The District Consumer Disputes Redressal Forum District Office Premises, Kolar 563 101. consumer case(CC) No. CC/10/80
V..R. Marishamaiaha
...........Appellant(s)
Vs.
Manager
...........Respondent(s)
BEFORE:
Complainant(s)/Appellant(s):
OppositeParty/Respondent(s):
OppositeParty/Respondent(s):
OppositeParty/Respondent(s):
ORDER
CC Filed on 22.06.2010 Disposed on 06.10.2010 BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, KOLAR. Dated: 06th day of October 2010 PRESENT: Sri. G.V.HEGDE, President. Sri. T.NAGARAJA, Member. Smt. K.G.SHANTALA, Member. --- Consumer Complaint No. 80/2010 Between: Sri. V.R. Marishamaiah, S/o. Late Rudhrappa, Vokkaleri Village, Kolar Taluk. .Complainant V/S The Manager, Canara Bank, Vokkaleri Branch, Kolar Taluk. (By Advocate Sri. N.G. Vasudev Murthy) .Opposite Party ORDERS This is a complaint filed under section 12 of the Consumer Protection Act, 1986 praying for a direction against the opposite party to pay compensation of Rs.1,000/- with costs and interest for the deficiency in service on the part of OP. 2. The complaint is filed by the complainant in person. From the records and documents filed by the parties the material facts required for disposal of the controversy between parties may be stated as follows: That the complainant has opened S.B. Account No. 3253 with OP Bank about in 1990s. The complainant had obtained from time to time different loans for which he was entitled to. He had also obtained cow loan from OP about in 2003. Certain amount was outstanding in that cow loan account. It appears the OP Bank introduced one time settlement of cow loan extending certain benefits as per their guidelines. It is said that the complainant also took benefit of that scheme and got waiver of outstanding balance in the cow loan account. It appears on 06.03.2006 there was a balance of Rs.108/- in the S.B. Account No. 3253 of complainant. This balance was taken to the credit of cow loan account by the OP before waiving the cow loan outstanding amount. Therefore the balance in the S.B. Account 3253 became nil subsequent to 06.03.2006. It appears the said S.B. Account was not operated by complainant till 06.01.2009. The complainant obtained a Government cheque for Rs.1,000/- towards some beneficiary scheme extended by Government to poor farmers. The complainant intended to encash that Government cheque. Therefore he approached OP Bank. The complainant credited cash of Rs.100/- on 06.01.2009 and he deposited the Government cheque for Rs.1,000/- on 17.01.2009 for collection. On the same day i.e. on 17.01.2009 there are three debit entries in the S.B. Account 3253 for Rs.68/-, Rs.480/- & Rs.59/- stating to be the debit entries relating to cheque collection commission, service charge for not maintaining minimum balance and service tax respectively. Subsequently on 31.01.2009 there are two debit entries in the S.B. Account for Rs.20/- and Rs.2/- towards service charge for not maintaining minimum balance and service tax respectively. The complainant made his grievances in respect of these debit entries. Then the debit entry of Rs.68/- dated 17.01.2009 towards cheque collection commission is reversed and a credit entry is shown for this amount on 22.04.2009. The complainant has grievance regarding debit entries made towards service charge for non-maintaining minimum balance and the consequential debit entries for service tax. Therefore he filed the present complaint. 3. OP appeared and contended that the debit entries made towards service charge for non-maintaining minimum balance is authorized and valid as per the Rules and Regulations of Canara Bank. The OP contended that service charge of Rs.480/- for non-maintenance of minimum balance in respect of the S.B. Account of complainant is as follows: From March 2006 to December 2006 ( 9 months) x 10 Rs.90-00 From January 2007 to September 2007 (9 months) x 10 Rs.90-00 From October 2007 to December 2008 (15 months) x 20 Rs.300-00 ----------- Rs.480-00 ----------- 4. The following points arise for our consideration: Point No.1: Whether the debit entries towards non-maintenance of minimum balance are valid? Point No.2: If not what shall be the order? 5. After considering the materials on records and submissions of the parties our findings on the above points are as follows: Point No.1: During the argument the Branch Manager of OP.1 was present in person with his Learned Advocate and enlightened us regarding the Rules in existence for service charges to be levied for non-maintenance of minimum balances and for inoperative accounts held by customers. The perusal of the relevant instructions for levying service charges in respect of inoperative S.B. accounts and non-maintenance of minimum balance in the S.B. Account, shows that the service charges for them are as follows: (a) For levying service charge for inoperative S.B. accounts:- if the balance is Rs.100/- or more no charge and if the balance is less than Rs.100/- but more than Rs.20/- the service charge of Rs.10/- per half year should be levied in the months of February and August, in addition to the service charges to be levied for non-maintenance of minimum balance. It is told that if an account is not operated for a continuous period of two years the account is treated as inoperative account. (b) For levying service charge for non-maintenance of minimum balance in S.B. account is Rs.10/- per occasion. It is told that the Bank has prescribed a minimum balance for different kinds of accounts and in case of S.B. account where cheque book facility is not provided the minimum balance to be maintained is prescribed at Rs.100/-. The above rates were revised w.e.f 01.10.2007 by Circular No. 231/2007, dated 28.08.2007. The revised rates are stated in clauses 10 & 11 of the said Circular and it is as follows: 10. Charges for Non-Maintenance of Minimum Balance (applicable for both Operative and In-operative accounts) : When the balance falls below the applicable minimum for the respective branch / account category : i) SB Accounts Flat Charge of Rs.20/- per month (to be collected once in a month on last working day) ii) Current Accounts Rs.50/- per day. Maximum Rs.250/- per calendar month (to be collected once in a month on last working day) 11. Charges for In-operative Accounts (Half Yearly Service Charge) i) In-operative SB Accounts a. If balance in the account is above the applicable minimum (for particular branch category, for without cheque book slab), No charge. b. If balance is below applicable minimum, service charge of Rs.30/- or available balance whichever is lower, is to be collected half yearly (for inoperative accounts other than unclaimed deposits). Branch to necessarily review and take up for closure of such accounts if revival is not possible. The said circular shows that after a gap of nine years the revision in service charges is effected and that all other existing instructions continue to apply. The Manual of Instructions revised upto 31st March 2001 at page 129 contains a para which is in the nature of explanation for levying service charges for inoperative accounts and non-maintenance of minimum balance in the account. The said para is as follows: Where the balance in the account is insufficient to cover the service charges to be levied, the same should be recovered from subsequent/future credits. Further in cases where the balances available in SB & CA/cs continue to be insufficient to cover the service charges, branches may adopt the following: (i) To send a registered notice to the account holder, giving 15 days time to regularise his account or to close his account. (ii) If the account holder fails to comply with the above, close the account and transfer the proceeds to Commission Miscellaneous. Now coming to the facts of the present case, it is submitted that in the case of complainant he was required to maintain minimum balance of Rs.100/- in his S.B. account and the balance was nil in his S.B. account from 06.03.2006 to 06.01.2009. Therefore it is contended that the OP could have levied even service charge for inoperative account apart from levying service charge for not maintaining required minimum balance. It is submitted in respect of the para above extracted which is in the nature of explanation, that the Bank may adopt the procedure laid down there or it may continued to go on levying the service charges for inoperative account and non-maintenance of minimum balance and the same may be recovered from subsequent/future credits. The balance in S.B. account of complainant became nil on 06.03.2006 as the balance amount of Rs.108/- was transferred to cow loan account while extending the benefit of waiver of cow loan to complainant. Subsequently the complainant turned up to Bank only on 06.01.2009 for encashing a cheque for Rs.1,000/- which was issued by Government under some beneficial scheme to farmers and he deposited Rs.100/- to his account on the same day and subsequently handed over the cheque to the Bank for collection. Thereafter the debit entry for non-maintenance of minimum balance and the consequential service tax were made. We think the Head of the Branch should properly apply his mind regarding the different courses to be adopted in case the balance in the account is insufficient to cover the service charges to be levied. We think for an indefinite period the Bank cannot go on accumulating the service charges on these heads and recover it from subsequent credits after long lapse of time. What is reasonable time to wait for closing the account, may depend on the nature of account and the way in which transactions were carried by the customer in the said account. The account becomes inoperative if it is not dealt with by the customer by continuously for a period of two years. The Instructions show that if the balance is insufficient to cover the applicable service charge, the Branch has to take steps for closure of such accounts if revival is not intended by the customer. Therefore we think if an account becomes inoperative for a period of six months and the minimum balance available in the account is below the service charges to be levied under these heads, the account should be closed after issue of a register notice and if the customer does not turn up to revive the account. In the present case, for a period of three years the OP went on accumulating the service charges for non-maintenance of minimum balance and when the cheque for Rs.1,000/- was realized the entire accumulated service charges of Rs.480/- and the consequential service tax were debited to the account of complainant. The Head of the Branch should also keep in mind the monetary loss to be incurred by the customer for the shortcomings of non-maintenance of minimum balance and inoperative account. In the present case, we think when the minimum balance of Rs.108/- was transferred to cow loan account on 06.03.2006 from the S.B. account of complainant, the OP should have closed the said S.B. Account after issue of a notice to complainant. Therefore we think the debit entries towards service charge for not maintaining minimum balance and the payment of service tax on it are not valid and they are not in accordance with the guidelines issued by the Canara Bank. Hence point No.1 is held in negative. Point No.2: The OP may be directed to reverse the entries in the S.B. Account of complainant dated 17.01.2009 and 31.01.2009 in respect of levying service charges and paying service tax for non-maintenance of minimum charge. Hence we pass the following: O R D E R The complaint is allowed with costs of Rs.250/-. The OP shall reverse the debit entries regarding service charges and payment of service tax made on 17.01.2009 and 31.01.2009 in the S.B. account 3253 of complainant, within 30 days from the date of this order. Dictated to the Stenographer, corrected and pronounced in open Forum this the 06th day of October 2010. MEMBER MEMBER PRESIDENT
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