A.  P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION : AT HYDERABAD

C.C. 79 of 2012

Between :

Smt. G Ratna Kumari

W/o Sri G. Narasimha Rao

Aged 61 years, Occ : House wife

R/o Plot no. 385, Ayyappa society

Madhapur, Hyderabad -81

Rep. by the Complainant’s husband &

GPA Mr. G. Narasimha rao                                     .. Complainant

And

01. M/s. Syndicate Bank

Head office,

 Manipal 576 104

Rep. by its Chairman and M.D.

02. The Branch Manager,

Syndicate Bank, Mehdipatnam Branch

Hyderabad – 500 028.

03. The Assistant General  Manager

Syndicate Bank, Regional office

Opp. Shadan College, Khairatabad

Hyderabad.

04. The Reserve Bank of India,

Central office,

Central Office Building,

18^th floor, Shahid Bhagat Singh Road

Mumbai -400 001

Rep. by its Governor Dr. D. Subba Rao

05. M/s. Karur Vysya Bank Ltd

A.   S. Rao Nagar Branch

A.   S. Rao Nagar, Hyderabad                    ..opposite parties

Counsel for the Complainant        :           M/s. B.S. Prasad

Counsel for the opposite parties   :           R1- served

                                                                        Mr. M. V. Ramana for OP2 and OP 3

                                                                        R4  - PIP

                                                                        Sri P. Rajesh Babu for OP. 5

Coram           ;          

                              Sri R. Lakshminarasimha Rao…      Hon’ble Member

And

                                    Sri T. Ashok Kumar                ..         Hon’ble Member

Thursday, the Twenty Fourth Day of October

Two Thousand Thirteen

          Oral Order       :   ( As per Sri T. Ashok Kumar , Hon’ble Member )

****

01.         This is a complaint filed  U/s. 17(1)(a) of Consumer Protection Act, 1986 to direct the opposite parties 1 to 3  to restitute the amounts Rs.23.00 Lakhs  together with interest @ 18% P.A. from the date of payment, i.e., 27.01.2012  said to have wrongfully paid by opposite parties under the forged and fake cheques, to direct the OP no. 3 & 5 jointly and severally to instruct the OP Nos. 1 to 3  to restitute the cheques amounts as per above prayer, to award Rs.2.00 lakhs towards damages and compensation for mental agony and costs.

02.         The brief facts of the complaint  are that  the complainant is having Savings Bank Account bearing No. 30072010057432 in the 2^nd opposite party Bank for the last about two decades.  The complainant  issued  two Account Payee crossed cheques i.e one  cheque dated 30.01.012 for Rs.1,00,000/-  in favour of  Ch. Vikram Reddy and another cheque dated 30.01.2012 for Rs.3,00,000/- in favour of           I. Sudhakar. On 27.01.2012   when the complainant approached OP. 2 to give instructions to stop payment of the said cheques, he was informed that the aforesaid cheques were already cleared by them for an amount of Rs.13.0 lakhs and Rs.10.00 lakhs  which were alleged to have been presented by ‘Karur Vysya Bank’, A.S. Rao nagar, Hyderabad. On verification, OP.2 noticed the alterations of the dates as 20..01.2012 and 23.01.2012 instead of the actual date 30.01.2013 and the amounts as Rs.13.00 lakhs and Rs.10.00 lakhs in place of Rs.3.00 lakhs and Rs.1.00 lakh respectively and opined that the collection Banker alone is responsible for the said fraud and in fact OP. 2 is responsible for the same. Despite brought the matter to the notice of OP. for their   carelessness and gross  negligence , Ops have started intimidating the complainant that she may be implicated in criminal case attributing negligence to her. Having direct control and being the Regulatory authority over the Nationalized Banks, the Reserve Bank of India is duty bound to instruct the Syndicate Bank  to take action against the responsible officials of the Bank and  to restore the amounts to the complainant  together with interest but did not take any action  and  that as the Syndicate Bank wrongfully paid the said cheques both of them are vicariously liable for the same. Ops 1 to 3 probably under the impression that the cheques were collected by Karur  Vysya Bank for its customer and hence  they may choose to invoke SEC. 131 of NI Act against Karur Vsya Bank. OP.No. 3 committed breach of contract in honoring the cheques resulting in wrongful loss apart from subjecting the complainant to  mental agony. She got issued legal notice dated 10.02.2012 to all the opposite parties. Ops 1 to 3 in their reply notice dated 09.03.2012 while admitting the tampering of the subject  instruments but shifted the entire liabilities and duties  on M/s. Karur Vysya Bank, collecting banker and hence OP. 5 is  impleaded as a party and in fact it is neither necessary nor proper party.  The opposite parties gave  complaint on 21.02.2012 to the CID, Hyderabad and a case  for the offences U/s 406, 468, 471 and 420 of IPC was registered  to take action against the culprits and that the subject instruments were passed through Central Accounts office i.e. Nodal Office  where the cheques are handled for clearing on behalf of the branches and hence it is the imperative duty of the Nodal office to examine the instruments while honouring the cheques. She was subjected to both physical strain and mental agony. The said  acts of opposite parties amount to dereliction of duty, gross negligence and deficiency in service and hence the complaint.

