Consumer Forum fines Prathama UP Gramin Bank over KCC Loan issue

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Gonda: In a recent case involving the recovery of money from a Kisan Credit Card holder, the Consumer Commission has taken action against Prathama UP Gramin Bank. The bank has been fined Rs 15,000 and the recovery notice issued by the bank has been cancelled. The complaint was filed by farmer Prema Devi, a resident of village Vishunpur Mafi in the Sadar tehsil area, through her advocate Ramesh Prasad Dubey.

According to the complaint, Prema Devi had taken a loan of Rs 25,000 under the Kisan Credit Scheme from the Mehanun branch of Prathama UP Gramin Bank on September 27, 2010. She fully repaid the loan amount and closed the account on August 10, 2016. However, due to negligence on the part of the bank officials, the account was not properly closed. On October 16, 2021, when Prema Devi visited the bank for some work, the branch manager deposited Rs 3,000 and stated that the account would be renewed. Subsequently, a recovery notice was sent to her on October 18, 2021, demanding payment of Rs 472, despite the loan being fully repaid.

The bank also blocked transactions on Prema Devi’s joint savings account. In response to the notice from the Consumer Commission, the bank manager appeared and filed a reply, strongly protesting the allegations. After considering the arguments presented by the lawyers of both sides and reviewing the evidence, the Commission’s Chairman Ramanand, along with members Subhash Singh and Manju Rawat, made a decision.

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Commission’s Decision

Based on the arguments and evidence presented during the hearing, the Consumer Commission has cancelled the loan recovery notice issued by the bank. In addition, the bank has been ordered to pay compensation to Prema Devi. The bank is required to pay Rs 10,000 for mental and physical compensation and Rs 5,000 for litigation expenses. It is important to note that if the bank fails to comply with the Commission’s order, it will also be liable to pay 7% interest.

This decision by the Consumer Commission serves as an example of how disputes between consumers and financial institutions can be resolved through legal channels. It highlights the importance of proper account management and communication by banks to avoid unnecessary inconvenience and financial burden on customers.

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