BANK OF INDIA versus M/S. BRINDAVAN AGRO INDUSTRIES PVT. LTD.

BANK OF INDIA versus M/S. BRINDAVAN AGRO INDUSTRIES PVT. LTD.

The Supreme Court held that the orders of the SCDRC and NCDRC suffered from patent illegality and were set aside; the Consumer had sought a 50% concession on the cumulative charges and the Bank had debited amounts in accordance with the Consumer's authority and its circular; the Consumer was therefore entitled only to the refund of Rs.9.16 lakhs that the Bank had agreed to refund, and the Bank was directed to refund that sum within two months.

Parties
Appellant: BANK OF INDIA; Respondent: M/S. BRINDAVAN AGRO INDUSTRIES PVT. LTD.
Jurisdiction
India
Judgment Date
28 February 2020
Procedural Posture
Civil Appeal / Appeal From Order of the National Consumer Disputes Redressal Commission Dated 10.05.2018 Arising From State Consumer Disputes Redressal Commission Order Dated 13.07.2016
Outcome
Appeal allowed
Legal Topics
Processing Charges, TEV Study/appraisal Fees, Loan Sanction Delay, Refund of Charges
Consumer Protection Banking Processing Charges TEV Study/appraisal Fees Loan Sanction Delay Refund of Charges

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Parties

BANK OF INDIA

Appellant

M/S. BRINDAVAN AGRO INDUSTRIES PVT. LTD.

Respondent

Procedural Posture

Civil Appeal / Appeal From Order of the National Consumer Disputes Redressal Commission Dated 10.05.2018 Arising From State Consumer Disputes Redressal Commission Order Dated 13.07.2016

Legal Issues

  1. 1 Whether the Bank validly debited processing and TEV charges prior to sanction of the loan
  2. 2 Whether the Consumer was entitled to refund of the amount debited (Rs.27,41,165)
  3. 3 Applicability of the Bank's Circular dated 20.04.2005 requiring TEV study and charging of appraisal fees

Ratio Decidendi

The Supreme Court held that the orders of the SCDRC and NCDRC suffered from patent illegality and were set aside; the Consumer had sought a 50% concession on the cumulative charges and the Bank had debited amounts in accordance with the Consumer's authority and its circular; the Consumer was therefore entitled only to the refund of Rs.9.16 lakhs that the Bank had agreed to refund, and the Bank was directed to refund that sum within two months.

Court Disposition

Appeal allowed

Orders

  • Set aside the orders of the State Consumer Disputes Redressal Commission dated 13.07.2016 and the National Consumer Disputes Redressal Commission dated 10.05.2018
  • Bank of India is directed to refund a sum of Rs.916000 (Rs.9.16 lakhs) to M/s Brindavan Agro Industries Pvt. Ltd. within two months from the date of this order