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Judgment
Dr. Shiva Kumar Swami and Smt. Prema Sudha, complainants obtained a loan in the sum of Rs.20 lakhs from the opposite party/LIC with an intention to purchase a residential flat. However, the said scheme could not materialize as the Developer of the said flat did not deliver the constructed flat well within the stipulated period of time. The agreement was cancelled. They paid the amount back to LIC. LIC imposed a pre-closure charges in the sum of Rs.39,845/-.
Both the fora below have decided the case in favour of the complainants and directed the opposite party to refund a sum of Rs.39,845/- with interest @12% per annum from 15.7.2010.
I have heard the learned counsel for the petitioner-LIC Housing Finance Ltd. and Ms. Anjalli Bansal, learned Amicus Curiae for the respondents/complainants. My attention was
invited towards the circular issued by National Housing Bank dated 18.10.2010. The relevant paras read as follows: "The issue of levying pre-payment penalty or pre-payment charges by housing finance companies on pre closure of housing loans by the borrowers out of their own sources has been considered by the National Housing Bank and it has been decided that housing finance companies should not charge prepayment levy or penalty in such cases.
It is, therefore, advised that the pre-payment levy or penalty should not be collected from the borrowers when the housing loan is pre-closed by the borrowers out of their own sources. All HFCs are advised to ensure compliance of the above with immediate effect."
Learned Amicus Curiae vehemently argued that the pre-closure charges were paid by the builder from the account of the complainants. She contended that it is the discretion of the Commission to condone the pre-closure charges. She also argued that the Consumer Commission is a benevolent institution and the Commission should have mercy upon the complainants.
The arguments urged by her lack conviction. The complaint in para 4 itself mentions: "4. Due to failure of delivery of flat as promised by M/s Pratham Constructions, Bengaluru, the entire loan amount of Rs.20,00,000/- (rupees Twenty lakhs only) along with interest have been repaid and its details are mentioned as under:
Sr. No. Mode Amount (in Rs.) Period
1 Through ECS 4,27,532/- 09.07.2008 to 16.09.2009
2 Through M/s Pratham constructions, Bengaluru Rs.15,00,000/- 19.06.2009
3 -do- Rs.3,99,689/- 16.09.2009
TOTAL 23,27,221/-
There is not even an iota of evidence to show that the pre-closure charges were paid on or after 18.10.2010. No evidence was furnished in this respect. Consequently, it appears that the orders passed by the fora below are not legally tenable.
The construction of contract/insurance policy entered into between the parties assumes importance. It is a settled law that court should refrain from any interpretation which would result in injustice and absurdity, AIR 1963 SC 25. The question to be considered is not what was intended, but what has been said. We cannot amend or substitute anything in the contract, as per law laid down in Suraj Mal Ram Niwas Oil Mills (P) Ltd. vs. United India Insurance Co. Ltd. & Anr., (2010) 10 SCC 567, General Assurance Society Ltd. vs. Chandmull Jain, 1966 ACJ 267 (SC), Harchand Rai Chandan Lal''s case, 2005 ACJ 570 (SC).
This is an indisputable fact that the loan agreement entered into between the parties provides for pre-closure charges. Consequently, I set aside the orders passed by fora below and dismiss the complaint. There shall be no order as to costs. The OP can withdraw the amount if any deposited in respect of this case after the expiry of 90 days.