Chandigarh

DF-I

CC/531/2022

Sh. Jogesh Kohli - Complainant(s)

Versus

India Infoline Housing Finance Limited - Opp.Party(s)

Nidhi Ayer

12 Feb 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-I,

U.T. CHANDIGARH

 

                    

Consumer Complaint No.	:	CC/531/2022
Date of Institution	:	18/05/2022
Date of Decision	:	12/02/2024

 

1. Jogesh Kohli, S/o Sh.M.P.Kohli presently residing at House No.1551, 1st Floor, Sector 18-D, Chandigarh.

 

2. Meena Kohli, W/o Sh.Jogesh Kohli presently residing at House No.1551, 1st Floor, Sector 18-D, Chandigarh.

 

3. Harsh Kohli S/o Sh.M.P.Kohli resident of House No.1256, Sector 8, Chandigarh.

 

4. Nilakshi Kohli W/o Harsh Kohli S/o Sh.M.P.Kohli resident of House No.1256 Sector 8 Chandigarh.

 

Versus

…Complainants

 

1. India Infoline Housing Finance Limited, IIFL House, Sun Infotech Park, Road No.16 V Plot No.B-23, MIDC, Thane, Industrial Area Wagle Estate Thane- 400604 through it Managing Director.

 

2. India Infoline Housing Finance Limited, SCO 2907, Second Floor, Sector 22-C, Chandigarh-160022 through its zonal sales Manager.

… Opposite Parties

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

 

                                                

ARGUED BY	:	Ms.Nidhi Ayer, Advocate for Complainants.
	:	Sh.Vineet Sehgal, Advocate for OPs.

Per Surjeet kaur, Member

1.      Averments are that the complainants applied for the home loan against the property situated at SCF No.58 Grain Market, Sector 26, 1st and 2nd Floor(50% share) Chandigarh with the OPs. On 8^th March 2017, a loan for a sum of Rs.1,75,50,000/- was sanctioned for a period of 10 Years by the OPs in favor of the complainants (Annexure C-1 & C-2) colly. EMI started on 05.11.2021 and a total sum of Rs 1,36,74,592.43/- was paid to the OP No.2. The complainants were paying the EMI’s to the OPs as per the schedule (Annexure C-3). Thereafter complainants received a call from the office of Axis Finance Ltd., to get his home loan transferred to Axis Finance Ltd, as the rate of interest of the Axis Finance Ltd. was lower than the rate of interest provided by the OPs. Hence, the complainants decided to get transfer the balance home loan to Axis Finance Ltd. In the month of February 2022, the complainants approached the office of the OP No.2 and requested for the foreclosure/transfer the balance home loan of the loan account with the OP No.2. The OP No.2 in response to the request made by the complainants, sent a letter dated 28.02.2022 to the complainants for the foreclosure of the loan account mentioning the foreclosure charges payable on 28.02.2022 (Annexure C-5). The complainants were shocked to see that the OPs had levied the Prepay Charges/Foreclosure Charges on the complainants to the tune of Rs.3,96,360.24/- till 28.02.2022 and further mentioned that an interest Rs.3670/- per day will be charged for additional days. The complainants contacted the office of the Opposite Party no. 2 and inquired about the foreclosure charges and requested to remove the same. But the OP No.2 didn't bother to listen to the request/grievance of the complainants. The Axis Finance Ltd. paid a sum of Rs.1,38,04,920/- vide bankers cheque No.210922 dated 01.03.2022 to IIFL Home Finance Ltd. and the complainants further paid a sum of Rs.7,929/- on 03.03.2020 towards the interest to get the loan closure (Annexure C-7). Hence, is the present consumer complaint.
2.     OPs contested the consumer complaint, filed its written reply and stated that Clause 2.9 of the loan agreement made it clear that in case of non-individual loan facility pre-payment charges/foreclosure charges will be applicable as per statutory guidelines. It is further submitted that the RBI circular dated 02.08.2019 annexed by the complainant vide Clause 2, makes it clear that the OPs were duly entitled for charging foreclosure charges from the complainant as the exemption has been granted against loans sanctioned for purposes other than business to individual borrower, whereas, in the present case, the loan advanced to the complainants was a LAP loan and as per the admitted case of the complainants, there are more than one borrower. Further, the instructions issued by the RBI cannot be read in parts and has to be read and complied with in totality. As in the present case, there were more than 01 borrower and the loan was a loan against property, the proceeds of which were used for business purposes, therefore, the complainant's case was not covered in the exemption clause as mentioned in the RBI circular. Denying all other allegations made in the complaint a prayer for dismissal of the complaint has been made.
3.     Despite grant of sufficient time, no rejoinder was filed by the complainants to rebut the stand of the OPs, hence, opportunity to file rejoinder was closed vide order dated 25.04.2023.
4.     Parties led evidence by way of affidavits and documents.
5.     We have heard the learned counsels for the parties and gone through the record of the case.
6.     Through the present complaint, the complainants have alleged that the OPs illegally have charged foreclosure charges resulting in mental and physical harassment to them. Hence, prayed for the refund of the wrongly charged foreclosure charges alongwith compensation and litigation.
7.     On the other hand, the OPs have taken a stand that they were duly entitled for charging foreclosure charges from the complainants as the exemption has been granted against loans sanctioned for purposes other than business only to individual borrower. Whereas, in the present case there are more than one borrower so the guidelines of the RBI are not applicable in case of the loan sanctioned to the complainants.
8.     Through their duly sworn affidavit, the complainants have disclosed the fact that the loan in question was availed for their personal use and not for the commercial purpose. Loan against property (LAP), in our opinion can be used for any purpose and can be available against both residential property and non-residential property. Further, it is clarified that the home equity loan is a type of borrowing that allows homeowners to borrow and use personal equity in residential property as collateral. In the present case also, the complainants are relatives with each other and so applied for the home loan against their property which was duly sanctioned by the OPs after completing all the necessary formalities. (Annexure C-8) is the circular issued by the RBI in respect of the foreclosure charges, the contents of which are as under:-

 

         2.“It is clarified that NBFCs shall not charge foreclosure charges/pre-payment penalties on any floating rate term loan sanctioned for purposes other than business to individual borrowers, with or without co-obligant(s)”. 

         In the present case, the loan has been sanctioned in the name of four individuals who are the members of the same family and not in the favour of some firm/company and therefore, in our opinion, the complainants fall under the category of individual borrower. Further, as per loan agreement Annexure C-2, page No.22 individual is defined as under:-

    “Individual” shall mean and include the natural living person only”.

         Hence, the act of OPs charging foreclosure charges against the RBI guidelines is itself deficiency in services on their part and their indulgence in unfair trade practice.

9.     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 amount of ₹3,96,360.24 to the complainants alongwith interest @ 9% per annum from the date of filing of this complaint onwards.
2. to pay an amount of ₹20,000/- to the complainants as compensation for causing mental agony and harassment to them.
3. to pay ₹8,000/- to the complainants as costs of litigation.

10.     This order be complied with by the OPs within 45 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.
11.     Pending miscellaneous application, if any, also stands disposed of.
12.     Certified copies of this order be sent to the parties free of charge. The file be consigned.

			Sd/-
12/02/2024			[Pawanjit Singh]
Ls			President
			Sd/-
			[Surjeet Kaur]
			Member
			Sd/-
			[Suresh Kumar Sardana]
			Member