Chandigarh

DF-II

CC/490/2020

Ms. Saroj Verma - Complainant(s)

Versus

PNB Housing Finance Ltd. - Opp.Party(s)

Sandeep Bhardwaj

10 Feb 2021

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II

U.T. CHANDIGARH

 

 

Consumer Complaint No.	:	490/2020
Date of Institution	:	22.09.2020
Date of Decision	:	10.02.2021

 

                                       

                       

 

Ms.Saroj Verma w/o Sh.Hari Pal Verma, Corresponding Address: House No.2181, Sector 15-C, Chandigarh

                                ...  Complainant.

Versus

 

PNB Housing Finance Ltd., SCO No.323-324, First Floor, Sector 35-B, Chandigarh through its Manager/Regional Manager/Branch Manager/Authorized representative.

 

…. Opposite Party.

 

BEFORE:
		SHRI RAJAN DEWAN,	PRESIDENT
		SHRI B.M.SHARMA	MEMBER
Argued by:-
	Sh.Sandeep Bhardwaj, Adv. for the complainant
	Sh.Sumit Puri, Advocate Proxy for Sh.Arjun Kundara, Adv. for the OP.

 

       

 

PER RAJAN DEWAN, PRESIDENT

1.         Averments in short are on being applied for by the complainant for a residential unit with Unitech Ltd. at Gurgoan, a unit bearing No. Block A5, Floor 05, No.0504 was allotted on 06.11.2019 @ Rs.46,92,216/-. Her case is for the intended purchase, she availed the loan facility of Rs.13.70 lacs at floating rate of interest @ 9.75% from the OP which was to be repaid in 156 months with EMI of Rs.15536/-. The loan was sanctioned on 18.02.2011. The OP marked the lien on the unit being purchased by the complainant and to this effect a tripartite agreement (Annexure C-4) inter se the parties and M/s Unitech Limited was entered into.  But the OP had disbursed the loan of Rs.4,75,346/- out of the sanctioned loan of Rs.13.70 lacs. Her case is, this amount was being regularly paid vide EMIs through ECS mode, which was linked with the account of the complainant, maintained with SBI Sector 14, PU, Chandigarh. Her case is, while in the year 2020, her husband planned to avail the housing loan from the SBI, then his CIBIL score was found low on account of default in the loan account being maintained with the OP. The perusal of the statement of account shows that the OP kept on levying overdue charges in the loan account of the complainant from 31.08.2015 till date. She was surprised to note that the floating rate of interest  was increased to 14.35% on 01.05.2015; 14.60% on 01.05.2018; 14.80% on 01.11.2018; 14.87%; on 01.03.2019;  14.72% on 01.03.2020 and 14.57% on 21.05.2020 instead of agreed floating rate of interest @ 9.75%.  The EMIs were increased against the agreed 156 months. For the enhanced floating rate of interest from time to time, the consent of the complainant was never taken and tenure of the loan account was also extended unilaterally.  It has also come to the notice of the complainant, now the loan disbursed of Rs.4,75,346/- will be around Rs.12,94,170/- approximately. It was gross violation of the instructions of the RBI. Despite repeated requests being made to adhere to the relevant instructions of the RBI, the OP did not accede to her request and, therefore, has been deficient in providing service and indulged into unfair trade practice. Hence, the complainant has filed the present consumer complaint and prayed to direct the OP not to charge the amount of installment till the handling over the possession of the unit allotted to the complainant; not to increase the tenure of installment from 156 as mentioned in letter dated 18.02.2011 (Annexure C-2)  as per which the loan has to be expire on 17.02.2024; to prove the interest being charged in accordance with the rate of interest being fixed by RBI from 01.01.2011 till date;  to refund the difference in the amount of installment being received at different intervals at the change of interest from the date of sanctioning till date; to remove the amount of overdue charges being shown in the account of the complainant; to correct the profile of CIBIL of the complainant immediately pertaining to loan account bearing no.00036660002679 with Customer I.D.2224159, direct the OP to pay compensation of Rs.5 lacs, to deposit a sum of Rs.5 lacs in the legal aid account and pay a sum of Rs.50,000/- as litigation expenses.
