Chandigarh

DF-I

CC/184/2020

Suram Singh Rana - Complainant(s)

Versus

India Bulls Housing Finance Ltd. - Opp.Party(s)

03 Feb 2023

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

 

                    

Consumer Complaint No.	:	CC/184/2020
Date of Institution	:	22/06/2020
Date of Decision	:	03/02/2023

 

1. Suram Singh Rana, aged about 60 years, son of Late Sh.Jagat Ram.
2. Neelam Rana, aged about 57 years, wife of Suram Singh Rana. Both residents of House No.708, Sector 22-A, Chandigarh.

… Complainant

V E R S U S

1. India Bulls Housing Finance Limited, M-62-63, 1^st Floor, Connaught Place, New Delhi.
2. India Bulls Housing Finance Limited, through its Branch Manager, SCF No.337-338, Sector 35-B, Chandigarh-160022.

… Opposite Parties

CORAM :	PAWANJIT SINGH	PRESIDENT
	SURJEET KAUR	MEMBER
	SURESH KUMAR SARDANA	MEMBER

 

                                                

ARGUED BY	:	Sh.Akshay Rana, Counsel for Complainants.
	:	Ms.Aanchal Thakur, Vice Counsel for Sh.Paras Money Goyal, Counsel for OPs.

 

Per Suresh Kumar Sardana, Member

1.      Averments are that the complainants purchased 20% share in H.No.708, Sector 22-A, Chandigarh and got possession of top floor from its owners. The complainant have also purchased 30% share in the aforesaid house and thus got 30% sale deed executed and thus got possession of the first floor also and became the owners with 50% of share in the said property. As per complaint, in the month of July-August 2017 the complainants were planning to carry out renovation on the top floor and thereafter suddenly the agent of OP contacted for loan facility for the purpose of renovation of the top floor. However, the OP-Bank sanctioned Rs.24,75,328/- loan on 16.09.2017 (Annexure A/1). It is submitted that, at the time of sanction of loan the OP-Bank had directed the complainants to deposit Rs.5900/- towards processing fee, whereas after sanction of loan the OP again deducted Rs.24,022/- and then took Rs.18,122/- in excess as processing fee illegally. It is also submitted that out of Rs.25 lacs the OP-Bank paid Rs.24,75,328/- to the complainants. The OP told the complainants that about Rs.198/- p.m. will have to be paid as insurance and thus total amount towards insurance is payable Rs.35,757/- in 180 installments. The complainants were required to pay Rs.27,051/- p.m. as installments of loan amount and Rs.198/- p.m. of the insurance amount and total installments was fixed as Rs.27,249/- p.m. for 180 months i.e., for 15 years. The complainant approached HDFC Bank for availing loan facility for home loan against 50% share and also to take over the loan amount of Rs.25 lacs taken from the OP Bank which had been obtained after mortgaging 20% share in the house. The OP-Bank is charging interest @ 18.75% p.a.. and whereas the HDFC Bank agreed to advance loan against the 20% share @ 10.05% p.a. and also agreed to extend the loan amount upto Rs.33 lacs (Annexure A/3).

         As per complainants, they applied for closure of loan account with the OP-Bank, who issued letter dated 07.05.2019 showing the principal outstanding amount of Rs.24,40,876/- and also illegally shown foreclosure charges @ 5% i.e., Rs.1,22,043/- alongwith IGST @ 18% i.e., Rs.21,967/- (Annexure C/4). Accordingly total amount of Rs.26,02,780/- was paid to the OP-Bank (Annexure C/5) and the NOC was issued by the OP-Bank (Annexure C/6). It is also submitted that the National Housing board vide its policy dated 14.06.2014 has advised to all the banks with regard to bring uniformity in prepayment of various loans and further directed that no bank shall charge foreclosure charges/prepayment penalties on all floating rate term loans sanctioned to individual borrowers (Annexure C/8). The complainants sent a legal notice to the OP-Bank, but the OPs have neither given reply nor the claim has been settled till date (Annexure C/11). Hence, this present complaint.

