Hyderabad Consumer Commission Orders Piramal Finance to Pay Rs 60,000
HYDERABAD: The District Consumer Disputes Redressal Commission-I, Hyderabad, has directed Piramal Finance Ltd to pay Rs 50,000 compensation and Rs 10,000 towards litigation costs to a 52-year-old ex-serviceman-pensioner after finding a deficiency in service over the unilateral extension of his housing loan tenure without cogent proof that changes in interest rates had been communicated to him.
The order, passed on August 27, 2026, allowed the complaint filed by Kameshwar Rao Yampalla in part. The commission, comprising president B Uma Venkata Subba Lakshmi and member C Lakshmi Prasanna, held that while a lender can revise interest rates under a floating-rate loan, the borrower has to be informed so that he can decide whether to increase his EMI or allow the tenure to be extended.
Borrower sought NDC, documents after 15-year loan
Rao, son of late Papa Rao and a resident of Ferozguda in Balanagar mandal, had availed a housing loan of Rs 7 lakh from Piramal Capital and Finance Ltd in September 2009. The loan was repayable through EMIs of Rs 9,375 over 15 years, or 180 months.
He told the commission that he had repaid the loan with interest as per the schedule and subsequently sought a No Due Certificate and return of the original property documents. According to him, the lender instead demanded another Rs 6,12,597, citing revisions in the interest rate.
Rao claimed that he had not received any written notice, email, SMS or other communication about interest-rate revisions or recalculation of the loan tenure during the 15-year period.
Piramal cited floating rate, Covid moratorium
Piramal Finance, formerly Piramal Capital and Housing Finance Ltd, disputed the claim. It said the loan carried a floating rate linked to its Retail Prime Lending Rate and that the loan agreement and sanction letter permitted revisions based on market fluctuations.
The company also said Rao chose a break from payments (moratorium) from March to August 2020 during the Covid-19 pandemic. The interest that built up during this time was added to the loan as per RBI rules, so he owed more money. The company also said it told customers about rate changes in account statements, notices, and public messages.
The commission, however, found that the lender had not produced cogent documentary evidence showing that the borrower had been informed of the interest-rate changes before the tenure was unilaterally extended. It termed the failure a deficiency in service.
At the same time, the commission held that since the loan was on a floating rate and dues remained outstanding, Piramal Finance was not required to issue an NDC or return the original title deeds until the actual outstanding amount was cleared.
The commission directed the company to pay Rs 50,000 for the mental agony caused by the unilateral decisions and Rs 10,000 as litigation costs within 45 days. If the compensation is not paid within the stipulated period, the Rs 50,000 amount will carry 9% annual interest from June 20, 2025, the date of filing of the complaint, until payment.
