BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, MYSORE-570023

CONSUMER COMPLAINT NO.220-2021

DATED ON THIS THE 3^rd December 2022

Present:   1) Sri. B.Narayanappa

M.A., LL.B., - PRESIDENT  

                     2) Smt.Lalitha.M.K.,

M.A., B.A.L., LL.B., - MEMBER  

Sri B.NARAYANAPPA,

PRESIDENT

1.       The complainant No.1 Smt.Radha.B and complainant No.2 Sri Ashoka.K.C. both are resident of Mysuru  have filed this complaint against the OP No.1- HDFC Home Loan Limited, Bangaluru and OP No.2 – HDFC Limited, HDFC House, Mysuru praying to direct the OP Nos.1 and 2 to return back the amount of Rs.3,540/- which is illegally deducted from the complainants and to pay compensation of Rs.1,00,000/- for mental agony caused to complainants and Rs.1,00,000/- towards inconvenience and hardship caused to complainant and such other reliefs as this Commission deems fit to grant.
2.       The brief facts are that:-

The complainant No.2 is an employee in Hindustan Lever Limited, Mysuru and working as technician.The complainant No.1 is his wife and she owns her property bearing No.347 situated at 2^nd Cross, KHB Colony, Kuvempunagara M Block, Mysuru measuring East to West 30 ft. and North to South 15 ft.The complainants were in need of money for construction of house in the said property. As such, complainant No.1 mortgaged her said property with India Bulls Housing Finance Ltd., and obtained loan of Rs.21,00,000/-. The complainant No.2 stood as collateral surety.The India Bulls Housing Finance Ltd., levied interest at 10.5% p.a. on the loan amount.The complainants come across advertisement of the OPs stating that they would sanction housing finance within 2 days and people can switch over the loan from any bank to OPs bank with attractive rate of interest.The complainants were impressed with the advertisement and approached OP No.2.The OP No.2 expressed that they would take over the outstanding loan from India Bulls Housing Finance Ltd., at the rate of 8% p.a. interest and assured the complainants to sanction loan and collected KYC information and uploaded loan application of the complainants for taking over the outstanding loan from the India Bulls Housing Finance Ltd., and also the OP No.2 has collected sum of Rs.9,940/- towards processing fee.But, on 24.07.2021 the OP No.2 sent E-mail to complainant No.2 stating that we have reviewed the application submitted by complainant and the documents, but we regret our inability to approve your application for a home loan as it does not meet our technical acceptance parameters.In turn, the complainant No.2 sent E-mail to OP No.2 requesting to give details about unable to process loan by OP No.2.Again the same intimation was given by OP No.2 about non-approval of loan and OP No.2 refunded an amount of Rs.5,900/- and retained a sum of Rs.3,540/- towards administrative expenses incurred on processing of the loan application.Therefore, it is alleged deficiency in service on the part of OPs in retaining the amount of Rs.3,540/- and it is further contention of the complainants that at the initial stage itself, the OP No.2 should have expressed their inability to sanction loan but after processing the loan application, the OP No.2 expressed its inability to sanction the loan which results in mental agony and harassment to complainant. Therefore, this complaint.

3.       After registration of this complaint, notices were ordered to be issued to OPs.  In response to notices, OPs appeared before this Commission through their counsel and have filed version contending that the complaint is not maintainable either in law or on facts and same is liable to be dismissed and denied the averments made in para 2 to 15 of the complaint and contended that the OPs are carrying out the business of housing financé and they are looking to take over loan from other financial institutions subject to the terms and conditions at competitive rates of interest and they are not bound to sanction loan to all applicants and the disbursement of the loan is purely the prerogative of the OPs.  The OPs are bound not only by their internal lending policies but also the statutory norms established by RBI.  The complainants submitted their entire documents to OPs evaluated the eligibility of the complainants and after scrutiny of the loan application, the OPs came to the conclusion that the complainants are not eligible for loan and refunded the processing fee by withholding expenses incurred towards processing the application. For all these reasons, the OPs prays to dismiss the complaint.   
4.       The complainant No.1 has filed her affidavit and same was taken as P.W.1 and got marked Ex.P.1 to Ex.P.7.  On the other hand, the OPs have also filed their affidavit and same was taken as R.W.1.  The complainant counsel has also filed written arguments. 
5. We have heard the oral arguments of both sides.      
6.        The points that would arise for our consideration are as under

1. Whether the complainants prove that the alleged deficiency in service on the part of the opposite parties and thereby they are entitled to the reliefs as sought for?
2.  What order?

7.       Our findings on the aforesaid points are as follows:

      Point No.1 :- Partly in the affirmative.