03.         Though notice was served on the 1^st opposite party  it  did not choose to appear before this Commission  and  file any counter.

04.          2^nd opposite party   filed written version, opposing the claim of the complainant and denying the allegations made in the complaint  and OP. 3  adopted the same.  The  brief facts of the said counter  are as under :

             The  complainant is an account holder of their bank and he approached the second opposite party on 27.01.2012  to ascertain whether the cheque No. 000004 dated 24.01.2012  for Rs.20,92,000/- as it was not dishonoured she collected the returned instrument and also a copy of her statement of Account and on verifying she observed debiting of two entries of Rs.10 lakhs and Rs.13 lakhs and thereafter she informed that she issued only  Rs.one lakh and Rs. 3 lakhs cheques  issued  in favour of Ch. Vikram KLumar Reddy and I. Sudhakar respectively  and that the said cheques were manipulated on which OP -2 stated to her that they have no knowledge.  They have no knowledge about the issuance of the said cheques. Cheque No. 568245 was presented through clearing by OP No. 5 and cheque no. 568246 was presented through Karur Vysya Bank, Boduppal Branch, and the CAO of the OP No. 2 cleared the same ONLINE and that there was no occasion for OP 2 to know whether there were  any alterations in  the instruments and that    the collecting Bank is responsible for the alleged fraud. Ops 1 to 3 got issued  reply notice on 09.03.2012 in response to the legal notice dt. 10.02.2012  of the complainant and OP. 2 also lodged a complaint with PS, CID, Hyderabad on 21.02.2012  under FIR 12/2012. On enquiry, after coming to know  that  OP. 5 and also Boduppal branch of Karur Vysya Bank had opened the Accounts in the names of the individuals Sri I. Sudhakr and Ch. Vikriam Reddy even without following KYC ( know your customer) norms very recent to the transaction, OP. 2 got issued legal notice to both of them claiming refund of the amounts but no action was taken by them.  The complainant did not issue notices to the said individuals or OP no. 5 or Karur Vysya Bank , Bodupal branch for their illegal activities. The opposite parties 1 to 4 are not necessary parries and Op 5 is only responsible for the same  so also  the persons to whom the complainant had issued the cheques. There is no deficiency in service on the part of OP.2   and that the allegation about possibility of connivance of the bank officials in the fraud is absolutely uncalled for and unwarranted and that the complaint is liable to be dismissed for non- joinder of necessary parties   and thus prayed to dismiss the complaint.

