BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL

FORUM, VELLORE DISTRICT AT VELLORE.

PRESENT:   THIRU. A. SAMPATH, B.A., B.L.,                 PRESIDENT       

                                      TMT. G. MALARVIZHI, B.E.                                 MEMBER – I

                                     THIRU. K. DHAYALAMURTHI,B.SC.                 MEMBER – II

CC.36 / 2007

MONDAY THE 20^TH DAY OF DECEMBER 2010.                               

S. Regginald Abraham,

S/o. Swamiadian,

No.2 (3), 17^th East Main Road,

Gandhinagar,

Vellore – 6.

Vellore District. .                                                                                 …  Complainant.

       - Vs

1. The Branch Manager,      

     The Vellore District Central Co-op Bank Ltd.,

     Gandhi Nagar East,

     Vellore.

2.  The Special Officer,

      The Vellore District,

      Central Co-op Bank Ltd.,

      Officer’s Line,

      Vellore.                                                                             … Opposite parties.

. . . .

              This petition coming on for final hearing before us on 15.12.2010, in the presence of Thiru. J. Venkatramani, Advocate for the complainant and Thiru. V. Varadarajan, & M.R. Ramanan , Advocates for the opposite party and having stood over for consideration till this day, the Forum made the following:

O R D E R

            Pronounced by Thiru. A. Sampath, President of the District Consumer Disputes Redressal Forum, Vellore District.

1.         The brief facts of the case of the complainant is as follows:   

            The complainant is one of the customers of the 1^st opposite party and he has been depositing his saving with the 1^st opposite party for the past 11 years.  Whileso, the complainant had initially deposited his retirement benefits under the fixed deposit scheme for the period of 36 months at the rate of 12.5. and 11.5.% per annum with the 1^st opposite party.  When the complainant had approached the 1st opposite party for the extension of the period of his above mentioned deposits, the 1^st opposite party wanted a complainant to submit a letter for the said purpose.   Accordingly the complainant had given a letter dt. 29.3.2000 to the 1^st opposite party.   Moreover with the consent and the knowledge of the 1^st opposite party and also by accepting the said letter of the complainant, all the said fixed deposits of the complainant have been extended for the period of 60 months  @ 12.5.% and the last receipt mentioned hereunder at 11.5.% interest by the 1^st opposite party.  All the deposits of the complainant detailed above got matured on the date shown in para-4 and the amounts have also been paid to the complainant.  To the shock and surprise of the complainant the 1^st opposite party sent a letter dt.14.7.05 stating that the extension of period from 36 months to 60 months should have been done only after the maturity of the said period of 36 months and by mistake and over sight of the 1^st opposite party the same was not done and the complainant is liable to repay excess interest at 3% amounting to Rs.47,180/- towards the interest of the said deposits of the complainant.  The 1^st opposite party failed to do so due to their careless and negligence in their work as admitted by the 1^st opposite party in his letter mentioned above.  Hence on this ground the complainant is not liable and for the said illegal and responsible at all for the irresponsibility of the opposite party demanding towards the repayment of the said amount of Rs.47,180/- the alleged excess amount from the complainant.   The opposite parties are liable to pay a sum of Rs.50,000/- to the complainant for mental agony.    The complainant had sent his reply letter dated 9.7.05 and his legal notice dt.23.8.05 repudiating the claim of the opposite parties. 

2.         The opposite parties not only claimed the excess amount mentioned above from the complainant but they have also stopped in paying the Fixed Deposit amounts dt. 23.7.04 under receipt No.212246 for Rs.61,200/- with a maturity value of Rs.65,597/- as on 23.7.05 of the complainant inspite of the complainant’s reply and his legal notice.  Though the complainant had made several reminders and though he send a lawyer’s notice dt.1.9.05 & 1.10.05 demanding the 1^st opposite partly to revoke his order of stop payment regarding the complainant’s fixed deposit, there was no reply nor any response from the 1^st opposite party.  On 15.3.06 the complainant and his wife received registered letter 13.3.06 from Thiru.R.Sundaramuthy, Co-operative Sub Registrar, Gudiyatham to appear before him on 24.3.06 at 11.00 am.  The complainant along with his wife appeared before the Enquiry officer.  The Enquiry Officer in his report to the Co-op bank found the staff of the Central Co-op Bank, Vellore guilty and requested the Special Officer to recover the amount from the staff concerned.    In continuation of the inquiry report the special officer issued notices to the concerned clerks to remit the amount to the bank.  Many of the staff members have obeyed the order of the Special Officer and have remitted the amount to the bank.   Inspite of the recover made the opposite parties had not settled the legitimate claim of the complainant.  Hence the complainant approached the special officer of the Chief Minister cell.  The Special officer of the C.M. Cell in his letter dt. 5.2.07 instructed the opposite parties to settle the legitimate claim of the complainant with interest on or before 15.2.07.  But the opposite parties in their letter dt. 8.3.07 sent to the Special officer C.M. cell had not mentioned the Enquiry Officer’s findings but instead gave the advise given to the opposite parties on 22.7.05 by their legal advisor to harass the complainant against his legitimate claim.   After issuing the said fixed deposits to the complainant, the 1^st opposite party had refused to pay the amount, thereby the opposite party has committed deficiency in service.    He prayed for directing the opposite parties to pay the fixed deposit amount Rs.65,597/- with interest at 12% from the date of maturity till date of payment to the complainant and the opposite party not to recover the amount of Rs.47,180 towards the interest of the said deposits as claimed by the complainant and to pay Rs.90,000/- towards the mental agony suffered by the complainant.