2.         The OP contested the consumer complaint and filed the written statement inter alia raising the preliminary objections, the consumer complaint being not maintainable and has vehemently contended that though the loan amount was sanctioned to the tune of Rs.13.75 lakhs on 18.02.2011 but on the request of the complainant part of the amount i.e. Rs.4,75,346/- was disbursed to the builder. Their case, agreed floating rate of interest was 9.75% p.a. and EMI was fixed at Rs.5,000/- commencing from April, 2011 and was linked to the ECS mode i.e. automatic deduction from the account of the complainant. However, the EMIs were bounced in the months of August and September due to insufficient funds in her account and due intimation was also sent to her and, therefore, the overdue and bouncing charges were charged.  It is further the case, since the complainant was habitual defaulter, therefore, her CIBIL score was deteriorated on account of default of payment of the EMIs for August, 2015 and other months i.e. December, 2012, January 2013, December, 2013, January, 2014, again for the months of April, May and June, 2014. It is also the case of the OP, whenever the rate of interest is decreased, the amount of EMI is reduced and tenure is not tinkered with and this is the standard practice being followed by all the financial institutions. The tripartite agreement was entered into inter se parties and builder i.e. M/s Unitech Ltd. On these lines, the OP justified the change in the agreed floating rate of interest and the CIBIL score of the complainant on account of being defaulted was put to low for which the OP cannot be blamed. On these lines, the justification is provided for the action of the OP as detailed in the written statement so furnished.
3.         Replication was filed by the complainant and the averments made in the consumer complaint were reiterated. However, it was denied that the EMIs were bounced having insufficient funds in her account. Hence, the complainant has affirmed her stand as was set forth in the consumer complaint.
4.         We have heard the learned counsel for the parties and gone through the record of the case along with the evidence so adduced in the form affidavits. Our conclusions based on the pleadings of the parties and the evidence led runs as under:-
5.         A cursory perusal of the pleadings of the parties, the complaint and the rejoinder so adduced on record by the complainant shows, the controversy revolved around as to whether the agreed floating rate of interest i.e. 9.75% could have been increased without seeking option/consent from the complainant. It is the own admission of the OP in the written statement that no  express consent of the complainant was obtained while agreed floating rate of interest i.e. 9.75% was enhanced.
6.         This may be referred here as per the schedule provided under paragraph 11 and the statement of account so supplied i.e. Annexure C-5 shows that from the agreed floating rate of interest i.e. 9.75%, it was increased to 14.35% on 01.05.2015; 14.60% on 01.05.2018; 14.80% on 01.11.2018; 14.87%; on 01.03.2019;  14.72% on 01.03.2020 and 14.57% on 21.05.2020 and as such there has been substantive increase on the agreed floating rate of interest. According to the contention of the learned Counsel for the OP, it was automatic and no express consent of the complainant was required to be taken. During the course of arguments, we have come across the Master Circular on Interest Rates on Advances issued by the RBI i.e. Guidelines came into force in June, 2005. Paragraphs 3 & 5, figuring at pages 43 & 44 of the Master Circular on Interest Rates on Advances are pertinent to take note of and the same reproduced below:-

“3.  Determination of Benchmark Prime Lending Rate (BPLR)

3.1    In order to enhance transparency in banks’ pricing of their loan products as also to ensure that the BPLR truly reflects the actual costs, banks may consider the following suggestions for determination of their benchmark PLR:

a)      Banks should take into account their (i) actual cost of funds, (ii) operating expenses and (iii) a minimum margin to cover regulatory requirement of provisioning/capital charge and profit margin, while arriving at the benchmark PLR. Banks should announce a benchmark PLR with the approval of their Boards.

 

b)     The benchmark PLR would be the ceiling rate for credit limit up to Rs.2 lakh, as hitherto.

 

c)     Since all other lending rates can be determined with reference to the benchmark PLR arrived at as above by taking into account term premia and/or risk premia, the system of tenor-linked PLR is discontinued. These premia can be factored in the spread over or below the BPLR.

 

The detailed guidelines on operational aspects on Benchmark PLR have been issued by IBA on November 25, 2003.

