`           STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

                                         U.T., CHANDIGARH 

1. HDFC Bank House, Senapati Bapat Marg, Parel West, Mumbai-400013 through its Managing Director.
2.  HDFC Bank Limited., Retail Loan Service Centre, Ground Floor, Bank House, Plot No.28, Industrial Area, Phase-1, Chandigarh through its General Manager.
3. HDFC Bank, SCO 23, Sector 23-C, Chandigarh through its Manger.                                                                                                       …Appellants

                                         V e r s u s

Ms.Sachin Sharma  w/o Sh.Ajay Kumar Sharma R/o House No.3018, Sector 23-D, Chandigarh.                                                                                               ..Respondent

Appeal under Section 41 of the Consumer Protection Act, 2019 against order dated 09.03.2023 passed by          District Consumer Disputes Redressal Commission-I, U.T. Chandigarh in Consumer Complaint No.69/2021.

BEFORE:    HON’BLE JUSTICE RAJ SHEKHAR ATTRI, PRESIDENT

                     MRS. PADMA PANDEY, MEMBER

For the appellants : Ms.Monika Thatai,Advocate

                                proxy for Sh.Nitin Thatai,Advocate 

For the respondent :Sh.Ajay Kumar Sharma, Advocate

 PER PADMA PANDEY, MEMBER

                     This appeal is directed against the order dated 09.03.2023, rendered by the District Consumer Disputes Redressal Commission-I, U.T. Chandigarh (hereinafter to be referred as “the Ld. Lower Commission”), vide which, it allowed the complaint bearing No.CC/69/2021 partly by directing the Opposite Parties  as under ;

“i. to refund an amount of Rs.8869/- & foreclosure charges of    Rs.14,030/- to the complainant alongwith interest @ 9% per annum from the date of filing of this complaint till realization.

ii. to pay an amount of Rs.15,000/- to the complainant as compensation for causing mental agony and harassment to her;

                      iii. to pay Rs.10,000/- to the complainant as costs of litigation.

                 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.”

2.      Before the Ld. Lower Commission, it was case of the complainant/respondent that she wanted to purchase one plot of 2½ Marla in village Nayagaon and for the said  purpose, she   needed money of about Rs.3.50 Lakhs. The Complainant approached appellant No.3/OP No.3 for Home Loan alongwith construction loan on the above said plot. Thereafter, the Opposite  Parties opened an account by getting deposited  from her Rs.11,000/-  on 07.05.2019.  The Opposite Parties then disbursed  loan of Rs.3,43,755/- in the loan account No.67690001 of the complainant on 08.05.2019. However, at the time of disbursement of loan, an amount of  Rs.15064/- was deducted  from the account of complainant. It is alleged by the complainant that the Opposite parties failed to explain the  reason for deduction of Rs.15064/-. Copies of provisional certificates showing sanctioned amount of loan and the loan amount disbursed are annexed as Annexure C-1 & C-2 respectively. Thereafter, the complainant purchased 2½ Marla plot vide sale deed dated 13.05.2019 (Annexure C-3). She  then  visited the office of the Opposite parties  alongwith sale deed as per their advice  for grant of home loan and for closing her personal loan account. However, OP No.3 replied that the account cannot be closed  prior to one year as it is mandatory provision. OP No.3 advised the complainant to  apply for home loan after completion of one year and the balance personal loan amount would  be deducted from her home loan account. After one year, the  complainant again visited the office of the OPs for home loan and for closing her personal loan but  the Opposite Parties  lingered on the matter on one pretext or the other. It is further stated that when the complainant closed her account, her outstanding amount  shown in the month of July, 2020 was as Rs.2,97,255.80/- and thereafter the Opposite Parties  levied charges on the complainant on account of prepayment charges to the tune of Rs.14,030/- @ 4.72% and interest till the date of prepayment i.e., Rs.1982.00. The total amount paid by the complainant was Rs.3,13,267.80/- to the OPs (Annexure C-5).  It was further alleged that the Opposite parties  failed to explain on what account they had deducted the above said  amount from the account of the complainant at the time of disbursement of loan. Hence, alleging deficiency in service and unfair trade practice on the part of the Opposite Parties, a consumer complaint was filed before the Ld. Lower Commission seeking refund of Rs.15064/- deducted at the time of disbursement of the personal loan and an amount of Rs.14030/- being pre-payment charges @ 4.72% on the outstanding amount alongwith compensation and costs etc. .

