ORDER                                    Dated: 31.12.2016

Manju Bala Sharma, Member

1.                Instant complaint has been filed by Complainant on 7.4.2016 alleging therein that the complainant took loan from OP against the property for a sum of Rs. 1,85,00,000/- vide loan account No. XOHEDHE 00000863062, in his individual name and paid installment of Rs. 2,60,058/- per month from his saving account till 19.11.2015.  After that  complainant applied to transfer his loan to other bank or to foreclose the said loan but OP intimated the complainant to pay 4% as penalty of foreclosure charges as well as to pay pre-payment extra also only then foreclosure of the loan or transfer of the loan amount to other bank can be done.  Complainant further stated that as per RBI guidelines No. RB/2014-15/121, DNBS(PD) C.C.No. 399/ 03.10.42/2014-15, dt July 14, 2014 as a measure of customer protection and also in order to bring in uniformity with regard to prepayment of various loans by borrowers of banks and NBFC’s , it is advised that NBFC’s shall not charge foreclosure charges/pre-payment penalties on all floating rate term loans sanctioned to individual; borrowers, with immediate effect and therefore complainant can not be charged with 4% as a foreclosure as well as pre-payment charges. Complainant sent legal notice dated 30.12.2015 to the OP to which OP sent its reply on 25.01.2016 but no solution could be made out.  Pleading deficiency in service and unfair trade practice on the part of OP, complainant prayed that OP be directed to return foreclosure charges to the tune of Rs. 7,45,969.64/- (Seven Lacs Forty Five Thousand Nine Hundred Sixty Nine and Sixty Four Paisa) with interest , Rs.1,00,000/- (One Lac) for harassment  and Rs.50,000/- (Fifty Thousand) as litigation charges.

2.       Notices was issued to the OP and was duly served on 30.5.2016 but nobody entered appearance on its behalf, hence on 02.08.2016 proceeded ex-parte. 

3.       Affidavit of ex-parte evidence has been filed by the complainant reiterating the facts stated in the complaint.  Complainant has filed copy of the legal notice Ex. CW 1/1, POD of legal Notice/Receipt Ex. CW1/2, Reply of legal notice Ex. CW 1/3, Guidelines of RBI Ex. CW 1/4, Welcome Letter  Ex. CW 1/5, Sanction Letter Ex. CW- 1/6, copy of letter of cut the foreclosure charges Ex. CW-1/7, copy of Saving Account Pass Book Ex. CW-1/8 and copy of Repayment Schedule Agreement Ex. CW-1/9. 

4.       We are heard Ld. Counsel for the complainant and gone through the documents filed as well as written arguments submitted by the complainant.  On perusal of Welcome letter as Ex. CW-1/5, Sanction letter of financial facilities as Ex. CW-1/6 and letter of OP to cut at the foreclosure charges Ex. CW-1/7 it is crystal clear that the loan has been sanctioned to the complainant as the main borrower and other applicants are the co-borrower with the complainant. Circular No. DNBS (PD) CC No. 399/03.10.42/2014-15 dated 14.07.2014 issued by RBI reads as under ,”

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‘’As measure of customer protection and also in order to bring in uniformity with regard to prepayment of various loans by borrowers of banks and NBFCs, it is advised that NBFCs shall not charge foreclosure charges/pre-payment penalties on all floating rate term loans sanctioned to individual borrowers with immediate effect. ‘’

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5.       As OP has not entered appearance despite service of notice there is nothing on record to rebut the allegations made by the complainant.  Hence, we are of the opinion that OP has failed to comply with the guidelines of the RBI mentioned above and the case put forth by the complainant is true we therefore, hold that OP is liable to pay the foreclosure charges of Rs. 7,45,969.64 which it has charged from the complainant along with interest @ 10% from the date of filing of the complaint till realization, to pay Rs. 20,000/- as compensation and Rs.5,000/- as cost of litigation.

6.       This order shall be complied with by the OP within a period of 30 days from the date of receipt of this order failing which interest @ 10% shall be payable on the entire above mentioned amount till realisation.  Copy of this order is sent to all the parties free of cost.   File be consigned to Record Room. 

Announced on this  31 December 2016.