RESERVED

STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

                               UTTAR PRADESH, LUCKNOW

                                    APPEAL NO.  887 OF 2004

        (Against the judgment/order dated 23-03-2004 in Complaint Case

                          No.974/2000 of the District Consumer Forum-II, Lucknow )

          Union of India

Through the Senior Post Master

Head Post Office Chowk

Lucknow

                                                                                            ...Appellant

                                                     Vs

01.N. K.Mandwal

S/o Late Sri B K Mandwal

R/o 414/7 Sarai Malikhan

Chowk, Lucknow

02.A K Mandwal

S/o Sri N K Mandwal

R/o 414/7 Sarai Malikhan

Chowk, Lucknow

03.Smt. Rukhsana Begum

C/o Apex Consultant

Sri Balaji Market, Khun Khunji Road

Chowk, Lucknow.

                                                                                            ...Respondents

BEFORE:

HON'BLE MR. JUSTICE AKHTER HUSAIN KHAN, PRESIDENT

For the Appellant                        :  Dr. Uday Veer Singh, Advocate.

For the Respondents No.1           :  Sri Vimal Kumar, Advocate.

For the Respondent No.2            :  None appeared                

Dated :  22-09-2017

                                            JUDGMENT

MR. JUSTICE A. H. KHAN, PRESIDENT (ORAL)

This is an appeal filed under Section-15 of the Consumer Protection Act 1986 against the judgment and order dated 23-03-2004 passed by the District Consumer Forum-II, Lucknow in Complaint No.974/2000 N K Mandwal and A K Mandwal V/s Head Post Master, Head Post Office, Chowk, Lucknow whereby the District Consumer Forum has allowed complaint and ordered opposite party to make payment of Rs.1,44,000/- to complainants with interest calculated at the rate of 9% per annum from 01-05-2000 within one month from the date of judgment. The District

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Consumer Forum has further ordered opposite party to pay Rs.1,000/- as cost of the complaint. The District Consumer Forum has ordered if the above amount is not paid within stipulated period the rate of interest shall be 12% per annum.

Feeling aggrieved with the judgment and order passed by the District Consumer Forum opposite party of the complaint Union of India through Senior Post Master, Head Post Office Chowk, Lucknow has filed this appeal.

Dr. Uday Veer Singh, learned Counsel for the appellant appeared.

Sri Vimal Kumar, learned Counsel for the respondents no.1  and 2 appeared.

None appeared for respondent no.3.

I have heard learned Counsel for the parties and perused impugned judgment and order as well as records.

In brief relevant facts for determination of appeal are that the complainants N K Mandwal and A K Mandwal have filed above complaint before District Consumer Forum against opposite party  Head Post Master, Head Post Office Chowk, Lucknow wherein it has been alleged that the complainants had jointly opened three separate accounts bearing Account Nos. 001716, 001731 and 001737 on 08-08-1995, 19-08-1995 and 22-08-1995 respectively and have deposited Rs.48,000/- in each account totalling Rs.1,44,000/-  for six years in the post office of opposite party. The passbook was issued to them. Thereafter in year 1996 respondents/complainants gave the passbook to agent for collecting monthly interest. They gave withdrawal form also to agent with their signature. The agent paid interest to them till April,2000 and stopped payment thereafter. Consequently the complainants asked agent to return passbook but the agent told them that the passbook has been misplaced. Therefore respondents/complainants wrote a letter to opposite party on 23-05-2000 to issue duplicate passbook but the opposite party did not issue duplicate passbook.

Following prayer has been made in complaint. 

01.To direct the respondent to issue duplicate passbook to the

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complainants of the aforesaid account numbers i.e. Account Nos.   001716, 001731 and 001737.

02.To direct the opposite party to pay interest for the month of May, 2000, June, 2000, July, 2000 and August, 2000.

03.To direct the opposite party to pay regular interest till the date of maturity i.e. upto July, 2001.

04.To award 10,000/- as damages for mental harassment.

05.To award cost of the complaint.