 

3.2    Banks are also advised that in the interest of customer protection and to have greater degree of transparency in regard to actual interest rates charged to borrowers, they should continue to provide information on maximum and minimum interest rates charged together with the benchmark PLR.

 

5.   Interest Rate for Loans

Banks have the freedom to offer all categories of loans on fixed or floating rates, subject to conformity to their Asset-Liability Management (ALM) guidelines. In order to ensure transparency, banks should use only external or market-based rupee benchmark interest rates for pricing of their floating rate loan products. The methodology of computing the floating rates should be objective, transparent and mutually acceptable to counterparties. Banks should not offer floating rate loans linked to their own internal benchmarks or any other derived rate based on the underlying. This methodology should be adopted for all new loans. In the case of existing loans of longer/fixed tenure, banks should reset the floating rates according to the above method at the time of review or renewal of loan accounts after obtaining the consent of the concerned borrower/s.”

 

                A simple perusal of the guidelines of the RBI referred hereinabove shows that agreed floating rate of interest could have been increased after obtaining the consent of the borrower. The reasons and objectives seems that in case of hefty increase of agreed floating rate of interest, the borrower could ponder over the matter to continue the loan account or shift to any other scheme of the Bank.

7.         In a similar situated proposition in the case titled as  ICICI Bank Ltd. Vs. Pankaj Goyal, 2015(3) RCR (Civil) 788, the Hon’ble Punjab State Commission had held as under :-

        “Therefore, whenever there is any change in the floating rate, it should be in conformity to Asset-Liability Management (ALM) guidelines and in the case of existing loans for longer/fixed tenure, the Banks should re-fix the rates according to the abovesaid method after obtaining the consent of the concerned borrower…… 

        …The complainant was advanced the loan on floating rate of interest. In case there was change in the floating rate of interest on loans then the abovesaid formula was to be adopted, while fixing the rate and taking the consent of the concerned borrower whether he wants to continue the loan with the enhanced rate of interest or he could adopt for other option i.e. closing of the account or shifting of the account, therefore, information/consent of the borrower is the predominant clause while changing the floating rate of interest.”

                Per express circular of the RBI referred hereinabove in the foregoing paragraph and the precedent of the Hon’ble Punjab State Commission shows, in the event of floating rate of interest being enhanced, the consent of the  borrower ought to have been taken so that she/he could have taken a decision whether she/he wants to continue the loan with the enhanced rate of interest or she/he could adopt for other option i.e. closing of the account or shifting of the account, therefore, information/consent of the borrower is the predominant clause while changing the floating rate of interest.

8.         In the instant consumer case, no record was produced to show, any consent of the complainant in writing was taken. Mere intimation was not sufficient that too oral one having no record, which has been denied by the complainant by way of affidavit, furnished in respect of her contention.  Thus, per this admission, the express instructions of the  RBI and the precedent of the Hon’ble Punjab State Commission, we have no option to hold that the OP had flagrantly violated the instructions of the RBI by not taking the consent of the borrower i.e. the complainant, hence the OP has committed deficiency in service and indulged into unfair trade practice.
9. The second ground of defence put forth by the OP was, mode of payment was ECS, linked with the account of the complainant but in few months as referred in the reply, the EMIs were bounced on account of insufficient funds in the account of the complainant and, therefore, the amount by way of penalty was levied which put the complainant in the status of defaulter and her CIBIL score had lowered down. The said plea was controverted by the complainant by filing an affidavit, there was no insufficient funds in her account so as to bounce the EMIs. The OP has produced the statement of account but the same is a computer generated document and has not  been signed by any bank official nor does bears the certification. Our attention was drawn to Section 65B of the Indian Evidence Act, which is reproduced as under:-

(4)    In any proceedings where it is desired to give a statement in evidence by virtue of this section, a certificate doing any of the following things, that is to say,—

(a)    identifying the electronic record containing the statement and describing the manner in which it was produced;

 

(b)    giving such particulars of any device involved in the production of that electronic record as may be appropriate for the purpose of showing that the electronic record was produced by a computer;

 

(c)    dealing with any of the matters to which the conditions mentioned in sub-section (2) relate, and purporting to be signed by a person occupying a responsible official position in relation to the operation of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.

