AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1446
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....he guise of collection of loan amount, she has been harassed with all kinds of abuses such as "sexual overtones" and circulating her images over WhatsApp groups tagging her "CHOR." A similar complaint was registered by one Kum. Vinditha who had also taken loans through the mobile apps, after the installation all the necessary information taken from her phone and by using her contact details, a WhatsApp group was created to circulate obscene words maligning the character. 3. A letter dated 30.12.2020 was received by DGP, CID, Special units and economic offences, Bengaluru wherein it was stated that FIR Nos. 0018/2020 and 0019/2020 have been registered by Cybercrime police station, CID, Bengaluru under sections 384, 385, 419 and 420 of the Indian penal code., 1860 and section 72A of the information technology act, 2000. It was alleged that the complainant installed the app for availing a loan of a small amount and on installation the basic details such as PAN, Aadhar card and bank details were provided as prompted in the app. The details were later misused to harass by way of obscene words to circulate over WhatsApp. For each loan, exorbitant processing charges were deducted and t....
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....irements for loan along with identification documents. The process was undertaken with consent of the borrowers and the sanction letter issued after acceptance of the request for loan included all the essential details such as interest rate, loan tenure, processing fees, other charges, terms and conditions etc. 9. The learned counsel stated that the appellant further argued that he has no role to play and the process was outsourced to third party who in turn outsourced the process of collection of the loan amount. 10. The learned counsel for the appellant further submitted that the activity of processing of KYC information provided by the customer and collection of funds was outsourced to service providers with adherence to the fair practices, code of conduct as well as the collection policy of the company. 11. The appellant has referred to the service agreement entered with the service providers and stated that as per the agreement, the NBFC have to source the loan application, check it as per the loan criteria of the company and forward the applications through an integrated digital platform. The loan applications were processed digitally with due diligence by checking t....
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....ance Guarantee" in the MID of NBFCs. It is alleged that fintech company was free to do its lending business using this money. In reality the Fintech Company was lending loan from their own money for which a MOU was entered with Indian NBFC Company, and got a de-facto NBFC license. The APPs were playing a risky high return game. The appellant gave instant micro-loans to thousands of customers with minimum KYC requirements. It was just based on online verification. At the time of sanctioning of loan, they would deduct 30-40% amount as "processing fee" and on the loan amount, charged heavy rate of interest with high penalty rate etc. although, the interest rate remains up to 36% per annum however, due to processing fees, the effective rate of interest reaches up to 1500% to more than 2000% per annum. A perusal of the sample sanction letters of the appellant with M/s Mad Elephant Network Technologies Private Limited revealed that the effective rate of interest per annum comes about 2233% per annum. 18. At the time of loan, they captured the mobile data of the customers and their phone contact data. They employed call centers who were notorious in chasing online and through threat ca....
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....sclosed to each other, shall not be dis closed to such third parties. 2.4. The NBFC shall pay the consideration to the Service Provider for the Services as detailed out above and for customers not rejected by the NBFC. The Services shall be calculated as a Monthly Payments which are detailed out in Schedule 2. 2.5. The Service Provider shall provide statements, and invoices within 7 days after the end of the last day of the month to NBFC towards the consideration the Ser vice Provider would earn, and the said consideration, if not disputed by the NBFC shall be paid within a period of 10 days from the date of the invoice. 2.6. If the Service Provider engages the services of collection agents for recovery of loans extended by the NBFC, it shall do so on behalf of the NBFC. The costs of engaging such collection agents and any other costs in relation to the processing of the loan or in the process of collection of the loan, shall be mutually decided by both the Parties. The Service Provider shall ensure that legal and technical requirements are complied with, while entering into such contracts with the agents and/or engaging them. The Service Provider shall a....
