Consumer Court Orders CanFin Homes to Pay Fine for Withholding Property Documents

BENGALURU: A consumer court has recently ruled against CanFin Homes Ltd, a housing finance company, for failing to return the property documents to a Bengaluru resident despite him having fully repaid his loan.

The court has ordered the company to hand over all the documents and also compensate the borrower with over Rs 1.3 lakh. C Sathyanathan, a 58-year-old resident of MSR Nagar in Bengaluru, took a loan of Rs 60 lakh from CanFin Homes Ltd in September 2014, at an interest rate of 11.20% per annum.

The loan, meant for purchasing a plot and constructing a house, had a 15-year repayment tenure with a monthly EMI of Rs 68,965. However, after quitting his job and utilizing his pension and savings, Sathyanathan decided to clear the entire loan in 2018 to focus on other family responsibilities.

In September 2018, he requested the return of his property documents from CanFin Homes, but the company failed to respond to his request.

Frustrated after waiting for a year, Sathyanathan approached the IV Additional District Consumer Disputes Redressal Commission in Bengaluru and filed a complaint, accusing CanFin Homes of withholding his original property documents despite the full repayment of the loan.

In its defense, CanFin Homes claimed that Sathyanathan still owed Rs 1.20 lakh as a penalty and had violated the loan agreement, which required him to purchase a site and build a house. They argued that although he had bought the land, no house had been constructed.

After reviewing all the evidence from both sides, the consumer court ruled that CanFin Homes had shown a deficiency in its services. The court determined that the company had failed to present sufficient evidence to support its claim that Sathyanathan still owed them money.

The commission ordered CanFin Homes to return the original title deed and other related documents to Sathyanathan.

Additionally, the company was directed to pay a fine of Rs 100 per day, from the date of the court order until the documents are returned.

The court further instructed the company to pay Rs 1 lakh as compensation for service deficiency, Rs 20,000 for mental distress caused to the complainant, and Rs 10,000 towards legal expenses.
The housing finance company has been given a 45-day deadline to comply with the court’s ruling.