Advocate Vijay Chandavale & Associates
for the complainant
S.V.Kshirsagar & Associates
For the Opponents
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Per Hon’ble Shri. V. P. Utpat, President
:- JUDGMENT :-
Date – 22nd March 2013
This complaint is filed by the account holder of the Opponent No.1 Bank for deficiency in service. Brief facts are as follows-
[1] The complainant is dealing in the business of transport. His Truck was attached by the Deputy Conservator of Forest, Gadag Division, Near Tara Plaza, Haveri who had directed him to furnish Bank Guarantee of Rs.2,00,000/-. The brother and father of the complainant had transactions with the Opponent No.1. Hence the complainant requested Opponent No.1 for giving Bank Guarantee. Opponent No. 1 had tie up with the Opponent No. 2 Cosmos Co-operative Bank for issuing Bank Guarantee. Accordingly the Bank Guarantee was given by the Cosmos Co-operative Bank on behalf of the Opponent No. 1. The said guarantee was renewed for two to three times. The said guarantee was lapsed on 31/01/2001. Still the Opponent No. 1 had not issued the Account Closure Certificate for the said account. The complainant has also produced letter from the Deputy Conservator of Forest showing that the Bank Guarantee was not renewed or encashed. Still the Opponent No. 1 had not issued the Account Closure Certificate in that respect. The Opponent No. 1 had took the cheque of Rs.1,00,000/- from the complainant which was issued on Citizen Co-operative Bank. The said cheque was stopped for payment by the complainant. Still the Opponent No. 1 had filed complaint u/s 138 of the Negotiable Instrument Act against the complainant. That complaint is decided on 5/4/2010. Meanwhile the complainant had deposited Rs.2,00,000/- with the Opponent No. 1 in four F.D.R. each of Rs.50,000/-. All the F.D.R. matured on 09/08/2011. The original receipts were handed over to the complainant. These were not kept with the Opponent No. 1 by way of any kind of security. The complainant was in need of money on 24/08/2009. Hence he demanded the said money by liquidating the F.D.R. The complainant also filed application accordingly and further issued stamp receipts but no payment was made. On 5/12/2009 the Opponent No. 1 gave false reply. On 17/09/2011 again the complainant requested the Opponent No. 1 for releasing proceeds of four F.D.R. That letter was falsely replied on 23/09/2011. There was no nexus between the said F.D.R. and Bank Guarantee. The Bank Guarantee is lapsed automatically by efflux of time. The complainant has prayed for directing the Opponent No. 1 and 2 to pay maturity values of all F.D.R. i.e. worth Rs.2,61,208/-. He has further asked interest on the said amount @ 24% p.a. and Account Closure Certificate of the said Bank Guarantee. He has also prayed for compensation for mental harassment and torture as well as costs of the litigation.
[2] The Opponent No. 1 and 2 both have resisted the claim by filing separate written versions. According to them this Forum has no jurisdiction to adjudicate this dispute. The Bank Guarantee was renewed at the request of the complainant till 31/01/2003. The complainant has not produced any record to show that the said Bank Guarantee is cancelled. The original document of the Bank Guarantee is not produced. The Opponent No. 1 has prayed for dismissal of the complaint.
According to the Opponent No. 2 there is no privity of contract between the complainant and themselves. The Bank Guarantee was issued as per the request of the Opponent No. 1. It is also contended that the complainant has not produced certificate from Deputy Conservator of Forest, Gadag Division showing that the Bank Guarantee is cancelled. Hence the complaint is liable to be dismissed.