The Appellant/opposite party has filed written statement before District Consumer Forum wherein it has been stated that complainants had opened three separate accounts as stated in complaint. They had opened accounts through agent and they have received monthly interest payment through their appointed agent.

In written statement it has been further stated that the accounts of complainants have been closed and final amounts have been withdrawn by complainants through their appointed agent/messenger on 10-04-1997. As such duplicate passbook cannot be issued.

In written statement it has also been stated that the National Saving Agents are appointed by National Saving Organization and the District authorities and not by Department of Post Offices.

It has been stated by the opposite party in written statement that no deficiency in service has been committed by it and no cause of action has accrued for the complaint. The complaint is liable to be dismissed.

After having gone through pleadings of the parties as well as evidence on record the District Consumer Forum has drawn conclusion that the opposite party has committed breach of rules and instructions in making premature closure of above five accounts of the complainants as well as in making payments of the amounts of said accounts. As such the opposite party has committed deficiency in service. In view of conclusion drawn above the District Consumer Forum has allowed complaint and passed order as mentioned above.

Learned Counsel for the appellant has contended that the impugned judgment and order is against law as well as evidence. The District

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Consumer Forum has committed error in granting relief not claimed in complaint.

Learned Counsel for the appellant has further contended that as per Rule/Clause 15 of Saving Bank General Rules the post office saving bank shall not be responsible to a depositor for any fraudulent withdrawal by a person obtaining possession of the passbook or cheque from the cheque book from the depositor.

Learned Counsel for the appellant has further contended that the District Consumer Forum has wrongly drawn conclusion that the Post Office Saving Bank General Rules 1981 and the Post Office Saving Account Rules 1981 are not applicable to Monthly Income Scheme.

Learned Counsel for the appellant has contended that the finding recorded by the District Consumer Forum to the effect that the opposite party in utter ignorance of rules and direction of the department has made payment to unauthorized person is incorrect and not sustainable in the eyes of law.

Learned Counsel for the appellant has contended that the finding recorded by the District Consumer Forum to the effect that opposite party failed to produce/adduce the withdrawal form or receipt etc. is against truth as the District Consumer Forum has never directed opposite party to produce withdrawal form or receipt nor any application for this purpose was moved by the complainants.

Learned Counsel for the appellant has contended that the dispute raised by the complainants requires detailed evidence for appropriate adjudication of the case and such type of dispute could be decided by civil court only.

Learned Counsel for the appellant has contended that the appellant has made payment to the agent of respondent/complainants. As such appellant cannot be ordered to make repayment of the amount. The dispute lies between respondents/complainants and their agent Smt. Rukhsana Begum who was appointee of the State Government. Appellant is not responsible for the acts done by her.

Learned Counsel for the respondent has opposed appeal and

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contended that the impugned judgment and order passed by the District Consumer Forum is in accordance with law and evidence. The appellant Post Office has not complied legal requirements required by rules in making premature closure and payment of accounts of complainants. As such the appellant has committed deficiency in service and is liable to make payment to the complainants/respondents.

Learned Counsel for the appellant has referred following case laws.      

01.Pradeep Kumar V/s Post Master General and others decided by Hon’ble National Commission on 15-05-2015 in Case No.148 of 2001.

02.Union of India V/s Shanker Ram and others reported in IV(2010) CPJ 363(NC)

03.Ganga Nagar Central Coop. Bank Limited V/s Pushpa Rani and another reported in II(2008) CPJ 19(SC).

04.Oriental Insurance Company Limited V/s Munimahesh Patel reported in 2006(7) Supreme 156.

05.Synco Industries V/s State Bank of Bikaner and Jaipur and others reported in (2002) 2 Supreme Court Cases 1.

06.Rakesh Kumar Sharma V/s ICICI Prudential Life Insurance Co. Ltd. and another reported in II(2014) CPJ 196(NC).

07.UCO Bank V/s S. D. Wadhawa reported in III(2013) CPJ 523(NC).

Learned Counsel for the respondents/complainants has referred following case laws.

