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

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Complaint  Case No  : 944 of 2009

Date of Institution :  07.07.2009

Date of  Decision   :  22.03.2010

Narinderjit Singh son of Late Shri Chattar Singh, R/o H.No. 2458, Phase-X, SAS Nagar, Mohali – 160 062.

 ……Complainant

V E R S U S

(1)     Citibank, SCO No. 132-134, Sector 9-C, Madhya Marg, Near CITCO Petrol Pump, Chandigarh, through its Branch Manager.

(2)     Chief Executive Officer, Citibank Centre, 7^th Floor, Bandra Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra.

(3)     Business Manager – Cards, Card Member Services, P.O. Box 4830, Anna Salai, P.O.Chennai – 600 002.

(4)  Ms. Nandini Raman, Officer-Customer Care, Citibank, N.A. Mail Room, 766, Anna Salai, Sakthi Towers, Chennai-2.

.…..Opposite Parties

CORAM:     SH.LAKSHMAN SHARMA              PRESIDENT

          SH.ASHOK RAJ BHANDARI       MEMBER

PRESENT: Sh.Charanjit Singh, Adv. for the Complainant.

         Sh.V.K.Diwan, Adv. for OPs.

PER ASHOK RAJ BHANDARI, MEMBER

        Concisely put, in response to the application of the Complainant, vide letter dated 29.01.2007 (Annexure C-1), he was issued “Citibank Gold Card” No. 5546379537534008 at the address as House No. 2458, Phase-X, SAS Nagar, Mohali – 160 062 (Punjab), by the OPs, with a credit limit of Rs.1.77 lakh and cash limit of Rs.10,000/- with the validity period of 01/07 to 01/10. It was alleged that on 10.4.2009, he received a telephone call from OP, intimating that an amount of Rs.3,02,499/- (Rs.2,66,000/- transaction charges; Rs.34,399/- interest charges and Rs.2100/- late payment charges), was outstanding towards his credit card. On 12.4.2009, he represented to the OP regarding the wrong billing, stating that no payment was outstanding against his card even as per Bank Statement dated 19.3.2007, upon which he was told that on his request letter, another credit card had been issued to him; whereas, as per the Complainant, he had never given a request letter for issuance of a new credit card, when he already had one such card. Accordingly, he requested the OP Bank to look into the matter, in response whereof, the Bank sought time for further investigating into the matter. Subsequently, on 26.4.2009, vide e-mail, the Complainant was told that the Bank was unable to address his query within the stipulated time frame. He was told that his card ending with 4008 had been re-issued to card ending with 4016, credit limit of which had been increased based on Complainant’s consent. The mailing address has been given of M/s Goodwill Associates, Plot No. 786, Office No. 2, 2^nd Floor, Mittal Building, Mota Singh Nagar Market, Jalandhar. The Complainant was asked to confirm the address. It was mentioned that since the Bank was unable to deliver the card, the same had been closed at their end and in case, the Complainant wanted to have a replacement card, then he should revert with his confirmation to issue the same. Vide an e-mail dated 27.4.2009, he informed the OP Bank that the addresses mentioned in e-mail dated 26.4.2009, were not his addresses and he had never made any request for change of address or for re-issuing the card, which according to the Complainant tantamounts to deficiency in service. On 28.4.2009, another e-mail was sent to OP on the same issue. In reply, on 4.5.2009, the Bank sent an e-mail to the Complainant stating that the credit limit assigned to the Card ending with 4016 had been enhanced from Rs.1,77,000/- to Rs.2,66,000/- on 11.09.2007, based on the clear consent of the Complainant, and that the new card was sent at the aforesaid address on 20.12.2008, which was received by one Sh. Jasdeep Singh – father of the Complainant. He was further informed by the OP that a sum of Rs.2,66,000/- had been provisionally credited to Complainant’s card account and interest charges of Rs.34,399.84P and late payment charges of Rs.2100/- had since been reversed. In addition, the entry of service tax was also reversed in due course. It was clearly stated that no amount was then outstanding in the Complainant’s card account of the credit card ending with 4016. On 5.5.2009, he reverted back to the Bank, saying that there was still confusion at the Bank’s level, as he had no concern whatsoever with the card ending 4016. He had never asked for this card, had never received the same and furthermore, had never used the same. He had, thus, been issued an unsolicited card, which was activated without his consent and he was even billed for the same for a huge amount, contrary to the guidelines of the RBI. Thereafter, protracted e-mails were exchanged between the parties, but to no avail. Hence, this complaint, alleging that the aforesaid acts of the OPs amount to deficiency in service and unfair trade practice. In the end, the Complainant has prayed for the following reliefs:-

