Per S.R. Khanzode – Hon’ble Presiding Judicial Member:
(1) This appeal takes an exception to an order dated 13.04.2012 passed in Consumer Complaint No.544/2011, Maruti M—Barve & Anr. V/s. Branch Manager, State Bank of India, Sahakar Nagar Branch, Pune – 9, by the District Consumer Disputes Redressal Forum, Pune (‘the Forum’ in short).
(2) The Forum accepting the contention of the Respondents/Complainants (hereinafter referred to as ‘the Complainants’) regarding deficiency on the part of the Bank in giving service relating to the calculation of interest under Bank’s reinvestment plan on their Term Deposits for 1000 days, awarded compensation of Rs.18,287/- along with interest @9% per annum. Feeling aggrieved thereby, the Opponent, Branch Manager, State Bank of India, preferred this appeal. It may not be out of place to mention here that the appeal is in fact filed by the State Bank of India and even proceeding before the Forum appears to have been contested on behalf of the State Bank of India. This could be further seen from the fact that appeal memo is signed for and on behalf of State Bank of India by the Branch Manager. This position is also conceded by the parties. Thus, it can be seen that service provider Bank, in real term is a party to the proceeding.
(3) Heard both sides and perused the material placed on record.
(4) Undisputed facts are that a special term deposits under the Bank’s reinvestment plan wherein it was agreed to pay quarterly interest at the rate of 11% per annum respectively on the deposit amounts of Rs.14,00,000/-, Rs.14,00,000/- Rs.5,00,000/- and Rs.1,50,000/-; were accepted by the Bank belonging to the Complainants except the Special Term Deposit of Rs.1,50,000/-. The deposits (FDR, in short) were accepted on 29.10.2008 for the period of 1000 days. A Special Term Deposit of Rs.1,50,000/- was accepted on 24.11.2008. According to Complainant the Bank did not calculate interest as per the guidelines issued by the Reserve Bank of India. The issue was raised immediately by the Complainant regarding the method of calculation (of the interest) and which remained unresolved for considerable long time and thus, resultantly on maturity the Complainants suffered a loss in terms of less payment of interest of Rs.18,287/- (on all deposits). