It has further been instructed to not claim any foreclosure charges if the payment is made in lumpsum.

Krishan Pal, a resident of Sector 26, said in his complaint that he availed a personal loan of Rs 40,636 from the bank in September 2006.

The instalments were fixed at Rs 2,199 each for 36 months. He said he was not informed about the rate of interest and terms and conditions of the loan but was assured that these would be sent by post.

He said he received a cheque of Rs 37,719 against the loan and till that time, neither the terms and conditions nor the rate of interest was disclosed to him. After disbursement of the loan amount, he received an insurance policy issued by ICICI Lombard General Insurance which he had never requested for. Despite paying regular EMIs, the rate of interest being charged from him was very high and against the guidelines of the RBI.

Upon seeking foreclosure of the loan, he was advised to pay all the EMIs for at least six months in order to avail the benefit of a one-time settlement.

Accordingly, he was given a letter dated November 23, 2007, whereby he was asked to pay Rs 36,575.84 as prepayment of the loan account, which was not valid, as he had already paid Rs 28,587 up to that time.

On raising protest against the aforesaid unfair trade practice, the bank agreed to receive Rs 25,000 as the final payment against the loan, which was accordingly paid. It was alleged that even after receiving the final settlement amount, the bank illegally withdrew an amount of Rs 2,199 through ECS clearing on from his account.

In its reply, the bank stated that the loan amount includes the premium accepted by the complainant to be paid towards the insurance policy.

It stated that after September 2007, the complainant stopped maintaining sufficient funds in his account in order to defray his liability towards the EMIs.

The forum stated said that it is an unfair trade practice on the part of the bank in not making the terms and conditions of the loan agreement clear to the complainant and withholding the loan agreement from him. It was also said that there was no agreement to suggest if the complainant ever agreed to such an exorbitant rate of interest.