5.         The Assistant General Manager, Department of Banking Supervision, Reserve Bank of India, Hyderabad, filed written version on behalf of the 4^th opposite party contending that this complaint is not maintainable against OP.4 since it exercises its statutory functions conferred upon it under the Banking Regulation Act, 1949 (BR Act) and it  did not render any service to the complainant and hence it does not come under the definition ‘service’ contemplated U/s. 2(1)(O) of C. P. Act and  that the complainant is not a consumer  and that there is no relationship of customer and service provider  between the complainant and OP. 4 RBI and that there is no territorial and pecuniary jurisdiction against OP.4.   The RBI is not a party to the transactions entered between the complainant and  its  banker nor is aware of depositing of the cheques with alteration or its alleged fraudulent encashment.  The dispute is an individual dispute  between the customer and its banker. As a Regulator, the RBI is neither a necessary nor a proper party to the dispute. The complainant did not disclose any cause of action against the RBI. The complaint is bad for misjoinder of party. They never received any legal notice from the complainant except an anonymous complaint dt. 15..3. 2012 addressed to the Hon’ble President of India endorsing to the RBI Governor. RBI  called for comments from OP  5 on the basis of newspaper clipping for alleged violation of RBI  directions on KYC norms and that from the  letters dt. 30.05.2012 and 18.09.2012  of  OP 5 it reveals that the alleged cheques were dropped in the cheque box of OP 5 and in turn sent for clearing to Syndicate Bank, Mehadipatnam Branch, payee bank and that if the cheques are materially altered, then it is the syndicate bank to be detected the alterations before passing for payment. From the letters of OP 5 it reveals that  the complainant got issued the said alleged two cheques to one Ravi Kumar for selling the property of the complainant a middleman towards commission  out to have been in the name of Mr. Ravi Kumar and not in the name of Mr. Ch. Vikram Reddy and Mr. Sudhakar Iran. There is neither dereliction of duty nor deficiency in service on their part. The complaint is a false, frivolous and vexatious petition against the OP.4 and thus prayed for dismissal of the complaint against OP. 4.

06.  The 5^th opposite party in its written version contended that the complaint is bad for non-joinder of necessary parties, ie Ch. Vikram Reddy and I. Sudhakar, who said to have altered the cheques and mis-joinder of OP.5 and that the complainant filed the complaint as if it a civil suit to be adjudicated regarding all claims seeking the reliefs made by her as if it is a civil suit and that whether the cheques were materially altered or not within its knowledge and that the bank opened Accounts of Ch. Vikram Reddy and I. Sudhakar following KYC norms and that the prayer of the complainant extend liability to OP 5 in case if it is found that there is a deficiency of service by OP. 5 bank and that there is no relationship of customer and banker and   OP 5 is not a necessary party and that the complainant  is not a consumer against OP 5 and that there is no deficiency in service on their part and thus prayed to dismiss the complaint.

7.         Both sides  filed  evidence affidavit reiterating their respective pleadings  and  Ex. A-1 to A 16 were marked on behalf of the complainant and Ex. B -1 to B 22 were  marked for the OP. Written arguments were submitted by  Ops  4 and 5 and heard both sides counsel with reference to their respective pleadings.

8.    Now the points  for considerations are

(1)  Since fraud, forgery, alterations etc are alleged with regard to subject cheques whether this Commission can entertain the complaint?

(2)  Whether there is any deficiency in service on the part of the Ops as alleged?

(3)  Whether the complainant is entitled for the reliefs as prayed for ? if so to what relief.

09. Point No.1 :

There is no dispute that the complainant is having SB Account vide A/c No. 3007201 0057 432 with the OP.2 Bank for the last two decades and that OP 1 is the head office, OP. 3  is the Asst. General Manager  and OP. 4 is Asst. General Manger of OP syndicate Bank. According to the complainant she has issued a cheque dt. 30.01.2012 for Rs. 1,00,000/- ( Rupees one lakh  only ) In favoaur of Ch. Vikram Reddy and another cheque dt. 30.01.2012 for Rs.3,00,000/- ( Rupess three lakhs only ) in favour of one I. Sudhakar and that on 27.01.2012 when she went to OP. 2 bank to give instructions to stop payments of the said cheques it was informed to her by OP. 2 bank that the said cheques were already cleared by them for an amount of Rs. 10 lakhs and Rs.13 lakhs respectively which were alleged to have been presented by Karur Vysya bank, AS Rao nagar, Hyderabad and Boduppal and that fraud had taken place. Very specifically the complainant  contended that the said cheques were materially altered  with regard to the dates and amount and that without noticing the same OP 2 cleared the cheques and that  in spite of request the 2^nd  OP in utter disregard and dereliction of duty did not pay the amount and that a criminal case ( FIR No. 12/12  dated 21.02.2012) was registered by CID police for the offences U/s. 406, 468, 471 and 420 IPC on the complaint of OP. 2 and that investigation is pending and that OP. 4 RBI is duty bound to instruct syndicate banks pertaining to Ops 1 to 3 to restore the amount and in spite of representation it did not do so and that the prayer on the deficiency on the part of the Ops 1 o 3 is extendable to OP. 5 also and thus contended that  the complaint is liable to be allowed as prayed for.