01.Prabhaben Sharma V/s Sub Post Master and others reported in 2010 NCJ 278(NC).

02.Narendra Kumar Jain and another V/s Sukumar Chand Jain and other reported in AIR 1994 Allahabad 1.

03.Gaiv Dinshaw Irani and others V/s Tehmtan Irani and others reported in AIR 2014 Supreme court 2326.

04.Central Motors (India) Private Limited V/s Ashok Ramnik Lal

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 Tolat and another reported in (2015) 1 Supreme Court Cases 429.

05.The Postmaster General and others V/s Sri Gautam Sengupta and another decided by Hon’ble National Commission on 04-03-2015 in First Appeal No. FA/1161/2013.

          I have considered the submissions made by learned Counsel for the parties.

In view of submissions made by learned Counsel for the parties, following points arise for determination.

01.Whether the appellant/post office has allowed premature closure of Monthly Income Scheme Accounts of respondents/complainants without compliance of relevant rules of Post Office (MonthlyIncome Account) Rules 1987 and thereby facilitated unauthorized withdrawal? If yes its effect?

02.Whether the appellant/post office has vicarious liability for the alleged wrongful acts of National Saving Agent?

03.Whether the District Consumer Forum has committed error in granting relief not claimed in complaint?

The District Consumer Forum has held in its impugned judgment that the rules under which premature closure of accounts of respondents/complainants is reported by the appellant/opposite party is applicable on Saving Bank Account and not on Monthly Income Scheme.

 The District Consumer Forum has referred Rules 9 and 10 of Post Office (Monthly Income Account) Rules 1987.

After having gone through above rules and instruction, the District Consumer Forum has drawn conclusion to the effect that the appellant/post office has permitted premature closure of accounts of respondents/complainants and payment of money to unauthorized person by ignoring departmental rules and instructions which is deficiency in service.

To examine the correctness of finding recorded by the District Consumer Forum, the relevant rules of Post Office (Monthly Income Account) Rules 1987 are reproduced below.

Rule-3 of Post Office (Monthly Income Account) Rules 1987 provides application of the Post Office Savings Bank General Rules, 1981

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and the Post Office Savings Account Rules 1981. It reads as follows:-

“The provisions of the Post Office Savings Bank General Rules, 1981 and the Post Office Savings Account Rules, 1981, so far as may be, apply in relation to matters for which no provision has been made in these rules.”

Rule 10 of Post Office (Monthly Income Account) Rules, 1987 deals with premature closure of account. It reads as follows:-

“Premature closure of account:- Notwithstanding anything contained in sub-rule (2) of rule 5 on an application made by the depositor in this regard, he may be permitted to withdraw the deposit and close the account any time after expiry of a period of one year from the date of opening of such account, subject to the condition that an amount equal to 5 percent of the deposit shall be deducted and remainder paid to him. Provided that no such deduction shall be made if the account is closed after expiry of three years from the date of opening of such account.” 

In view of provisions contained in above Rule 10 an application for premature closure of account by depositor is necessary.

In complaint it has been averred by complainants that complainant no.1 has given passbook and withdrawal form with signature to the National

Saving Agent to withdraw monthly interest only. As such, it was for the appellant/post office to show that premature closure of accounts of complainants/respondents has been done in accordance with Rule 10 of Post Office (Monthly Income Account) Rules 1987 but appellant/opposite party has not brought on record before District Consumer Forum papers and documents related to accounts of respondents/complainants in question to show that the proper procedure has been adopted for getting premature closure and final withdrawal of the amount. If these documents have not been brought on record before District Consumer Forum, the District Consumer Forum has correctly drawn adverse inference against appellant/opposite party for non production of these papers before it as the papers relating to the accounts of respondents/complainants in question are in custody of appellant/post office and the burden lies on the post office to prove that premature closure of accounts has been done in accordance with the rules after completion of necessary formalities. As such, I am unable to

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accept the argument advanced by learned Counsel for the appellant/post office to the effect that these papers have not been summoned under Section 13 (4) of the Consumer Protection Act 1986 by the District Consumer Forum. Therefore, no adverse presumption can be drawn against appellant/post office for non production of these papers.

