The commission asked the firm to pay for the mental agony as well as the litigation cost the consumer had to endure. The forum also asked the firm to pay back the excess amount it had taken from the complainant.
The Maharashtra State Commission for Consumer Dispute Redressal on Tuesday pulled up a leading finance company, GE Money Housing Finance Limited, for alleged unfair trade practice and deficiency in service extended to a borrower, who had taken a loan to buy a house in Andheri. The commission penalised the firm, and directed it to pay compensation.
The commission held that the complainant in the ex parte complaint proceedings is entitled to reasonable amounts as damages and compensation because as a consumer availing a loan, the complainant was the victim of exploitation by the service provider.
The commission asked the firm to pay for the mental agony as well as the litigation cost the consumer had to endure. The forum also asked the firm to pay back the excess amount it had taken from the complainant.
The complainant, Mathew Thomas, had opted for a loan of Rs 18 lakh on August 18, 2006 and Rs 14,21,000 on August 28, 2006. According to the loan agreement, the amount was to be repaid to the company with an interest rate of 9.86 per cent per annum. The agreement said that the EMI amount was changeable subject to the change in the rate of interest, but not the period. The tenure of the loan repayment, was therefore, not to be increased. The firm, however, suddenly started changing the rate of interest, not as per the RBI guidelines, but on their own whims, exceeding the benchmark set.
The commission held that the complainant is entitled to recover, by way of refund, the excess amount of Rs 1,21,000 along with Rs 50,000 towards mental agony and Rs 1 lakh towards litigation charges.
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