RBI tells banks to get copy of building plan for housing loan

New Delhi, Dec 27 (UNI) In compliance with the order of the Delhi High Court, the Reserve Bank of India(RBI) has issued directives to all the commercial banks in the country to extend housing loans only if a sanctioned building plan was submitted with the loan application.

RBI Chief General Manager-in-Charge Prashant Saran in a letter to the Chairman and Managing Director(CMD) of all the Indian and Foreign Commercial Banks asked the banks to strictly comply with to the order immediately while extending housing loans.

The RBI also fixed responsibility on the banks to check unauthorised construction all over the country.

''An architect appointed by the bank must also certify before disbursement of the loan that the built-up property(building) is strictly as per the sanctioned plan and/or building bye-laws,'' said the order sent to all the banks.

During the hearing of the Kalyan Sanstha Welfare Organisation vrs Union of India on October 12, 2006, then acting Chief Justice Vijender Jain and Justice Rekha Sharma had said ''... 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.'' In case where the applicant or builder approached the banks or financial institutions for a credit facility to purchase the built up house or flat, it should be mandatory for him to declare by way of an affidavit-cum-undertaking that the built up property had been constructed as per the sanctioned plan and/or building bye-laws and as far as possible, has a completion certificate also, said the directive of the RBI.

The person or the builder in case of housing societies should not violate the sanctioned plan. The construction should be strictly as per the sanctioned plan and it should be the sole responsibility of the executant to obtain completion certificate within three months of the completion of the building, failing which the bank shall have the power and the authority to recall the entire loan with interest, costs and other usual charges, said the order.

UNI PAT PK VV1716