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2025 Supreme(Online)(SCDRC) 1068
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Harinderpal Singh Mahal, Kiran Sibal, JJ
State Bank of India – Appellant
Versus
Sandeep Sharma – Respondent
First Appeal under Section 41 of the Consumer Protection Act, 2019
For the Appellants/Petitioners: Sh.Chandeep Singh
For the Respondents: Sh.Sandeep Sharma, In person
The court upheld that banks must honor fixed interest rates and cannot unilaterally alter terms without notifying borrowers.
Headnote:(A) Consumer Protection Act, 2019 - Section 41 - Appeal against the order directing issuance of a fresh loan statement and NOC based on a fixed interest rate - Complainant availed loans at a fixed rate of interest of 8% per annum - Complaint dismissed alleging unfair trade practice by increasing interest without intimation - The court upheld the district commission’s order as no valid evidence was provided by the bank to justify the floating rate. (Paras 11, 12)
(B) Fair Trade Practices - It was observed that raising the interest rate without prior notice is considered an unfair trade practice, which lacks transparency and can harm the borrower’s financial planning.
| Table of Content |
|---|
| 1. background of the loan agreements and complaints raised. (Para 1 , 2 , 3) |
| 2. details about the complaint regarding interest rate adjustments. (Para 4 , 7 , 8) |
| 3. arguments presented by the appellants focusing on the loan terms and interest rate issues. (Para 5) |
| 4. asserted findings about the bank's notification duties. (Para 10 , 11) |
| 5. final ruling on the appeal and decision sustainment. (Para 12 , 13) |
Mr.Harinderpal Singh Mahal, Presiding Judicial Member Mrs.Kiran Sibal, Member Present:-
For the appellants : Sh.Chandeep Singh, Advocate For the respondent : Sh.Sandeep Sharma, In person HARINDERPAL SINGH MAHAL, PRESIDING JUDICIAL MEMBER This appeal has been preferred by the appellants/opposite parties–State Bank of India & Anr. against the order dated 24.09.2024 passed by the District Consumer Disputes Redressal Commission, SBS Nagar, whereby the complaint filed by the complainant was disposed of with the direction to the opposite parties to issue fresh statement loan account on the basis of loan having been sanctioned on fixed rate of interest i.e.8% per annum and also to issue NOC to the complainant on receipt of complete 180 installments of Rs.6,238/- based on fresh statement of loan account.
It would be apposite to mention that hereinafter the parties will be referred, as have been arrayed before the District Commission.
2. Brief facts of the case are that the complainant availed a housing loan for Rs.6,20,000/- from the SBI Bank Branch, Old Court Road, Nawanshahr, District SBS Nagar, which was sanctioned, vide loan account No.65072242182 on 15.10.2009 and the same was to be repaid in 180 months in equal monthly installment of Rs.6,238/-. At the time of sanctioning the home loan, the official asked the complainant not to give first 6-7 installments and first installment will start from 14.05.2010. The complainant obtained another loan of Rs.1,00,000/- from the SBI Bank, vide loan account No.65153091717, which was sanctioned on 23.10.2012, which also was to be repaid in 15 years and first installment started on 07.12.2012. The complainant has been paying the installments regularly from the last 14 years and the loan was to be completed by March, 2025. All the installments given in the loan account of worth Rs.11,25,238/- but now the bank officials are harassing for excess loan installments. The complainant approached the opposite parties regarding the illegal demand of excess installment but they flatly refused to withdraw the request. This act and conduct of the opposite parties compelled the complainant to approach the District Commission seeking following reliefs:
i) not to take excess loan installment and provide NOC Certificate after expiry of home loan tenure in March, 2025;
ii) to pay Rs.2,00,000/- as damages for mental agony and tension and monetary loss; and iii) to pay Rs.50,000/- to the complainants as legal expenditure and for counsel fee.
3. Upon notice, opposite parties appeared and filed their reply taking preliminary objections that the complaint is bad for non- joinder of the necessary parties. The complainant has got no cause of action against the answering opposite parties as opposite party No.1, number of times written or verbally submitted the request to change the rate of interest. On merits, it is submitted that if the complainant is ready to move the request letter to the opposite parties then they are ready to change the rate of interest, as per the Guidelines of the Bank. It is further submitted that the complainant has also raised a personal loan of Rs.15,00,000/- from opposite party No.1 but the same was not disclosed. Further, it is submitted that as per the terms and conditions of the loan agreement, the rate of interest was floating, and when the rate of interest increases, the amount of instalment automatically increases and the tenure of the loan automatically changes. Rest all the averments as averred by the complainant in his complaint were denied and prayed for dismissal of the