3.         The averments in the counter filed by the opposite parties are as follows;

   The complaint filed on behalf of the complainant is most vexatious, malafide and is unsustainable in law and on the facts of the case.    The opposite parties does not admit any of the allegations made in the complaint except those that are expressly admitted herein and the complainant is put to strict proof of the allegations not so admitted.  The complainant invested in Fixed Deposits with the Gandhi Nagar (East) of the Bank and the details are as follows:

Even any of the above said deposits could mature the complainant and his wife presented letter on 29.3.00 seeking to renew the deposits for 60 months from the initial date of deposit.  The Bank Branch Officials as well as the complainant appeared to have done so in anticipation of the reduction in the rate of interest and all of them colluded together.  The above alteration was noticed during the Audit of accounts for the year 2004-05.  The dates of fresh maturity were noted on the Fixed Deposit Receipts but not on the Fixed Deposit application.  By the time it was noticed, the deposits matured with the fresh extended dates and amounts were withdrawn.    The bank suffered wrongful loss of Rs.47,180/- and the complainant derived wrongful gain as pointed out by the audit.  The complainant and his wife were therefore called upon to refund the excess amount received by them.  Legal action was also taken against the erring officials.   The opposite party is a Public Sector Bank governed and controlled by the Banking Regulation Act and the Directions of the Reserve Bank of India. The rates of interests fixed by these statutory authorities cannot be called into question.   Any contract outside these will be illegal and no right, title or interest can accrue or be claimed by the customers or paid by the bank.     The Bank has general lien over all the deposits of a constituent and is entitled to withhold the same for the amounts payable by the complainant as in this case.   There is absolutely no deficiency of service rendered by the Bank.   The complaint is devoid of merits and bonafide and is liable to be dismissed.

4.         Now the points for consideration are:

a)  Whether there is any deficiency in service, on 

                 the part of the opposite party

            b)  Whether the complainant is entitled to the

                reliefs asked for?.

5.         Ex.A1 to ExA6 were marked on the side of the complainant and Ex.B1 to Ex.B4 were marked on the side of the opposite parties.  Proof affidavit of the complainant and Proof affidavit of the opposite parties have been filed.  No oral evidence let in by either side. 

6.  POINT NO (a):

            It is admitted facts of the parties that the complainant invested  seven fixed deposits for the period of 36 months at the rate of 12.5 % and for the period of 24 months at the rate of 11.5.% p.a. with the 1^st opposite party bank.  The date of six deposits of 36 months commenced on 24.6.99 and the 7th deposit was made on 15.11.99 for 24 months at the interest rate of 11.5%.   All the said seven fixed deposits got matured on the date shown in the deposits and amounts have also been paid to the complainant. 