[3] After scrutinizing the documentary evidence which is produced by both the parties and hearing the argument of both counsel as well as considering the affidavits of the parties following points arise for my determination. The points, findings and the reasons thereon are as follows-
Sr.No. | POINTS | FINDINGS |
1 | Whether the complainant has proved that the Opponents had caused deficiency in service by not returning the maturity values of the F.D.R. ? | In the affirmative against the Opponent No.1. |
2 | Whether the complainant is entitled for Account Closure Certificate of Bank Guarantee ? | In the affirmative On furnishing original Bank Guarantee to the Opponent No. 1 |
3 | What order ? | Complaint is partly allowed against the Opponent No. 1. |
REASONS –
AS TO THE POINT NO.1
The undisputed facts in the present proceeding are that at the request of the complainant Bank Guarantee for Rs.2,00,000/- was given by the Opponent No. 1 and 2. It is the case of the Opponent No. 2 that the said Guarantee was given as per the request of the Opponent No.1. It also reveals from the documentary evidence such as letters issued by the Deputy Conservator of Forest from 14/3/2000 to 2004 that the Bank Guarantee was renewed from time to time. But since 2004 the said Bank Guarantee was not at all renewed. During the pendency of the present proceeding the complainant has produced the letter which was addressed to the Deputy Conservator of Forest by the Branch Manager of the Opponent No. 1. It is dated 05/05/2003. It reveals from the same that the said Bank Guarantee was valid only upto 31/01/2003 and it is expired and the liability of the Opponent No. 1 is ceased from the said date. It is also requested by the Opponent No. 1 to the Forest Department to return the original Bank Guarantee for cancellation with discharge. Thus it is crystal clear that on the date of filing of the complaint no Bank Guarantee was in existence. Still the Opponent has withheld the four F.D.R. which were kept by the complainant.
It is significant to note that the facts as regards keeping the four F.D.R. with the Opponent No. 1 is not at all disputed by the Opponent No. 1 either by filing affidavit for in the written version. It is significant to note that the transaction of issuance of Bank Guarantee is of 14/03/2003 and the said F.D.R. are kept on 09/08/2008. All the deposits were matured on 09/08/2011. It is worth to note that as the receipts were kept after long period from the date of execution of Bank Guarantee. In this circumstances Bank cannot keep lien on the said F.D.R. for the purpose of the said Bank Guarantee. As the purpose of the Bank Guarantee is already over and this fact is disclosed in the letter which is issued by the Opponent No. 1 to the Conservator of Forest then the Opponent No. 1 has no right to withheld the maturity values of the four F.D.R. Thus I held that the Opponent No. 1 has caused deficiency in service by not releasing the maturity values of four F.D.R.
AS TO THE POINT NO.2
As regards the Bank Guarantee it is also proved on the basis of the documentary evidence that said letter was issued by the Opponent No. 1 to the Conservator of Forest that the Bank Guarantee is not valid after 31/01/2003. Then it cannot be said that the Bank Guarantee is still in continuation. However the original document of Bank Guarantee is not returned by the complainant and unless and until that document is returned the Opponent No. 1 cannot be directed to issue Account Closure Certificate as regards the transaction of Bank Guarantee.
It is crystal clear that the Opponent No. 1 has failed to prove that the said four F.D.R. were kept as a guarantee for the Bank Guarantee and the Opponent No. 1 had lien on those receipts. By not making payment of maturity values the Opponent No. 1 has caused deficiency in service. The complainant is entitled for compensation on the ground of deficiency in service to the tune of Rs.5000/-. The complainant is also entitled to get Rs.5000/- by way of compensation on the ground of mental and physical torture and Rs.2000/- by way of costs of this litigation. The complainant is further entitled to get the maturity values of the four F.D.R. alongwith interest @ 9% p.a.
I answer the points accordingly and pass the following order -
:- ORDER :-
1. The complaint is partly allowed as against the Opponent No. 1.
2. It is hereby declared that the Opponent No. 1 has caused deficiency in service by not making payment of maturity value of four F.D.R.
3. The Opponent No. 1 is directed to pay to the complainant amount of Rs.2,61,208/- along with interest @ 9% p.a. from the date of filing of this complaint i.e. 22/03/2012 till its realization within six weeks from the date of receipt of copy of this order.
4. The Opponent No. 1 is directed to pay to the complainant compensation of Rs.12000/- on the ground of deficiency in service, physical and mental torture as well as costs of this litigation.
5. The Opponent No. 1 is directed to issue Account Closure Certificate of Bank Guarantee Transaction on condition that complainant will produce the original document of Bank Guarantee.
6. The complaint is dismissed against the Opponent No. 2.
Copy of order be supplied to both the parties free of cost.
Place-Pune
Date- 22/03/2013
