Consumer financing

Consumer financing remains exempted/ excluded from applicability of KIBOR.

Consumer impugned actions of respondent Bank whereby his car finance loan was terminated a few months after the disbursement of the loan, and he was asked to pay an amount for delivery of the vehicle to the petitioner

Contention of the petitioner was that the actions of the respondent (Bank) were in violation of the Prudential Regulations for Consumer Finance issued by the State Bank of Pakistan

Validity

Termination of auto-lease was effected without notice and without the case of the petitioner incurring classification under Regln.14 of the said Prudential Regulations for Consumer Finance (State Bank of Pakistan)

Termination letter was not preceded by any notice in terms of Regln.6 of the Prudential Regulations for Consumer Finance (State Bank of Pakistan) and the specific default period of 90 days as per the said Regulations, was not attracted to the present case and the repossession of the vehicle was therefore contrary to the said Regulations

Conduct of the respondent bank also had an element of mala fide and coercion and there was a failure of the respondent Bank to confront the petitioner with his specific default and with the means to cure the same

High Court directed the State Bank of Pakistan to probe the transactions and dealing of the respondent Bank in order to determine a suitable compensation for the petitioner and to take appropriate action against the respondent Bank

Constitutional petition was disposed of accordingly.