IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, KOTTAYAM
Dated this the 22nd day of September, 2022
Present: Sri. Manulal V.S. President
Smt. Bindhu R. Member
C C No. 69/2021 (filed on 26-03-2021)
Petitioner : Santhoshkumar A.S.
S/o. Sukumaran,
Ananathanparambil House,
Sachivothamapuram P.O.
Kurichy, Kottayam.
(Adv. Sunny George Chathukulam) Vs.
Opposite Party : The Manager,
Punjab National Housing
Finance Ltd. Cyril’s Tower,
Kottayam – 1.
(Adv. K. Anilkumar Ambady)
O R D E R
Smt. Bindhu R. Member
The complaint is filed under Section 35 of the Consumer Protection Act, 2019.
The complainant’s case is that he had applied for a loan from the opposite party for taking over another loan with New India Assurance Company Limited, Kottayam of Rs.17,00,000/- on the positive assurance from the opposite party. Initially the complainant has submitted photocopy of the documents and two cheques for the amounts of Rs.11,800/-and 5,900/- respectively vide cheque no 10064682 dated 13/03/2018 and 10064684 dated 15/03/18. The opposite party has collected an amount of Rs.17,700/- from the complainant’s account from Federal Bank, Kurichy branch towards processing charges. The opposite party assured the complainant that the loan would be sanctioned after complying the formalities. At the time of submission of documents, the complainant submitted a certified copy of the prior deed as the original of the same was irrecoverably lost. Subsequently the opposite party rejected the loan and returned all the title deeds on the ground of non-production of original of the prior deed, but did not return the money they collected.
Though the complainant demanded the refund of the processing charges, the opposite party returned only Rs.8,000/-to the complainant. The opposite party has no right to retain the balance amount of Rs.9,700/- as processing charge as the loan was rejected. The complainant issued a lawyers notice on 13-11-2018 demanding the return of the balance amount. Though the opposite party received the notice on 16-11-2018, they did not refund the amount. The opposite party had the knowledge that the original of the prior deed was irrecoverably lost even at the time of submission of documents but they assured to pass the loan and proceeded with the knowledge of chance of rejection of the same. This act of the opposite party to defraud the complainant to get undue gain is a deficiency of service on the part of the opposite party and hence this complaint is filed for getting the balance amount, compensation and cost.
The opposite party received the notice sent by the Commission and appeared before the Commission.
The opposite party filed version contending that the Opposite party is a housing finance company registered with the national housing bank, a statutory body constituted under the National Housing Bank Act.1987.The opposite party has acted in accordance with the guidelines and circulars by NHB. Hence the complaint is not maintainable. At the very inception of procedures the opposite party informed the complainant that they had no obligation to refund any of the charges in the processing. Moreover, the complainant and the co obligant have under took the same in the loan application also. The opposite party has duly processed the housing loan of the complainant. The complainant could not furnish the original of the prior deed, gift deed no 540/1971.The legal opinion of Adv. Sajimon T.J, Advocate dated 18.06.2018 insisted that for creating valid mortgage the original of the said gift deed was necessary. So as the complainant could not produce the original of the said document and thus could not satisfy the legal requirements of creating a valid mortgage, the loan was rejected and all the documents were returned to the complainant. The PNB housing finance bank has no obligation to return the money but only upon special consideration they refunded Rs.8000 to the complainant. The opposite party is not personally liable and is unnecessarily dragged into the complaint. The complaint is hit by non joinder of necessary party. The opposite party had no prior knowledge about the missing of the original document. The opposite party sanctioned the loan and were ready to disburse the money but the legal opinion came insisting for the production of the original of the prior deed and the complainant failed to do so. Then the opposite party was unable to proceed further. So there is no deficiency of service on the part of the opposite party and the complaint is liable to be dismissed.
The complainant adduced evidence through proof affidavit and documents which were marked as Exhibit A1 to A8 and the opposite party has filed proof affidavit along with exhibits marked as B1 to B4.
