CDC Directed SBT
The Coimbatore District Consumer Disputes Redressal Forum has directed the State Bank of Travancore to waive the housing loan it has given to a customer and refund the Rs. 3 lakhs paid by the complainant before the Debts Recovery Appellate Tribunal, Chennai. The forum awarded Rs. 5,000 towards damages and Rs. 1,000 towards cost of litigation. The order was passed by the president of the forum, S.A. Sreeramulu, and members P. Madhavi and K. Rathinam while disposing a complaint filed by S. Senthilvadivu, wife of late R. Shanmugam. The complaint was that the bank asked her to pay the loan amount within 60 days when her husband died in an accident, though the loan was covered by SBI Life.Mr. Shanmugam availed himself of a housing loan from the bank in 2002. He had to subscribe to an insurance policy with SBI Life that ensured payment of the loan amount in case of his death. Shanmugam died in a road accident on May 22, 2004. The banker got the claim form from his wife Senthilvadivu on July 13, 2004. She was informed that the loan would be covered through SBI Life. On December 22, 2005, the complainant received a letter from the bank asking her to meet the manager. Despite several visits by the complainant, no proper clarification was given about the loan and insurance coverage.
Then, a notice was sent to the banker to explain the status of the SBI Life cover and to furnish a statement of accounts, if there were any due. The notice failed to elicit any response from the banker.Two years after the death of the loan applicant, the banker issued a notice asking the complainant to repay the entire loan within 60 days. The complainant, in turn, replied that the loan was covered through SBI Life and the claim form was already given.
The banker then contended that since the deceased had not underwent certain medical examinations as specified by the SBI Life, the policy was not effected by the insurer. The bank insisted that she repay the loan. Then, the complainant preferred an appeal before the Debts Recovery Appellate Tribunal, Chennai, and paid Rs. 3 lakhs to stop the banker from further action. The complainant contended that the banker had not intimated her husband to undergo any medical examination.