7.         The complainant contended that when the complainant had approached the 1^st opposite party bank for the extension of the period of the above said seven fixed deposits, the 1^st opposite party wanted a letter for the said purpose.   Accordingly the complainant had given a letter dt. 29.3.2000 to the 1^st opposite party, with the consent and the knowledge of the 1^st opposite party and also by accepting the said letter of the complainant,  all the said seven fixed deposits have been extended for the period of 60 months @ 12.5.% and the last deposit receipt @ 11.5% interest by the 1^st  opposite party.  All the deposits got matured on the date shown in the record and amounts have also been paid to the complainant.  Whileso the 1^st opposite party sent a letter Ex.A2, dt. 14.7.05 stating that the extension of period from 36 months to 60 months should have been done only after the maturity of the said period of 36 months, and by mistake and oversight of the 1^st opposite party, the same was not done, therefore the complainant is liable to repay excess interest at 3% amounting to Rs.47,180/- towards the interest of the said seven fixed deposits.  The 1^st opposite party failed to do so due to their careless and negligence in their work as admitted by the 1^st opposite party in the said letter.  Hence, on this ground the complainant is not liable repay the said alleged interest amount of Rs.47,180/-.  It is further contended that the opposite parties not only claimed the above said alleged excess amount from the complainant but they have also stopped in paying the another  fixed deposit amount dt.23.7.04 under receipt No.212246 for Rs.61,200/- with the maturity value of Rs.65,597/- as on 23.7.05 of the complainant.  Inspite of the complainant’s reply letter dt. 9.7.05 and his legal notice Ex.A3, dt. 23.8.05, the opposite parties have refused to pay the said fixed deposit amount, thereby the opposite parties have committed deficiency in service. 

8.         The opposite parties contended that the 1^st opposite party bank officials as well as the complainant appeared to have extended the period before the mature dates so in anticipation of the reduction in the rate of interest and all of them colluded together.    The said alteration was noticed during the audit of accounts for the year 2004-2005.  The dates of fresh maturity were noted on the fixed deposit receipts but not on the fixed deposit application.  By the time it was noticed, the deposits matured with the fresh extended dates and amounts were withdrawn by the complainant.   The bank suffered wrongful loss of Rs.47,180/- and the complainant derived wrongful gain as pointed out by the audit.  The complainant and his wife were therefore called upon to refund the excess amount received by them and legal action was also taken against the erring officials.   The bank has general lien over all the deposits of a constituent and is entitled to withhold the same for the amounts payable by the complainant as in this case.   Therefore, there is absolutely no deficiency of service rendered by the bank.    In this connection the learned counsel for the opposite parties relied upon the following Judgement of National Consumer Disputes Redressal Commission, New Delhi

2010 (2) CPR 83 (NC)

Vyavasaya Seva Sahakari Bank Ltd.

Versus

Sannadyamanagounda and Ors

Wherein the Hon’ble National Consumer Disputes Redressal Commission, New Delhi is held that

                            “Consumer Protection Act, 1986 – Sections 12 and 17 – Exercise of general right of lien by petitioner bank – Complainant agriculturist got crop insurance through petitioner bank – Crop failed due to drought and Insurance CO remitted policy amount to petitioner bank –Bank exercising its right of lien recovered loan amounts from insurance compensation amount – Evidence to show that individual farmers had issued cheques to discharge their loan liability – Bank could not be said to be deficient in service in adjusting the insurance amount towards loan account – Impugned order was liable to be set aside. “

9.         In the present case when the complainant wanted to extend the period of seven fixed deposits from 36/24  months to 60 months,  the 1^st opposite party bank Manger  could have informed the complainant about the  guide lines of the bank that the extension of period from 36 / 24 months to 60 months should have been done only after the maturity of the said period of 36 / 24 months, but they did not do so.   The complainant is not aware of the procedure adopted by the opposite parties while extending the period of the fixed deposits, during the pendency of the fixed deposits and before his actual maturity dates.  According to the complainant if the procedure was informed to him earlier he would have opted to take the entire money put them in the post office deposits or some other better investments which will give better returns to him who is a retired and senior citizen, and only this interest amount alone he seek his livelihood.   The 1^st opposite party bank sent a letter Ex.A2, dt.14.7.05 to the complainant about the repayment of excess amount of Rs.47,180/-  the said letter reads as follows:

            bghUs; : fhy bfL itg;g[fs; - itg;g[fSf;Fj; jtWjyhf

             tl;o mjpfkhf tHA;fpaJ – jpUg;gpr; brYj;jf;

             BfhUjy; - bjhlh;ghf.

