Chandigarh

DF-II

CC/401/2020

Devinder Singh Jamwal - Complainant(s)

Versus

HDFC Bank Limited - Opp.Party(s)

Vishal Garg Narwana and Sudhir Theari

02 Nov 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II

U.T. CHANDIGARH

 

Consumer Complaint No.	:	401/2020
Date of Institution	:	25.08.2020
Date of Decision	:	02.11.2023

 

                     

            

 

1. Devinder Singh Jamwal son of Late Jagdev Singh, Age about 51 years, Resident of House No.1401, Sector 20-B, Chandigarh (E-Mail:jamwaldevinder@rediffmail.com)

 

2. Meena Jamwal wife of Sh. Devinder Singh Jamwal, Age about 48 years, Resident of House No.1401, Sector 20-B, Chandigarh (E-Mail:meenajamwal@yahoo.com)

….Complainants

Versus

 

1. HDFC Bank Limited, Through the Branch Manager/Officer-in-Charge, SCO No, 153-155, Sector 8-C, Madhya Marg, Chandigarh-160008.(E-Mail:prernaanand@hdfc.com).

 

2. HDFC Bank Limited, Through the Managing Director, Regd. Office: Ramon House, H.T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai-400020 (E-Mail:customer. service@hdfc.com).

…. Opposite Parties.

 

BEFORE:
	SHRI AMRINDER SINGH SIDHU,	PRESIDENT
	SHRI B.M.SHARMA	MEMBER
Present:-
	Sh.Vishal Garg Narwana, Counsel for the complainant along with complainant Ms.Rupali Shekhar Verma, counsel for the OPs.

   

 

ORDER BY AMRINDER SINGH SIDHU, M.A.(Eng.),LLM,PRESIDENT

1.     The complainants have filed the present complaint pleading therein that they jointly applied for the housing loan of Rs.60.00 lacs with the OPs for the purchase of the residential plot measuring 250 sq. yards at Village Hasanpur, Sunny Enclave, Sector 123, Mohali (i.e. Rs.35.00 lakhs for purchase of the plot and Rs.25.00 lacs for raising construction thereupon). The loan was approved vide letter dated 06.10.2018 for Rs.60.00 lakhs @ 9% p.a. for the term of 15 years with EMIs of Rs.60,856/- per month. On 16.10.2018, complainant No.1 received a text message that the OPs arranged to disburse an amount of Rs.31.50 lakhs on 17.10.2018 against the approved loan of Rs.35.00 lakhs.  On enquiry, it was informed that the OPs reduced the loan to Rs.57.80 lakhs without the consent of the complainants.  Since the date of registration of the sale deed was fixed as 18.10.2018 and as such they signed the necessary documents for obtaining the lesser loan and accordingly, the monthly EMI was reduced to Rs.58,453/- per month by making cutting on the loan-acceptance letter dated 06.10.2018. The OPs released the cheque dated 17.10.2018 for Rs.31,50,000/- to the complainants at the time of registration of the sale deed dated 18.10.2018 (Annexure C-17) and the remaining amount of Rs.3.00 lakhs were paid by the complainant No.2 and the sale deed was mortgaged with the OPs. Subsequently, the complainants applied for revised permission for joint housing loan to Rs.57.80 lakhs vide request letter dated 21.11.2018 (Annexure C-19). On 18.10.2018, when the complainants were perusing all the documents, it came to their notice that apart from the housing/construction loan account No.636153698, OP No.1 without their consent created another loan a/c No.636622471 in the name of “Insurance Premium Funding on Land Loan) for Rs.6,49,592/- of their own and obtained their signatures  on the documents for another loan while getting the signatures on the documents for the housing/construction loan.  It has also come to the notice of Complainants while going through the documents i.e. Letter of Part disbursement advice dated 17.10.2018 of Housing Loan bearing no. 636153698 and Final disbursement advice dated 17.10.2018 of Land Loan bearing No.636622471 in the name of "Insurance Premium Funding On Land Loan," that the OPs will deduct Rs. 11,704/- against Pre-EMI Interest against Loan Account No.636153698 & Rs.2,508/-against Pre-EMI Interest against Insurance for Land Loan A/c No.636622471, total amounting to Rs.14,212/- for the month of October, 2018. Further, the OPs will deduct Rs.23,494/- against Pre-EMI against Loan A/c No.636153698 and Rs.6,570/- against EMI against Insurance for Land Loan A/c No.636622471, total amounting to Rs.30,064/- for coming months.  Immediately the Complainants approached  OP No.1 in writing dated 19.10.2018 (Annexure C-21) for closing the Loan A/c No.636622471 amounting to Rs.6,49,592/- and not to deduct the EMI of Rs. 14,212/-, which was against Two number of Loan Accounts. Despite the request, an amount of Rs. 14,212/- was deducted by filing the blank cheque bearing no. 608600 obtained by OP No.1. However, the complainants were assured that they will close the said loan within two days. It has been alleged that they had not only visited number of times with their aforesaid request, but also given number of request letters in writing to the OPs on 20.12.2018, 15.01.2019, 06.03.2019, 27.03.2019, 18.04.2019 etc. [Annexure C-23(a) to Annexure C-23(e)].