10.         A perusal of the above shows, when any computer/electronic record is to be used as evidence, it must bears the certification i.e. containing the statement and describing the manner in which it was produced and giving such particulars of any device involved in the production of that electronic record as may be appropriate for the purpose of showing that the electronic record was produced by a computer. To our dismay, the said computer generated statement does not bear any certification, therefore, it is not admissible in evidence unless there was proper certification as referred in the aforesaid rule of evidence. Hence, this is a scrape paper and cannot be used as evidence for the purpose to authenticate the version of the OP, the EMI was bounced particularly so when it was the claim of the complainant, there were sufficient funds in her account and the statement so produced that it was bounced is not believable in the absence of certification within the four corners of the rule of evidence, which we have reproduced hereinabove. Thus on the basis of unauthentic record, it cannot be held that there was insufficient funds in the account of the complainant by dint of which the EMIs were bounced and the complainant was put in the category of defaulter so as to record her CIBIL score low which creates a disqualification for borrowing the further amount.  Hence, there has been again breach of rule of the evidence for want of authentic statement duly certified and, therefore, we are bound to conclude that the complainant was not a defaulter and the OP has indulged into unfair trade practice and on account of which, the OP also increased the tenure of installments regarding part of loan which was disbursed to them.
11.         We shall refer here, with regard to the advance of the loan, the parties and the developer had entered into a tripartite agreement (Annexure C-4) regulating the terms of the loan, the manner it was to be discharged by three i.e. loan disbursing  bank, developer and the buyer. We have also had a glance to the tripartite agreement (Annexure C-4) and the possession was to be given after consent from the banker i.e. the OP meaning thereby it binds the banker, loanee as well as the developer.  More than 10 years have already elapsed and the said flat has not been delivered to the complainant and installments were recovered that too part of the loan amount, which was disbursed to the complainant and, therefore, the OP and the developer has also committed breach of the terms and conditions of the tripartite agreement, which decide their duties, responsibilities and action from time to time. To this effect, the OP was also deficient in rendering the service to the complainant.
12.         In a recent case law of the Hon’ble Apex Court, Pioneer Urban Land & Infrastructure Ltd. Vs. Govindan Raghavan, Civil Appeal No.12238 of 2018 decided on 2.4.2019,  it was held where the terms and conditions of the agreement are one sided, the consumer is not bound with the same. Thus, the terms and conditions, if any, were one sided, the same cannot be blindly foisted upon the consumer. Keeping in view the record and evidence discussed above, one side change of the EMIs and tenure of the installments without intimation to the complainant, the OP have resorted to unfair trade practice and, thus, the complaint is liable to be accepted
13.         In view of the above discussion, the present consumer complaint succeeds and the same is accordingly partly allowed qua the OP.  Accordingly, the OP is directed as under:-

1. Not to increase the tenure of installment from 156 as mentioned in letter dated 18.02.2011 (Annexure C-2)  without the consent of the complainant.
2. To charge the rate of interest as fixed by the RBI from 01.01.2011 till date after option and consent of the complainant.
3. To refund the difference in the amount of installment being received at different intervals at the change of interest from the date of sanctioning till date.
4. To remove the amount of overdue charges being shown in the account of the complainant.
5. To correct the profile of CIBIL of the complainant and her husband namely Sh.Hari Pal Verma immediately pertaining to loan account bearing No.00036660002679 with Customer I.D.2224159.
6. To pay a sum of Rs.1,00,000/- as compensation on account of mental agony, physical harassment and financial loss to the complainant.
7. To pay a sum of Rs.15,000/- as litigation expenses.

14.             This order be complied with by the OP within 45 days from the date of receipt of its certified copy, failing which, they shall make the payment of the awarded amounts with interest @ 9% per annum from the date of this order, till realization, apart from compliance of remaining directions.
15.         Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced 10/02/2021	Sd/-
	(RAJAN DEWAN) PRESIDENT
	Sd/-
	(B.M.SHARMA) MEMBER