a)  Penalty of twice the value of the charges which have been reversed as provided by the guidelines dated 21.11.2005 issued by the RBI (Annexure C-14) (Rs.3,02,499/- x 2= Rs.6,04,998/-)

b)  Service tax charges as deducted by the bank.

c)  Interest @24% p.a. on Rs.6,04,998/- till its realization.

d)  Rs.10.00 lakhs towards compensation for inconvenience, harassment, fraud, damage to reputation and wastage of time etc.

2]      Notice of the complaint was sent to OPs seeking their version of the case. 

3]      OP No. 1 to 4 in their joint written statement, while admitting the factual matrix of the case/reply, pleaded that the credit limit was enhanced from Rs.1.77 lakh to 2.66 lakh in the credit card of the Complainant. The factum of cancellation and closure of Card on 20.12.2008 and issuance of a card bearing the number ending 4016 has also been admitted. It was submitted that upon detection of the fraud, the entire loss of Rs.2.66 lakh was accepted by the OP and all the bills containing the said entry and consequential charges on account of interest and late payment charges were reversed with automatic reversal of service charges and all these reversals were to be reflected in May, 2009 statement of the card account. It was also confirmed on 6.5.2009 that the Credit Card No. 4016 had been blocked. It was submitted that there was no financial loss suffered by the Complainant. Even the follow up made by the Bank for recovery of its dues from the Complainant was not based on any intentional act of any officer. All other material contentions of the Complainant were controverted. Pleading that there was no deficiency in service on their part, a prayer has been made for dismissal of the complaint with exemplary costs.

4]      Parties led evidence in support of their contentions.

5]      We have carefully gone through the entire case thoroughly, including the complaint and the relevant documents tendered by the complainant / OPs. We also heard the arguments put forth by the learned counsels for the Complainant and OPs. As a result of the detailed analysis of the entire case, the following points/issues have clearly emerged and certain conclusions/arrived at, accordingly:-

i]  The basic facts of the case in respect of the Complainant having taken a “Citibank Gold Card” No. 5546379537534008, at his address as House No. 2458, Phase-X, S.A.S. Nagar, Mohali – 160 062 (Punjab), from the OPs, with a credit limit of Rs.1.77 lakh and cash limit of Rs.10,000/-, with the validity period of 01/07 to 01/10 and that the Complainant had used the Card and made payments accordingly, from time to time, without any controversy till March, 2009, have all been admitted. It was only on 10.4.2009, that the problem arose between the parties as the Complainant received               a telephonic message from OP,           intimating  him that an amount of Rs.3,02,499/- (Rs.2,66,000/- transaction charges; Rs.34,399/- interest charges and Rs.2100/- late payment charges), was outstanding towards his credit card. On receiving the said telephonic message, the Complainant took up the matter with OPs, stating that no payment was outstanding against his Credit Card which had been confirmed even by the OPs themselves, through the Credit Card Statement dated 19.03.2007, sent to him by them. Subsequently, the OP told the Complainant that as matter of fact, one more Credit Card had been issued to him at his own request and by obtaining his prior consent, which had the digits ending with 4016. This card was issued to him with a credit limit of Rs.2,66,000/-, contrary to the earlier limit of Rs.1,77,000/- against his previous Credit Card, ending with digits 4008. The Complainant strongly protested to the OPs against all this, saying that he had never given a request for issuance of new Credit Card or conveyed his consent for the purpose, when he already had one such Credit Card. Further, he had also not sought any enhancement in the limit from Rs.1,77,000/- to Rs.2,66,000/- in his Card.

