Telangana: Consumer Commission Slams SBI For Delaying Car Auction Refund, Orders Full Payment With Interest

Hyderabad: The Rangareddy District Consumer Commission on Wednesday has pulled up the State Bank of India (SBI) for "deficiency in service" after the bank delayed refunding the surplus auction proceeds from a customer's seized car, directing it to pay the full amount with interest and compensation.

M. Jaipal Reddy, a Bachupally resident, took a Rs 6 lakh vehicle loan from SBI's Dullapalle branch in 2017 to buy a Maruti Swift Dzire. According to Reddy, financial hardship during the COVID-19 pandemic led to missed EMIs, prompting the bank to seize the car in March 2021.

Subsequently, the ban auctioned the car on April 20 that year for Rs 4.20 lakh.

After deducting the outstanding loan and charges, Rs 2,14,481 remained due to Reddy. However, SBI stalled the refund and imposed what he called unnecessary charges, forcing him to approach the commission.

During hearings, the bank cited "various reasons" for the delay and offered only Rs 67,000. The commission dismissed these claims, ruling the bank's inaction as a service failure.

It ordered SBI to pay the entire Rs 2,14,481 plus 9% interest from April 20, 2021, along with Rs 30,000 for mental agony and Rs 10,000 for legal costs. The order stated that non-compliance within 45 days will attract 12% interest.

Also Read

1. Hyderabad Consumer Commission Orders Hospital To Pay Rs 5.20 Lakh For Negligence
2. Airbags Not Deployed During Accident: Toyota Asked To Pay Rs 61 Lakh To Chhattisgarh Brothers For Manufacturing Defect