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....tered among the Service provider, NBFC and the escrow bank. 3.3. The Service Provider shall ensure that all amounts paid by a Borrower are de posited only in the Repayment Account. 3.4. The Service Provider shall promptly within 48 hours notify the NBFC in writing of any event which may result in or which may give reason to believe that there may be a work stoppage or other impediments or disruptions in the due performance of the obligations of the Service Provider under this Agreement. 3.5. In the event any excess payment is made by the Borrower to the NBFC through the Repayment Account or any other refund is due to the Borrower, the NBFC shall refund such amount to the Disbursement Escrow Account and the Service Provider will refund such amount to the relevant Borrower, once such claim of the Borrower has been resolved/settled by the NBFC. 3.6. The NBFC reserves its right not to extend any loan, advance or credit to any Customer. The NBFC shall have the discretion to charge any Borrower any ROI that the NBFC may specify at its sole discretion, not exceeding the maximum rate prescribed under law or under any direction or guidelines prescribed by....
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....n the Parties in writing. B. Customer Identification and Loan Processing 1. The Service Provider shall assist the NBFC Identify prospective Customer for the loans as specified in Schedule 3, based on the eligibility criteria provided by the NBFC that may be revised from time to time. 2. The Service Provider shall seek requisite consents and permissions from the Customer, to conduct a background verification of such Customer and share details of such Customer with the NBFC. The NBFC shall be responsible to keep the information of the Customer/Borrower as confidential. The NBFC Indemnifies the Service Provider and agrees that Service Provider shall not be liable for any dis-closure by the NBFC to any third parties or any claim from the Customer/Borrowers or its representatives, if such disclosure is not attributable to the Service Provider. 3. Subject to Clause A, the Service Provider shall provide the NBFC with details of the Customer it has identified, along with the Customer background check data and credit reports generated by the Service Provider in order for the NBFC to evaluate the eligibility of the Customer to avail of loans. 4. A....
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.... with respect to loan lending and debt recovery were kept upon the marketing manager/fintech companies. The agreement has on one hand provided that debt recovery agents shall be appointed and would not engage in threatening or abusing the borrowers, however at the same time, the penalty clause in the agreement, gives a free hand to threaten the borrowers for debt recovery which is the modus of the appellant to defraud the borrowers. 23. The appellant has argued the case on facts relying upon the service agreement which is reproduced above. The agreement showcases a free hand to the fintech companies to operate in the lending business which is a core-activity of the NBFC and in return, NBFCs received return on revenue sharing basis. It is case where one fintech company may have entered into agreement with various NBFCs and one NBFC may have Agreement with more than one Fintech company. The particular Fintech company run Different mobile Apps for same NBFC. The scope of work on the part of Fintech Companies included to create, maintain and run the App to provide digital lending platform, marketing activities and promotion of business, taking application for loans from borrowers th....
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....n this policy. If you do not wish to agree to these T & C (Terms and Conditions), please refrain from using this app. Refund/Cancellation policy Currently we do not have refund cancellation policy. If users have any issues on cancellation, please feel free to contact with our help centre through panda rupees app. This website is protected by copyright and other intellectual property laws of India. 1. Collection of information Use of the panda rupees platform, we will collect information and data including but not limited to your personal information and sensitive personal information/data, as defined under the information on technology (Reasonable security protection and produce and sensitive personal data or information) Rules, 2011. You hereby provide us explicit onset to collect the following data from you as a data provider which also includes sensitive personal information. 1.11 Facilitating purchase and sale of product between the users in its platform. 1.12 Assisting its customers to obtain product from various ways who are partnered with panda rupees. 1.13 Assisting its users to obtain their credit report through authorised agents partnered with panda r....
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....of 7 days. In maximum cases, the period of loan ranges from 7 to 14 days. The lending mobile app deducts platform charge or processing fee out of the disbursed amount to the borrower which is as high as 30-40% of the amount sanctioned to the borrower. For example, if loan of Rs.5000 is sanctioned to some person, actual amount of Rs.3500 is transferred to his bank account after deducting Rs.1500 as platform fees. The interest rate generally remains 36% per annum. However, due to processing fees, the effective rate of interest comes between 1500% to more than 2000% per annum. The main source of revenue in this model, is the processing charges which is dependant upon rotation funds. If the recovery is quick and higher, then the same amount can be rotated 4 times in a month and processing fee can be charged four times on the same amount. 28. The fintech companies provided facilities to avail loan with minimum requirements and not merely a software, thus luring the borrowers who are in dire need of funds. The appellant took advantage of their situation and made them subject to the harassment/ blackmailing/extortion/ abuse etc through the tele-callers by misusing their personal data w....