ii] A lot of correspondence through e-mails took place between the parties and finally, the Complainant was told that the whole matter was being investigated and as a result of the said investigation, the OPs told the Complainant that his Credit Card ending with the digits 4008 had been re-issued to a new Credit Card ending with digits 4016. The new Credit Card had an enhanced credit limit and the same was mailed to M/s Goodwill Associates, Plot No. 786, Office No. 2, 2^nd Floor, Mittal Building, Mota Singh Nagar Market, Jalandhar and he was asked to confirm the address. The contention of the OPs was again contested by the Complainant, saying that the address given was not his address and he had never asked for change of address or for re-issuing the Credit Card into a new card. Further, the contention of the OPs that the said Credit Card which was sent to the Complainant on 20.12.2008 and received by a person with the name   Sh.Jasdeep Singh – said to be father of the Complainant, was also denied by the Complainant, saying that he does not know any Jasdeep Singh. Ultimately, at the end of the investigation carried out by the OPs, the OPs admitted their mistake, saying that the new Credit Card had been wrongly issued and that it had withdrawn the entire claim of Rs.3,02,499/- standing against the Credit Card Account of the Complainant and as such, the outstanding balance with the Credit Card account of the Complainant was made as ‘Zero’ in the Credit Card ending with digits 4016. Still, later the said Credit Card was also blocked and cancelled by the OPs. 

iii] The main grievance of the Complainant against OPs in this case is that he has suffered a lot of physical harassment, mental agony and pain, including damage to his reputation and wastage of time and, therefore, he needs to be adequately compensated. Secondly, he had quoted the Reserve Bank of India’s guidelines (Annexure C-14) in respect of the Credit Card Operations of Banks, in which the relevant Clause (5) quoted by the Complainant is reproduced hereinbelow:-

          5.   Protection of Customer Rights

Customer’s rights in relation to credit card operations primarily relate to personal privacy, clarity relating to rights and obligations, preservation         of customer records, maintaining confidentiality of customer information and fair practices in debt collection. The card issuing bank / NBFC would be responsible as the principal for all acts of omission or commission of their agents (DSAs / DMAs and recovery agents).

i. Right to privacy

a. Unsolicited cards should not be issued. In case, an unsolicited card is issued and activated without the consent of the recipient and the latter is billed for the same, the card issuing bank / NBFC shall not only reverse the charges forthwith, but also pay a penalty without demur to the recipient amounting to twice the value of the charges reversed.

b. Unsolicited loans or other credit facilities should not be offered to the credit card customers. In case, an unsolicited credit facility is extended without the consent of the recipient and the latter objects to the same, the credit sanctioning bank / NBFC shall not only withdraw the credit limit, but also be liable to pay such penalty as may be considered appropriate.

c. The card issuing bank / NBFC should not unilaterally upgrade credit cards and enhance credit limits. Prior consent of the borrower should invariably be taken whenever there are any change/s in terms and conditions.”

iv] Based on the above said Clause (5) of the R.B.I. Guidelines, the Complainant has claimed a compensation amounting to double the amount, which was claimed from him by the OPs in the first instance and which was subsequently reversed by the OPs after due inquiry. The second claim of the Complainant as already stated in the foregoings is on account of the physical harassment, mental agony and pain, which he suffered for a short span of about one month, on account of receiving demand of Rs.3,02,499/- from the OPs, which he was not supposed to pay for and eventually, did not pay as the said demand was withdrawn by the OPs within a month or so.   