It is pertinent to mention at this juncture that it has not been contended on behalf of appellant/opposite party/post office that premature closure of complainants/respondents’ accounts has been done on the application moved by respondents/complainants. During course of hearing learned Counsel for the appellant has contended that the application for premature closure of accounts required by Rule 10 of the Post Office (Monthly Income Account) Rules, 1987 is withdrawal form (SB 7).

Learned Counsel for the appellant has placed reliance on Rule 41 of the Post Office Savings Bank General Rules, 1981 wherein it has been provided that a depositor is required to present or send his passbook with an application for withdrawal SB-7 to withdraw money. In said Rule 41 it has been further provided that if the depositor does not attend office for payment, the counter assistant should see that the name and signature of the agent or messenger has been entered in the space provided for the purpose in form of application.

In view of submissions made by learned Counsel for the appellant it is clear that no separate application has been moved by or on behalf of complainants/respondents for premature closure of their accounts except application in the form of SB-7.

In the case of Prabhaben Sharma V/s Sub Post Master, Freeland Gunj, Dahod (Gujrat) and others reported in 2010 NCJ 278 (NC) the Hon’ble National Commission has held as under:-

“Present cases were clearly cases of premature closure. Hence, in our view, as per Rule 10 a separate application was required for premature closure, which has not been done in this case. Learned Counsel for the petitioner wishes to rely upon the withdrawal forms (appearing at pages 114 and 123 in RP No. 1280 of 2006 and at page 110 in RP No.1281 of 2006). We have very carefully gone through these documents and find that these forms are not relevant for premature closure for the simple reason that the

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word ‘PMC meaning thereby ‘Premature Closure’ has been stamped on it. The heading of this form is ‘Withdrawal Form’. Here in the instant cases, we are concerned with ‘Premature Closure’ and not ‘withdrawal’. Thus, in our view, these forms will have no bearing in the merits of these cases.”

In view of proposition laid down by Hon’ble National Commission in

the above case it is apparent that application required by Rule 10 of Post Office (Monthly Income Account) Rules 1987 is not covered with withdrawal form SB-7. It requires an application with prayer to make premature closure of the account.

During course of hearing learned Counsel for the appellant has shown withdrawal form SB-7. Perusal of withdrawal form SB-7 shows that there is no column or prayer in it to make premature closure of account and to pay amount accordingly.

In First Appeal No. 1161/2013 The Postmaster General and others V/s Sri Gautam Sengupta and another the State Consumer Disputes Redressal Commission, West Bengal has also expressed view that form SB-7 is meant for withdrawal of interest only. The State Consumer Disputes Redressal Commission, West Bengal has further held that as per Rules & Regulations of postal department it is mandatory to execute form SB-7A before closing an account. The State Commission, West Bengal has mentioned in its above judgment that the Department of Post Office has introduced form no. SB-7A vide its order dated 19-09-2006 to facilitate premature withdrawal of deposit and it has been strictly advised that in case such form is not available with the concerned post office, the postmaster concerned must ensure that an application to this effect be made by the depositor on plain paper.

In view of above judgments of Hon’ble National Commission and State Commission, West Bengal as well as provisions of Rule 10 of the Post Office (Monthly Income Account) Rules, 1987 it is crystal clear that application mentioned in above Rule 10 is not withdrawal form SB-7.  It is an application with special prayer to close the account with final withdrawal and no such application is reported to have been presented before appellant post office for premature closure of accounts of respondents/complainant.

In view of discussion made above I am of the view that the District Consumer Forum has rightly recorded finding to the effect that the

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premature closure and final withdrawal of Monthly Income Scheme accounts of complainants/respondents have been permitted by appellant/post office in violation of rules as well as departmental instruction. The finding recorded by the District Consumer Forum in this respect cannot be said to be against law or fact.