2.     OPs contested the consumer complaint, filed their written reply and stated that the loan availed by the complainant herein was for purchasing space for making office space, which is an admitted fact in the present complaint and the same is also mentioned in the loan application forms submitted by the complainant to the OP (Annexure OP-3). As per the circular if the loan was pre-closed by an individual borrower, then, foreclosure charges/prepayment penalities shall not be attracted. However, the same shall be charged/levied in case of a company, firm etc. It is further submitted that the complainant being a commercial entity applied above said loan facilities for business expansion. NHB circular is annexed as Annexure OP-4. It is also submitted that the foreclosure/prepayment penalties are charged/ levied by the OP in view of the terms and conditions of the loan agreement duly executed between the parties. The complainant being a proprietor of the proprietorship Firm, also the borrower of the loan, was fully aware of the terms and conditions of the loan agreement. The sanctioning of the loan, name of the borrowers and guarantors, rate of interest, terms of the repayment and such other particulars has been clearly detailed in the schedule of the loan agreement. Copy of the loan agreement is annexed as Annexure OP-5. On these lines, the case is sought to be defended by the OPs.
3.     Rejoinder was filed and averments made in the consumer complaint were reiterated.
4.     Parties led evidence by way of affidavits and documents.
5.     We have heard the learned counsel for the parties and gone through the record of the case. After perusal of record, our findings are as under:-
6.     The core point for consideration before us, is as to whether, the OPs rightly charged foreclosure charges from the complainants. The answer, to this, question is in the negative. The allegation of the complainants is that when he approached the HDFC Bank for borrowing a housing loan, he came to know that the rate of interest was much lower than the OPs and, therefore, he applied to the OPs for full and final repayment of loan, for which, the OPs charged an amount of Rs.1,44,010/-( Rs.1,22,043/- alongwith IST @ 18% i.e., Rs.21,967/-) towards pre-closure charges (Annexure C-4). It is the admitted fact that the complainants took a housing loan from the OPs. A bare perusal of Loan Sanction Letter issued by the OPs themselves on dated 14.09.2017 (Annexure OP-5) clearly reveals that the loan was sanctioned by the OPs to Mr.Suram Rana because the name of the applicant ‘Suram Rana’ is clearly shown in the said loan sanction letter and Name of the Co-applicant/guarantor is clearly shown as ‘M/s Rana Law Agency, Neelam Rana, Akshay Rana’. It is also true that all the pages of the said sanction letter was duly signed by the complainants and the co-applicants/guarantors in the capacity of proprietor of Rana Law Agency. Further, it is observed that the said agency does not have any relation whatsoever with the loan in dispute as the property mortgaged in favour of the said home loan is in the personal name of the complainants. On perusal of the documents on file, it is proved that the OPs intimated the complainants regarding foreclosure charges. It is also evident from Loan Application Form (Annexure OP-3 Colly Page 17 of the reply) that the name of the applicant is mentioned as ‘Suram Rana’ & co-applicant is mentioned as ‘Neelam Rana’ and both the employer/business name & address is mentioned as M/s Rana Law Agency, House No.708, Sector 22A, Chandigarh. So, it is clear from Loan Application Form & Loan Sanctioned Letter that the loan was availed by the complainants and Rana Law Agency acted in the legal capacity of guarantor in the said loan and not as borrower.  Further, on perusal of circular letters (Annexure OP-4 of the reply & Annexure C-8 of the complaint) from the National Housing Bank to all registered housing finance companies, it is observed that “foreclosure charges/pre-payment penalties shall not be applicable to the individual borrowers.” In the present case, it is clearly proved that the loan was taken in the capacity as individual borrower, therefore, the respondents/Opposite Parties wrongly charged as foreclosure charges. In view of the above discussion, the OPs have indulged in the unfair trade practice and caused lot of mental agony and harassment to the complaiants.
7.     In view of the above discussion, the present consumer complaint succeeds and the same is accordingly partly allowed. OPs are directed as under :-

1. to refund an amount of ₹1,44,010/- to the complainants alongwith interest @ 9% per annum from the date of filing of this complaint till realization.
2. to pay an amount of ₹10,000/- to the complainants as compensation for causing mental agony and harassment to them;
3. to pay ₹7000/- to the complainants as costs of litigation.

8.     This order be complied with by the OPs within thirty days from the date of receipt of its certified copy, failing which, they shall make the payment of the amounts mentioned at Sr.No.(i) & (ii) above, with interest @ 12% per annum from the date of this order, till realization, apart from compliance of direction at Sr.No.(iii) above.
9.     Certified copies of this order be sent to the parties free of charge. The file be consigned.

			Sd/-
03/02/2023			[Pawanjit Singh]
Ls			President
			Sd/-
			[Surjeet Kaur]
			Member
			Sd/-
			[Suresh Kumar Sardana]
			Member