has to W.P.(C) No.25000 of 2006 3 be necessarily held that Ext.P7 order cannot be sustained. In the result, I allow the writ petition, quash Ext.P7 order and dismiss O.P.No.A.103 of 2004 on the file of the Consumer Disputes Redressal Forum, Alappuzha. P.N. RAVINDRAN, JUDGE. nj.