DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, BATHINDA.

CC.No.593 of 13-12-2012

Decided on 26-03-2013

Navdeep Singh Sidhu aged about 42 years S/o Daljit Singh Sidhu R/o House No.7398, Mohalla Guru Nanakpura, Bathinda.

........Complainant

Versus

India Bulls Housing Finance Ltd., Ground Floor, Deep Complex, Near Hanuman Chowk, Bathinda, through its Branch Head.

.......Opposite party

Complaint under Section 12 of the Consumer Protection Act, 1986.

QUORUM

Smt. Vikramjit Kaur Soni, President.

Sh.Amarjeet Paul, Member.

Smt.Sukhwinder Kaur, Member.

Present:-

For the Complainant: Sh.Ashok Gupta, counsel for complainant.

For Opposite party: Sh.J.D Nayyar, counsel for opposite party.

ORDER

VIKRAMJIT KAUR SONI, PRESIDENT:-

1. The complainant has filed the present complaint under section 12 of the Consumer Protection Act, 1986 as amended upto date (Here-in-after referred to as an 'Act'). The brief facts of the complaint are that the complainant has purchased a plot, situated at Sushant City, Kot Shamir Road of 280.97 sq. yds @ 6600 per sq. yds from one Krishan Chand S/o Roshan Lal R/o House No.167, Phase-I, Model Town Bathinda. The sale deed of the said plot was to be executed on or before 21.10.2012. The complainant has paid Rs.4,62,000/- as earnest money. The remaining amount of about Rs.13 lacs was to be paid for the execution of the sale deed and the complainant contacted the opposite party for getting the loan and on its assurance he applied for the same. After fulfilling all the requirements the opposite party got the cheque of Rs.5618/- as processing fee with the promise that the cheque would be encashed only after granting the loan of Rs.6 lacs. The complainant got the legal opinion as directed by the opposite party and deposited all the documents with it. The complainant received a message on 20.9.2012 about the sanctioning of the loan but the loan was never granted and the opposite party delayed the matter on one or the other pretext. Ultimately the opposite party rejected the loan when only 7 days left for the execution of the sale deed and create a panic in the mind of the complainant as he has already paid a hefty amount of Rs.4,62,000/- and in the failure of the loan his earnest money is likely to be forfeited. The complainant came to know that his loan was rejected being advocate whereas the opposite party encashed the cheque on 22.9.2012 without telling anything to him as such it cannot swallow the amount of Rs.5618/- as it had not granted any loan to him. The complainant got the loan of Rs.13 lacs from Sukhpal Singh S/o Gurdev Singh R/o Bibi Wala Road, St.No.14, Bathinda @ 3% and he has to pay Rs.39,000/- per month as interest to Sukhpal Singh. Hence the complainant has filed the present complaint to seek the direction to the opposite party to refund the amount of Rs.5618/- taken by it as processing fee alongwith cost and compensation.

2. Notice was sent to the opposite party. The opposite party after appearing before this Forum has filed its written statement and pleaded that the complainant does not fall within the definition of complainant, complaint, consumer dispute and service as defined under section 2(1) of the 'Act' as the controversy involved in the present complaint is not a consumer dispute. The opposite party further pleaded that in actual the complainant had applied the loan of Rs.6 lacs and the same was not approved by it & therefore mere applying of a loan does not give any right to him to claim the loan facility. The complainant was well aware of the fact that the processing fee is non-refundable even if the loan is not sanctioned as clearly stated in the declaration given & signed by him in the Loan Application Form. The opposite party denied that it ever assured the complainant to sanction the loan and also denied that the processing fee of Rs.5618/- which was taken, was to be encashed only after granting the loan of Rs.6 lacs. In fact in order to process his application for availing the financial facility, the complainant was to pay the non-refundable processing fee towards the administrative and other miscellaneous expenses and accordingly, he deposited a chqeue bearing No.133880 dated 12.9.2012, drawn on the Oriental Bank of Commerce, alongwith the application form. The cheque of Rs.5618/- as processing fee was deposited by the complainant with the understanding that the same is non-refundable and the said cheque will not be returned to him ever after the rejection of his loan application. The complainant has not annexed the sale deed executed by him for the purchase of the property in question for which the loan was applied by him. The opposite party has not directed the complainant to get the legal opinion. The complainant has failed to submit the title documents and more particularly the Agreement to sell entered by him with the seller of the property to conduct the due diligence of the title of the property under the sale & to be mortgaged by him. The legal opinions are obtained by the opposite party from their respective empanelled lawyers of the respective locations, after a customer provides the documents relating to the proposed mortgaged property. The opposite party has also denied that the complainant has received the text message on 20.9.2012 from the opposite party confirming to him about the sanctioning of the loan. No such type of message was ever conveyed to him as his loan had never been sanctioned. The text of the message (SMS) sent by the opposite party to the complainant is as under:-