On evaluation of the evidence and pleadings we would frame the following points :
- Whether there is any deficiency of service on the part of the opposite party?
- If so what are the reliefs?
Points 1 and 2
- The complainant’s case is that he had applied for the takeover of a housing loan from the New India Assurance Company Limited for an amount of Rs.17,00,000/- and submitted all necessary documents. Though the opposite party collected the processing charge of Rs.17,700/- from the complainant, had rejected the loan for the reason of non-production of original prior deed. The non-refund of processing charges is a deficiency of service. The opposite party contested that they were ready to give the loan but as per the legal opinion they were made unable to sanction the loan. There is no wilful latches on their part and they had to reject the loan as the complainant failed to comply with the required procedure as per the rules.
- The complainant applied for the takeover loan in the month of February 2018. The opposite party collected two cheques along with the submission of documents. But the opposite party encashed the cheques on 11/03/18 and15-03-2018 and drew Rs.11,800/- and 5,900 respectively from the account of the complainant. The legal opinion came only on 18-06-18 and subsequently the loan was rejected. We infer that the loan processing would include the legal scrutiny report from the concerned lawyer. The opposite party retained the money of the complainant amounting to Rs.17,700/- for 3months and more unlawfully. Thereafter when the loan was rejected after several demands by the complainant, they returned only 8,000/- on 31.08 18 after two more months. So altogether the opposite party retained the amount for 5months. The balance amount of Rs.9,700/- is retained by the opposite party till now.
The question is whether the opposite party is bound to repay the fee collected by them towards processing fee in the event of rejection of loan. The opposite parties accepted the application form from the complainant for a loan by taking over another loan. The opposite party has failed to establish what were the process they initiated to sanction the loan and what all expenses were incurred during the process. From the evidence on record, we infer that the loan application was undergone the legal scrutiny. But there is no statement regarding the expenses for the processing is before us.
The opposite party though contended that the processing fee could not be repaid, they refunded Rs.8,000/- out of Rs.17,700/- without any explanation except that it was a gesture of goodwill. For that also the opposite party has not produced any document to show that it was an official decision by the Punjab National Housing Bank. So it is clear that the processing charge could be refunded at his discretion. So we find that there is clear deficiency of service on the part of the opposite party in retaining the service charge with him.
Hence we allow the complaint vide the following order:
- The opposite party is directed to repay the amount of Rs.9,700/- to the complainant with interest @9% p.a from 15.03.2018 till realization.
- The opposite party is further directed to pay a compensation of Rs.2000/- to the complainant.
The Order shall be complied within 30 days from the date of receipt of Order. If not complied as directed, the compensation amount will also carry 6% interest from the date of Order till realization.
Pronounced in the Open Commission on this the 22nd day of September, 2022
Smt. Bindhu R. Member Sd/-
Sri. Manulal V.S. President Sd/-
Appendix
Exhibits marked from the side of complainant
A1 – Copy of computer printout of letter dtd.01-08-18 by complainant to opposite
party
A2 – E-mail letter dtd.13-08-18 by complainant to the customer care of opposite
party
A3 – Computer printout of letter dtd.,29-08-18 by opposite party to customer care
of opposite party
A4 – Copy of statement of account for the period of 12-03-2018 to 26-03-18 in
the name of petitioner issued by Federal Bank
A5 - Copy of statement of account for the period of 08-08-18 to 06-09-18 in
the name of petitioner issued by Federal Bank
A6 – Copy of lawyers notice dtd.14-11-18
A7 – Postal receipt
A8 – Postal Acknowledgement card
Exhibits marked from the side of opposite party
B1 – True copy of power of Attorney dtd.08-09-21
B2 – Copy of loan application form
B3 – Copy of loan application form
B4 – Copy of Legal title opinion report dtd.18-06-18
By order
Assistant Registrar
