West Bengal

Bankura

CC/10/2022

Sri Supratik Sen - Complainant(s)

Versus

Deputy General Manager, Domestic Resource Department, Unit-IDBI Bank Ltd - Opp.Party(s)

Haridas Banerjee

26 Apr 2023

ORDER

IN    THE   DISTRICT   CONSUMER   DISPUTES   REDRESSAL COMMISSION BANKURA

  Consumer Complaint No. 10/2022

                                                                                              Date of Filing: 03.03.2022                                                                                                                                                                                                                                          

Before:                                        

1. Samiran Dutta                              Ld. President.      

2. Rina Mukherjee                          Ld. Member. 

3. Siddhartha Sankar Bhui            Ld. Member.

 

For the Complainant:  Self

For the O.P.Ld Advocate Asim Kumar Mandal

 

Complainant  

Sri Supratik Sen,  S/O Sri Ratul Sen, At Beliatore 12^th Mile, P.O. & P.S. Beliatore, District- Bankura

Opposite Party          

Deputy General Manager, Domestic Resource Department, Unit-IDBI Bank Ltd., Flexi Bond, Head Office-IDBI Tower, WTC Complex, Cuffe Parade Colaba, Mumbai-400005.                                                                                                                                                   

 

 JUDGEMENT            

                                                                                                                                               

Dated:26-04-2023

This is an application u/s 12 of the Consumer Protection Act, 1986 filed by the Complainant against the O.P. claiming Rs.2 Lakh as the matured value of the Bond  together with Rs.10,000/- as litigation cost.

The complainant’s case is that he purchased in  his name IDBI Deep Discount Bond in the form of Promissory Note on 18-03-1996 as per offer document (OD) dated:30^th January, 1996 with issue price Rs.5,300/- and face value of Rs.2 Lakh as on March, 18, 2021 issued by the O.P. Bank. But on 28-05-2009 the O.P. issued a letter to the complainant stating thereby to surrender the aforesaid Bond at face value of Rs.10,000/- as on 1^st August, 2000 as per terms and condition of the Bond but the complainant did not comply with the same by sending a letter to the O.P. on 03-09-2009 expressing his unwillingness to surrender the Bond as called for. According to the complainant he is entitled to get return of matured amount of Rs.2 Lakh after completion of 25 years in 2021 in terms of the aforesaid Bond but the O.P.  has deliberately misled the complainant by denying his claim in the guise of redemption of Bond by the O.P. Bank.

The complainant has therefore approached this Commission for appropriate relief.

                                                                                                                                                                                      Contd…..p/2

Page: 2

The O.P. Bank filed a written version to contest the case contending inter alia that the O.P. Bank has exercised the option of Redemption of the Bond as per terms and condition of such Bond after observing and complying with all the legal formalities such as intimation to the Bond holder and issuing public advertisement regarding the exercise of such Redemption condition. The O.P. is always ready and willing to pay back the Redemption proceeds after surrender of the original Bond by the complainant but the complainant has never turned up to the call of the O.P. and accordingly the complainant is at best entitled to get Rs.10,000/- as the face value as on 1^st August, 2000 with permissible rate of interest till the surrender of the duly discharged Bond Certificate.

-:Decision with reasons:-

At the time of hearing the complainant who conducts the case personally expressed his dissatisfaction regarding such scheme of the Bond which is totally vague and misleading. The complainant was under the impression when he purchased the Bond in 1996 that he would get return of the matured value of Rs.2 Lakh in 2021 after 25 years but he was shattered to learn from the O.P. that he has to surrender the Bond and get fully discharged therefrom as on August, 2000 with return of Rs.10,000/- only plus nominal interest.

But the Ld. Advocate appearing for the O.P. has referred to the Redemption Clause of the Bond wherein the O.P. along with the Bond holder has been given the option to redeem the Bond as the face value of Rs.10,000/- as on 1^st August, 2000 and the O.P. Bank has duly complied with all the legal formalities in order to exercise that option of Redemption. So the complainant has nothing to question on the terms and condition of the Bond and put forward his claim to get Rs.2 Lakh as the maturity value after the stipulated period.

Ld. Advocate appearing for the O.P. in support of his contention has referred to two decisions of Hon’ble NCDRC, New Delhi viz R.P. No.3107 of 2012 and R.P. No.3930 of 2013 wherein order has been passed in favour of the IDBI Bank dismissing the claim of the complainant in similar cases.