      Point No.2 :- As per final order for the following

:: R E A S O N S ::

8.          Point No.1:- It is undisputed fact that the complainant No.1 had availed housing loan from India Bulls Housing Finance Ltd., to construct house on her property bearing No.347 situated at Kuvempunagar, Mysuru by mortgaging her above said property with India Bull Housing Finance Ltd.,  The complainant No.2 being the husband of the complainant No.1 stood as collateral surety for the housing loan and the India Bull Housing Finance Ltd., had charged interest at the rate of 10.5% p.a.
9. It is the specific contention of the complainants that they came to know about the advertisement issued by OPs stating that they would sanction housing loan within 2 days and the people can switch over from any bank to OPs for taking over loan with attractive rate of interest. The complainant were impressed with the advertisement of OPs and approached OP No.2 who expressed that they would take over the loan of the complainants raised from India Bull Housing Finance Limited and they would sanction the loan to the complainant at the rate of interest at 8% p.a. and after collecting an amount of Rs.9,940/- from the complainant processed the loan application and assured that the loan application duly honoured but to the shock and surprise of the complainants, they received mail from OP No.2 on 24.07.2021 stating that the OPs are unable to approve the loan application of the complainant since the loan application of the complainants does not meet their technical acceptance and parameters and refunded an amount of Rs.5,900/- by retaining amount of Rs.3,540/- towards administrative expenses incurred for processing the loan application.  Therefore, the complainants have alleged deficiency in service on the part of OPs. 
10. The complainants produced documents such as loan registration details, HDFC Online Home loan application form, loan account etc., submitted to OPs and processed by OP No.2.  Therefore, from the material documents produced by complainants at Ex.P.1 to Ex.P.7, it is crystal clear that as per the assurance given by OP No.2, loan application was submitted by complainants and the same was processed by OP No.2 with an assurance that OPs will take over the loan of complainants raised by them in India Bulls Housing Finance Ltd., and they would sanction the loan to the complainants at attractive rate of interest at 8% p.a.  But, the OPs failed to sanction the loan to the complainants and expressed their inability to sanction the loan to the complainants on the ground that the loan application of the complainants does not meet the parameters of the OPs.  The OPs have also produced copies of loan application form submitted by complainant, file original details, income tax details, customer interview sheet, Aadhar consent for declaration for KYC loans, acknowledgement of receipt issued by Central Processing Center, Income Tax Department and declaration of communication address.
11. Though the OPs have assured to the complainants to sanction the housing loan and take over the loan of the complainants raised in India Bulls Housing Finance Ltd., but, they failed to sanction the housing loan and also they failed to return the entire processing fee of Rs.9,940/- collected from the complainants, but refunded only Rs.5,900/- and retained Rs.3,540/- stating that they retained Rs.3,540/- towards administrative expenses on processing of the loan application. If at all, the OPs were unable to sanction the loan to the complainants, they should have informed the complainants at the initial stage itself, after going through documents submitted by the complainants. But, the OPs after verifying the documents submitted by complainants in respect of their house property, they assured to sanction the loan and also they went to the extent to process the loan application by collecting processing fee of Rs.9,940/- processed loan application.  Thereafter, they expressed their inability to sanction the loan at a belated stage and more over after expressing their inability to sanction the loan, they should have returned the entire processing fee collected from the complainants at Rs.9,940/-.  But, only refunded Rs.5,900/- to the complainants and retained Rs.3,540/- towards processing of loan application which is nothing but deficiency in service on the part of OPs.  Therefore, we are of the considered view that the OPs are liable to refund the retained amount of Rs.3540/- to the complainants and also liable to pay compensation to the complainants for the deficiency in service committed by them.  Hence, we answer point No.1 partly in the affirmative.
12.       Point No.2:- For the aforesaid reasons, we proceed to pass the following

:: ORDER ::

1. The complaint of the complainants is hereby allowed in part.
2. The opposite party Nos.l and 2 are hereby directed to refund Rs.3,540/- to the complainants retained by them towards processing of loan application with interest at 10% p.a. within 2 months from the date of this order till payment.
3. Further opposite party Nos.1 and 2 are hereby directed to pay compensation of Rs.15,000/- to complainants towards deficiency in service and Rs.5,000/- towards cost of the litigation to the complainant within 2 months from the date of this order.  Failing which, the compensation of Rs.15,000/- + cost of litigation Rs.5,000/- = Rs.20,000/- shall carry interest at 10% p.a. till payment.
4. The complainant is at liberty to take action against the opposite party under Section 72 of the C.P.Act, 2019 for non-compliance of this order.
5. Furnish the copy of order to both parties at free of cost.

(Dictated to the Stenographer transcribed, typed by her, corrected by us and then pronounced in open Commission on this the 3^rd December 2022)