CLIENT CONSULTATION REPORT

CLIENT DETAILS

• Client Name: Chethan S.

• Age & Gender: 27, Male

• Occupation: Business Man

• Contact Details: 8800880088

• Address: 69, SRS Road, Peenya 1st Stage, Bangalore – 560058

NATURE OF THE CONSUMER COMPLAINT

• Product/Service Involved: Personal Loan from XYZ Finance Company

• Date of Loan Sanction: 16/04/2023

• Name of Service Provider: XYZ Finance Company

• Transaction Details:

o Loan Amount: ₹10,00,000

o Interest Rate: 20%

o Tenure: 24 months

o EMI: ₹50,896 per month

o Payments Made: 20 EMIs paid

o Defaults: Missed last 2 EMIs due to business losses

FACTS OF THE CASE

• Brief Background:
The client availed a personal loan of ₹10 lakhs from XYZ Finance Company under
standard terms. The EMI was set at ₹50,896, and he consistently paid for 20 months.
 However, due to recent financial hardship and business losses, he defaulted on the last
two EMIs.

• Key Issues Faced:

1. Recovery agents began visiting the client’s residence late at night, violating his
privacy.

2. Personal loan details were disclosed to neighbors, resulting in mental

harassment and public humiliation.

3. The client’s personal car was seized without prior notice or legal order, despite
the fact that it was not hypothecated against the loan.

• Attempts at Resolution:

o Complaint filed at the local police station regarding illegal car seizure.

o Complaint filed with the RBI Ombudsman, but no response received even after
30 days.

o No appropriate action taken by police authorities.

LEGAL ANALYSIS

• Relevant Consumer Protection Laws:

o Consumer Protection Act, 2019:

▪ Section 2(6) – Definition of "deficiency in service"

▪ Section 2(47) – Definition of "unfair trade practice"

▪ Section 3 – Provisions override other inconsistent laws

▪ Section 17 – Jurisdiction of State Consumer Commission

o Reserve Bank of India Guidelines on Fair Practices Code (FPC)

▪ Guidelines prohibit recovery agents from acting in an abusive,

threatening, or harassing manner.

▪ Time restrictions: No calls or visits post 7 PM or before 7 AM

 ▪ No third-party disclosure without borrower consent

o Indian Penal Code (IPC):

▪ Section 503 & 506 – Criminal intimidation

▪ Section 441 – Criminal trespass

▪ Section 379 – Theft (in case of illegal vehicle seizure)

• Case Laws/Precedents:

o ICICI Bank v. Shanti Devi Sharma (2008) – DCDRC held bank liable for mental
harassment by recovery agents

o Manager, ICICI Bank Ltd. v. Prakash Kaur (2007) – Delhi High Court
condemned strong-arm tactics

o K.K. Singh v. State Bank of India (2006) – Car seizure without following due
process deemed illegal

• Legal Rights of the Client:

o Right to privacy under Article 21 of the Constitution

o Protection against harassment and unlawful seizure under RBI guidelines and
IPC

o Right to compensation for mental harassment, reputation loss, and illegal

possession of property

o Right to file a consumer complaint for deficiency in service and unfair trade
practices

RECOMMENDED COURSE OF ACTION

1. Consumer Forum Complaint:

File a complaint before the State Consumer Disputes Redressal Commission for:

o Compensation for mental agony and harassment

o Return of illegally seized vehicle

 o Penalty for unfair trade practice and privacy violation

2. Legal Notice to XYZ Finance:

Issue a legal notice through an advocate demanding return of the car and cease of
harassment.

3. Writ Petition (if police inaction continues):

File a writ petition (mandamus) in the High Court seeking direction to the police and
RBI Ombudsman for redressal.

4. Further Complaint to RBI:

Escalate matter to Banking Ombudsman Appellate Authority with supporting
documents and proof of no response within 30 days.

