BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 28^th DAY OF MARCH 2024

ORDER

SMT. K. ANITA SHIVAKUMAR, MEMBER

Complaint filed U/S 35 of Consumer Protection Act 2019, seeking direction to OP to pay a total sum of Rs.50,00,000/- towards compensation, in spite of expenses incurred, harassment and mental agony, caused due to deficiency of service and Unfair Trade Practice by OP, to pay legal expenses on such other reliefs.

2. Brief facts of this case are as follows:-

Complainant being a doctor by profession, specialized in ophthalmology, having high reputation in the society in the field of medical profession, is having “priority savings bank account” No.913010007074619, with the OP since 15 years, the said account is qualified as “priority account”. Complainant has not availed any loan facility from OP, no adverse record against complainant in the field of financial transactions with the OP bank. Complainant stated that the Savings Bank account facility is being maintained by account holder/complainant, strictly in account with the standard terms and conditions and she further stated that she had submitted the necessary KYC documents namely Adhar Card, PAN card,. etc. at the time of opening of the bank account. The said Savings Bank account was having substantial credit balance at any given point of time.

3. Complainant further stated that during the month of May 2023 (03.05.2023 to 24.05.2023) the complainant with her husband had planned a holiday trip to Amster Dam (for 4 days), Baltic Cruise (14 days) and Abu dabi (3nights and 4 days) by paying entire money for travel. The said holiday was subsequently planned in advance and necessary travel and sightseeing arrangement was also planned. In order to complete the above holiday from the hectic professional schedule, the amount lying in her savings account about Rs.16,00,000/- was supposed to be used for said purpose through/via international debit card provided by OP in respect of SB account of the complainant maintained by her with the OP was supposed to be used during the period of 03.05.2023 to 24.05.2023. Before taking the holiday travel, complainant frequently visited OP bank for one or the other enquiries and transaction with the OP. During the said visits, OP never raised any issues in respect of Re-KYC compliance. After reaching the Bangalore International Airport for the above travel, to the utter shock and surprise to the complainant that OP bank freezed the savings bank account without any prior intimation to the reason best known to OP which resulted into very serious financial crisis despite the account was having sufficient credit plan of Rs.16,28,113/-.

4. Complainant further stated that declaring the Savings Bank account of complainant by OP under category “high risk category” and freezing the account, amounts to deficiency of service and Unfair Trade Practice. The entire holiday planned by her at abroad had costs more than 20 lakhs which incurred, visa, Air Travel ticket, cruise expenses and accommodation. Complainant and her family was expected to spend their own money for visit, sightseeing and every day to day miscellaneous expenses from their own pocket during the trip. The agreed facility utilized by the complainant is meant of utilizing the fund from the savings bank account, complainant had with OP bank. Complainant was not able to take money for sightseeing trips organized by the cruise due to lack of fund. Due to the sudden freeze of Savings Bank account of complainant without any prior intimation or any advance notice, the serious financial problem arised when travelling abroad without any money for their day to day expenses, despite having huge credit plan in her account, is clear case of deficiency of service and Unfair Trade Practice.

5. It is pertinent to note that these all above stated reasons calling under hardship and deprived of utilizing their own money when it was genuinely required for food, shelter and clothing in foreign country. It is pathetic case of complainant that they have to constrained themselves from buying even a water and food when they went outside. Due to the Unfair Trade Practice of OP, complainant and her family had suffered during the whole trip from 03.05.2023 to 24.05.2023. It has become “pressure trip instead of pleasure trip”. The entire trip had been spoiled by OP by the arbitrary attitude without following any rule of law.

6. Complainant further stated that after completing their immigration formalities at the Bangalore International Airport for their travel, when they went to transfer sum funds to other accounts they have realized, their account was freezed. Immediately noticing the same the complainant contacted OP bank to defreezing the account explaining the requirement of utilizing of fund from their account during the travel as stated supra. OP responded that the same will be recovered immediately after complainant has given intimation. Further OP has not rectified the account till the complainant returned to India. Complainant in this regard made series of communication with OP through phone, E-mail communication, whatsapp. Complainant in order to clear the issue, when she was in cruise also sent all the required documents through whatsapp. Despite receiving the same, OP had restrained the saving account to normal operations and changed the category to ‘medium risk’ within half an hour without asking for any Re-KYC requirements, for the reasons best known to OP. Therefore complainant prayed to allow this complaint, therefore this OP should learn a lesson and should not repeat the same to the other customer of the bank when they visit a pilgrimages and abroad trips. Complainant has given the detailed expenses that she incurred, for about Rs.19,69,000/-. Hence she prayed for the relief she sought above from OP for her sufferings, inconvenience and deprived by enjoying the holiday trip which was she planned to have.

