BEFORE THE A.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSIONAT HYDERABAD.
F.A. 138/2007 against C.D. 1024/2005, Dist. Forum-I, Hyderabad
Between:
State Bank of India
Hyderabad Public School Branch
Ameerpet, Hyderabad-500 016. *** Appellant/
Opposite Party
And
P. Uday Kumar
S/o. Chandra Reddy
707, Srinivasa Towers
Begumpet, Hyderabad-500 016. *** Respondent/
Complainant.
Counsel for the Appellant: Mr. Sreemannarayanamurthy
Counsel for the Resp: P.I.P.
F.A. 365/2007 against C.D. 1024/2005, Dist. Forum-I, Hyderabad
Between:
P. Uday Kumar
S/o. Chandra Reddy
707, Srinivasa Towers
Begumpet, Hyderabad-500 016. *** Appellant/
Complainant
And
State Bank of India
Hyderabad Public School Branch
Ameerpet, Hyderabad-500 016. *** Respondent/
Opposite Party.
Counsel for the Appellant: P.I.P.
Counsel for the Resp: Mr. Sreemannarayanamurthy
QUORUM:
HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT
&
SMT. M. SHREESHA, MEMBER
FRIDAY, THIS THE EIGTH DAY OF AUGUST TWO THOUSAND EIGHT
Oral Order: (Per Hon’ble Justice D. Appa Rao, President)
*****
These appeals are preferred one by the complainant against inadequacy of compensation and the other by the opposite party against the order of the Dist. Forum-I, Hyderabad in granting compensation.
The parties are described as arrayed in the complaint in order to obviate confusion in describing the parties.
The case of the complainant in brief is that, he was having S.B. account with the respondent bank. He issued two cheques one for Rs. 9,000/- in favour of Sri Dayakar Reddy and another for Rs. 5,000/- in favour of Smt. B. Jalaja towards rent and service charges payable by him for the apartment occupied by him. They were presented for payment on 9.9.2005, however, returned unpaid on the ground that funds were insufficient. In fact he was having pass book balance of Rs. 17,943/- from 5.9.2003 to 14.9.2005. This has resulted in loss of reputation. He is a Company Secretary in Republic Forge Company and number of other reputed companies. Since the opposite party failed to render service as required, it constitutes deficiency in service. Therefore, he prayed for Rs. 1, 00,000/- towards compensation for loss of reputation and costs.
The respondent bank filed counter denying the facts alleged in the complaint. While admitting that the complainant was having S.B. account with it, denied that those cheques were issued towards rent and services charges for the apartment occupied by him. It alleged that those cheques were presented in clearing on 9.9.2005 with UTI Bank and returned with reasons ‘insufficient funds’. The complainant tendered a cheque on 5.9.2005 for Rs. 15,000/- to credit into his account and was sent for clearing and the bank was expected to receive it on 9.9.2005. As on 5.9.2005 the balance in his account was Rs. 2,943.11 evident from banks cheques referred and returned register Ex. B2. The complainant has issued the cheques in anticipation of funds.
As per the clearing norms, cheques are to be returned by 11.30 a.m. and further release of day’s credit is done simultaneously which is processed at Belapur and credits are posted into accounts. On the material date the credits were received after the return of cheques, though the pass book entry reflects credit of Rs. 15,000/- raising the balance to Rs. 17,943.11 but Rs. 15,000/- will be in un-cleared balance till 9.9.2005. Since the pass book entries were printed after 9.9.20005 an amount of Rs. 15,000/- was not reflected as un-cleared. The pass book clearly shows the entry Dt. 21.9.2005 for Rs. 2,500/- the resultant balance has increased to Rs. 18,056.61, simultaneously the amounts of Rs. 15,556.61 and Rs. 2,500/- as un-cleared balance. Therefore, the system will allow drawings up to Rs. 15,556.61 only and not Rs. 18.056.61. From this it is clear that by the time of return of cheques the balance in the account was only Rs. 2,943.11. He being an ex-bank official he himself knows the clearing process and issue of cheques. They cannot be cleared in anticipation of funds. More over, the complainant was negligent while depositing the cheques of other banks, without the name of the payee and the date. The cheques were returned on 9.9.2005 as there was no sufficient balance. The question of losing of reputation will not arise since the cheques were presented at the opposite party bank even before realization of Rs. 15,000/-. The cheques were returned by 11.30 a.m. Thus there is no deficiency in service and prayed for dismissal of the complaint.
The complainant in proof of his case filed his affidavit and Exs. A1 to A10. The respondent bank filed the affidavit of its officer and marked Exs. B1 to B6.
The Dist. Forum after considering the evidence placed on record opined that the pass book extract taken on 10.9.2005 shows that the entire amount of Rs. 15,000/- was available in the account of the complainant well before 9.9.2005. The cheques were presented by the payee bank on 8.9.2005 and the respondent bank has received on 9.9.2005. Therefore, return of cheques on the ground of insufficient funds amounts to deficiency in service, a compensation of Rs. 10,000/- was awarded together with costs of Rs. 1,000/-.
Aggrieved by the said decision, the complainant preferred F.A. 365/2007 alleging that having opined that there was deficiency in service, compensation of Rs. 1,00,000/- ought to have been granted as he is a company secretary and he was forced to vacate the premises, as his landlords had lost confidence in him. The bank preferred F.A. 138/2007 contending that the Dist. Forum did not appreciate the facts in correct perspective. The Dist. Forum ought to have seen that when the cheques were presented on 5.9.2005 drawn on UTI bank the complainant was having only bank balance of Rs. 2,943.11. The cheque that was issued was received by the respondent bank on 9.9.2005 and by that time the cheques were returned. Since the complainant had taken extract of pass book after 10.9.2005 the entire amount, including Rs. 15,000/- was shown as cleared amount. Thus, it cannot be said that there was deficiency in service. Therefore, it prayed that the appeal be allowed by setting aside the order of the Dist. Forum.