In view of conclusion drawn above point no. 1 for determination is decided in affirmative against appellant/post office and in view of this determination I find sufficient ground to hold that the appellant/post office has committed deficiency in service in maintaining and securing accounts of respondents/complainants and thereby facilitated unauthorised withdrawal.

Point No.2 for determination   

Indisputably Rukhshana Begum National Saving Agent is not an appointee of appellant/post office or postal department of Union of India. She has been appointed by State Government. Further the averment made in the complaint itself makes it clear that complainants themselves appointed her as their messenger/agent to receive and withdraw interest from their monthly income scheme accounts. There is no averment in the complaint to the effect that the said National Saving Agent was authorised to withdraw the monthly interest to invest it in any other accounts of respondents/complainants being maintained by post office or likely to be opened by post office. Considering these facts of the case it cannot be said that the said National Saving Agent was working as agent of appellant/post office for withdrawal of money from the accounts of respondents/complainants.

In view of above I am of the view that appellant/opposite party/post office cannot be held liable for the alleged wrongful act of said National Saving Agent.

In the case of Union of India through Postmaster General U.P. and another V/s Shanker Ram reported in IV(2010) CPJ 363(NC) on identical facts the Hon’ble National Commission has held that post office is not liable for the wrongful act of agent appointed by State Government.

In view of discussion made above point no.2 for determination is decided in negative in favour of appellant. Finding recorded by District Consumer Forum in this respect is set aside.

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Point no.3 for determination

After having gone through relief claimed in complaint and relief granted by the District Consumer Forum it is apparent that the District Consumer Forum has granted relief not specifically claimed in complaint.

I have considered this aspect of the judgment also. In view of conclusion drawn in determination of point no. 1 it is apparent that premature closure of accounts of respondents/complainants as well as payment there for have been made without observing formalities required by rules and instructions issued by department. As such the appellant post office is liable to restore the monthly income scheme accounts of respondents/complainants with interest and other consequential benefits and to issue passbook to the complainants/respondents for said amounts making them entitled to receive the same.  The relief granted by the District Consumer Forum has also the same effect.

Considering all facts and circumstances of the case I am of the view that it is wrong to say that the relief granted by the District Consumer Forum is inconsistent with relief claimed.

One more point has been raised by learned Counsel for the appellant  that the money deposited in the monthly income scheme accounts of the complainants is alleged to have been fraudulently withdrawn and misappropriated by National Saving Agent. Said National Saving Agent has not been impleaded in complaint. No finding can be recorded against her in her absence. Further more District Consumer Forum is not competent to decide issues of fraud and misappropriation. Charges of fraud and misappropriation levelled against National Saving Agent can be tried by competent Criminal Court only. Learned Counsel for the appellant has placed reliance upon case laws mentioned above at serial number 4 to 7 of case laws referred by him.

I have considered this argument of learned Counsel for the appellant. The conclusion drawn above clearly shows that the appellant post office has committed deficiency in maintaining and securing accounts of respondents/complainants. As such appellant post office is liable to restore  accounts of respondents/complainants.  Deficiency in service committed by

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appellant Post Office is crystal clear. Case laws referred by learned Counsel for the appellant are not applicable on facts of present case.

The appellant/post office cannot be exonerated from its liability on the ground that the alleged fraud and misappropriation have been committed by National Saving Agent. Deficiency in service committed by Post Office has contributory role in facilitating alleged wrongful act of National Saving Agent. On facts of present case appellant Post Office is not entitled to protection provided in Rule 15 of the Saving Bank General Rules.

I have gone through all the case laws referred by learned Counsel for the appellant. In view of discussion made and conclusion drawn above, on facts of present case, case laws referred by learned Counsel for the appellant are not helpful to appellant Post Office.  

For reasons recorded above I am of the view that appeal has no force and is liable to be dismissed.

Appeal is dismissed.

Parties shall bear their own costs.

Let copy of this order be made available to the parties within 15 days positively as per rules.

( JUSTICE A H KHAN )

                                                                                                       PRESIDENT

Pnt.