Loans with multiple co-borrowers, including firms, are not exempt from foreclosure charges according to specific circulars.

1. This order shall dispose of the appeal filed by the appellant / O.P. being aggrieved by the order dated 13.7.2018, passed by the District Consumer Disputes Redressal Forum, Raipur (C.G.) (in brevity District Forum) in Complaint Case No. 413/2017 whereby and whereunder the concerned District Forum, has directed the appellant / O.P. to proceed under the guidelines of the Reserve Bank of India, to transfer the home loan account without taking 4% foreclosure charges, for transfer to another Bank, as per the prayer of the respondent / complainant. The concerned District Forum, has also awarded Rs. 5,000 towards compensation for mental harassment and Rs. 2,000 towards Advocate's fees and cost of the complaint to the respondent / complainant.

2. Facts in brief are that the respondent / complainant as an individual had taken loan of Rs. 96,00,000 from I.C.I.C.I. Bank as Home Loan and thereafter he had attempted to transfer the said home loan account to another Bank. The respondent / complainant was asked for 4% foreclosure charges. As per the respondent / complainant, the Reserve Bank of India vide its Circular dated 5.6.2012 directed that the Banks will not be permitted to charge foreclosure charges / pre - payment penalties on home loans on floating interest rate basis, with immediate effect. Despite their Circular, as the respondent / complainant not get reliefs in the line of the said guidelines, the respondent / complainant had filed the complaint before the concerned District Forum on 14.7.2017. On 17.12.2017, the notice issued to the appellant / O.P. was served, despite service, the appellant / O.P. not took part in the proceedings before the concerned District Forum. The concerned District Forum heard the matter ex parte and decided the complaint case vide order as aforementioned.

3. The appellant / O.P. had filed the instant appeal against the impugned order dated 13.7.2018. On 4.10.2018, this Commission condoned the delay of 26 days in filing the appeal subject to cost of Rs. 1,500, to be deposited in C.G. State Consumer Welfare Fund. The appeal was admitted for final hearing. The appellant / O.P. has submitted in his Memorandum of Appeal that the respondent / complainant not came with clean hands before the concerned District Forum and not disclosed the fact that the said loan was given to the respondent / complainant, Smt. Gurmeet Kaur Arora, Parmeet Singh Arora, Ankit Arora and a firm Hotel Welcome, and as the said loan was for the commercial purpose, hence the respondent / complainant does not fall under the category of Consumer under The Consumer Protection Act, 1986 (in brevity The Act of 1986). Also the respondent / complainant has not made parties to the above co - borrowers. With this, there is non - joinder of the necessary parties and as per the Circular of the National Housing Bank dated 3.9.2014 and 22.7.2016 only individual borrowers are exempted from any foreclosure charges / pre - payment penalties. Hence submitted that the appeal may be allowed and the impugned order passed by the concerned District Forum, may be quashed.

4. The appellant / O.P. has also filed an application under O.41 R.27 of The Code of Civil Procedure, 1908 (in brevity The Code) for taking on record the above two Circulars, issued by the concerned authorities to demonstrate the provisions ultimately for charging of foreclosure charges / prepayment penalties on floating rate terms loans.

5. Learned Counsel for the appellant / O.P. would submit that the respondent / complainant has not stated the true facts and concealed certain facts, which is apparent from their document Annexure C - 1. As per Annexure C - 1