Kerala

Idukki

CC/174/2021

Liji Sunny - Complainant(s)

Versus

Federal Bank - Opp.Party(s)

23 May 2023

ORDER

DATE OF FILING : 27/11/2020

IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, IDUKKI

Dated this the 16^th day of May 2023

Present :

              SRI.C.SURESHKUMAR                                               PRESIDENT

              SMT.ASAMOL P.                                                          MEMBER

              SRI.AMPADY K.S.                                                        MEMBER

CC NO.167/2020

Between

Complainant                                :  Ammu Unnikrishanan (Nithya),

                                                        Block No.484, Kallar P.O., Putharikandam,

                                                        Thookkupalam, Idukki District, Pin – 685 552.

                                                   And

Opposite Party :                      :  1 .  The President,

                                                          Kattappana Urban Co-Operative Bank Ltd.,

                                                           Kattappana

                                                     2  . The Secretary,

                                                            Kattappana Urban Co-Operative Bank Ltd.,

                                                            Kattappana

                                                           (Both by Adv.Babichen V.George)

 

O R D E R

SRI.AMPADY K.S., MEMBER

 

This complaint is filed raising the following allegations against opposite parties and sought for the reliefs hereinafter mentioned.

 

1 . Opposite party bank had issued a cash certificate for Rs.25,000/- on 03/04/2000 to complainant in her account No.202.  Maturity period was 240 months with maturity date as 03/04/2020.  She is now residing in Telungana State.  At the time of maturity, she could not approach the bank due to lock down and travelling difficulties owing to Covid 19.  So she could come over to Kerala on 05/11/2020 and after quarantine and Covid test she approached the   bank  on  18/11/2020  and   submitted   the   matured  cash   certificate. 

(Cont....2)

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As per bank’s direction, she has signed the fund transfer form without filling it for crediting the amount in her account in SBI.  They returned counterfoil of the above form without showing the amount but affixing their signature and seal.  On enquiry with bank officials regarding the non-filling up of counterfoil, they told her that it would take time to calculate interest but they had transferred Rs.16150/- to her account in SBI on the same day itself.  While asked about the reason for crediting lower amount, they replied that they could give that much amount only.  After waiting for a long period, bank has cheated her by not giving Rs.8850/-.  Hence she prayed for the following reliefs.

1 . Recover the balance amount Rs.8850/- due from bank and give to her.

2 . Allow Rs.25,000/- as compensation for the mental agony and physical difficulties caused to her by opposite party bank.

3 . Allow litigation costs and other travelling expenses from opposite  party bank.

          Opposite  parties filed joint written version as follows.

1 . Opposite party bank has no President or Secretary.  Instead, it is having Chairman and General Manager Posts.   Due to non-jointer of necessary parties, this complaint is not maintainable.  Complainant has transacted business with bank.   So, bank is a necessary party.  Officials have no personal responsibility for the transactions with bank and therefore allegation against the bank would not sustain against the bank officials.

2 . Opposite parties admitted the issuance of “Jeevan Suraksha Deposit Certificate” on 03/04/2000 with maturity value Rs.25,000/- on 03/04/2020.  But they denied the issuance of account transfer form of her SBI account

(Cont....3)

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without filling the amount.  She had kept the counterfoil without filling the same and her allegation is only for sake of complaint.

3 .   A relative of complainant named Joseph Kurian had deposited Rs.1367/- for and on her behalf.  Though they had given interest upto 15% at the time of deposit in question, now it is below 7%.  Opposite party bank is functioning based on law and interest rate fixed by RBI.  Difference in interest rate during various periods fixed by RBI is applicable to the bank and its customers.  It was informed to the complainant at the time of deposit itself and the same is recorded in the certificate itself.  While RBI had reduced the interest rate of deposits drastically, it had issued letter on 15/09/2004 to Joseph Kurian stating that they were ready give 15% interest upto 30/09/2004 as offered and may close the account.  They had also offered rate of interest fixed from time to time by RBI from 01/10/2004.  But, even after receiving the letter by Joseph Kurain and understood its contents, he continued the deposit.  Even then they had given maximum interest rate of 8.5% which can be allowed by Co-Operative Banks.  Opposite party bank or other banks cannot give 15% interest at present.

4  .There is no basis for the mental agony and physical difficulties alleged by her.  There is no deficiency in service from the side of opposite party bank.

          So, they prayed for dismissal of complaint.