“We have received your Home Loan application (Ref. No.273011) for Rs.6,00,000/-. Thank you for applying for Home Loan with Indiabulls. T&C apply.”

This message was conveyed to the complainant on 20.9.2012 at 18:10 Hrs. on his mobile No.+919501279799.

The opposite party further pleaded that a detailed process followed by it for processing of the loan applications before the loan amount is sanctioned and disbursed by it. A home loan involves three processes, the first & initial one being to submit a duly filled application form alongwith the necessary documents which include the financial documents also. The second step involves sanction and the third step is disbursement for availing a home loan. Sanction of home loan is based on the duly filled loan application form upon which the bank/FI will evaluate the loan application form. Further the bank/FI will check all the information including the customers existing residential address, his place of employment, employer credentials, residence & work telephone numbers. The representatives of the bank/FI then visits the residential address or workplace to verify all the details. All the income related documents are scrutinized by the lending institution to study & check the financial status of the customer. The bank statements & average bank balance maintained in the savings bank account are carefully scrutinized alongwith a study of the pattern of the cheque bouncing charges if any levied in the bank statement. The bank also checks for regular periodic payments being done by the customer, to other banks/finance company to check the existing liabilities on the customer. If the bank is not satisfied or convicted with the documents and details provided by the customer, his application for the home loan would not get approved. The loan of the complainant was rejected, as he failed to submit the property papers of the proposed mortgaged property for its verification and and necessary due diligence, based on which the loan facility was to be sanctioned. Further the complainant did not submit audited financial documents, which are mandatory for the precessing of the loan. The processing fee is non-refundable even if the loan amount is rejected and his processing fee is taken by the company towards the administrative cost it incurs for the processing of the loan applications including the legal expenses. Since the processing fee is taken by the company for the expenses incurred on the processing of the loan applicability hence non refundable, the cheque given by the complainant was encashed by the opposite party. Moreover no assurance/guarantee given by the opposite party with regard to sanction of the loan to the complainant. Secondly, the complainant was fully aware of the fact that the loan may or may not be accepted. While signing the loan application, the applicant alongwith Mrs.Jaspreet Kaur has given & signed the declaration to the effect that 'The processing fee is non-refundable (even if the loan is rejected)' Further, 'I am/we are further aware that it is sole and absolute discretion of Indiabulls to accept or reject the application and/or to change the loan amount (without assigning any reason)'. This declaration was duly signed by the applicant and Mrs.Jaspreet Kaur, as the co-applicant, on their own free will and without any undue influence and coercion from any part. After signing the declaration, the applicant has no right to make allegation against the opposite party regarding encashing of the cheque of Rs.5618/- towards the processing fee. In this way there is no deficiency in service on the part of the opposite party.

3. The parties have led their evidence in support of their respective pleadings.

4. Arguments heard. The record alongwith written submissions submitted by the parties perused.

5. Admitted facts of the parties are that the complainant has applied for the loan and has paid Rs.5618/- as processing charges to the opposite party. The loan of the complainant has been repudiated by the opposite party.

6. The disputed facts between the parties are that the complainant submitted that he has received the text message on 20.9.2012 from the opposite party confirming to him about the sanctioning of the loan but the loan was not granted and the opposite party delayed the matter by making lame excuses. The complainant has already paid Rs.4,62,000/- as earnest money towards the said plot to the officials of Sushant city. The opposite party has not sanctioned the loan to the complainant and due to this he had to get the loan of Rs.13 lacs from outside and he has to pay the interest of Rs.39,000/- per month to Sukhpal Singh from whom he took the loan. The complainant further submitted that his application has been rejected without assigning any reason. The opposite party rejected the loan of the complainant being advocate and it has swallowed Rs.5618/- without any reason. The opposite party promised that if the loan is not granted the cheque of Rs.5618/- would not be encashed. The opposite party got the signatures of the complainant on the various papers without disclosing the contents and the original documents like income tax returns, jamabandi, photocopy of passport etc. were not returned to the complainant till date.

