RBI/2006-07/187
RPCD. RF. BC.35/07.40.06/2006-07
November 22, 2006
The Chief Executive Officers of all State and
District Central Co-operative Banks (StCBs/DCCBs)
Dear Sirs
Housing Loans – Implementation of Delhi High Court Orders
Writ Petition by Kalyan Sanstha Welfare Organisation against
Union of India and Others- Implementation of Directions
During the hearing in the captioned Writ Petition, the Hon'ble
High Court of Delhi has directed as under:
' We hereby direct that henceforth Banks will check whether
the loan sought for is for authorized structure or an unauthorized structure
and the Banks will obtain an undertaking on an affidavit from the parties seeking
such loans that the building is constructed as per sanctioned building plans.
Banks shall also ensure that the sanctioned building plans are attached with
the undertaking. Let necessary directions be issued in this regard either by
the concerned Ministry of Banking or the Reserve Bank of India'.
2. In this context, the Monitoring Committee constituted by
the Hon'ble High Court of Delhi regarding Unauthorised Construction, Misuse
of Properties and Encroachment on Public Land, has issued the following directions
for immediate compliance by the banks/Financial Institutions:
- Housing Loan for building construction
i) In cases where the applicant owns a plot/land and approaches
the banks/FIs for a credit facility to construct a house, a copy of the sanctioned
plan by competent authority in the name of a person applying for such credit
facility must be obtained by the banks/FIs before sanctioning the home loan.
ii) An affidavit-cum-undertaking must be obtained from the
person applying for such credit facility that he shall not violate the sanctioned
plan, construction shall be strictly as per the sanctioned plan and it shall
be the sole responsibility of the executant to obtain completion certificate
within 3 months of completion of construction, failing which the bank shall
have the power and the authority to recall the entire loan with interest, costs
and other usual bank charges.
iii) An Architect appointed by the bank must also certify at
various stages of construction of building that the construction of the building
is strictly as per sanctioned plan and shall also certify at a particular point
of time that the completion certificate of the building issued by the competent
authority has been obtained.
B. Housing Loan for purchase of constructed property/built
up property
i) In cases where the applicant approaches the banks/FIs for
a credit facility to purchase the built up house/flat, it should be mandatory
for him to declare by way of an affidavit-cum-undertaking that the built up
property has been constructed as per the sanctioned plan and/or building bye-laws
and as far as possible has a completion certificate also.
ii) An Architect appointed by the bank must also certify before
disbursement of the loan that the built up property is strictly as per sanctioned
plan and/or building bye-laws.
C. No loan should be given in respect of those properties
which fall in the category of unauthorized colonies unless and until they have
been regularized and development and other charges paid.
D. No loan should also be given in respect of properties
meant for residential use, but which the applicant intends to use for commercial
purposes and declares so while applying for loan.
3. Although the above instructions were issued in the context
of a writ petition in the Delhi High Court, all the banks are advised to strictly
comply with the above directions with immediate effect.
4. Please acknowledge receipt to our Regional Office concerned.
Yours faithfully,
(K.Bhattacharya)
General Manager