BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, ERNAKULAM.

Date of filing : 05/05/2010

Date of Order : 31/05/2011

Present :-

Shri. A. Rajesh, President.

Shri. Paul Gomez, Member.

Smt. C.K. Lekhamma, Member.

C.C. No. 276/2010

Between

 

And

O R D E R

A. Rajesh, President.

1. The facts leading to this complaint are as follows :

On 03-01-1992, the complainant joined “Mangalya Deposit Scheme” conducted by the opposite party by depositing a sum of Rs. 7,000/-. As per the scheme, the opposite party agreed to pay Rs. 1,12,000/- on the maturity of the scheme ie. on 04-01-2010. However, the opposite party offered to pay only Rs. 82,014/- instead of Rs. 1,12,000/-. So on 05-01-2010, the complainant preferred to lodge complaint against the Managing Director and the President of the Bank as well as the Joint Registrar, Co-operative Department, but there was no response. Again on 16-02-2010, the complainant caused to issue a complaint to the Registrar, Co-operative Department. The Registrar directed the Joint Registrar, Ernakulam to take appropriate action against the grievances of the complainant, but in vain. Thus, the complainant is before us seeking direction against the opposite party to pay Rs. 1,12,000/- with interest from 03-01-2010 together with Rs. 500/- being the costs of the proceedings and Rs. 5,000/- towards compensation.

2. Version of the opposite party :

During 1986-87, the Government and the Registrar of Co-operative Societies had permitted opposite party to charge interest upto 21% on loans and advances and to pay interest upto 18% on deposits. In anticipation of steady interest, the opposite party introduced various deposit schemes including Mangalya Deposit Scheme. However, the interest rate declined to maximum of 8% as per Circular No. 09/2003 dated 22-02-2003, since the continuance of the scheme affects the very existence of the bank. At the time of joining the scheme, the complainant had undertaken that he will abide by the rules as applicable from time to time. The opposite party was not in a position to continue with the scheme. The Managing Committee of the opposite party resolved to stop the scheme with effect from 15-03-2005 and the matter was intimated to the complainant. The opposite party was ready to pay Rs. 54,032/- the amount accrued on 15-03-2005 with interest approved by the Registrar from time to time. There is neither negligence nor deficiency in service on the part of the opposite party.

3. The complainant was examined as PW1 and Exts. A1 to A13 were marked on his side. No oral evidence was adduced by the opposite party. Exts. B1 to B4 were marked on the side of the opposite party. Heard the complainant who appeared in person and the counsel for the opposite party.

4. The points that arose for consideration are :-

1. Whether the complainant is entitled to get the amount as per Mangalya Deposit Scheme with interest?

2. Compensation and costs of the proceedings?

5. Point No. i. :- The parties are not on dispute in the following issues:

1. The complainant joined “Mangalya Deposit Scheme” with the opposite party on 03-01-1992 evidenced by Ext. A4 receipt.

2. As per the scheme, the date of maturity was 03-01-2010 and the amount on the maturity date was Rs. 1,12,000/-.

3. The complainant lodged Exts. A6 to A10 complaints before various authorities seeking direction against the opposite party to pay the maturity amount.

4. The Registrar, Co-operative Department forwarded his complaint to Joint Registrar, Ernakulam, evident from Ext. A4.

5. Though the opposite party resolved to accord sanction to stop the long term deposit schemes, the Joint Registrar rejected the same vide order dated 05-07-2004 evidenced by Ext. A3 page 16.

6. The opposite party closed the deposit account with effect from 15-03-2005 and offered Rs. 54,032/- and also agreed to pay interest for the amount as per the direction of the Registrar, Co-operative Societies, evident from Ext. B4.

7. The opposite party sent Ext. B4 letter to the complainant evidenced by Ext. B4 (a) certificate of posting.

6. According to the complainant, he is entitled to get the maturity amount of Rs. 1,12,000/- from the opposite party together with interest thereafter. The opposite party vehemently contended that the Hon’ble High Court has considered a writ petition in O.P. No. 27838/2000 (Mohanan Nair Vs. Union of India & 4 Others) under ’Rajalekshmy Unit Scheme’ of the Unit Trust of India and held that deposit holder has no locus-standi to challenge the action of the Unit Trust in terminating the deposit scheme before its maturity. Further, the opposite party stated that the further continuation of the present scheme will affect the very existence of the bank.

7. The Hon’ble Kerala State Consumer Disputes Redressal Commission in Mary Mathai Vs. Kalloorkadu Farmers Co-operative Bank Ltd. III (2010) CPJ 279 against the very same opposite party in an identical matter held in para 9 as follows :

“Evidently the appellants have deposited the amounts taking into confidence that the terms of the above schemes will be complied with by the respondent/bank, the same being a organization fully supported and controlled by the Government. It is after more than a decade that the opposite parties have unilaterally closed the schemes and intimated that they will provide only the prevalent rate of interest. Retreating from the promises made evidently amounts to deficiency in service. We find that there is considerable loss to the complainants on account of the withdrawal of the above schemes. They would have opted for some other social security measures if the opposite parties had not launched the impugned welfare schemes. It is almost in the last phase of the period and in certain cases even after receiving Karshaka pension the schemes have been stopped. It is also pertinent to note to the stoppage of schemes is against the order of the Joint Registrar, Co-operative Societies. The case of the respondents that complainants had agreed to abide by the future terms brought in by the bank cannot be taken as a defense as such as future terms cannot be brought that would terminate the entire scheme itself. There is no clause in the declaration that the opposite parties are empowered or entitled to withdraw the schemes at any time.”

8. In the instant case, as well the opposite party unilaterally closed the deposit account of the complainant with effect from 15-03-2005 and offered Rs. 54,032/- to the complainant, which was evidently not approved even by the Joint Registrar, Co-operatives not to mention higher authorities. The non-approval or ratification of the same by the authorities goes to show that the above conduct of the opposite party is not good at law. Therefore, the opposite party is primarily and contractually liable to pay the maturity amount to the complainant together with the prevailing interest thereafter.

9. The decision submitted by the opposite party is not applicable in the same set of facts especially so because in that case the fluctuation of price in the share market was the focal point which has no pertinence.

10. Point No. ii. :- Since the primary grievance of the complainant has been met squarely, we order no compensation and costs.

11. Accordingly, we partly allow the complaint and direct that, the opposite party shall pay to the complainant the maturity amount (Rs. 1,12,000/-) as per Ext. A4 receipt together with the prevailing interest thereafter till payment.

The order shall be complied with, within a period of one month from the date of receipt of a copy of this order.

Pronounced in open Forum on this the 31^st day of May 2011.