Life Insurance Corporation of India vs Sukhbir Singh Chahal

G.C. Garg, J.—Plaintiff-Respondent applied for the house loan under the Own Your House Scheme. The application for the grant of loan was rejected by the Defendant-Appellant primarily on the ground that Plaintiff was not the owner of the plot in dispute. However, on a consideration of the matter I find that the Plaintiff purchased a plot measuring about 300 sq. yds. out of which he surrendered 157 sq Yds. in favour of his wife by a consent decree. He, however, continues to be the owner of 143 sq Yds. over which a house was sought to be constructed by raising a loan. The only ground to reject the application of the Plaintiff was that the title of the property involved a court decree and such documents cannot be accepted for creating an equitable mortgage. This ground has not been accepted by the two courts below. On a consideration, I find that the Plaintiff in any case continues to be the owner of 143 sq. yds. and he wanted to avail the loan facility for raising construction on this piece of land and there was no dispute that he is the owner of this area. The consent decree, if any, relates to the balance area. Faced with the above situation, learned Counsel for the Appellant submitted that in any case the courts below were not justified in giving a direction to the Corporation to sanction a loan and at the most a direction could be issued to consider the case of the Plaintiff afresh in the light of the observations made in the judgments. Learned Counsel further submitted that this scheme has been discontinued w.e.f. 1.11.1991 i.e. during the pendency of the suit. On a consideration of the matter I find substance in the first contention of the learned Counsel. In the circumstances, this appeal is disposed of only with a direction that the LIC shall now consider the case of the Plaintiff applicant for the grant of house loan under the Own Your House scheme as applicable at the time of making the application and dispose of the same according to law. The application shall now be disposed of as early as possible preferably within three months to avoid hardship to the Plaintiff.