Notaries

Notary is a public official appointed by the government to provide notarization services to the public. They include taking affidavits and authenticating documents. Notaries are governed by the Notaries Act, 1952 and the Notaries Rules, 1956. The number of notaries in Karnataka is limited by law to 1350, half of whom are appointed by the central government and the other half by the state government.

A casual glance at the system as practised in Mysore shows some major shortcomings.

1. The maximum amount that can be charged for various services provided by the notaries is fixed by Sec.10(1) of the Rules, but some notaries charge more than the limit. For example, the maximum fee for notarizing an affidavit is Rs. 10 and the fee for attesting true copies of original documents is Rs. 5 per page (minimum Rs. 10). These limits are frequently exceeded.

2. The Rules clearly state that the rates charged by a notary should be displayed in a conspicuous place inside as well as outside the notary's office. But such rate charts are rarely seen.

3. The Rules state that the notary should issue a receipt for the fees and charges realized, but this rule is also frequently violated.

4. Some notaries are not careful in checking the identity of the person appearing before them or in carefully going through the documents. Such carelessness defeats the very purpose of notarization. In some cases, this carelessness has escalated into almost contempt of law. We have a copy of a blank MUDA indemnity bond which has been notarized!

The licencing and the control of the notaries also leaves a lot to be desired. A person applying for the position of a notary should prove that the number of notaries practising in that area is insufficient. It is clear from this requirement that the intention of the law is to distribute the notaries equally all across the city and not concentrate them in certain areas. If one looks at the current distribution of notaries in Mysore, it is obvious that the intention of the law has been defeated.

The Rules state that an officer appointed by the government will periodically inspect all the notaries. The government must have been derelict because the problems mentioned above seem to be increasing with time.

Prarthana Kashinath, Mysore Grahakara Parishat

Are You Paying Too Much Interest On Your Loan?

One frequently sees advertisements in the newspapers by finance companies offering loans at "low" interest rates of 2-2.5% per month (or 24-30% per year). If there is delay in repayment of the loan, there is a further overdue interest of 3-5% per year. Many people avail of these loans, especially loans secured with gold or ornaments, as they are easier to get than bank loans.

Most people do not realize that these companies are violating State laws against excessive interest. Karnataka Money Lenders Act, 1961makes charging interest at a rate higher than the rate fixed by the Karnataka State Government a criminal offence punishable by imprisonment of upto three months. There is another law, Karnataka Prohibition of Charging Exorbitant Interest Act, 2004, which makes the penalty harsher by extending it to a limit of three years. The maximum interest rate fixed by Karnataka Government is 15% maximum for secured loans and 18% maximum for unsecured loans. If you pawn your valuables to secure the loan, the maximum rate that can be charged is 15% per year.

Many of these companies make the loan receiver sign a document in which he agrees to pay the interest rates charged by the companies. But even if the debtor signs the contract, charging more than government interest rates is illegal. Sec. 28(2) of the Money Lenders Act says, "Notwithstanding anything contained in any law for the time being in force, no agreement between a moneylender and a debtor for payment of interest at a rate exceeding the maximum rate fixed by the State Government under subsection (1), shall be valid and no Court shall in any suit to which this Act applies award interest exceeding the said rates".

If the money lender harasses the debtor for the payment of excessive interest, legal action should be initiated against him under these two acts.

B.V.Shenoy, memeber, Mysore Grahakara Parishat

Surprising Decision By The District Forum

In a recent decision by the Mysore District Consumer Forum (dated 11-11-09 in Complaint No. CC/09/278), a person who had complained about being charged excessive interest rates has not only been denied compensation but also fined for filing a frivolous complaint. This judgment seems contrary to law.

H.N. Nagendra had pledged ornaments with Manapuram Finance and Leasing Limited and borrowed Rs. 5,700. When he was late on his payments, he was charged compound interest on the outstanding amount. Nagendra filed a complaint before the Mysore District Forum saying that the demand of compound interest is illegal and contrary to the Money Lenders Act.

During the hearings before the forum, the finance company produced a document signed by Nagendra in which he had agreed to pay 24% interest on the loan and 3% overdue interest. It argued that when the complainant had agreed to pay interest at these rates, he could not contend contrary to it and he was bound by the terms and conditions of the contract.

The District Forum agreed with the finance company and said that there was no deficiency in service by it. It decided that Nagendra had filed a frivolous complaint and fined him Rs. 1000 for doing so.

But the decision of the Forum seems to fly against the law. Karnataka Money Lenders Act, 1961 makes charging interest at a rate higher than the rate fixed by the Karnataka State Government a criminal offence punishable by imprisonment of upto three months.

There is another law, Karnataka Prohibition of Charging Exorbitant Interest Act, 2004, which makes the penalty harsher by extending it to a limit of three years. The maximum interest rate fixed by Karnataka Government is 15% maximum for secured loans and 18% maximum for unsecured loans. Since, Nagendra's loan was secured with ornaments, the finance company could not have charged more than 15% interest without violating the law. Sec. 28(2) of the PCEI Act also says "Notwithstanding anything contained in any law for the time being in force, no agreement between a money-lender and a debtor for payment of interest at a rate exceeding the maximum rate fixed by the State Government under sub-section (1), shall be valid and no Court shall in any suit to which this Act applies award interest exceeding the said rates". So the contract signed by Nagendra in which he agreed to pay 24% interest and 3% overdue interest was not valid and the finance company still could not charge more than 15% interest. It appears that the District Forum did not consider this fact. So it was not correct in upholding the argument of the finance company. In light of the two laws mentioned above, Nagendra's complaint was valid and was not frivolous.

