I had taken a Gold Loan of Rs.5.5 Lakhs from Manappuram Finance (a NBFC Company). The interest accrued for the preceding 12 months is 2 Lakhs and the total outstanding payable is 7.5 Lakhs. The Market value of the Gold is also 7.5 Lakhs. So I decided not to redeem the same.
The Company auctioned off the ornaments deliberately at a low consideration of 6 lakhs (sold to their private members).
Now the company is asking me to repay the balance or shortfall amount, failing which legal proceedings will be initiated against me.
I have gone through the loan agreement copy meticulously and there is NO terms, conditions or stipulations that I will be responsible for payment of shortfall amount arisen due to auction at low consideration.
When there is no such clause, I am under the impression that I don’t owe them any money or I am not responsible for payment.
Just in case, if suit is filed, do you think I have recourse to law. Do you think I have to pay the company in the absence of specific terms, conditions or clause.