3 housing firms penalized for non-compliance of RBI directions – Times of India

NEW DELHI: The Reserve Bank of India on Friday penalized three housing firms for non-compliance with provisions of directions on ‘non-banking financial company – housing finance company.’
The central bank imposed a penalty of Rs 5 lakhs on Godrej Housing, Rs 5 lakhs on Aadhar Housing Finance Ltd, and 3.5 lakhs on Housing and Urban Development Corporation Limited.
RBI in a press release said that Housing and Urban Development Corporation Limited had “failed to undertake risk categorization of its customers during the financial year 2021-22 and did not put in place a system for periodic review of risk categorization of accounts.”
In a similar release RBI said that Godrej Housing was issued a notice asking why it should not be penalized. After oral submissions and personal hearings, RBI had sustained the monetary penalty, “The company failed to obtain two independent valuation reports before sanctioning certain loans of ₹75 lakh and above”
Aadhar Housing Finance Ltd was fined because the company charged interest on loans for a period prior to the date of actual disbursement of loan cheque to certain borrowers violating RBI directions of ‘Fair Practices Code’.
The RBI added that penalties are based on faults in regulatory compliance and not intended to pronounce upon the validity of any transaction or agreement made by the housing corporations.