Problems in the E-filing System of the Supreme Court

The Supreme Court has instituted a system through which advocates and the public can file cases before the Supreme Court electronically. The launching of the e-filing system to make the Supreme Court easily accessible to the public is most welcome.

But due to improper design of the e-filing system, it is extremely difficult to use. We have been trying to e-file two appeals against orders of the National Consumer Commission for the last seven months. Every time we e-file our appeals, the assistant registrar of the Supreme Court points out the defects in them, we correct the defects and e-file once again. We have gone through three revisions, but we still have not been able to get them approved.

Based on our experience with the Supreme Court e-filing system, we wish to bring some major problems in the system to your attention and suggest some solutions. It is our belief that by removing these deficiencies in the implementation of the e-filing system, it can be made more accessible to the public. It will also reduce the load on the registrar's office. The good idea of e-filing can be made more useful by proper software implementation.

PROBLEM 1. The sign-up process seems to work only with the Microsoft Internet Explorer (IE) web browser. It definitely does not work with Firefox (or Iceweasel) web browser which innumerable people use. The characters in the left window of the User Registration form is completely garbled up in the Firefox browser and so one can not even complete the sign-up process. Many people may not realize that this is a browser-related problem and may give up on e-filing.

Once a person has signed up for e-filing (using IE web browser), he/she can log in even from Firefox (or Iceweasel) web browser. But uploading the petition copy is still difficult. It is our repeated experience that all the files are not transmitted.

SUGGESTION: The e-filing process should be made browser-independent. The public of India should not be forced to buy the proprietary and expensive software of Microsoft Company to make use of e-filing facility. The Supreme Court should encourage non-proprietary and free software such as Linux (and web browsers such as Firefox and Iceweasel which work with Linux), especially in a poor country like India. Incidentally, at the meetings of ISO (International Organization for Standards), India has consistently voted for Open Document Format (which can be accessed by non-Microsoft software also) and against accepting the Microsoft internet format as the international standard.

PROBLEM 2. The filing fee and the printing charges are now collected at the time of initial filing. Every time the registrar's office points out any defects, the defects will have to be rectified and the corresponding pages re-uploaded. Printing charges have to be paid for the re-uploaded pages. Very often, even a small correction on one page changes the page numbering and so all the succeeding pages have to be uploaded at great expense even though there are no corrections (except page numbering) on them. This causes needless expenditure to the petitioner.

SUGGESTION: The printing charges should be collected only when the e-filed petition gets the approval of the registrar.

PROBLEM 3. During user sign-up, the screen asks for a hint question for the password and the sign-up can not be completed unless the hint question is given. But, in the login screen, there is no help for remembering a forgotten password. If one forgets his/her password, there is no way of recovering it. So e-filing can not be accessed and the money and effort till then will be wasted.

SUGGESTION: The login screen should be redesigned to help people who have forgotten their passwords.

PROBLEM 4. Our petition copied the format of the paperbook of an SLP admitted by the Supreme Court in 2003. But the guidelines for SLPs must have changed since 2003 because our petition has been found defective not once, but three times, even after revisions. For people who do not have the advantage of possessing an SLP, it must be much more difficult. The instructions on the Supreme Court website on how to file an SLP are not at all adequate.

SUGGESTION: A complete model SLP with all the supporting applications (such as application for exemption from filing certified copies of lower court orders, application for condonation of delay, etc.), affidavits, certificates, etc., composed with the correct font with the correct margins etc. should be available to the public on the Supreme Court website. It can be uploaded in Open Document Format so that it can be opened even with non-Microsoft software. The user can open this document and change the names of the petitioner and the respondents and edit the rest to his/her requirement. Since the user will be using a standard template for the SLP, the defects in the petition will be minimum and so the load on the registrar's office will be greatly reduced. Similar templates for all types of petitions that can be filed before the Supreme Court can be prepared and uploaded on the Supreme Court website.

Maj.Gen.(Rtd.) S.G. Vombatkere, President, Mysore Grahakara Parishat

AKRAMA-SAKRAMA

The State Cabinet's formal approval of regularization of unauthorized housing layouts and violations of building by-laws upto 50% (domestic) and 25% (commercial) buildings highlights the ineffectiveness of urban governance in Karnataka. If laws could not be enforced over decades, successive governments have clearly failed, or the law itself was inappropriate. However, the penalty intended to now be levied cannot compensate for loss of tax revenue over the many years when CR was not issued and tax not recovered. It also makes citizens who have not committed violations and paid tax, appear like honest fools. Thus, regularization sends the message that breaking laws and by-laws can be compensated by payment of money, that it can be profitable to break the law for a price (it is also well known that there are cheap ways to avoid paying heavy penalties), and that the law is meant to be adhered to by fools. It appears that earning revenue is the most important if not the only consideration for urban governance.

Nevertheless, even this if-you-can't-lick-'em-join-'em formal abdication of governance powers has to be thorough, so as not to create loopholes that may be exploited in future by potential law-breakers. As the press reports are understood, there are two unanswered questions in the Cabinet decision. One, what guidance has the Cabinet given to the ULBs in regard to those violators who do not respond to the offer of regularization because, for example, they cannot afford the large sums of penalty money? Two, what guidelines have been provided to ULBs to control unauthorised housing layouts and by-law violations starting from the cut-off date of 03 December 2009? Or is 50% (domestic) and 25% (commercial) the starting point for on-going and future constructions, and will unauthorized housing layouts be permitted and regularized in due course for a consideration at the operating level, of course?

The above questions and the unabated, irregular on-demand change of land use being permitted by MUDA in spite of MGP's frequent notices to MUDA over several years need to find place in the on-going discussions on urban planning. But are our elected representatives aware of these issues?

 

Maj Gen S.G.Vombatkere, President, Mysore Grahakara Parishat