Suppressed Loan Details Lead to Dismissal of Consumer Complaints Against Bank and Coffee Board.


01 November 2024 Civil Revision >> Civil & Consumer Law  

In Deputy Director, Coffee Board, Kerala & Another v/s K.A. Roy & Others., the National Consumer Disputes Redressal Commission (NCDRC) has allowed Revision Petitions filed by the Wayanad District Co-operative Bank Ltd. and the Coffee Board, setting aside concurrent orders passed by the State Consumer Disputes Redressal Commission, Kerala, and the District Forum. The case involved complaints filed by two coffee cultivators seeking benefits under the Coffee Debt Relief Package (CDRP) of 2010 for loans they claimed were restructured from pre-2002 borrowings.

The complainants, K.A. Roy and K.A. Jose, had initially taken agricultural loans in 1999 for coffee cultivation. Facing financial difficulties due to drought and declining prices, they were unable to repay these loans, which became overdue. Following the introduction of the CDRP in 2010, which offered relief to small coffee planters with pre-2002 loans outstanding as of June 30, 2009, the complainants applied for benefits. The package stipulated a waiver of 50% of the outstanding loan by the Government of India and 25% by the respective banks, with the remaining 25% to be rescheduled.


 

 

The complainants alleged that the Bank failed to provide the full benefits of the CDRP, demanding a higher repayment amount than what was due under the scheme. They argued that this constituted a deficiency in service by both the Bank and the Coffee Board. The District Forum partly allowed their complaints, directing the Bank to provide the remaining waivers and the Coffee Board to reimburse the Bank's share. This order was subsequently affirmed by the State Commission.

However, in the Revision Petitions before the NCDRC, the Bank and the Coffee Board challenged these findings, primarily arguing that the complainants did not qualify for the pre-2002 loan benefits under the CDRP as they had taken fresh loans in 2003, effectively placing them in a different eligibility category with potentially lesser benefits. The Coffee Board also contended that the CDRP was a government relief scheme, not a service for consideration under the Consumer Protection Act, and therefore, the Consumer Fora lacked jurisdiction.

The NCDRC, upon reviewing the records and hearing the arguments, noted that both the District Forum and the State Commission had initially dismissed the Bank's claim of fresh loans in 2002/2003 due to the non-production of original documents. However, the NCDRC, in an earlier order, deemed it appropriate to examine these original documents.

Upon perusal of the original documents pertaining to the loan of complainant K.A. Roy, the NCDRC found clear evidence that he had submitted a fresh loan application on March 10, 2003, which was sanctioned by the Bank on March 22, 2003. This contradicted the complainant's vague averment that his 1999 loan had merely been "rescheduled" without specifying the closure of the original account. The NCDRC observed that the complainant had not provided any documentation to support the claim of continuous restructuring of the pre-2002 loan beyond 2002 and appeared to have suppressed the fact of obtaining a fresh loan in 2003.

Regarding the other complainant, K.A. Jose, the Bank stated that the original loan documents were untraceable due to the passage of time. However, the NCDRC noted that a copy of a similar sanction letter for a loan granted to K.A. Jose had been produced before the District Forum.

Considering the material evidence, particularly the documented fresh loan obtained by K.A. Roy in 2003, the NCDRC found no reason to believe that K.A. Jose's case was materially different. The Commission concluded that both complainants had approached the District Forum with misleading claims, particularly concerning the nature of their loans post-2002.

The NCDRC held that the complainants' vague assertions about the "restructuring" of their 1999 loans were incorrect, as the documents clearly indicated a fresh loan in the case of K.A. Roy, a fact that was seemingly concealed in his complaint. Given these findings, the NCDRC allowed the Revision Petitions, setting aside the orders of both the District Forum and the State Commission and dismissing the original complaints filed by the coffee farmers. The parties were directed to bear their own costs.

This judgment underscores the importance of presenting accurate and complete information before consumer redressal fora. The NCDRC's decision highlights that complainants must act with "clean hands" and cannot misrepresent crucial facts, such as the nature and history of their financial transactions, to seek relief.