         As per the terms & conditions of Housing Loan bearing no.636153698 of amounting to Rs.57,80,000/-, the OP No.1 had to release 20% of sanctioned Plot construction Loan of Rs.26,30,000/- after completion of D.P.C. but OP No.1 released Rs.3.50 lakhs instead of Rs.5.30 lakhs i.e. 20% of the sanctioned plot construction loan of Rs.26.30 lakhs.  The complainants shown all the relevant documents to the OPs for getting 20% of the sanctioned plot construction loan of Rs.26.30 lakhs but all in vain. Finally, the complainants decided to switch over the housing loan from OP NO.1 to State Bank of India and made a request letter dated 28.05.2019 (Annexure C-25) to the OP NO.1 for foreclosure of the housing loan a/c No.636153698 by switching over to SBI and deposited Rs.590/- by way of Cheque bearing no. 830355 dated 28.05.2019 (Annexure C-27)  for obtaining documents of Foreclosure and 2nd request letter dated 28.05.2019 (Annexure C-26) was made for closing the Insurance for Land Loan A/c No.636622471 amounting to Rs. 6,49,592/- which was never opted for. But no action has been taken by OP NO.1 despite request letters dated 10.06.2019 and 12.06.2019(Annexure C-29 & 30). Finally, the complainants received the statement of accounts for the aforesaid two loan accounts(Annexure C-31 and C-32). Vide letter dated 18.06.2019 (Annexure C-33), the Complainants were advised to pre-pay the entire Loan amount of Rs.34,90,961/ on or before 21.06.2019 against Housing Loan Account bearing No.636153698 and the Concerned Official namely Ms. Shaveta Khanna of OP No.1 also written on the backside of this letter that an amount of Rs.6,37,460/- be also deposited on or before 21.06.2019 against the insurance for land loan.  It has been averred that they have never received the insurance policy against the said loan nor the amount of Rs.6,49,592/- had been released to them. The complainants raised the protest against the said demand of Rs.6,49,592/- vide letter dated 19.06.2019.   On the ruthless conduct of the Concerned Officials of OP No.1, the Complainant No. 1 had deposited an amount of Rs.6,34,052/-by way of cheque bearing no.830363 dated 21.06.2019 from his personal saving account towards the Insurance for Land Loan Account bearing No.636622471. However, the Branch Manager of Opposite Party No. 1 assured that the case of Complainants is under consideration and the amount of Rs. 6,34,052/- deposited against the Insurance for Land Loan will be remitted back to them. The Complainants have also deposited the amount of Rs. 34,90,961/- by way of Cheque bearing no. 318873 dated 20.06.2019 issued by the State Bank of India, against Housing Loan Account bearing No.636153698 and requested to release necessary receipt and documents, besides NOCs for the same.  However, the amounts of Rs. 6,34,052/- against Insurance for Land Loan Account has not been remitted by the OPs. It has further been averred that they are also legally also entitled for the amounts of EMI of Rs.48,380/- in total, charged against the Insurance for Land Loan Account bearing No.636622471 of Rs.6,34,052/-, which was never opted for/taken by the Complainants and immediately requested to the OP No.1 for the closure of same. As such, the Complainants have given request Letter dated 09.09.2019 to the Opposite Parties through registered post. Despite the receipt of the same, the OPs have failed to take any action on the request of Complainants. Thereafter, the Complainants have received reply dated 19.09.2019 (Annexure C-47) in response to request letter dated 09.09.2019 vide which claim has been denied and they were advised to take up their Claim Case with HDFC Standard Life Insurance Company Limited. The complainant again given request letter dated 30.09.2019 to OP No.2 with a copy to OP No.1, but no action was taken on the request of Complainants and even the OPs have not bothered to reply the same. The complainants sought the information under the RTI vide application 27.12.2019 but to no effect.  It has been alleged that the OPs have unlawfully retained Rs.6,34,052/- and the amounts of EMI of Rs.48,380/- in total, charged against the said Insurance for Land Loan Account bearing No.636622471 without any rhyme and reasons. Alleging that the aforesaid acts of omission and commission on the part of the OPs amount to deficiency in service and unfair trade practice, the complainants have filed the instant complaint seeking directions to the OPs to refund Rs.6,34,052/- and the amounts of EMI of Rs.48,380/- charged against the said Insurance for Land Loan Account bearing No.636622471 along with interest, compensation and litigation expenses.

2.     After service of notice upon the OPs, they appeared before this Commission and filed their written version stating that the sanctioned loan of Rs.60.00 lakhs was reduced to Rs.57.80 lakhs on the request of the complainants. The loan availed by the Complainants for payment of insurance premium was in pursuance of a separate loan agreement and sanction letter duly signed and acknowledged by the Complainants. The  complainants have concealed the fact that they must have received insurance policies and must have executed separate documents with the insurance company. It is not even their suggested case that the loan amount of the insurance premium was never disbursed in favour of the insurance company. It has further been stated that the loan amount disbursed at the time of construction is strictly in terms and conditions of the loan agreement based on the field reports and stage of construction. The complainants could not have compelled them to disburse loan beyond or contrary to the stage of construction. In any case, this issue no longer survives because the parties have already parted ways and they are no longer in a contractual relationship. It has further been stated that as per the records the processing fee of Rs.2,950/- has been charged by HDFC Limited in accordance with the understanding of parties. The remaining allegations have been denied, being false. Pleading that there is no deficiency in service on their part, the OPs prayed for dismissal of the complaint.
3.     The complainants filed replication to the written reply of the OPs controverting their stand and reiterating their own.
4.     The parties filed their respective affidavits and documents in support of their case.
5.     We have heard the Counsel for the contesting parties  and have gone through the documents on record including written submissions.
6.     The main issue involved in the present case is whether the act of the OPs in creating another loan account in the name of Insurance Premium Funding on Land Loan without the consent and knowledge of the complainants amounts to restrictive trade practice on their part or not?
7.     In order to find out answer to the above mentioned issue, it is important to take into consideration Section 2 (41) (ii) of the Consumer Protection Act, 2019, which reads as under:-

“Section 2(41) "restrictive trade practice" means a trade practice which tends to bring about manipulation of price or its conditions of delivery or to affect flow of supplies in the market relating to goods or services in such a manner as to impose on the consumers unjustified costs or restrictions and shall include—

(i)      xxxxxxxxxxx

(ii)     any trade practice which requires a consumer to buy, hire or avail of any goods or, as the case may be, services as condition precedent for buying, hiring or availing of other goods or services;”

         The bare  perusal of the aforesaid Section clearly reveals that any trade practice which requires a consumer to buy, hire or avail of any goods or, as the case may be, services as condition precedent for buying, hiring or availing of other goods or services amounts to restrictive trade practice. In the instant case, the complainants have specifically averred in the complaint that the OPs without their consent  and knowledge created another loan a/c No.636622471 in the name of “Insurance Premium Funding on Land Loan) for Rs.6,49,592/- of their own and obtained their signatures  on the documents for another loan while getting the signatures on the documents for the housing/construction loan whereas they never agreed or consented for another loan except the housing loan for purchase of the plot and construction thereof. 

