DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: BHADRAK
Dated the 15th day of November, 2018
Present 1. Shri Raghunath Kar, President
2. Shri Basanta Kumar Mallick, Member
3. Afsara Begum, Member
C.D Case No. 104 of 2016
The Branch Manager
New India Assurance Co. Ltd.
Bhadrak Branch, Bhadrak
Kacheri Road
Dist: Bhadrak & others
……………………. Complainant
(Versus)
1. Branch Manager
Central Bank of India
Bhadrak Branch
At: Nayabazar
Po/Dist: Bhadrak, 756100
2. Regional Manager
Central Bank of India
Regional Office
Plot No. 108 B
Surya Nagar
Bhubaneswar, 751003
3. Chairman-cum-Managing Director
Central Bank of India
Corporate Office
Chandermukhi
Nariman Point
Mumbai, 400021
…………………………..Opp. Parties
Counsel For Complainant: Sri A. Panda, Advocate
Counsel For the O.Ps. : Sri J. K Nayak, Advocate & Associates
Date of hearing: 06.03.2018
Date of order: 15.11.2018
BASANTA KUMAR MALLICK, MEMBER
This dispute arises out of a complaint filed by the complainant alleging deficiency of service.
The facts of the complaint are that the complainant is an Insurance Company namely M/S New India Assurance Company Ltd. governed by the provisions of Insurance Act 1938, the General Insurance Business (Nationalization) Act 1972, Insurance Regulatory Authority & Development Authority Act 1999 and regulation passed there under to conduct General Insurance Business. Being a public sector Insurance Company, the complainant’s business has been increasing day by day to a large extent since inspection of the company and thereby the said company has earned a good name and created an exlent market all over India including the Branch at Bhadrak & Balasore. The complainant while receiving insurance premiums from it’s customers use to receive the same either in shape of cash or in shape of cheques and other instruments. When the premiums are received in shape of cheques or in shape of other instruments, the complainant deposits the same in its current account maintained with OP No. 1 i.e. the Central Bank of India, Bhadrak Branch for collection of cheques and crediting the collection proceeds to the A/c No. 9101/05 maintained with the said bank. Such practice was continuing since inspection of current account till the date of closer due to inadequate service provided by OP No. 1 as the collection proceeds of as many as 13 numbers of cheques were detected not credited to the account of the complainant. The complainant has made several approaches and written communication to OP No. 1 under intimation to it’s higher authorities to get a positive response and result but unfortunately all of the efforts were proved fruitless. Being disappointed, the complainant lodged the complaint with banking ombudsman, grievance cell of Reserve Bank of India, Regional Office Bhubaneswar which was responded in a positive spirit. The banking ombudsmen in initiating action summoned both the parties to initiate process of conducting the enquiry and after completion of the process, the ombudsmen directed to the OP No. 1 and the complainant on 15.02.2007 to reconcile the entries effected in the said current account in order to tress out the omission of required entries. In course of reconciliation, it was found that 13 numbers of cheques in dispute, the collection proceeds of those cheques have not been credited to the current account. But at the later stage OP No. 1 intimated the complainant on dt. 21.02.2007, explaining the cheques in dispute have not been debited from the account of the drawers of the cheques. It is pertinent to mention here that relying on those uncollected cheques the complainant has issued policy bonds to the insured and in some cases the claims have been raised and settled but the concerned cheques have not been collected because of gross negligence of the OP No. 1. In this manner the complainant has sustained loss of Rs 1,15,075/- and interest thereon from the date of submission of cheques till date. It is very much surprising that even after intervention of Banking Ombudsman, the OP No. 1 did not take appropriate action for settlement of the account. Despite repeated correspondences and persistent persuasions the OP No. 1 and other O.Ps also did not credited the amount of collection proceeds of cheques to the current account of the complainant which compelled the complainant to file this dispute in this Forum for proper adjudication and decision.
OP No. 1 appeared in person and submitted the written version to contest the case. Due to non appearance of OP No. 2 & 3 on the date fixed were set ex-parte and subsequently OP No. 2 submitted the written version after nearly 3 months from the date of passing of ex-parte order and consequently the advocate for OP No. 2 filed a petition to set-a-side the ex-parte order which was properly heard by the Forum and the set-a-side petition was rejected. In the written version OP No. 1 has stated that the complaint filed by the complainant is not at all maintainable in the Consumer Forum and at the outset OP No. 1 has stated that, it being the collecting banker of the cheques as mentioned in the complaint could have credited the amount to the account of the complainant if the collection proceeds would have reached the collecting banker. In this particular case, in many times, the OP No. 1 has tried to convince the complainant that the paying bank has not yet transmitted the amount to the collecting banker. Apart from above it is also worth mentioning that the cheques in discussion were time bared and due to non receipt of collection proceeds, the cover note issued by insurance company (Complainant) stands invalid and there by does not bear any liability. According to the direction of banking Ombudsman, two officials, one from each organization had to verify the status of cheques and accordingly the officers have jointly verified the accounts and reached at the conclusion that the paying banks have not debited with the cheque amount to individual accounts maintained in different banks. This clearly proves that the collecting banker has not received the amount which does not tantamount to any negligence and the collecting bank is not liable to pay. The result of the joint verification was also communicated to the complainant during February, 2007 but the complainant did not want to convince itself from the outcome of verification report. It is pertinent to mention here that it was categorically mentioned in clause No. 3 & 6 of the account opining form that the account holder is solely responsible for non-collection of cheques and the complainant has agreed and accepted such provision while opining the account with OP No. 2 bank. Finally it is submitted that the complainant has not sustained any loss rather the OP No. 1 has incurred too much expenses in course of verification and transmission of cheques through registered post. Under the above facts and circumstances the claim raised by the complainant is clearly meaningless and the complaint has got no merit and liable to be dismissed.