3.                Pursuant to issuance of notice, the Opposite Parties appeared before the Ld. District Commission and contested the complaint. In their written version,  it was  stated that the loan can be foreclosed by the complainant at any time before the expiry of tenure subject to the charges as agreed between the complainant and the  OPs. It was further stated in the reply  that  it was  clearly mentioned in the loan agreement which  was accepted by the complainant by duly signing the loan agreement that the foreclosure charges and interest was payable as per Annexure OP 2 & OP-3. The loan account statement alongwith the repayment schedule is annexed as Annexure OP-4 & OP-5 respectively. It was further stated  that the complainant had not placed on record any document/communication in support of the visit to the office of the Opposite parties, as alleged in the complaint. It was pleaded  that  no higher rate of interest was charged from the complainant and the foreclosure/pre-payment charges were levied as per the terms and conditions of the agreement. The remaining allegations were  denied and a prayer was made for dismissal of the complaint.

  4.                    On appraisal of the pleadings, and the evidence adduced on record, Ld. Lower Commission allowed the Complaint of  the  Respondent/ Complainant partly , as noticed in the opening para of this order.   

5.             Aggrieved against the aforesaid order passed by the Ld. Lower Commission, the instant Appeal has been filed by the Appellants/Opposite Parties.

6.                        We have heard Learned Counsel for the parties  and have gone through the evidence and record of the case with utmost care and circumspection.

7.                  Alongwith the appeal, an application has been moved on behalf of the appellants to place on record Annexure A-2 i.e. Member Enrolment Form SMQ Regulated Entity (HDFC Life Group Credit Protect Plus) by way of additional evidence as the same could not be produced before the Ld. Lower Commission despite exercising due diligence.  A perusal of Annexure A-2 reveals  that the same is signed by the respondent/complainant. Though the said document was existing at the time of complaint  and  the application for additional evidence is opposed by the respondent on the ground that the same cannot be allowed at this stage to  fill the lacuna, yet in the interest of justice for proper and effective adjudication of the controversy between the parties and in view of the contents of the application which is supported by a duly sworn affidavit of the Manager(Legal) of the appellants, the same is allowed and the document Annexure A-2 is allowed to be placed on record.

8.          It is contended on behalf of the appellants that the respondent/complainant has nowhere in the complaint before the Ld. Lower Commission has stated that the loan was availed on floating rate of interest. It is further contended that only due to a typographical error, the rate of interest in the written statement was mentioned as ‘Floating’ whereas the entire loan documents would reveal that the said loan had been sanctioned on ‘Fixed’ rate of interest.  It is further contended that the foreclosure charges were levied as per the terms and conditions of the loan agreement duly accepted by the respondent and  there is no plea taken by the complainant about applicability of foreclosure charges contrary to the terms and conditions of the loan. It is case of the appellants that the respondent availed the personal loan on her own will and had submitted the documents required for sanction of the loan such as KYC including the salary slip and on the basis of the request made by the respondent on 2.5.2019 for sanction of personal loan, appellant No.3 on 5.5.2019 sanctioned personal loan for an amount of Rs.3,58,819/-. Further an amount of Rs.3,43,755/- was disabused on 8.5.2019 in the account of the respondent. An amount of Rs.15064/- was deducted towards processing fee which also included insurance to the tune of Rs.4990/- towards Sarv Suraksha insurance, Rs.3829/- towards Credit Protect Insurance and Rs.50/- towards Stamp Duty. The said insurance was got done by the respondent herself to secure the loan amount in any eventuality of mishap.   In this respect, she also signed Member Enrollment Form-SMQ wherein she consented for the debit of premium for an amount of Rs.8819/- (Rs.4990/- towards Sarv Suraksha Insurance, Rs.3829/- towards Credit Protect Insurance). Thus, the loan was secured from HDFC Standard Life Insurance Company and husband of the respondent was made as her nominee whereas the appellants stood only as a facilitator. It is further case of the appellants that there exists a loan Agreement between the parties, and as such, respondent/complainant is bound by the terms and conditions of the loan agreement which was duly accepted by the respondent by entering into  loan agreement dated 5.5.2019.

9.          On the other hand, it is contended on behalf of the respondent/complainant that according to the guidelines of the Govt. Of  India, Ministry of Finance regarding Covid relief, no interest could be charged on any loan upto Rs.2 crore including Personal and profession loan for the period 1.3.2020 to 31.08.2020.  It is further contended that by charging Rs.4990/- towards Sarv Surakhsa Insurance and Rs.3829/- towards credit Protect Insurance, the appellants cleverly sold two insurance policies of the same coverage. Even both the policies cover critical illness, accidental death, accidental hospitalization, loss of job and Householder’s coverage, whereas as per RBI Guidelines/ Insurance Regulatory and Development Authority, insurance is not mandatory for personal loan. It is an optional policy.  It is further contended that  in para-4 of their reply furnished before the Ld. Lower Commission it was stated by the appellants  that the Loan was at floating rate now they  have changed their stand  by coining a new plea that the loan was sanctioned   at fixed rate of interest. It is pleaded that the order passed by the Ld. Lower Commission is quite just and proper, and does not call for any interference.