Bkw;Fwpg;gpl;l itg;g[fspy; t.vz;.1 Kjy; 6 tiu fz;Ls;stw;iw 36 khjA;fSf;Fk;, t.vz;.7y; cs;sJ 24 khj fhyj;jpw;Fk; KjyPL bra;Js;sPh;fs; nt;itg;g[fSf;F KjyPL bra;j Bjjpapy; eilKiwapy; nUe;jgo t.vz;.1 Kjy; 6 tiuapyhd urPJfspy; 12.5% tl;oa[k; t.vz;.7y; fz;Ls;s urPjpy; 11.5.% tl;oa[k; Fwpf;fg;gl;Ls;sJ.

    xU Kiw xU Fwpg;gpl;l fhyj;jpw;F KjyPL bra;j  itg;g[fspd;  fhyk; Kotile;j gpd;dBu mt;itg;g[fis BkYk; xU Fwpg;gpl;l fhyj;jpw;F ePl;of;f naYk;.  Mdhy; jhA;fs; Vw;fdBt 36 khjA;fSf;F 1999k; Mz;L gy;BtW Bjjpfspy; KjyPL bra;jpUe;j itg;g[fis 29.3.2000 Bjjpa fojk; K}yk; 60 khjA;fSf;F KjyPL bra;a[khW Bfhug;gl;ljd; Bghpy; fojj;jpd; K}yk; itg;g[ urPJfspy; kl;Lk; itg;gpd; fhykhfpa 36 khjA;fis 60 khjA;fs; vd;W jpUj;jpa[k; itg;gpd; Kjph;t[ Bjjpfisa[k; jtWjyhf Kiwaw;w tifapy; khw;wpa[k; bfhLj;Js;shh;.  Vw;fdBt itg;g[fis KjyPL bra;j ehspy; KjyPPL bra;j fhykhd 36/24 khjA;fs; Kotile;j gpd;dBu fpis Bkyhsh; BkYk; fhyj;ij eP;l;oj;jpUf;f Btz;Lk;.  njw;fhf rk;ge;jg;gl;l tA;fpg; gzpahsh; kPJ jf;f nyhf;fh g{h;t eltof;if Bkw;bfhs;sg;gl;Ls;sJ.

    Mdhy; 36 khj fhyj;jp;w;Fg; gpd; itg;g[fs; Kjph;tile;j Bjjpapy; nuz;lhz;L itg;g[fSf;F 9.5% tl;oBa eilKiwapy; nUe;jJ (23.7.04 Kjy; 8.11.04 tiu).

    vdBt jA;fspy; itg;g[fSf;F 36 khjA;fSf;F Bky; tA;fpapy; nUe;j 2 Mz;LfSf;F 9.5% tl;ojhd; tHA;f  naYk;.  vdBt mjpfg;goahf tHA;fg;gl;l 3% tl;oapd; TLjy; bjhifahd U}.47,180/- jhA;fs; tA;fpf;Fj; jpUg;gpr; brYj;JkhW Bfl;Lf; bfhs;fpBwhk;.

    jfty; 3y; fz;Ls;s fojA;fs; thapyhf mjpfg;goahf tHA;fg;gl;l bjhifiaj; jpUg;gpr; brYj;JkhW BfhhpapUe;Jk; jhA;fs; vt;tpj eltof;ifa[k; vLf;ftpy;iy.  BkYk; tA;fpapd; 2004-05 Mz;L jzpf;ifapYk; Bkw;fz;l bjhifia cld; tR{ypf;FkhW Rl;of;fhl;lg;gl;Ls;sJ vd;gija[k; jA;fSf;Fj; bjhptpj;Jf; bfhs;fpBwhk;.  vdBt cldoahf Bkw;Fwpg;gpl;l bjhifia tA;fpf;Fj; jpUg;gpr; brYj;JkhW jA;fis md;g[ld; Bfl;Lf; bfhs;fpBwhk;.  

From the perusal of the above letter dt.14.7.05 it is seen that the 1^st opposite party bank has admitted that their officials committed mistakes and an enquiry has been initiated against the erring officials.  The opposite party has also not denied the contention of the complainant that on 15.3.06  the complainant and his wife received a letter Ex.A4 and Ex.A5, dt. 13.3.06 from Thiru.R.Sundaramurthy, Co-operative Sub Registrar, Gudiyatham to appear before him on 24.3.06 at 11.00 a.m.  Accordingly, both of them appeared before the Enquiry officer.   The Enquiry Officer in his report to the Co-op bank found the staff of the Central Co-op Bank, Gandhi Nagar, Vellore was guilty and requested the Special Officer to recover the amount from the staff concerned.  In continuation of the inquiry report the special officer issued notices to the concerned clerks to remit the amount to the bank and many of the staff members have obeyed the order of the Special Officer and have remitted the amount to the bank.  Therefore, the contention of the opposite parties that the bank officials as well as the complainant appeared to have done so in anticipation of the reduction in the rate of interest and all of them colluded together is not acceptable.  