Complainant was not appearing on several posting dates and no representation or application also.  Therefore notice for personal appearance was issued and the case stood adjourned to 14/12/2022.  Though notice was served, she was not present on that day also.  No application or representation also.  No oral evidence tendered. Copies of 5 documents produced by her were marked as Exts. P1 to 5 as follows.

(Cont....4)

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1 . Ext.P1 – Jeevan Suraksha Deposit receipt dated 03/04/2000 in the name of complainant for an amount of Rs.1367/- with maturity value Rs.25,000/- on 03/04/2020.

2 . Ext.P2 – SB Account Pass Book first  page  in the name of complainant in SBI with entries from 25/09/2019 to 18/11/2020.

3 . Ext.P3 – Counterfoil of fund transfer slip.

4 . Ext.P4 – Domestic returnees registration issued by District Collector, Idukki during Covid period (issued for 18/12/2020).

5 . Ext.P5 – Entry pass, issued by Kumily Grama Panchayath.

Subsequently, opposite parties filed copy of 6 documents which were  marked as Exts.R1 to R6 as follows.  No oral evidence was adduced by opposite parties.

1 . Ext.R1 – RBI circular dated 31/01/2002 issued to all Primary Urban Co-Operative Banks regarding interest rates on deposits offered.

2 . Ext.R2 – Inspection report of RBI dated 10/07/2004.

3 . Ext.R3 – Minutes of the Board Meeting dated 10/09/2004.

4 . Ext.R4 – Deposit receipt dated 03/04/2000. (This and Ext.P1 are same)

5 . Ext.R5 – Debit slip 106135 Suspense A/c for Rs.16150/- and payee is shown as Ammu Unnikrishnan.

6 . Ext.R6 – RTGS/NEFT Application Form (in original)

 

 

(Cont....5)

-5-

We have examined the pleadings of both sides and perused the records produced.  On a careful analysis of the same, following points arise for consideration.

1 . Whether the complainant is bad for non-joinder of necessary parties?

2 . Whether there is deficiency in service or unfair trade practice on the side of opposite parties?

3 . If so, for what reliefs the complainant is entitled to?

4 . Reliefs and costs?

Point No.1

Contention of opposite parties is that complaint is bad for non-joinder of necessary parties.  It is seen that Ext.P1 deposit receipt was signed by Secretary and accountant with bank’s seal.  A customer/ consumer of an Urban or other Co-Operative banks need not know the official structuring of each bank.  Normally, Secretary is the head of the primary and Urban Co-Operative banks.  Similarly, complainant had incorporated name of opposite party bank.  A bank can sue or be sued only through some authorised person as the bank is a perpetual legal entity.  She had mentioned the name of President & Secretary on behalf of the bank.  Being a legal entity, acts of its officials are binding on banks and it has vicarious liability for the same.  Issuance of Fixed Deposit receipt  was for and on behalf of the bank. Moreover, Chairman and General Manager have filed written version on behalf of the bank.   In these circumstances contention of the opposite parties is found to be unsustainable.  Hence overruled.  Point No.1 is answered as above.

 

(Cont....6)

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Point Nos.2 and 3 are considered together

The main allegation of the complainant is that though FD receipt was issued showing maturity value as Rs.25,000/-, opposite party bank had given only Rs.16150/-.  On the other hand, contention of opposite parties is that as per direction of RBI, interest has been reduced and the maximum rate of interest of Rs.8.5% was given which can be given by a Co-Operative bank.  Opposite parties claimed that they have already issued letter to one Joseph Kurian in 2004, who is stated by them to be the person who had deposited the amount on behalf of complainant.  On a perusal of fixed deposit, it is seen that it was issued in the name of complainant.  Learned counsel for the opposite parties contented that in the fixed deposit receipt itself, seal was affixed stating that “rate of interest may be changed in terms of statutory direction of RBI”.  On going through Ext.R2, it is seen that certain mismanagement was occurred in the bank for certain periods and the direction was issued by RBI after conducting the inspection in 2004.  Though opposite parties contented that as per RBI direction, interest was reduced, no rate of interest is seen entered in fixed deposit receipt.  Interest rate portion is kept blank.  Only the deposited amount and maturity amount with period of investment is shown.  Mere affixing of a seal on the fixed deposit  stating that interest rate will be varied according to RBI directions is not sufficient to sustain their contention.  Moreover, once the bank offered a maturity amount to a customer, they are estopped from denying the amount or allowing any lesser amount stating some legal impediments.    It is a contract  between the bank and the customer.  The doctrine of promissory estoppel come into play.  On going through Ext.R1 and clause 3.2 of Ext.R2 , it is seen that there was no direction to reduce the interest rate already offered on fixed deposit.  In clause 3.2 of Ext.R2 it is stated that bank should take immediate steps to reduce the interest rate offered for term deposit so that they are comparable