7. Notice sent to OP through RPAD, represented through counsel filed version along with 2 documents. OP denied all the allegations against the bank made in the complaint and admitted that complainant has maintained SB account No.913010007074619 with OP bank and her account was due for Re-KYC with effect from 17.11.2022 as per the guidelines of RBI. OP stated in its version that bank has sent several reminders through E-mail, SMSs to the complainant’s registered E-mail ID to comply with her Re-KYC due’s by submitting necessary documents. In spite of several requests, complainant failed to submit the necessary Re-KYC documents, hence OP has sent SMS and E-mail communications to her registered E-mail Id and mobile number to furnish the same. They also stated that in case of non adherence to the same, account will be meant to deep freeze (including ECS and stating instructions). The said communications duly received through E-mail and SMSs by complainant on 24.03.2023 and 31.03.2023 respectively. Accordingly OP has imposed deep freeze on account of the complainant on 21.04.2023 as per the RBI guidelines, hence there is deficiency of service on part of OP as alleged by complainant and OP prayed for dismissal of the present case with exemplary cost.

8. At this stage complainant lead evidences by way of filing affidavit along with Certificate U/S 65 B of Indian Evidence Act with 5 documents which are marked as Ex.P.1 to Ex.P.6. Subsequently, one Roshan V.P, Vice President and Branch head of Axis Bank Limited, has filed affidavit evidence on behalf of OP bank along with documentary evidences by filing 4 documents and Certificate U/S 65 B on Indian Evidence Act. Both the counsels filed written arguments. Complainant counsel also filed memo and citations and OPs counsel filed memo with copy of SBI account opening form. Heard both the counsels and perused the materials on record.

9. On the basis of above pleadings for our consideration are as follows:-

i) Whether the complainant proves the deficiency of service on the part of OP?

ii) Whether complainant is entitled for the relief?

iii) What order?

10.  Our answers to the above points are as follows:-

Point No.1:- Affirmative.

Point No.2:- Partly Affirmative.

Point No.3:- As per the final order.

                      REASONS

11. Point No.1&2:- These points are inter-connected to each other and for the sake of convenience, to avoid repetition of facts, these points are taken up together for common discussion.

12. By perusing the pleadings and evidences placed before this commission, it is admitted that complainant has SB account at OP bank since 15 years and she maintained her account with heavy amount in her account. It is also not disputed that, she being a medical professional, planned to go for vacation trip from 03.05.2023 to 24.05.2023 with her husband. As per her tour plan to Amster Dam for 4 days, Baltic Cruse for 14 days and Abu Dabi for 4 days, she paid entire travel expenses and booked her tickets priorly. In order to complete the above holiday from her hectic professional schedule about Rs.16,00,000/-amount lying in her account was kept only to utilize for the said purpose through international debit card facility provided by OP. Complainant has produced her said account for the period of 01.04.2023 to 30.05.2023 which is at Ex.P.1. Complainant and her husband travelled from Bangalore to Abu Dabi on 03.05.2023 from Bangalore International Airport on the same day from Abu Dabi to Amster Dam. She also booked her return ticket on 20.05.2023, reached Bangalore from Amster Dam on 24.05.2023. The air tickets are produced in Ex.P.2. After going through the complaint, here the dispute arised only with regard to the bank transaction which was withheld by OP bank on the ground that the complainant has not produced the documents for Re-KYC. Hence the discussion about the trip plan and air ticket is not much required here. As alleged by the complainant, she visited frequently to the OP bank before going to holiday trip, OP bank has not informed about the Re-KYC to the SB account of complainant. Subsequently OP bank raised an issue in respect of RE-KYC compliance after reaching Bangalore International Airport for the above said travel. With utter shock and surprise and without any prior intimation to the complainant, OP bank freezed the savings bank account of complainant caused very serious financial crisis during the time travel dispute the account was having credit plan of Rs.16,28,114/-.

13. Here the question arises whether OP bank has rightly freezed the SB account of the complainant or not?

Firstly we should know more about the KYC which means “KNOW YOUR CUSTOMER” is generally completed by the bank opening the account for its customers. It is the process of verifying the identity of customer with an objective to protect bank transaction being used, by economical element for many illegal activities. It means the main objective of KYC and Re-KYC is providing security/protection to the money of customers with the help of bank and co-ordination with the customers. As per the Re-KYC at the time of opening their accounts in the bank, for high risk category accounts, Re-KYC has to be complied for every 2years. In the medium risk account, for every 8 years, customers has to comply by providing their updated information from his side to bank to protect his money as per Ex.R.1. As complainant stated in her complaint, her SB account was received as “priority account”, means for every 2 years the Re-KYC should be complied by updating information’s. The objective of Re-KYC is, if any of the personal or contact information changed during the period, customer must inform/update the same to the bank.

