PER MR.B.S.WASEKAR, HON’BLE PRESIDENT

1)  The present complaint has been filed by the complainant under section 12 of the Consumer Protection Act, 1986. According to the complainant, he had invested in GOI RBI 8% saving (taxable) bonds on 05/09/2006 through the B.L.A. in the opponent bank.  These bonds are governed by RBI circular dated 20/05/2005 bearing reference no.RBI/2004-05/477 and RBI circular dated 10/04/2012 bearing reference no.RBI/2011-12/491.  The maturity date of the bonds was 05/09/2012 and maturity value was Rs.8005000/-.  As per RBI guidelines the opponent bank is required to send an advice to the investor one month before the maturity date, notifying him the maturity of the said bonds.  The opponent bank failed to notify the maturity of the bond to the complainant. No advice was sent by the opponent to the complainant.  In May 2014 while the complainant was reviewing his saving account statement, he realized that, the bonds have matured way back in 2012.  Therefore the complainant issued request letter to the opponent.  In spite of several request the opponent failed to redeem the bonds.  Finally on 20/09/2014 i.e. after two years of maturity date, the opponent redeemed the bonds.  Opponent failed to compensate the complainant for delay.  Opponent was deficient in service as per RBI guidelines.  Therefore, the complainant is entitled to recover the amount of Rs.1360682.62 i.e. interest at the rate of 8% p.a. on the maturity value from the date of maturity till the payment.  Therefore, the complainant has filed this complaint for recovery of amount of Rs.1360682.62. He has also claimed compensation of Rs.5,00,000/-, towards mental harassment and cost of litigation. 

2) Opponent appeared and filed written statement.  It is submitted that, the complaint is barred by limitation as the cause of action arose on 05/09/2012 and the complaint is filed after two years from the date of cause of action.  The complainant is not a consumer of this opponent as no consideration was passed to this opponent.  There is no privity of contract therefore the complainant is not entitled.  The complainant failed to redeem the bond on the maturity.  The bonds are already redeemed as per RBI guidelines.  The entire maturity amount was paid on 20/09/2014.  The opponent bank is not the service provider and no consideration was paid to the opponent bank.  Therefore, the complainant is not entitled for the relief as prayed. 

3)   After hearing both the parties and after going through the record, following points arise for our consideration.

POINTS

REASONS

4) As to Point No.1:- There is no dispute that, complainant had purchased GOI RBI 8% saving (taxable) bonds on 05/09/2006 through the B.L.A. in the OP bank. The amount was paid through opponent bank.  As per RBI guidelines opponent bank had received the commission for this transaction.  As the bonds were purchased and the opponent bank received the commission, the complainant is the consumer.  Therefore, the defense of the opponent that complainant is not the consumer cannot be accepted. 

5) As to Point No.2:- The maturity date 05/09/2012 is not in dispute.  It is also not disputed that, the amount was paid to complainant on 20/09/2014. The cause of action arose on 20/09/2014 as the opponent failed to pay interest for the period 05/09/2012 to 20/09/2014.  The complaint is filed on 01/07/2015 i.e. within two years. Therefore, the complaint is within limitation. 

6) As to Point No.3&4:-  The purchase of bonds  are not disputed.  It is not  disputed that, maturity value was paid on 20/09/2014.  The dispute is about the interest from the maturity period till actual payment i.e. from 05/09/2012 to 20/09/2014.  According to the complainant as per RBI guidelines in RBI circular dated 20/05/2005 bearing reference no.RBI/2004-05/477 and RBI circular dated 10/04/2012 bearing reference no.RBI/2011-12/491, the complainant is entitled for interest at the rate of 8% p.a. from maturity date till actual payment.  The complainant has produced copies of these RBI circulars.  We think it just to reproduce para-2 of RBI circular dated 10/04/2012 bearing reference no.RBI/2011-12/491, as under:-

2.  Under the present scenario of deregulated interest rate on the saving bank account, in order to avoid ambiguity and variation in compensation rates across different agency banks, these instructions have been reviewed.  It has now been decided that with effect from the date of this circular, an agency bank shall compensate an investor in Relief/Savings bonds, for the financial loss due to late receipt/delayed credit of interest warranty/maturity value, at a fixed rate of 8% per annum.

        On perusal of para-2 of this circular it is clear that, the complainant is entitled for interest at fixed rate of 8% p.a.  This circular is dated 10/04/2012 and the bonds are matured on 20/09/2012. Therefore, this circular is binding on the opponent bank. As per this circular it was necessary for the opponent to pay fixed rate of interest i.e. 8% p.a.  There is no evidence on record to show that, intimation was given to the complainant about the maturity of bond prior to the maturity date.  As per these circulars the complainant is entitled for interest, irrespective of the fault. The complainant suffered loss as interest was not paid for the period 05/09/2012 to 20/09/2014.  As per the above said circulars the complainant is entitled for fixed rate of interest at the rate of 8% p.a.  The opponent bank has refused to pay the interest thereby the opponent bank is deficient in service.  Therefore, the complainant is entitled for fixed rate of interest for the period 05/09/2012 to 20/09/ 2014. 

         The complainant has claimed interest on the maturity amount.  He is not entitled for the interest on the maturity amount. He is entitled for interest on the invested amount i.e. Rs.50,00,000/-  which  comes to Rs.8,16,438/-.  Besides this the complainant has claimed compensation of Rs.5,00,000/- towards mental harassment. We are giving relief of interest. Therefore, he is not entitled for more compensation.  However, he is entitled for litigation cost of Rs.10,000/- Hence, we proceed to pass the following order.

ORDER

1. Complaint is partly allowed.

2. The O.P. is directed to pay amount of Rs.8,16,438/- (Rs.  Eight lakh Sixteen thousand Four hundred Thirty eight only) to the complainant with interest at the rate of 8% per annum from the date of filling of the complaint i.e.1^st July 2015 till its realization.

3. The O.P. bank is directed to pay Rs.10,000/- (Rs. Ten Thousand Only) to the complainant as cost of this proceeding.

4. The above order shall be complied with within a period of one month from today.

5. Copies of this order be sent to the parties free of cost.

 Pronounced on 19^th August, 2016