Bank to pay Rs.1 lac for not informing Rejection of Loan

State Consumer Disputes Redressal Commission, Maharashtra directed Bank of Baroda to pay Rs.1 lac as compensation for not informing the rejection of housing loan and reasons thereof.

Jayprakash R.Kushwaha entered into an agreement for purchase of house, in a Co.Op. Housing Society for Rs.4 lakh on 12/3/2007 and gave Rs.87,000/- as advance. Rest of amount of Rs.3,13,000/- was to be paid by obtaining loan from the bank. Before execution of agreement he had approached Bank of Baroda (Saki Naka Branch, Andheri East, Mumbai) for getting loan for purchase of flat. He had shown document of flat to the Bank they agreed to give housing loan of Rs.3,13,000/-.

After execution of that agreement he approached the Bank submitted application for giving housing loan alongwith necessary documents. Bank verified those documents and agreed to extend loan of Rs.3,13,000/- to him.

Complainant deposited processing fees and amount required for mortgage of flat with bank and after the process was completed he had given application to the Co-Operative Housing Society for no objection certificate. Society gave no objection and also transferred share certificate of in favour of complainant.

Complainant submitted that bank did not gave the cheque for housing loan amount on the pretext that his file of house loan is missing. Complainant filed complaint against the Bank and requested to direct the Bank to give the cheque of housing loan along with compensation and costs of litigation.

Bank of Baroda submitted that the no objection of society produced by the complainant is false and fabricated. It does not bear the signature of the President/Secretary of the society. Hence, loan cannot be given in respect of that flat to the complainant.

Bank also submitted that the seller was not authorized to execute the agreement for sale in respect of that flat. Hence, the title of the flat in respect of house was not clear. For all these reasons Bank submitted that complainant is not entitled for loan.

District Forum held that Bank caused deficiency of service to the complainant and hence, directed the Bank to inform about status of house loan to be given to the complainant in respect of flat to him within 30 days from passing of order.

District Forum also directed the Bank for giving compensation of Rs.1,00,000/- and costs of litigation Rs.10,000/- to him.

Being aggrieved by the decision of District Forum Bank preferred the appeal to State Commission, which was dismissed.

State Commission opined that as and when Bank had come to know that title of the proposed seller is not clear and letter of transfer of flat given to them by the complainant is false and fabricated it was incumbent on the Bank to inform this fact to the complainant. However, complainant was required to wait for same and was required to file this complaint against the Bank. Bank did not responded to the complainant on the pretext that house loan file of complainant is missing.

Under such circumstances, the commission opined that there was deficiency in service given by the Bank. and hence complainant is entitled to get compensation.