It is an undisputed fact that the complainant has an S.B. account in the respondent bank. He was an ex-official of the bank. He has issued two cheques drawn on UTI Bank one for Rs. 9,000/- in favour of Sri Dayakar Reddy and another for Rs. 5,000/- in favour of Smt. B. Jalaja and they were returned on the ground that funds were insufficient. They were deposited on 5.9.2005 evidenced under Exs. A3 to A6. The complainant alleges that he was having bank balance of Rs. 17,943.11 from 5.9.2003 to 14.9.2005.
The bank alleges that the cheques Dt. 5.9.2005 were post-dated for crediting to his account and was sent for clearing and the bank received the funds on 9.9.2005 evidenced from Ex. B1 statement of account. It is not in dispute that by 5.9.2005 the balance was only Rs. 2,943.11 vide Ex. B2. From this it is evident that when the cheques were presented, he was not having requisite funds. The complainant had issued cheques, obviously, in anticipation of funds.
The contention of the bank is that as per the clearing norms the cheques are to be returned from clearing house by 11.30 to 12.00 a.m. and further release of day’s credit is done simultaneously which is processed at Belapur and the credits are posted into accounts.
Undoubtedly, the bank clears the cheques if the balance is available in his account, and not in anticipation of funds in the account. Learned counsel for the bank contended that after receipt of cheques the opposite party bank will send them to service branch which in turn sends to RBI clearing house and the RBI clearing house sends those cheques to the drawee banks and again they will return in the same process and generally they will be cleared in 3 days and in this particular case since there was holiday on 7.9.2005 Vinayaka Chavithi, four days time was taken. Therefore the cheque that was deposited on 5.9.2005 was sent by the bank to the service branch on 6.9.2005 and it was cleared by the drawee bank Central Bank of India, Khairatabad on 8.9.2005 evidenced under Exs. B4 & B5 and was received by the bank on 9.9.2005. The cheques that were presented by the complainant on 9.9.2005 were returned on the ground of ‘insufficient funds’ at about 11.30 a.m. or 12.00 a.m. on 9.9.2005. After they were returned the cheque for Rs. 15,000/- was cleared. In other words by the time they have received the information of clearance of Rs. 15,000/-, the two cheques were returned as the bank balance of the complainant was Rs. 2,493.11 only vide Ex. B2.
It is the respondent bank’s case that the cheque that was drawn on Central Bank of India, Khairatabad submitted by the complainant was cleared by payee bank on 8.9.2005, evidenced from Exs. B4 & B5. The same was received by it on 9.9.2005 evidenced from Ex. B6 statement of account. It also shows that an amount of Rs. 15,000/- was shown as un-cleared amount. The complainant being an ex-official of the bank was aware of this practice. Though on 9.9.2005, the pass book entry reflects credit of Rs. 15,000/-, raising the balance to Rs. 17,943.11 however, Rs. 15,000/- was shown as un-cleared balance till 9.9.2005 evidenced from Ex. B1 statement of account. In other words, since the pass book entry was printed after 9.9.2005, an amount of Rs. 15,000/- was not reflected. It was un-cleared by then.. In order to show the practice of posting of these amounts, the bank submitted that due entry Dt. 21.9.2005 for Rs. 2,500/-, the resultant balance has increased to Rs. 18,056.51, but simultaneously Rs. 15,556.61 and Rs. 2,500/- was shown as un-cleared balance. This would enable drawing up to Rs. 15,556.61 and not Rs. 18,056.61.
The complainant filed Ex. A2 obviously to show that an amount of Rs. 15,000/- was also credited. It was taken not on 9.9.2005 but after 10.9.2005. The corresponding statements Exs. B1 to B6 show that the amount of Rs. 15,000/- was shown as ‘to be cleared amount’. Exs. B4 & B5 would undoubtedly show that the payee bank has cleared the cheque on 8.9.2005, received by the respondent bank on 9.9.2005 that too after return of above two cheques. No doubt the Dist. Forum is incorrect in mentioning that Ex. B5 cheque for Rs. 15,000/- was deposited on 1.9.2005. It was deposited on 5.9.2005, and it was sent for clearance on 6.9.2005, and cleared by Central Bank of India on 8.9.2005, and received by respondent bank on 9.9.2005, that too after the bank has returned the two cheques.
Therefore, we do not see any deficiency in service on the part of respondent bank in not clearing the cheques. The complainant being an ex-officer of the bank would undoubtedly aware of the procedure.
The complainant alleges that return of the cheques resulted in loss of reputation. He was also inconvenienced since the owner of the apartment where he was residing, in whose favour the cheque was issued, has lost confidence in him. Therefore, he was forced to shift to another apartment, and therefore claimed a compensation of Rs. 1, 00,000/-. The fact that he was forced to vacate the premises in view of confidence lost in him by his landlord, or that he had to occupy another apartment, not evidenced by any document. No notices were exchanged. The said fact was not substantiated by any documentary evidence. He could have filed the affidavit of the owner or some other person to show that he has shifted his house in view of return of cheques.
We have perused the entire evidence, and we are of the opinion that there is no deficiency in service on the part of respondent bank. The complainant is not entitled to any compensation.
In the result, F.A. No. 138/2007 is allowed and compensation of Rs. 10,000/- besides costs of Rs. 1,000/- awarded by the Dist. Forum is set-aside, consequently F.A. No. 365/2007 is dismissed. However, both parties are directed to bear their own costs in these appeals.
PRESIDENT LADY MEMBER
Dt. 8. 8. 2008.
*pnr
CORRECTED – O.K.
