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Home Loan – Loss of original documents of property by the Bank

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On 28.10.2015, the complainant had executed home loan agreement against the property.  Mortgage was created by taking the original registered sale deed dated 31.10.2015 and other documents as collateral security for the home loan.  The said original documents were to be returned after repayment of home loan and after receipt of SMS from the Bank.

However, SMS was not received by the complainant, whereas, he was informed that the original title deed was lost and would be returned after it is traced. However, the exchange of communications show that the Bank was negligent for loss of original deed and the complainant was not in a position to sell the property to prospective purchaser at Rs.4.5 crores.

After giving legal notice, the complainant filed the consumer complaint.

HELD that the Bank has not disputed that it has failed to return the original deed and except claiming that the Bank is ready to re-create the original deed or to take certified copies, it did not submit the same.  The Bank was directed to issue a public notice in a newspaper that the original deed is loss & that the said property is free from its encumbrances, to get certified copy, to bear all expenses to issue indemnity bond and to pay Rs.3 lakhs compensation for mental agony and financial loss to the complainant.

The complainant shall approach the Bank in 15 days and needful should be done in 45 days, otherwise penalty of Rs.5,000/- per day shall be imposed upon the Bank in view of RBI guidelines dated 13.9.2023.

Original sale deed is essential part of title of the property and in the absence of original sale deed it would certainly be impossible for the complainant to sell his property.

Judgment dated 24.6.2024 of the District Consumer Disputes Redressal Commission, Ranga Reddy, in CC No.20 of 2021 of Venkat Ramana Peesapati  Vs. M/s. Axis Bank Limited Loan Centre

 

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