ATTACHMENTS

• Copy of Loan Agreement (with details of amount, interest, tenure, and EMI
structure)

• Complaint copy filed at Police Station (with date and acknowledgment)

• Complaint copy filed with RBI Ombudsman (with date and acknowledgment)
 POLICE COMPLAINT

To:
The Station House Officer
Peenya Police Station
Bangalore - 560057

Subject: Complaint regarding illegal seizure of vehicle and harassment by XYZ Finance
Company agents

Respected Sir/Madam,

I, Chethan S., aged 27, resident of 69, SRS Road, Peenya 1st Stage, Bangalore – 560058, wish
to lodge a complaint against XYZ Finance Company and its recovery agents for illegally
seizing my personal vehicle and harassing me and my family.

I availed a personal loan of ₹10,00,000 from XYZ Finance Company with a 24-month tenure
and an EMI of ₹50,896. I have paid 20 installments and defaulted only on the last 2 months
due to financial hardship. However, recovery agents started visiting my residence past 10 PM,
disclosing my loan details to neighbors and causing public humiliation.

Most shockingly, on 13/03/2025, my personal car was taken away by recovery agents without
any court order or notice. The vehicle was not hypothecated under the loan agreement, and
such forceful repossession is unlawful.

I request you to kindly register my complaint and take necessary legal action against the
company and its agents. I am enclosing my loan agreement copy and RBI Ombudsman
complaint as supporting documents.

Thank you.

Sincerely,
Chethan S.
Mob: 8800880088
Date: 15/03/2025
Encl: Loan Agreement, Ombudsman Complaint, ID Proof
 RBI OMBUDSMAN COMPLAINT

To:
The Banking Ombudsman
Reserve Bank of India

Subject: Complaint against XYZ Finance Company for harassment and illegal recovery
practices

Respected Sir/Madam,

I am filing this complaint against XYZ Finance Company for violating RBI’s Fair Practices
Code and causing mental harassment through unlawful recovery measures.

I had taken a personal loan of ₹10 lakhs (Loan ID: 32321252) with a 24-month tenure and a
20% interest rate. I paid EMIs regularly for 20 months but defaulted on 2 due to business losses.
Thereafter:

1. Agents of XYZ Finance began visiting my home at odd hours, especially after 10 PM.

2. They disclosed my financial status to neighbors, violating my privacy.

3. On 13/03/2025, my personal car was seized without any notice or legal authority,
although the car was not pledged against the loan.

I filed a police complaint, but no proper action has been taken. I seek your intervention under
the RBI Ombudsman Scheme and request action against the finance company for non-
compliance with RBI regulations.

Thanking you.

Yours sincerely,
Chethan S.
Mob: 8800880088
Email: [email protected]
Address: 69, SRS Road, Peenya 1st Stage, Bangalore – 560058
Date: 16/03/2025
Encl: Loan Agreement, Police Complaint Copy, Supporting Documents
 LOAN AGREEMENT FORMAT

Loan Agreement
This agreement is made on between: 16/04/2023

Borrower: Chethan S., aged 27, resident of 69, SRS Road, Peenya 1st Stage, Bangalore –
560058
Lender: XYZ Finance Company, having registered office at vijaynagar-Bangalore

Loan Details:

• Loan Amount: ₹10,00,000

• Interest Rate: 20% p.a. (Flat)

• Tenure: 24 months

• Monthly EMI: ₹50,896

• Mode of Disbursal: Bank Transfer

• Repayment: Monthly EMIs through auto-debit

• Security: Unsecured personal loan (i.e., no asset pledged or hypothecated)

Terms & Conditions:

1. In case of default, the Lender shall initiate recovery as per RBI guidelines.

2. No personal property shall be seized without due legal process.

3. Any harassment, coercion, or third-party disclosure is strictly prohibited under RBI

norms.

Signed on this day - 16/04/2023

Signature of Borrower: __________________

Signature of Lender Representative: __________________