10.       The Hon’ble National Consumer Disputes Redressal Commission, New Delhi is held the above ruling that the “Evidence to show that individual farmers had issued cheques to discharge their loan liability bank exercising its rights of lien recovered loan amounts  from the insurance compensation amount, therefore the amount could not be said to be deficient in service in adjusting the insurance amount towards loan account.  But in the present case the complainant invested seven fixed deposits for the period of 36 / 24 months  at the rate of 12.5.% & 11.5.%  interest with the 1^st opposite party bank, before the dates of maturity of the said seven fixed deposits the complainant had given a letter dt.29.3.2000 to the 1^st opposite party’s bank for the extension of the period of the said seven fixed deposits.  The 1^st opposite party’s bank  officials received the said letter and extended the period from 36 / 24 months to 60 months and after the dates of maturity,  the seven fixed deposits the amount have been paid to the complainant by the 1^st opposite party’s bank.  The contact between the complainant and the opposite parties was concluded.   Due to mistakes done by the officials of the 1^st opposite party bank the opposite parties bank demanded the alleged excess amount of Rs.40,180/- from the complainant.    Therefore, the contention of the opposite parties that the bank has general lien and is entitled to withhold the fixed deposit amounts dt. 23.7.04 under receipt No.212246 for Rs.61,200/- with a maturity value of Rs.65,597/- as on 23.7.05 of the complainant is not acceptable.    The ruling cited by the learned counsel for the opposite party is not applicable to the facts and circumstances of this case.   Even after the letter and legal notice received from the complainant about the fixed deposit Ex.A1 under receipt No.212246 for Rs.61200/- the 1^st opposite party bank had refused to pay the said fixed deposit amount to the complainant is not proper.  In such circumstances, we have come to the conclusion that the complainant herein has clearly proved the deficiency in service on the part of the opposite parties herein.  Hence we answer this point (a) is accordingly.    

 11.      POINT NO. (b):

            In view of our findings on point No.(a), the opposite parties are jointly and  severally directed to pay a sum of Rs.65,597/- under Ex.A1 Fixed deposit receipt  with interest at 7% from the date of maturity till date of payment to the complainant  and the opposite parties not to recover the amount of Rs.47,180/- towards the alleged excess interest of the said deposits as claimed by the complainant and the complainant  has also entitled for a sum of Rs.2,000/- as compensation towards the mental agony suffered by complainant and in view of deficiency in service on the part of the opposite parties.    Hence this point (b) is also accordingly.

12.       In the result, this complaint is partly allowed.    The opposite parties are directed to pay a sum of Rs. Rs.65,597/- under Ex.A1 Fixed Deposit Receipt  with interest at 7% from the date of maturity till date of payment to the complainant and the opposite parties not to recover the amount of Rs.47,180/- towards the alleged excess interest of the said seven        deposits as claimed by the complainant .

2.  The opposite parties are also directed to pay a sum of Rs.2,000/- (Rupees two thousand only) as compensation towards the mental agony.

          3.     and also to a pay a sum of Rs.1,000/-    (Rupees one thousand only) as cost of this complaint.                                                   

          The opposite parties are hereby directed to pay the above said amounts within one month from the date of receipt of copy of this order, failing which, the complainant is also entitled to interest on the above said sum @ 9 % p.a from the date of default till the date of payment.

            Dictated to the Steno-typist and transcribed by her, corrected and pronounced by the President, in Open Forum, this the 20^th day of December  2010.

MEMBER-I                               MEMBER-II                                             PRESIDENT.

List of Documents:

Complainant’s Exhibits:

Ex.A1- 23.7.05          - X-copy of Fixed Deposit Receipt.

Ex.A2- 14.7.05          - X-copy of letter of the 1^st opp party to the complainant.

Ex.A3-  23.8.05         - X-copy of Legal Notice.

Ex.A4- 13.3.06          - X-copy of summons.

Ex.A5- 13.3.06          - X-copy of summon.

Ex.A6-5.2.07             - X-copy of C.M.’s Cell addressed letter to Special Officer, Vellore.

Opposite parties’ Exhibits:

Ex.B1-            --          - X-copy of the directions of the Reserve Bank of India on      

                                   Interest rates on deposits.

Ex.B2-            --          - X-copy of Directions of the Registrar of Co-operative societies,

                                   Chennai.

Ex.B3-  3.11.01        - X-copy of Circular.

Ex.B4-            --          - X-copy of Calculation sheet regarding the excess interest paid.

MEMBER-I                               MEMBER-II                                                     PRESIDENT.