
The State Consumer Disputes Redressal Commission of Chandigarh has imposed a penalty of Rs 96,000 on a public sector bank for mishandling the car loan account of a retired Army officer.
Lt. Col. (Retd.) Vipin Bakshi filed a complaint through advocate Pankaj Chandgothia, alleging that he had taken a car loan of Rs 4.50 lakhs from the bank. The loan was approved, and the amount was disbursed with a tenure of 48 months. The monthly installment (EMI) was set at Rs 11,209, with the first payment due on December 21, 2018.
Chandgothia argued that the bank had obtained signed ECS (Electronic Clearing Service) instructions from Bakshi, as required by loan rules, to ensure automatic monthly EMI payments. However, the bank failed to set up the ECS facility and instead collected ad-hoc payments from Bakshi without any consistency or explanation. The bank also sent letters demanding arrears, which Bakshi claimed were incorrect, as the ECS mandate should have been used. The lawyer further stated that the bank’s actions had negatively impacted Bakshi’s CIBIL score.
In its defense, the Canara Bank branch in Sector 47, Chandigarh, argued that Bakshi was a repeat defaulter and that all charges were correctly debited to his account.
The Consumer Commission, after reviewing the case, noted that it was unjust for a retired army officer, who had selflessly served the nation, to be caught in a dispute with a financial institution over poor service. The Commission stated that Bakshi should not bear the consequences of the bank’s failure to set up the ECS facility on time.
The Commission concluded that the bank had mishandled the loan and violated banking principles. As a result, it directed the bank to treat Bakshi’s loan account as closed and issue a No Dues Certificate. Additionally, the bank was ordered to correct Bakshi’s CIBIL score.
Good decision. Adamant officials must be punishable.