v]  A detailed analysis of all the facts and figures of the entire case shows that in reality and also as admitted by the Complainant himself, he has not suffered any financial loss in the case of his Credit Card account transactions. The amount demanded by the OPs to the tune of Rs. 3,02,499/- on 10.04.2009, which included transaction charges, interest charges, late payment charges and service tax etc., has not been actually paid by the Complainant to the OPs at any stage. Moreover, when the Complainant pointed out the discrepancies in the Credit Card statement, the OPs conducted a thorough investigation in the matter promptly and reversed all the disputed entries from the Credit Card account of the Complainant, immediately, in April, 2009, itself i.e. in less than a month’s period and the relevant clause of the R.B.I. Guidelines quoted by the Complainant is also not very helpful to the Complainant, in the sense that he has not suffered any financial loss in the entire episode and the OP Bank reversed all the entries, in a very short period of time, after quickly conducting due investigation.  That is the only thing the OPs could do under the given circumstances. The claim made by the Complainant to the tune of double the disputed amount i.e. Rs.6,04,998/- + Rs.10,00,000/- as compensation, totalling to Rs.16,04,998/-, is a very tall order, which cannot be accepted, as the compensation could be given to the Complainant only to provide some relief for the actual loss suffered by the Complainant, if any, and not against any imaginary loss. No compensation is admissible to anyone with a view to enrich him unduly against ZERO LOSS to give him totally unearned profits and, therefore, such claims, as made out by the Complainant, to the extent of more than Rs.16,00,000/- are just unjustified, unreasonable and hence, untenable and, therefore, cannot be allowed under any circumstances, whatsoever.  

vi] In a similar case, decided by the Hon’ble State Consumer Disputes Redressal Commission, Delhi, titled as ICICI Bank Ltd. V/s Nilima Gulati, 2007(2) CPC 160, it has been held as under:-

        Head Note:

“Consumer Protection Act, 1986 – Section 15 – Credit Card – Respondent/ Complainant got a credit card from Appellant Bank for two years – She was stunned to receive a demand draft of Rs.42,250/- outstanding against her though she had never asked for any loan – It was argued by the appellant that Respondent had asked for loan but later on she might have realized that no loan was required – But no evidence was produced that demand draft was sent on the request of the Respondent – District Forum rightly directed to pay compensation and cost of Rs.10,000/- to the Complainant for causing mental agony and unnecessary harassment – Appeal dismissed.

  (Paras 4 to 7)”

vii] The present case is quite similar to the aforesaid case in the sense that although the Complainant has suffered no financial loss whatsoever in the entire transaction, but he has suffered some harassment, mental agony and pain, on account of a wrong demand made by the OPs on him for paying a huge amount of Rs.3,02,499/-, by issuing a totally unsolicited second Credit Card to him with the digits ending 4016 and also arbitrarily enhancing the credit limit from Rs.1,77,000/- to Rs.2,66,000/- in the new Credit Card. All these things were neither asked for by the Complainant, nor he had given his consent for the same and this has been candidly admitted by the OPs also. Therefore, surely, there is deficiency in service on the part of the OPs and the Complainant deserves at least some compensation on that account. 

6]      Keeping in view the foregoings, in our considered opinion, the present complaint has merit, weight or substance and it must succeed. We, therefore, allow the complaint in favour of the Complainant and against the OPs & pass the following order.

7]      The OPs shall, jointly and severally, make the following payments to the Complainant:-

(i) To pay a sum of Rs.10,000/- as compensation for causing inconvenience, harassment, mental agony and pain to the Complainant, on account of wrongly issuing the second Credit Card to him and enhancing the credit limit of the new Credit Card and also demanding the sum of Rs.3,02,499/-, which was not at all payable by the Complainant.

(ii) To pay a sum of Rs.5000/- as litigation costs.

8]      The aforesaid order be complied with by the OPs, jointly and severally, within a period of 06 weeks from the receipt of its certified copy, failing which they shall pay the sum of Rs.10,000/- along with interest @18% per annum calculated from the date of claiming the disputed amount for the first time from the Complainant i.e. 10.4.2009, till the date of realization, besides paying the cost of litigation as Rs.5,000/- to the Complainant.

13]    Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

22.03.2010                                       Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

                                             Sd/-

(ASHOK RAJ BHANDARI)

MEMBER

‘Dutt’