Case: BANK OF INDIA Vs. M/S. BRINDAVAN AGRO INDUSTRIES PVT. LTD

words, the sanction letter should not be given to the customer without ensuring that Bank has received the processing charges. It, therefore, follows that Bank would not consider in future waiver of un-recovered processing charges, in the normal course. 4. Please bring the contents of this circular letter to the attention of all staff members for strict compliance. 12. Learned counsel for the Bank also refers to the letter dated 15th October, 2011 by the Consumer seeking credit facility with the request on behalf of the Consumer to give concession of 50% on LC charges, processing charges, inspection charges etc. and fully waive DD charges and commitment charges. 13. In this background, the final proposal for sanction was submitted by the CPU on 24th January, 2012 to the Head Office of the Bank. Soon after the letter was sent by the CPU, the Consumer communicated that it was promised that the sanction would be received by 4th February, 2012 but since the Consumer had not received the sanction letter, it sought reversal of the amount debited in view of the fact that it got sanctions from other banks with attractive rate of interest and the other terms and conditions. The credit facilities were sanctioned on 17th March, 2012. 14. Learned counsel for the Consumer, on the other hand, contended that the Circular of the Bank dated 20th April, 2005, to which the reliance has been placed by the learned counsel for the Bank, was never brought to the notice of the Consumer, therefore, the conditions mentioned in such Circular will not bind the Consumer. It is also contended that the Bank had taken extra-ordinarily long time to sanction the loan which compelled the Consumer to take credit facilities from the other Banks. It is also contended that amount of Rs.27,41,165/- was debited to the account of the Consumer without its consent and knowledge and, therefore, the order passed by the SCDRC and NCDRC does not warrant any interference in the present appeal. 15. The learned NCDRC held that the services of the Bank availed for cash credit limits do not disentitle the respondent/complainant from becoming a consumer under the Act. It further held that even though the Consumer had changed its loan demand three times, the Consumer had requested to pay 50% processing and other charges, and the total amount of Rs.27,41,165/- that was debited including PPC charges and Rs.18.25 lakhs as TEV study charges. Further, as the Bank had agreed to refund Rs.9.16 lakhs, it meant that the Bank had considered to take only Rs.18.25 lakhs as TEV charges. Additionally, the Consumer had requested for 50% discount on processing and other charges to which the Bank never disagreed, hence it was presumed that the Bank had agreed to the concession sought. Therefore, the Bank should have charged only 1/4th of the TEV charges i.e. Rs.4,56,250/-. Similarly, with regard to PPC charges, the Bank at one time agreed to waive off these charges of Rs.9.16 lakhs subject to the Consumer paying the TEV charge in full. But now, it was found that the Bank was entitled to only Rs.4,56,250/- as TEV charge, therefore, on the same analogy, 1/4th of the PPC charge i.e. Rs.2,29,000/- was found to be allowed to be deducted by the Bank. Hence, the Bank was entitled to debit total of only Rs.6,85,250/- (Rs.4,56,250/- + Rs.2,29,000/-). Resultantly, the Bank was directed to refund Rs.20,55,915/- to the Consumer and the interest rate was modified from 9% p.a. to 7% p.a. 16. We find that the reasoning given by the learned NCDRC is de hors the proposal as well as Circular of the Bank and is, in fact, based on ipse dixit of the NCDRC. The Consumer had sought a waiver of 50% of all charges in the request letter dated 15th October, 2011. As per the sanction letter dated 17th March, 2012, the following were the charges claimed from the Consumer: TABLE 17. The total charges, thus, payable were Rs.68,83,000/- plus service tax. Even if, the 50% concession is conceded to the Consumer, still the amount to be charged is much more than Rs.27,47,165/-. As per the tariff mentioned in the sanction letter, TEV charges are Rs.18,25,000/- whereas processing charges are to the tune of Rs.49,63,000/-. Obviously, the Consumer had to pay charges for availing credit facilities of which the Consumer was in knowledge of and, therefore, sought a waiver of 50% of the charges. It is the Consumer who revised the requirement of credit facilities three times and the Bank sanctioned credit facilities on 17th March, 2012 i.e. within almost three months from the final modified request. 18. The Consumer admittedly was an old customer of the Bank who applied to avail credit facilities of more than Rs.40 crores and it is unbelievable that it was unaware of the procedure and the Circulars of the Bank. The ignorance of the procedure and the Circular of the Bank dated 20th April, 2005 cannot be accepted. The Consumer was aware of the processing charges and had sought a waiver of the processing charges, therefore, the processing charges had been debited by the Bank on 30th December, 2011 in terms of authority given by the Consumer on 19th January, 2011 (Annexure P/3 in the appeal paper-book). 19. Thus, we find that orders passed by the NCDRC and SCDRC are liable to be set aside. We may say that though, the Bank agreed to refund Rs.9.16 lakhs from the processing charges through email dated 29th June 2012 but the Consumer had not accepted such proposal in its e-mail dated 24th July, 2012. Therefore, we find that the Consumer is entitled to refund of Rs.9.16 lakhs only in terms of the decision of the Bank communicated to the Consumer rather than waiver of TEV charges in its entirety. The request was to give concession of 50% of all charges, therefore, it is the cumulative amount of charges which is to be taken into consideration and not the charges under a particular head.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]16. We find that the reasoning given by the learned NCDRC is de hors the proposal as well as Circular of the Bank and is, in fact, based on ipse dixit of the NCDRC. The Consumer had sought a waiver of 50% of all charges in the request letter dated 15th October, 201117. The total charges, thus, payable were Rs.68,83,000/- plus service tax. Even if, the 50% concession is conceded to the Consumer, still the amount to be charged is much more than Rs.27,47,165/-. As per the tariff mentioned in the sanction letter, TEV charges are Rs.18,25,000/- whereas processing charges are to the tune of Rs.49,63,000/-. Obviously, the Consumer had to pay charges for availing credit facilities of which the Consumer was in knowledge of and, therefore, sought a waiver of 50% of the charges. It is the Consumer who revised the requirement of credit facilities three times and the Bank sanctioned credit facilities on 17th March, 2012 i.e. within almost three months from the final modified request18. The Consumer admittedly was an old customer of the Bank who applied to avail credit facilities of more than Rs.40 crores and it is unbelievable that it was unaware of the procedure and the Circulars of the Bank. The ignorance of the procedure and the Circular of the Bank dated 20th April, 2005 cannot be accepted. The Consumer was aware of the processing charges and had sought a waiver of the processing charges, therefore, the processing charges had been debited by the Bank on 30th December, 2011 in terms of authority given by the Consumer on 19th January, 2011 (Annexure P/3 in the appeal paper-book)19. Thus, we find that orders passed by the NCDRC and SCDRC are liable to be set aside. We may say that though, the Bank agreed to refund Rs.9.16 lakhs from the processing charges through email dated 29th June 2012 but the Consumer had not accepted such proposal in its e-mail dated 24th July, 2012. Therefore, we find that the Consumer is entitled to refund of Rs.9.16 lakhs only in terms of the decision of the Bank communicated to the Consumer rather than waiver of TEV charges in its entirety. The request was to give concession of 50% of all charges, therefore, it is the cumulative amount of charges which is to be taken into consideration and not the charges under a particular head.