10.                  It is not in dispute that the amount financed was Rs.3,58,819/- whereas an amount of Rs.3,43,755/- was disbursed to the respondent by deducting Rs.15064/-. Out of the said amount of Rs.15064/-, Rs.6195/- were deducted as processing fee, Rs. 3829/- toward Credit Protect Insurance, Rs.4990/- towards Sarv Suraksha and Rs.50/- towards stamp duty.  Annexure A-2  is the Member Enrollment Form-SMQ duly signed by the respondent wherein detail of  premium of Rs.8819/- (Rs.3829/- & Rs.4990/-) towards credit Protect insurance  and Sarv Surakhsa respectively has been given. Annexure OP-2 is copy of the stamped document/agreement on non-judicial paper worth Rs.50/- which contained terms and conditions applicable to personal loan. Annexure OP-3 is Schedule-cum-Key Fact Statement which is signed by the parties to the agreement i.e. the respondent and the Operations Manager on behalf of the appellant bank. Against  the column of ‘Loan Amount’ it is described as Rs.3,58,819/-, instalment frequency is mentioned as ‘monthly’ and against the column Interest Rate(Monthly reducing ) (Fixed Rate) it is mentioned as 15% per annum. Against the column ‘processing charges(amount), it is mentioned as Rs.6195/-. As regards Loan prepayment charges for part or full prepayment, it is mentioned in the said column as under ;

“Foreclosure charges are on Principal outstanding balance and Part Payment charges on Part Payment amount

                      13-24 months of EMI repayment: 4%

                      25-36 months of EMI repayment :3%

                       >36 months of EMI repayment:2%

  Note :Prepayment in part or full not allowed prior to payment of 12      EMI. Part Payment allowed up to 25% of Principal Outstanding. It is allowed only once in a year and twice during Loan tenure. Government Taxes are other levies as applicable, would be charged additionally.”

                         Thus, it is clearly mentioned in this document that the interest rate was fixed rate.   It also contained the detail of prepayment charges  according to the duration of EMI repayment.

 11.              No doubt, in para-4 of Reply on Merits, the appellants filed before the Ld. Lower Commission, it is mentioned that the loan was at floating rate of interest but the said fact was inadvertently mentioned, as pleaded in this appeal. The plea of the Learned Counsel for the respondent that in the reply the appellants/Opposite Parties have mentioned that the loan was at floating rate of interest and now it cannot be changed, is not tenable for the reason that  the  factual aspect as per document Annexure OP-3 is  that the interest rate was fixed and there is no document produced to the contrary. The Learned District Commission, however, did not thoroughly consider the said document. Further in paragraph 15 & 16 of the reply,  it is clarified that that foreclosure charges were levied as per the agreement Annexure OP-2 & OP-3.  It is not disputed that as per RBI Circular dated 2.8.2019 banks were not permitted to charge foreclosure charges/pre-payment penalties on home loans/all floating rate term loan sanctioned to individual borrowers but in the present case the personal loan/term loan was availed by the respondent at Fixed Rate of interest i.e.15% p.a. as such as per the agreement, such charges were leviable. There is a plethora of judgments wherein it is recited that when a person signed the contract document, he is bound by its terms and conditions. In Standard Chartered Bank Vs Krishan Lal Juneja II(2013) CPJ-498(NC) it is stated that “the terms and conditions of the agreement signed by the complainant are binding on him.  The complainant is bound to pay the pre-closure charges as per the agreement and opposite parties have not committed any deficiency in service in demanding the same” Similar view has been taken in Nitin Vashisht and Gagan Vashisth Vs Central Bank of India & Ors III(2013) CPJ-679 (NC). Further in Annexure C-5 attached with the complaint, it is clearly mentioned that Rs.14030/- are payable on account of prepayment charges @4.72 % on outstanding principal. Thereafter, Loan Closure Letter dated 5.6.2023  for Personal Loan Agreement No.67690001 has already been issued to the respondent wherein it is mentioned that “we are pleased to inform you that your captioned loan stands fully repaid on our Books as on 27.07.2020.” Thus, after 20.7.2020 there was nothing payable to the Bank by the respondent.  

12..                In view of the above discussion, we find that the   impugned order  is not based on the correct appreciation of law and facts of the case and calls for interference of this Commission. Accordingly the appeal is accepted and the impugned order is set aside. Resultantly, consumer complaint is dismissed. 

13.                   Pending interlocutory application(s), if any, also stands disposed of

14.                  Certified copies of this order be sent to the parties free of charge.

15.                 The file be consigned to Record Room, after completion.