(Cont....7)

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with the rates offered by commercial banks.  In Ext.R1, it is stated that it is desirable for Urban Co-Operative bank to reduce their costs of funds by raising the percentage of low cost deposit in their deposit mix and by aligning the interest rates in tune with the market rates.  Nowhere, it is stated that it has any retrospective effect or to reduce interest rate on existing fixed deposits.  Legally it is not possible also.  Above all, the Hon’ble National Consumer Disputes Redressal Commission had held in BRIG. B.K.Bhadari Vs SBI (Ex.State Bank of Indore IV (2015) CPJ 14 (NC)) held that “loss of interest amount is deficiency in service.    Circular issued by RBI can never apply retrospectively or in respect of running fixed deposit receipts”.  In the above mentioned circumstances it is explicit that the opposite parties have made a vain attempt to not give maturity amount to the complainant.  The above mentioned facts show that there is deficiency in service and unfair trade practice on the side of opposite parties for which they are liable to make good the loss and hardship caused to the complainant.  In these circumstances we find that, complainant is entitled to get the balance maturity amount of Rs.8850/- from opposite party bank as per Ext.P1 with interest @ 9% from 03/04/2020 till payment.  Besides, she   is also entitled to compensation of Rs.10,000/- for the mental agony and hardship caused to her by the irresponsible attitude and wrong action on the part of opposite party bank.  She is also entitled to litigation cost of Rs.5000/-.  Point Nos.2 and 3 are answered  as above.

Point No.4

In the light of our finding on point Nos.2 and 3 , we direct opposite party bank and its authorised officer to pay the differential maturity amount of Rs.8850/- as per Ext.P1 with 9% interest from 03/04/2020 with compensation of Rs.10,000/- and litigation cost of Rs.5,000/- to  the

 

(Cont....8)

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complainant within 30 days of receipt of this order.  Bank shall be liable  to pay interest @ 9% per annum on compensation also from the date of this order with interest ordered on differential maturity amount.  Litigation cost will not carry any interest.

In the result, complaint is allowed in part as mentioned above.

Parties shall take back extra copies without delay.

Pronounced by this Commission on this the 16^th  day of May 2023.

 

                                                                                                Sd/-

                                                                            SRI.AMPADY K.S., MEMBER

                                                                                            Sd/-                                                                

                                                                 SRI.C.SURESHKUMAR, PRESIDENT

                                                                                            Sd/-

                                                                        SMT.ASAMOL P., MEMBER

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Cont....9)

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APPENDIX

Depositions :

On the side of the Complainant :

Nil

On the side of the Opposite Party :

Nil.

Exhibits :

On the side of the Complainant :

Ext.P1 – Jeevan Suraksha Deposit receipt dated 03/04/2000 in the name of

              complainant for an amount of Rs.1367/- with maturity value

                   Rs.25,000/- on 03/04/2020.

Ext.P2 – SB Account Pass Book first  page  in the name of complainant in

               SBI with entries from 25/09/2019 to 18/11/2020.

Ext.P3 – Counterfoil of fund transfer slip.

Ext.P4 – Domestic returnees registration issued by District Collector, Idukki  

               during Covid period (issued for 18/12/2020).

Ext.P5 – Entry pass, issued by Kumily Grama Panchayath

 On the side of the Opposite Party :

Ext.R1 – RBI circular dated 31/01/2002 issued to all Primary Urban Co-

                Operative Banks regarding interest rates on deposits offered.

Ext.R2 – Inspection report of RBI dated 10/07/2004.

Ext.R3 – Minutes of the Board Meeting dated 10/09/2004.

Ext.R4 – Deposit receipt dated 03/04/2000. (This and Ext.P1 are same)

Ext.R5 – Debit slip 106135 Suspense A/c for Rs.16150/- and payee is shown    

               as Ammu Unnikrishnan.

Ext.R6 – RTGS/NEFT Application Form (in original)

 

 

                                                                                              Forwarded by Order  

 

 

                                                                                        ASSISTANT REGISTRAR