When a bank's failure to adjust a credit amount in a loan account increases the borrower's liability, the interest payable on the refund of that amount should match the interest rate charged by the bank on the loan.

ORDER

(Per: Ms. Kumkum Rani, President):

This appeal under Section 41 of the Consumer Protection Act, 2019 has been directed against the impugned judgment and order dated 22.02.2025 passed by learned District Consumer Disputes Redressal Commission, Tehri Garhwal (hereinafter to be referred as “The District Commission”) in consumer complaint No. 04 of 2022, styled as Smt. Pushpa Bhatt Vs. District Co-operative Bank, wherein and whereby the consumer complaint filed by the appellant / complainant was allowed in part, directing the respondent / opposite party (bank) to pay the adjusted amount of Rs. 1,03,079/- to the appellant / complainant together with interest @0.65% per month w.e.f. 28.09.2021 till the date of impugned judgment and order, besides to pay Rs. 10,000/- towards financial & mental agony as well as on account of deficiency in service and Rs. 3,000/- towards litigation expenses, within a period of 45 days’, failing which the respondent / opposite party was directed to pay the aforesaid amount along with interest @9% p.a.

The facts giving rise to the present appeal, in brief, are, as such that in the year 2010, the appellant / complainant had taken a housing loan of Rs. 12,00,000/- from the respondent / opposite party (bank) for the construction of her house. The loan account of the complainant is 000119004000018. Against the loan, the complainant had paid Rs. 3,60,000/- to the bank on 26.10.2020; Rs. 3,60,000/- on 03.12.2010; Rs. 3,60,000/- on 21.01.2011 and Rs. 1,20,000/- on 11.05.2011. This way, the complainant had repaid total sum of Rs. 12,00,000/- to the bank. The aforesaid amount was paid by the complainant to the bank from her salary account. In the month of May, 2016, after payment of 53 installments to the bank, when the complainant approached the bank, it transpired that by the said date, there was outstanding loan of Rs. 13,57,557/- against the complainant, whereas apart from depositing 53 installments, the complainant had also deposited additional amount of Rs. 9,000/-. Thus, the complainant had deposited additional amount of Rs. 6,71,500/-, but instead of reducing, the loan amount got enhanced to Rs. 1,57,557/-. The complainant immediately met the then Branch Manager, who told that the loan installment was fixed at lesser amount. No information was ever given by the bank to the complainant that the loan installment has inadvertently been fixed at a lesser amount and the complainant should get the mistake corrected, otherwise the loan duration may extend. In the month of June, 2016, the complainant on her own, made the loan installment as Rs. 15,000/- per month and till 31.03.2020, an amount of Rs. 6,90,000/- was deposited. Thus, upto 31.03.2020, total sum of Rs. 13,61,500/- was deposited by the complainant. However, on 31.03.2020, a sum of Rs. 11,31,398/- was shown as outstanding loan amount by the bank. Every year, the bank provides statement to the complainant regarding payment of interest by her, according to which, for the period from 26.10.2010 to 31.03.2022, an amount of Rs. 11,35,397/- has been deposited by the complainant towards interest. Thus, from the deposited amount of Rs. 13,61,500/-, an amount of Rs. 11,35,397/- deposited towards interest is deducted, till 2020, an amount of Rs. 2,26,103/- should have been deducted from the principal loan amount and outstanding loan amount should have been to the tune of Rs. 11,31,397/-. After deposit of interest amount, the bank has added the amount instead of deducting from the principal loan amount. As on 31.03.2020, after deducting Rs. 2,96,103/- from sum of Rs. 11,31,397/-, the outstanding loan amount should have been to the tune of Rs. 9,05,295/-, on which the bank had charged compound interest, which too needs to be deducted.

It was also stated that the complainant under her own signatures issued a notice dated 17.11.2020 to the bank for rectifying the mistake, but neither any action was taken by the bank, nor the notice was replied