10.       However, OP 1 did not choose to file any version. Whereas the plea of OP.2 which has been adopted by OP. 3 is that there was no occasion to second OP to know whether there were any alterations in the instrument/cheques since they were never handled by OP. 2 and that the said cheques were paid though online clearing process as they were presented for collection in Karur vysya bank, AS rao nagar and Boduppal and that a complaint  was  also lodged a criminal case with CID PS Hyderabad and FIR 12/12 dt. 21.2.2012 was registered and that it under investigation and that Ops 1 to 3 are not liable to answer the claim and that on the representation of the complainant they also addressed a notice to OP 5 to refund the amount but a vague reply was given and that there is no deficiency in service on the part of the Ops 1 to 3.

 11.      The gist of the contentions raised by OP. 4 is that it has been unnecessarily arrayed in the complaint and that complainant is not a consumer and that OP. 4 is constituted to discharge statutory functions and therefore no consumer complaint lies and thus prayed to dismiss the complaint.

12.       5^th OP contended that the complaint is filed as if a civil suit as if it a civil suit to be adjudicated regarding all claims seeking the reliefs made by her asif it a civil suit and that whether the cheques were materially altered or not within its knowledge and that the bank opened Accounts of Ch. Vikram Reddy and I. Sudhakar following KYC norms and that the prayer of the complainant extend liability to OP 5 in case if it is found that there is a deficiency of service by OP. 5 bank is alien to law and that there is no relationship of customer and banker and that non joinder of payees of the cheques is fatal and that OP 5 followed every precaution with regard to KYC norms while Opening the new Account and thus prayed to dismiss the complaint.

13.       In view of the above contentions and rival contentions of parties to the proceedings it is evident that several complicated and complex questions of facts and law are involved in this case for determination and for that oral evidence, cross examination of the  witnesses and also documentary evidence so also the evidence of hand writing experts is necessary  as it was alleged that subject cheques were materially altered with regard to dates and amounts. Where issues involved are of simple in nature they can be disposed of on affidavit enquiry, this Commission can entertain the complaint. Even in the case of deficiency in service where there are allegations of  coercion, fraud and manipulation of record,  material alterations certainly such complaints cannot be effectively disposed of by the Consumer Fora.  Because a detailed enquiry is necessary for determination of the facts involving  fraud, forgery etc. it is an admitted fact that a criminal case for the offences U/s. 406, 468, 471and 420 IPC and that investigation is pending. Of course, decision in a criminal case does not bind this Commission so also Civil Court but in view of nature of such offences certainly voluminous oral and documentary evidence has to be recorded  to decide the lis  and  the witnesses have to be   tested on touch tone by way of cross examination to find out whether their version can  be relied upon or not and certainly such exercise cannot be undertaken by this Commission in Consumer complaint. Even if statutory functions are being discharged by OP,. 5 , a civil Suit is not a bar provided cause of action against it is established by the complainant. Whether liability can be fastened on Ops 1 to 3, in the event of clearance of the cheques   several rules are necessary to be considered, so also, to decide the duties of OP. 5 collection bank with regard to the disputed cheques.  Original cheques not presented before this Commission and basing on Xerox copies no expert opinion can be obtained by this Commission. The alleged payees of the cheque ie Ch Vikram Reddy and I. Sudhakar have also not been arrayed as parties in this complaint and in their absence also it is difficult to decide the dispute.  In a decision dated 12.9.2006 in appeal ( Civil ) 4091/2006 between Oriental Insurance Company Limited Vs. Muni Mahesh Patel, the Hon’ble Supreme court of India, observed that the nature of the proceedings before the Commission as noted above, are essentially in summary nature, the factual position was required to be established by documents. Commission was required to examine whether in view of the disputed facts it would exercise the jurisdiction. The State commission was right in its view that the complex factual position required that the matter should be examined by appropriate court of law and not by the Commission. Thus, the action of the Commission in dismissing the complaint leaving the complainant to take appropriate proceedings  for establishing his claim or seeking the reliefs in the Court of competent jurisdiction was justified.  The said decision supports to relegate the complainant to Civil Court for redressal by dismissing the Consumer Complaint. Thus point no. 1 is answered against the complainant. In view of the finding in issue no. 1 , it is not desirable to decide issue Nos. 2 and 3  by this Commission.