         Finally, on the request of the complainants, the SBI, Sector 17, Chandigarh sanctioned/switching over the joint housing loan to the tune of Rs.57.80 lakhs on 20.06.2019 (Annexure C-34) in their names.

8.     It may be stated here that immediately on coming to know about the aforesaid act of the OPs in creating the aforesaid loan account under the name of Insurance Premium Funding on Land Loan, the complainants  wrote various letters for cancellation of the said policy, followed by the registered letter dated 09.09.2019 but the said request was denied by the OPs bank with advice to take up the matter with HDFC Standard Life Insurance Co. Ltd. despite the fact that the complainants never approached the said company for taking the policy/loan. Even otherwise, the OPs have not placed on record the complete copy of the insurance policy/certificate for the reasons best known to them.
9.     Besides  this, the OPs also flouted another Statutory Guidelines of Notification dated May 26, 2016 on Para 18 (d)(v) and 18 (d) (iii) (c) mentioning therein that "The bank shall not follow any restrictive practices of forcing a customer to either opt for products of a specific insurance company or link sale of such products to any banking product". Even the OPs Bank did not disclose the complainants that they had opened in the air a dummy Insurance Premium Funding Land Loan No.636622471 of Rs.6,49,592/- on the same very day while signing more than 100 documents for taking housing loan by the complainants i.e. on 17.10.2018 by linking product of insurance company with the banking product/loan at its own, which amount never deposited into the Account of the complainants, Therefore, the OPs Bank have not treated the complainants fairly, honestly and transparently with regard to insurance product as OPs Bank sole objective was to enhance its "other income" portfolio.
10.     In similar set of facts the Hon’ble Punjab & Haryana High Court in the case titled as New India Assurance Company Limited Vs. Smt.Usha Yadav & Others 2008(3) RCR (Civil) Page 111 went on to hold as under:-

“It seems that the insurance companies are only interested in earning the premiums and find ways and means to decline claims. All conditions which generally are hidden, need to be simplified so that these are easily understood by a person at the time of buying any policy. The Insurance Companies in such cases rely upon clauses of the agreement, which a person is generally made to sign on dotted lines at the time of obtaining policy. Insurance Company also directed to pay costs of Rs.5000/- for luxury litigation, being rich”.

11.     Taking into considering the overall facts and circumstances of the present case, we have no hesitation in our mind to come to the conclusion that the complainants were compelled to sign the documents for purchase of the  Insurance Premium Funding on Land Loan against their wish and consent under garb of issuance of the housing loan/construction loan qua the plot in question, which amounts to restrictive trade practice on the part of the OPs. Being adopting restrictive trade practice, the OPs are liable to pay Rs.6,34,052/- to the complainant to make good their loss.
12.     In view of the above discussion, the present complaint deserves to be partly allowed and the same is accordingly partly allowed. The OPs are directed to :-

i)      refund Rs.6,34,052/- to the complainants along with interest @ 9% p.a. from the date of filing of the complaint till the date of its actual realization.

13.      This order be complied with by the OPs jointly and severally, within 90 days from the date of receipt of its certified copy.
14.     The pending application(s) if any, stands disposed of accordingly.
15.     Certified copy of this order be sent to the parties, as per rules. After compliance file be consigned to record room.

Announced in open Commission 02/11/2023
	Sd/- (AMRINDER SINGH SIDHU) PRESIDENT
	Sd/- (B.M.SHARMA) MEMBER