Court orders PNB Housing Finance to pay compensation for taking prepayment charges from customer
The District Consumer Disputes Redressal Commission-I (Chandigarh) bench, consisting of Pawanjit Singh (President), Surjeet Kaur (Member), and Suresh Kumar Sardana (Member), recently ruled on a case involving PNB Housing Finance Ltd. The commission found the finance company responsible for imposing prepayment charges on a loan and causing a delay in the delivery of the loan cheque.
Background – Brief Facts:
Mr. Subash Chander Gupta and Mrs. Manu Gupta applied for a housing loan of Rs. 70,00,000 from PNB Housing Finance Ltd. The sanctioned loan amount was Rs. 70,19,525 with a tenure of 180 months, carrying a floating fixed 9.50% interest for the first year. The loan faced delays, and despite the delayed delivery of the cheque, the finance company imposed interest on the Complainants, leading to an approximate charge of Rs. 6000.
In April 2018, the Complainants made a prepayment of Rs. 45,00,000 to the loan account. The Finance Company levied prepayment charges of Rs. 1,55,000, calculated at 3% + GST. However, the deposited amount was Rs. 43,46,146, with the prepayment charges deducted. Despite reminders, the Finance Company did not reverse the charges, forcing the Complainants to deposit an extra amount of Rs. 1,29,427.89. Dissatisfied with the Finance Company’s responses, the Complainants filed a consumer complaint in the District Consumer Disputes Redressal Commission-I, U.T. Chandigarh.
Contentions and Ex-Parte Proceedings:
The Finance Company, failing to appear before the District Commission, was proceeded against ex-parte.
Observations by the Commission:
The District Commission reviewed emails confirming prepayment, Loan Amortization Schedule, and noted a disparity of Rs. 1,55,000 between the Complainants’ payment and the recorded entry by the Finance Company. Referring to RBI guidelines, the Commission found the imposition of foreclosure charges on floating-rate term loans to individual borrowers as a deficiency in service. The delay in providing the sanctioned loan amount cheque and subsequent imposition of interest were also deemed unfair and against the guidelines.
Commission’s Decision:
The Finance Company was directed to refund Rs. 1,55,000, along with Rs. 6,000, to the Complainants, with interest at 9% per annum from the date of filing the complaint. Additionally, a compensation of Rs. 10,000 for mental agony and harassment, and litigation costs of Rs. 8,000 were awarded to the Complainants.