14.       In the result, the complaint is dismissed and the complainant is relegated to Civil Court for redressal if he so chooses and in such a situation she is entitled for exclusion of the period spent between filing of the claim till disposal of the Appeal U/s. 14 of the Indian Limitation Act, 1963 for the purposes   of limitation in the light of the decision of the Hon’ble Supreme Court of India in “Trai Foods Ltd Vs. National Insurance Company Ltd and another reported in (2004) 13 SCC 656”. No costs

                                                                        MEMBER                  MEMBER

                                                                                    DATED   :  24.10.2013.

CC No. 79/2012

APPENDIX OF EVIDENCE

EXHIBITS MARKED

For the complainants

Ex. A1       Cheque bearing No.000004 for Rs.20,92,000/-

Ex. A2       Cheque bearing No.000005 for Rs.34,00,000/-

Ex. A3       Visiting Card

Ex. A4       Cheque bearing No.568245

Ex. A5       Cheque bearing No.568246

Ex. A6       Complaint

Ex. A7       Complaint

Ex. A8       Complaint

Ex.A9                Complaint

Ex.A10       Complaint

Ex.A11       Office copy legal notice

Ex.A12       Postal Receipts 4 Nos

Ex.A13       Postal Acknowledgement. 

Ex.A14       Postal Acknowledgement

Ex.A15       Reply Legal Notice

Ex.A16       FIR No.50/2012 of P.S. Humuin Nagar.

Opposite parties:-

Ex.B1        Xerox copy of complaint

Ex.B2        Karur Vysya Bank Letter

Ex.B3        Karur Vysya Bank Letter

Ex.B4        The OP No. 3, Syndicate Bank

Ex.B5        Circular DBOD.AML. BC.No. 2/14.01.001/2011-12

Ex.B6        Master  circular FrMC.BC.No.1/23.04.001/2011-12

Ex.B7        Reserve Bank of India

Ex.B8        Xerox copy of the No.568246

Ex.B9        Xerox copy of Cheque No.568245

Ex.B10       Complaint by complainant

ExB11        Letter Addressed to Bodummpal Branch of Karur Vysya Bank, dated 27.01.12

Ex.B12       Letter Addressed to Bodummpal Branch of Karur Vysya Bank, dated 27.01.12

Ex.B13       Legal Notice dated 10.02.12 got issued by complainant

Ex.B14       reply Notice dated 09.03.12

Ex.B15       Copy of complaint lodged with Police

Ex.B16       Acknowledge from CBCID

Ex.B17       Copy of FIR No.12/2012

Ex.B18       Copy of letter dated 13.02.12 of OP5

Ex.B19       O/c of Legal Notice dated 09.03.12 to OP No.5

Ex.B20       O/o of Legal Notice dated 09.03.12 to Boduppal Branch of Karur Vysya Bank.

Ex.B21       Reply Notice dated 11.04.12 by counsel for OP-5

ExB.22       Reply Notice dated 11.04.12 by counsel for Karur Vysya Bank Boduppal Branch.

                                                            MEMBER                               MEMBER

                                                                        DATED : 24.10.2013