So the bone of contention between the parties is that from IDBI stand point the complainant is bound by the terms and condition of the Bond and neither party can get any extra benefit therefrom but from the Bond holder stand point the complainant is to get the maturity value after expiry of the Bond period without surrender of the Bond certificate in any interval period.                           

                                                                                                                                                                                    Contd…..p/3

Page:3

The Commission has examined the entire materials on record particularly the bond in question itself and on perusal of the Bond the Commission is astonished to find that it is not only a simple Bond but it is a Bond in the form of Promissory Note. Let us reproduce the recital of the Bond in question as hereunder: -

BOND IN THE FORM OF PROMISSORY NOTE

IDBI DEEP DISCOUNT BOND’96

……… Has been presented by IDBI Bank does hereby promise to pay to or order on demand …………on March 18, 2021, the sum of Rs.2 Lakh being the face value of the Bond herein contained ………and the holders of the Bond/IDBI shall have the option to redeem the Bond on any of the following dates i.e. August 1, 2000 at Rs.10,000……..

On plain reading of the Bond itself it is clear that it is a Bond in the form of Promissory Note and so the condition of issuing Promissory Note must be complied with. According to Section-4 of the Negotiable Instrument Act, 1881 Promissory Note has been defined as an instrument in writing (not being a Bank Note or a currency Note) containing an unconditional undertaking signed by the maker to pay a certain sum of money to the bearer of the instrument.

If the Bond is a Promissory Note it must be unconditional according to the definition of the Promissory Note but as stated above the Bond in question contains conditions like Redemption of the Bond either by the Bond holder or by IDBI and so such conditions are contrary to the provision of Promissory Note as provided in the Negotiable Instrument Act. U/s 23 of the Indian Contract Act such Bond Certificate is also a void document as it defeats the provision of Section-4 of the Negotiable Instrument Act, 1881 for incorporation of condition of Redemption Clause.

Incorporation of such condition in the Bond Certificate brings the case within the definition of unfair contract as provided in Section-2(46) of Consumer Protection Act, 2019 which says that a contract between a service provider on one hand and a consumer on the other having such terms which cause significant change in the rights of such consumer including the following namely Clause-IV- entitling a party to the contract to terminate such contract unilaterally without reasonable cause and Clause-VI - imposing on the consumer any unreasonable charge, obligation or condition which puts such consumer to disadvantage.

                                                                                                                                                                                        Contd….p/4

Page:4

In this case the Bond in question has empowered the IDBI Bank to terminate the contract unilaterally without reasonable cause and also imposed on the consumer the obligation or the condition which has put him to disadvantage of not getting the matured value as is normally expected. Exercise of call option by the O.P. Bank has virtually terminated the Bond unilaterally depriving the Bond holder of his actual matured value.         

The above referred two decisions of Hon’ble NCDRC, New Delhi has not gone into this legal aspect of the IDBI Bond and as such those two decisions are not applicable and binding on this Commission as it is judgement per incuriam.

It is no doubt true that this Commission has no jurisdiction to decide the validity of the contract and declare a contract as a void document but under the Consumer Protection Act, 2019 the Commission has the power and jurisdiction to award compensation upon the O.P. for entering into such an unfair contract as enumerated above if the consumer is found to be the victim of such contract. The O.P. has to compensate the consumer in such case the expectant loss in the investment.

What the complainant expected of return benefit by investment in  such type of Bond has been totally belied by the O.P. in the guise of exercise of Redemption of Bond and this is exactly the concern of this Commission to protect the interest of the consumer.

                                                                                                                                                                                       Contd……p/5

Page: 5

On consideration of the entire materials on record and the facts and circumstances of the case and the delicacy of the matter the Commission thinks that the complainant is entitled to get Rs.2 Lakhs as the compensation which is equivalent to the matured value of the investment and the O.P. is bound to pay the same on the ground of deficiency of service on their part for issuing such Bond amounting to unfair contract as discussed above.           

Hence it is ordered……..

That the case be and the same is allowed on contest against the O.P.

The O.P. is  directed to pay to the complainant Rs.2 Lakhs within one month of the production of the original Bond certificate by the complainant with interest @7% per annum from 18-03-2021(date of maturity) till the payment of maturity value  in default the decretal amount may be realized in due process of law.

The complainant is directed to produce the original Bond certificate before the O.P. Bank within seven days from the date of this order.

Both parties be supplied copy of this Order free of cost.  

 

  ____________________               ________________              _________________

HON’BLE   PRESIDENT           HON’BLE MEMBER          HON’BLE MEMBER