14. Complainant alleged that she visited frequently to the bank prior to travel, OP bank has not informed about the Re-KYC and later when she reaches Airport on the date of travel, she received a message of freezing her account on the ground that Re-KYC has not complied. When her SB account is a ‘high risk category’, the account must be complied with Re-KYC for over 2 years. But OP has not taken any stand that they have complied the Re-KYC earlier to this, because complainant has her account and maintained in the OP bank since 15 years, means OP could do Re-KYC a several times earlier to this and OP not stated any information about previous Re-KYC. When the re-KYC has not done in its regular interval, as per the RBI guidelines OP bank and its officials has committed mistake, not by the complainant. But OP bank has taken contention that, they sent E-mails and SMS’s to registered E-mail ID and mobile number of the complainant. Complainant has produced E-mail communication between the OP bank which is at Ex.P.5, reveals that she has not received any SMS’s to her registered mobile number. The OP sent E-mail on 19.07.2023 with attaching SMS’s sent on 22.03.2023 and 31.03.2023 which are auto-generated SMS’s. Generally in our observation, banks send to their customers a several SMS’s and E-mail not particularly to one customer. They used to send auto-generated messages to all its customer, at the last they states that “ignore if already updated”, it does not give any serious stand by bank to the above customer. In our observation several telephone calls used to received by the public by bank, insurance companies and other service providers offering and for availing services from banks and insurance companies. In this above case, bank could have call directly to the customer/complainant for compliance of re-KYC instead of sending SMS’s and E-mails and also says to ignore if updated, doesn’t give any seriousness about the information.

15. It is pertinent to note that OP bank has not submitted any information about Re-KYC compliance pertains to the complainant before this. OP in its version stated that complainant’s account was overdue with Re-KYC with affect from 17.11.2022 as per RBI guidelines in Ex.P.5. In Ex.P.7, OP has imposed deposit freezing on her account on 21.04.2023 as per the guidelines. Here in our view there is an year time available for the customer to comply with re-KYC after the date of expiry of KYC which means from 17.11.2022 to 17.11.2023, 12 months of time bound available for the complainant for compliance in between the due period of 1 year, OP bank freezes the complainant’s account prior to year, is unfair and unjust. In our considered view, KYC is necessary to open the account with the bank but re-KYC is only updated information obtained by the bank if any changes with the information of the customer, if the customer has not provided any updation, there is no point in freezing the account and deprived her by using her own money, which she reserved for the enjoyment and vacation trip with family. When the person saved hard earned money for their comforts, is not available during the time of convenience and at the time of requirements, OP bank does not have right to freezing the account and deprive by her facility. Hence with all these observation OP bank has committed mistake by freezing her account, deprived by the utilization of amount at the time of requirement, does not have any sense and caused deficiency of service.

16. It is pertinent to note that the account of complainant freezed on 21.04.2023, but the complainant had transaction on 02.05.2023 and 26.05.2023, as per Ex.P.1. If in case those transactions not materialized, complainant got to know before leaving the country and could sort out the problem. Since the complainant has travelled between 03.05.2023 to 24.05.2023, she was not in position to transact amount with OP bank. When she received the message of re-KYC compliance, she tried to contact the OP bank to defreeze the account expending the requirement of utilization on force from their account during their travel. Though OP responded to it and stated that the same will be utilized immediately but not have done till she return to India. Complainant stated in her complaint that the entire holiday plan at abroad, had costed more than Rs.20,00,000/- which includes visa, air travel, cruise travel expenses and accommodation as booked prior to travel but she was supposed to spend money for food, sightseeing and other day to day miscellaneous expenses from other expenditure, was uncomfortable during that time, due to the act of OP bank. We can assume the situation of complainant without having money, borrow for each and every from Co-passengers at strange place, surely humiliation, embarrassment and the entire trip spoilt due to the act of bank.  Complainant after noticing the sudden freezing of savings bank of account without any prior intimation or advance notice, putting her in serious financial crisis, despite having substantial credit plan in her account, due to the act of OP bank. Immediately noticing the freezing of account she contacted OP to defreeze it by sending the required documents to them through whatsapp but OP did not take caution to set right the issue.

17. Complainant has claimed the inconvenience caused to her during the travel and also claimed the amount for the deficiency of service and Unfair Trade Practice by OP bank. In view of the above reasons complainant is entitled for the compensation from OP bank for depriving and utilizing her own fund which is reserved for the trip, due to the act of OP. Complainant obviously have not enjoyed her trip without having money in her hand for food, hotel, day to day miscellaneous expenses. In our considered view it obviously caused heavy inconvenience to complainant and suffered in the entire trip. For their enjoyment, she already spent Rs.20,00,000/- for booking air tickets, cruise ticket, accommodation, etc. all went in vain. Hence, is entitled for the compensation of Rs.3,00,000/- for deficiency of service and Unfair Trade Practice of OP. OP bank without her fault made her to incur money on filing this complaint to seek justice, hence OP is liable to pay Rs.10,000/- towards cost of litigation. On the above reasons we answer Point No.1&2 accordingly.

18. Point No.3:- In view of the discussion referred above, we proceed to pass the following:-

                                    ORDER

1. Complaint filed by the complainant U/S 35 of Consumer Protection Act, is hereby allowed in part.
2. OP is directed to pay Rs.3,00,000/- towards inconvenience and mental agony caused due to the deficiency of service on the part of OP.
3. OP is further directed to pay Rs.10,000/- towards cost of litigation within 30 days from the date of order, failing which OPs are directed to pay 10% interest p.a. from the date of freezing of her account i.e. 21.04.2023 till realization.
4. Furnish the copies of the order and return the extra copies of pleadings and documents to the parties, with no cost.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 28^th day of March, 2024)

Documents produced by the Complainant-P.W.1 are as follows:

Documents produced by the representative of opposite party – R.W.1;