Banking policy and credit card interest cannot be rewritten by consumer forums absent deception, statutory breach, or RBI mandate.

The text explains that a consumer forum complaint against banks failed because the complainant organisation lacked maintainable locus for representative litigation, the forum could not enter the Reserve Bank of India's statutory domain or impose a ceiling on credit card interest, and it could not rewrite disclosed contractual terms governing card transactions. It also states that charging interest under RBI circulars did not amount to an unfair trade practice absent deception, misrepresentation, or another legally recognised statutory violation. The overall effect was that consumer forum directions limiting interest and altering banking terms could not stand in law.

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Issues: (i) whether the complainant organisation had locus to maintain the consumer complaint in a representative capacity; (ii) whether the National Commission could interfere with banking policy and fix a ceiling on interest rates, despite the statutory domain of the Reserve Bank of India; (iii) whether the impugned decision impermissibly interfered with the contractual terms governing credit card transactions; and (iv) whether the charging of interest in terms of RBI circulars, without a prescribed ceiling rate, amounted to an unfair trade practice.

Issue (i): whether the complainant organisation had locus to maintain the consumer complaint in a representative capacity.

Analysis: To maintain a complaint under the Consumer Protection Act, 1986, the complainant must satisfy the statutory definition of consumer or fall within the categories recognised by section 12. A complaint filed on behalf of consumers in a representative capacity must comply with the procedural mandate akin to Order I Rule 8 through section 13(6). The record showed no prior permission by the Commission for such representative litigation. In addition, a trust was not treated as a consumer for the purpose of the proceedings as a matter of the then prevailing law. The complaint also failed to disclose a concrete consumer cause of action and bore the character of a public interest dispute.

Conclusion: The complainant organisation had no maintainable locus in the manner in which the complaint was pursued.

Issue (ii): whether the National Commission could interfere with banking policy and fix a ceiling on interest rates, despite the statutory domain of the Reserve Bank of India.

Analysis: The statutory scheme of the Banking Regulation Act, 1949 vests the regulation of banking policy and interest-related directions in the Reserve Bank of India. Section 21A bars courts and tribunals from reopening banking transactions on the ground that the rate of interest is excessive, while section 35A empowers the Reserve Bank to issue binding directions in public interest and for proper banking management. The Commission could not assume the role of a financial regulator or impose a judicially created cap on interest in the absence of a RBI mandate. Judicial review is confined to testing legality and reasonableness, not substituting judicial views for expert economic policy.

Conclusion: The National Commission had no jurisdiction to fix a ceiling on credit card interest or to interfere with RBI's regulatory domain.

Issue (iii): whether the impugned decision impermissibly interfered with the contractual terms governing credit card transactions.

Analysis: The credit card terms, including interest and charges, had been disclosed to cardholders through the relevant contractual documents and terms and conditions. A court or tribunal cannot rewrite a contract merely because it considers other terms to be preferable or fairer. In the absence of arbitrariness, mala fides, discrimination, or statutory violation, the contractual stipulations accepted by the parties had to be enforced as written. The Commission's attempt to recast the rate structure amounted to substituting a new contract for the one entered into by the parties.

Conclusion: The impugned decision wrongly interfered with the contractual bargain between the banks and cardholders.

Issue (iv): whether the charging of interest in terms of RBI circulars, without a prescribed ceiling rate, amounted to an unfair trade practice.

Analysis: An unfair trade practice requires a trade practice adopted by deception, misrepresentation, or an unfair or deceptive method in the promotion or provision of services. The record did not show any material particulars establishing deception or any false representation by the banks. The RBI's circulars permitted banks to determine credit card interest within the regulatory framework, and there was no demonstrated violation of those directions. Mere charging of interest, even at a high rate, could not by itself establish an unfair trade practice in the absence of the necessary statutory ingredients.

Conclusion: Charging interest in accordance with RBI's regulatory framework did not constitute an unfair trade practice on the facts of the case.

Final Conclusion: The consumer complaint and the directions issued by the National Commission could not be sustained in law, and the banks' challenge succeeded on all material questions decided.

Ratio Decidendi: Where a statute vests exclusive regulatory control over banking policy and interest directions in the Reserve Bank of India, a consumer forum cannot reopen the transaction, impose a ceiling on interest, or rewrite contractual terms in the absence of proven deception, statutory breach, or other legally recognised unfair trade practice.

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