We have gone through the complaint; written version filed by OP No. 1, heard the parties in course of hearing, perused the materials on record and arrived at the conclusion as discussed here under.
1. The facts of the entire complaint and the written version contains the following issues which are very much relevant to be discussed. The complainant has alleged that the cheques received from the customers have been deposited with the OP No. 1, being the banker of the complainant, for collection. All those cheques on different dates were deposited through pay-in-slip for collection with proper acknowledgement so as to enable the complainant to get the premium amount realized from the customers. Accordingly the cheques deposited by the complainant with the OP No. 1 bank need to be collected within the time frame and non collection of some of cheques would have adversely affected the business of the complainant. In the present case complainant claims to have opened the current account with OP No. 1 bank since 1999 and had been transacting regularly till the closer of the account in an abnormal situation when OP No. 1 did not provide required service to the complainant. It is stated by the complainant that from the year 2000 to 2005 a good numbers of cheques were deposited for collection out of which the whereabouts of as many as 13 numbers of cheques is not known to complainant as the collection proceeds was not credited to the account maintained with OP No. 1 bank. In order to get the amount collected and to be credited to the account, the complainant has made a lot of initiatives to persuade the O.Ps for resolving the issue but the O.Ps did not take any concrete step for resolution of the problem which led to the intervention of Ombudsman for a reconciliation on the request of the complainant. But all of the efforts failed to yield a positive result for the complainant and the amount of those 13 cheques still remains non credited to the current account. This has happened due to insincerity of the banker of the complainant leaving him to suffer financially.
On the other hand O.Ps claimed that by the direction of Ombudsman, a two members team, each from one organization, had been to the paying banks to ascertain whether the cheques in question have been collected or not and on joint verification it is observed that the accounts of the customers of the complainant have not been debited from their account. This indicates that the claim raised by the complainant as to it has sustained financial loss is having no base and the cover note issued by the complainant as a public sector Insurance Company have subsequently been cancelled when the collection proceeds did not reach the complainant. The contention of the O.Ps is to the affect that the complainant has not sustained financial loss as it is highlighted.
In objecting the above submission of the O.Ps, complainant claims that the contention of the O.Ps in this context is very much irrelevant as neither the amount of cheques were credited to their account nor the cheques deposited with the OP bank for collection were returned back to the complainant along with objection memo that is the reason for dishonor of cheques. Therefore the complainant remained in darkness about the cheques have been collected or not and as such could not cancel the cover notes or the policy certificates issued to the customers. During this period some customers have also lodged claims for obvious reasons which has invited a lot of mental anxieties for the complainant. The deficiency of service arose when the OP No. 1 did not intimate the complainant about non collection of cheques nor returned back the bounced cheques to the complainant. It is pertinent to mention here that at the time of joint verification it is observed that the concerned accounts of the customers/drawer of cheques have not been debited. This leads to believe that the banker of the complainant has not submitted the cheques to the paying banks for collection and such action of OP No. 1 indicates that it has grossly neglected in performing it’s legitimate duties with due diligence without caring for the interest of the customers. Hence this activity of the OP No. 1 amounts to deficiency of service for which liable to augment the loss sustained by the complainant.
Minutely scrutinized the materials available on record and observed that the OP No. 1 has grossly neglected either in transmitting the cheques to the paying banks or have retained the cheques with them for a prolonged period without intimating the result to the complainant as a result of which the complainant could not initiate any action against the errant OP. Hence from the recorded evidence it is crystal clear that O.Ps have made deficiency of service for which the complainant suffered from mental agony, unnecessary harassment and sustained financial loss. Therefore the OP has to pay the cheque amount to the complainant together with interest at the bank rate along with cost and compensation. Hence it is ordered;
ORDER
The complaint be and the same is allowed against O.Ps. OP No. 1 is directed to pay the total cheque amount of 13 cheques together with interest at the bank rate from the date of deposit of individual cheques till the date of payment. It is further ordered that the OP No. 1 shall have to pay of Rs 5,000/- as compensation for mental agony and harassment and cost of litigation of Rs 3,000/-. This order must be complied within a period of 30 days from the date of receipt of this order unfailingly.
This order is pronounced in the open Forum on this day of 15th November, 2018 under my hand and seal of the Forum.
