As per sanction stipulations while availing the housing loan, Bank's first lien on my terminal benefits was created for staff housing loan in the year 1985 for the purchase of a tiled house and in 2000 for the purchase of a Flat under 'change of security'.Overdraft facility was introduced in the bank in the year 2002 and I had created second lien on my terminal benefits for staff overdraft account. Bank did not inform me at the time of availing the overdraft facility that first lien against staff housing loan is cancelled.Lien letters in the prescribed format with stamp duty duly signed by me and Nominee were submitted to bank's IR cell every time after availing the housing loan as mentioned above.
Accordingly, Rs.299656 towards my PF settlement was credited to my Housing loan account on 04.06.2013 and subsequently I had repaid the remaining outstanding amount just before the end of December 2013 with an intention to close this account and the housing loan account had no other dues. But on 31.12.2013, Rs.299656 was reversed by the branch and credited to my Overdraft account stating that my terminal benefits are under lien to overdraft facility which was an illegal act by the bank thereby my staff housing loan account was not closed with malafide intention.
The rule of the land says that 'the term second-lien debt refers to a form of borrowing that occurs once a first lien is put into place. Put simply, if a borrower defaults, any second-lien debt gets paid after the first or original first lienholder is paid off in the event of bankruptcy of asset liquidation.
Based on above principles, reversal of Rs.299656 from the staff housing loan account to my overdraft account without my consent was illegal.
It is learnt that Bank had transferred Rs.299656 from housing loan account to overdraft account because of following reasons
1. Overdraft facility is a clean advances without any security
1. Bank cannot take any action under SARFAESI Act for overdraft facility
From 2013 onwards, I have repaid substantial amount to my housing loan account which bank can transfer to OD account
Please guide me what action I can take to protect my interest
