Chandigarh

DF-II

CC/636/2019

Power Waves Industries - Complainant(s)

Versus

Canara Bank - Opp.Party(s)

Vijesh Chaudhary Adv.

25 Mar 2021

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

======

Consumer Complaint  No	:	636 of 2019
Date  of  Institution	:	16.07.2019
Date   of   Decision	:	25.03.2021

 

 

 

 

Power Waves Industries, E-17, Phase-7, Industrial Focal Point, SAS Nagar, Mohali through its partner Sh.Harbans Singh

             …..Complainant

Versus

Canara Bank, SCO No.311-12, Sector 35-D, Chandigarh, through its Manager.

   ….. Opposite Party

 

BEFORE:  SMT.PRITI MALHOTRA    PERSIDING MEMBER 

                    SH.S.K.SARDANA           MEMBER

 

 

For Complainant :    Sh.Vijesh Bahadur, Advocate

For OP(s)       :    Sh.Nitin Gupta, Advocate  

 

PER PRITI MALHOTRA, PRESIDING MEMBER

 

         Briefly stated, the complainant being partner of Power Waves Industries, applied to Assistant Excise and Taxation Commissioner, Shimla (HP) for Sales Tax Number for doing business in H.P. and accordingly, as per their condition, an F.D. of Rs.One Lakh was to be pledged to them.  It is averred that the complainant took FD from OP bearing No.KD 980000020 dated 6.1.1998 for Rs.One Lakh for one year i.e. upto 7.1.1999 with interest to be compounded at quarterly rests @10% p.a. (Ann.C-1).  Accordingly, the said FD was pledged to Assistant Excise and Taxation Commissioner, Shimla (HP) on 6.1.1998.  It is also averred that the complainant closed its business in H.P. in the year 2018 and applied to Assistant Excise and Taxation Commissioner, Shimla to release the said FD in response to which, it wrote a letter dated 10.12.2018 (Ann.C-2) to OP for release of the said FD.  It is submitted that the complainant also wrote letter dated 12.12.2018 (Ann.C-3) to OP to release the FD.   

         Ultimately, the OP paid an amount of Rs.1,58,539-81P only to the complainant on 31.3.2019 after using it for 20 years.  It is submitted that OP was to calculate the interest @10% compounded quarterly rests as mentioned in FD (Ann.A-1) on the amount of Rs.One lakh from 6.1.1998 to 31.3.2019, which comes to Rs.8,15,696/- including principal amount of Rs.1,00,000/-.  It is also submitted that the OP is liable to pay the balance amount of Rs.6,57,156/-.  The complainant approached the OP in this regard and also served a notice dated 16.4.2019, but to no avail.  Hence, this complaint has been filed alleging deficiency in service on the part of OP.

 

2]       The OP has filed reply and while admitting the factual matrix of the case, stated that the complainant got issued Kamadhenu Deposit Receipt dated 6.1.1998 for Rs.One lakh from OP, which was matured on 7.1.1999 with maturity value of Rs.1,10,412/-. It is submitted that the complainant never applied for renewal of the said term deposit receipt. It is also submitted that as per Reserve Bank of India Guidelines, the said overdue term deposits were declared as unclaimed deposits after 10 years and the same were transferred to unclaimed deposits in the year 2008. It is pleaded that on receipt of letter dated 12.12.2018 from the complainant to release the payment of K.D.R., the OP raised the claim with Head Office and received a payment of Rs.1,58,539.81 from Head Office and the same was credited to the current account No.3301201000219 on 27.12.2019 (Ann.R-1).  It is also pleaded that as per Manual of Instructions on Term Deposits, the OP paid interest at prevailing saving bank rate for the overdue period to the complainant (Ann.R-2). It is stated that the complainant is not entitled to any such interest as alleged in Ann.C-4.  It is also stated that the OP had already paid the overdue term deposit with accrued interest to the complainant on 27.12.2018 and the complainant is not entitled to any further amount towards interest on the said KDR. Denying rest of the allegations and pleading no deficiency in service, the OP has prayed for dismissal of the complaint.

 

3]       Rejoinder has also been filed by the complainant thereby reiterating the assertions as made in complaint and controverting that of OP in its reply.

 

4]       Parties led evidence in support of their contentions.

 

5]       We have heard the ld.Counsel for the OPs and have also perused the entire record including written arguments of complainant.

 

6]       Admittedly, Sh.Harbans Singh, being Partner in complainant firm (Power Waves Industries) got issued from OP one FDR bearing No.KD 980000020 dated 6.1.1998 of Rs.One Lakh to be matured on 7.1.1999 with interest compounded at quarterly rests @10% p.a. (Ann.C-1) in order to pledge it in favour of Assistant Excise and Taxation Commissioner, Shimla (HP) for procuring Sales Tax Number in respect of its business operations in H.P.

 

7]       As per the complaint file, the complainant firm closed its business in the year 2018 and got issued a letter dated 6.12.2017/10.12.2018 (Ann.C-2) from Assistant Excise and Taxation Commissioner, Shimla (HP) for release of said pledged FD from OP.  Thereafer, on the basis of that letter, the complainant vide letter dated 12.12.2018 (Ann.C-3) requested the OP Bank to release the said FDR.

