VIKAS VIJ Vs. STANDARD CHARTERED BANK

JUDGEMENT

(1.) HEARD parties' counsel on appeal. This appeal has been directed against the order dated 5.11.2012 of DRT -II, Delhi, whereby S.A. No. 41 of 2007 filed by the appellants has been dismissed.

(2.) MR . Chaudhary states that the only issue which the appellants intend to press in this appeal is the rate of interest charged by the respondent bank. His submissions are that the bank had sanctioned a housing loan of Rs. 65 lacs to the appellants, which was repayable in 240 equated monthly instalments(EMI) of Rs. 51,375/ - with interest @7.5% per annum, that a loan agreement was executed by the appellants in respect thereof and the sanctioned loan amount was disbursed to them on 3.11.2004; that the bank had wrongly increased the amount of EMI to Rs. 62,687/ - and alleging default in repayment of EMIs, issued demand notice dated 26.9.2006 under section 13(2) of the SARFAESI Act, claiming an amount of Rs. 64,45,104.95 as due on 25.8.2006; that tile bank also published the demand notice in the newspaper wherein the amount was claimed with interest @7.25% per annum w.e.f. 26.8.2006; that though in paras 7 and 11 of the reply to the S.A. the bank had admitted that the amount claimed through the demand notice was payable with future interest @7.25% per annum, but in paras 3 -5 of the said reply {page 85) it had stated that the rate of interest of 7.25% was for the first month only and thereafter the interest was @16% per annum, which had been charged at such rate; that In the affidavit filed by the bank's officer, it was again stated that the amount of debt was claimed with future interest @7.25% per annum; that in para 7 of the reply to this appeal the bank has, for tile first time, said that the interest @7.25% was to be charged on compounding basis but in para 9 thereof, it has been said that the rate of interest was 7.25% to 12% on compounding basis till the declaration of account as NPA, which shows that even the bank was not clear about tile rate of interest, as it has changed its stance repeatedly. According to him, the appellants are liable to pay interest only @7.25% p.a.

(3.) MR Sagar, on the other hand, submits that the sanction letter dated 31.10.2004 had clearly stated that tile type of interest was variable' and as per clause 2.3 of the loan agreement, the EMI was comprised of interest calculated on the basis of monthly rests, which shows that the interest was compoundable at such rests and clause 2.7. thereof provides that, in case of default in the payment of EMI, the borrower would be liable to pay additional interest @27% per annum. According to him, the bank has rightly charged the interest at variable; rates as applicable from time to time. He has, however, admitted, the receipt of amounts totaling Rs. 56.38 lacs by the bank post demand notice on different dates. He has also not disputed that prior to the issuance of the demand notice, certain amounts were paid by the appellants through EMls.