ALLAHABAD BANK Vs. GULSHAN NARANG

JUDGEMENT

(1.) -the appellant, M/s. Allahabad Bank has filed this appeal against the judgment and order dated 30.4.2003 passed by the District Consumer Forum, Udham Singh Nagar whereby the learned Forum directed the appellant to cancel the entire penal interest and to pay damages of Rs.2,000/- (Rupees two thousand) along with cost of Rs.1,000/- (Rupees one thousand to the complainant ).

(2.) The brief facts of the case are that the complainant has a cash credit limit with the Bank. It is said that the rate of interest was only 14% but the Bank has charged interest @ 20.75%. There was also an application to down the limit to Rs.2,00,000/- (Rupees two lacs) instead of Rs.2,50,000/- (Rupees two lacs fifty thousand), but it was not heard, it is (sic.) to pay more interest, it is said that a sum of Rs.60,000/- (Rupees sixty thousand) has been unnecessarily imposed against the complainant. The Bank filed written statement, admitted the cash credit limit. However, it is alleged that the interest is charged according to the directions of the Reserve Bank. It was further alleged that this was a commercial transaction and the complainant is not within the definition of consumer.

(3.) The complainant has given a chart of the rate. Most of the reliefs have not been granted to the complainant. However, the Forum has given relief to the complainant that penal interest may not be charged. The complainant alleged that the penal interest could also have been charged but atleast a right of hearing by notice was necessary. It was argued that reasonable opportunity to be heard is to be given in every case where any penalty is to be imposed and in the absence of reasonable opportunity, the order of penal interest cannot be sustained.