RBI imposes Rs 5 lakh penalty on LIC Housing Finance

The Reserve Bank of India (RBI) on Monday imposed a penalty of Rs 5 lakh on LIC Housing Finance Ltd for non-compliance with certain provisions of the Housing Finance Companies Directions, 2010 issued by the National Housing Bank (NHB).”This penalty has been imposed in exercise of powers vested in the RBI under the provisions of clause (b) of sub-section (1) of section 52A read with clause (aa) of sub-section (3) of section 49 of the National Housing Bank Act, 1987 (NHB Act),” a statement issued by the RBI said.This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers, the central bank clarified.”After considering the company’s reply to the notice, examination of additional submissions made by it and oral submissions made during the personal hearing, the RBI came to the conclusion that the charge of non-compliance with the aforesaid statutory directions was substantiated and warranted imposition of monetary penalty,” the statement added.