KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAUD, THIRUVANANTHAPURAM.

APPEAL No. 294/2009

JUDGMENT DATED:  12-01-2010

PRESENT:

JUSTICE SHRI. K.R. UDAYABHANU            :  PRESIDENT

SHRI. M.K. ABDULLA SONA                            :  MEMBER

APPELLANT

V. Narayanan Nambeesan,

‘Archana’, P.O. Chevarambalam,

Calicut 673 017.

          (Rep. by Adv. Sri. Mahesh)

                    Vs

RESPONDENT

Industrial Development Bank,

Head Office, IDBI Tower,

Cuffe Parade,

Mumbai 400 005.

(Rep. by Adv. Smt. Rakhi Ravikumar)

JUDGMENT

JUSTICE SHRI. K.R. UDAYABHANU:   PRESIDENT

                        The appellant is the complainant in CC No. 139/2007 in the file of CDRF, Kozhikkode.  The complaint stands dismissed.

          2.          It is the case of the complainant that he had invested Rs. 5,300/- each in 3 IDBI Deep Discount Bonds dated 18-03-1996.  Option was provided to redeem the bonds on 1^st August 2000 for Rs. 10,000/- each; and on December 1^st, 2006 at Rs. 25,000/- each and on September 1^st 2011 at Rs. 50,000/- each.  On 04-04-2007 he sought for the redemption of the bonds.  IDBI was liable to pay Rs. 25,000/- each with interest from the date of maturity.  But he was provided only Rs. 10,000/- for each of the bonds.  He has sought for the balance amount of Rs. 15,000/- each ie, 45,000/- with interest.

          3.          The opposite party/IDBI has contended that the bonds issued by the IDBI for public subscription was in the form of promissory note.  The condition to recall or redemption to the bondholder or IDBI respectively was provided.  The conditions are mentioned in the offer document.  The right to exercise call option on the different dates or redemption by the bondholder was mentioned.  As the lending rates started receding and as it was not commercially viable to pay higher interest on such bonds the IDBI decided to exercise the call option available on 1^st August 2000 by paying Rs, 10,000/- per bond.  The call option notice dated 09-05-2000 was published in the Times of India dated 10^th May 2000.  It was specifically mentioned that no interest on the said bonds will be payable after 1^st August 2000.  The IDBI dispatched the call option notice dated 25-05-2000 to all bondholders including the complainant directing to surrender the bonds by 15-07-2000 and to receive the proceeds by 01-08-2000.  Reminder intimation notice was sent to the complainant vide letter dated 10-10-2000.  The notice and the reminder notice were published in leading national newspapers.  The petitioner forwarded the bonds for the redemption only on 24-04-2007.  He was paid Rs. 10,000/- each vide redemption warrants dated 19-05-2007.

          4.          The evidence adduced consisted of Exts. A1 to A6, and B1 to B7.

          5.          The Counsel for the appellant has relied on the decision of the National Commission in IDBI Bank Ltd and Anr. Vs T.K. Nagarathan [IV (2008) CPJ 136 (NC)] wherein on a similar set of facts the National Commission upheld the orders of the District Forum and the State Commission directing to release the amount due on the redemption date subsequent to the exercise of call option with interest at 10% and costs, as there was no evidence that the complainant therein was personally intimated.  We find that the situation is the same herein also although the amount and the dates are different. In the instant case also Ext.B6 the photocopy of the intimation sent under certificate of posting would not show that the notices were duly served on the complainant.  The copy of the letter sent to the complainant was not produced.  Only a specimen has been produced.  Publication in the newspaper was found by the National Commission in the above cited case as inadequate.  In the light of the above cited decision, we find that the order of the Forum is liable to be set aside; and we do so. 

In the result, the appeal is allowed. The respondent/IDBI is directed to pay the balance amount of Rs. 45,000/- with interest at 8% from 04-07-2007, the date of complaint.  The respondent would also be liable to pay costs of Rs. 2,500/-.  The amounts are to be paid within 3 months from the date of receipt of this order failing which the complainant would be entitled for interest at 12% from today.

                                   JUSTICE K.R. UDAYABHANU    :  PRESIDENT

                                                M.K. ABDULLA SONA                  :  MEMBER