7. On the other hand the opposite party submitted that the complainant had applied the loan of Rs.6 lacs and he has not submitted the the title documents and the Agreement to sell entered by him with the seller of the property to conduct the due diligence of the title of the property under the sale & to be mortgaged by him. The legal opinions are obtained by the opposite party from their respective empanelled lawyers of the respective locations, after a customer provides the documents relating to the proposed mortgaged property. Moreover the complainant was fully aware of the fact that the processing fee i.e. Rs.5618/- is non-refundable. The complainant alongwith Mrs.Jaspreet Kaur has given & signed the declaration to the effect that 'the processing fee is non-refundable (even if the loan is rejected)'. As the complainant has failed to submit the requisite documents, his loan application has been rejected. No text message regarding the sanctioning of the loan was sent to the complainant rather the following text message has been sent to him:-

“We have received your Home Loan application (Ref. No.273011) for Rs.6,00,000/-. Thank you for applying for Home Loan with Indiabulls. T&C apply.”

8. A perusal of record shows that the loan application form was submitted by the complainant alongwith the processing fee of Rs.5618/-. Sh.Hardeep Singh, Senior Manager Legal, India Bulls Housing Finance Ltd., has deposed in his affidavit Ex.R1 in para No.9:-

“9)........The loan of the complainant was rejected as he failed to submit the property papers of the proposed mortgaged property for its verification and and necessary due diligence, based on which the loan facility was to be sanctioned. Further the complainant did not submit audited financial documents which are mandatory for the precessing of the loan.”

The opposite party has placed nothing on file to prove that it has ever asked for these documents from the complainant or has given any notice to him regarding the submissions of these documents. If these were the documents which are required to be submitted alongwith the loan application form in that case why the opposite party has accepted the loan application form without these documents. A perusal of the loan application form shows that all the particulars regarding the documents which are filled in this and there is no reference given regarding the documents which are to be submitted alongwith this application. Moreover when the opposite party is accepting this loan application form alongwith the processing fee it should immediately asked the complainant to provide the documents which were required. The original documents has already been submitted alongwith the loan application form by the complainant like income tax returns, jamabandi, photocopy of passport etc. were not returned to him till date which falsifies the contention of the opposite party that he has not deposited the documents. When the opposite party is charging the amount of Rs.5618/- for processing the loan it should have scrutinized the application and if there is any discrepancy it should have asked the complainant to remove that discrepancy and must have sent notice/letter regarding the submission of those documents but no such efforts has been done on the part of the opposite party which shows that it was predetermined to reject his loan without assigning him any proper reason.

9. The complainant has placed on file Ex.C5, the sale agreement which shows his necessity to seek the loan from the opposite party and the rejection of the loan without any solid basis that too before 7 days before the sale deed leads to mental harassment to the complainant. Moreover it was the duty of the bank to convey the complainant in writing, the reasons of rejection of his loan application. The opposite party without giving a chance to complete his documents that are required for the process of loan and without hearing him cannot reject his loan application. If for the argument sake it is believed the complainant has not supplied the requisite documents required for the processing of loan even than the opposite party cannot decide his loan application unilaterally without giving him a chance of hearing. Thus we are of the considered view that there is deficiency in service on the part of the opposite party and opposite party on no pretext is entitled to keep the processing fee as the processing remained incomplete.

10. Therefore in view of what has been discussed above this complaint is accepted with Rs.3000/- as cost and compensation against the opposite party and it is directed to refund the processing fees of Rs.5618/- to the complainant.

11. The compliance of this order be done within 45 days from the date of receipt of the copy of this order.

In case of non-compliance the interest @ 9% per annum will yield on the amount of Rs.5618/- till realization.

12. A copy of this order be sent to the parties concerned free of cost and file be consigned to the record room.

Pronounced in open Forum:-

26-03-2013

Vikramjit Kaur Soni

President

Amarjeet Paul Sukhwinder Kaur

Member Member