 

8]       It is well proved on record that the OP entertained the request of the complainant and after calculating the amount of FDR with its due interest, released an amount of Rs.1,58,539.81 in the current account No.3301201000219 on 27.12.2019 (Ann.R-1). 

 

9]       It is disputed that the OP did not pay the compounded interest on the FDR amount from the date of deposit till payment and paid only the saving interest after the maturity date.

 

10]      On the contrary, it is the stand of the OP that the FDR in the present case was for One year i.e. from 6.1.1998 to 7.1.1999 and thereafter none approached the Bank to get the FDR renewed nor there was any instruction about renewal of the said FDR, after its maturity and as such the same was transferred to unclaimed deposit. It is stated that as per Manual of Instructions on Term Deposits per Section 26.1 “Overdue term deposits (term deposits which have matured) will be paid interest at prevailing Savings Bank rate for the overdue period”, the OP paid interest at prevailing saving bank rate for the overdue period to the complainant (Ann.R-2).

 

11]      In order to establish its claim, the complainant has relied upon various circulars issued by Reserve Bank of India regarding interest to be paid on overdue amount, but the same are not applicable in case of the complainant, as the FDR in question got matured in the year 1999 and the circulars relied upon by the complainant are of the year 2000 & onwards applicable prospectively. Moreover, the said circulars empowers the Bank with a discretionary power to renew the Overdue Term Deposit in the given eventualities.  For the sake of convenience, we are reproducing the specific provision from one of the circular as it remains the same in the subsequent circulars as placed on record.  We are reproducing the relevant provision from the Reserve Bank of India Circular No.DBOD No.Dir.BC.47/13.03.00/2000-2001, dated November 04, 2000 (Ann.2 Page-24), which reads as under:-

         “11. Overdue deposits

             xxxxxx

A bank may, at its discretion, renew an overdue deposit or a portion thereof provided the overdue period from the date of maturity till the date of renewal (both days inclusive) does not exceed 14 days and the rate of interest payable on the amount of the deposit so renewed shall be the appropriate rate of interest for the period of renewal as prevailing on the date of maturity or on the date when the depositor seeks renewal, whichever is lower. In the case of overdue deposits where the overdue period exceeds 14 days and if the depositor places the entire amount of overdue deposit or a portion thereof as a fresh NRE term deposit, the bank may fix its own interest rates for the overdue period on the amount so placed as a fresh deposit. The bank is free to recover the interest so paid for the overdue period if the deposit is withdrawn before completion of minimum period prescribed under the scheme, after renewal.

         The perusal of the above provisions specifically mentions about the renewal of those Overdue Term Deposits, which became due for renewal within the stipulated period and in case when the Bank is approached for the renewal and that also after fulfilling the conditions as mentioned therein.   

 

12]      In the case in hand, the complainant obtained FDR for 1 year only i.e. from 6.1.1998 to 6.1.1999 and pledged the same with the Assistant Excise and Taxation Commissioner, Shimla (HP) as is well proved on record.   

 

13]      The complainant after winding up of its business in the year 2018, procured a letter dated 6.12.2017/10.12.2018 (Ann.C-2) from Assistant Excise and Taxation Commissioner, Shimla (HP) for release of said pledged FDR from OP and thereafter, the complainant vide letter dated 12.12.2018 (Ann.C-3) requested the OP Bank to release the FDR.

 

14]     From the record, it is well clear that the FDR in question of the complainant was pledged with Assistant Excise and Taxation Commissioner, Shimla (HP), so in our considered opinion said party was the necessary party to clarify its stands in regard to the instruction, if any given by it, for the renewal of the FDR in question either to the complainant or to the OP Bank.  Record transpires that the complainant also after winding up its business in the year 2018, approached the said department for release of FDR and then after procuring the said letter Ann.C-2, approached the OP bank on 12.12.2018 for release of the FDR amount. The complainant through its Partner did not bother to give any instructions/request to the OP Bank or had not enquired about the interest to be paid on the FDR in question after its date of maturity i.e. 6.1.1999 till the date when request for release of the amount was made on 12.12.2018.  The correspondence with the bank placed on record by the complainant with regard to interest rate, is after the date of release of the FDR amount in the account. The complainant did not bother to either give instructions/request to the OP Bank or made any enquiry, about the interest to be paid on the FDR in question at any point of time, before the release of the amount in its favour. 

 

15]      From the above discussion and findings, we are of the view that no case of deficiency in service is made out against the OP.  Therefore, the complaint being bereft of any merit, is hereby dismissed.  No order as to costs.

         The certified copy of this order be sent to the parties free of charge, after which the file be consigned.

Announced

25^th March, 2021                                                                                                                                                          

Sd/-

 (PRITI MALHOTRA)

PRESIDING MEMBER

 

 

Sd/-

(S.K.SARDANA)

MEMBER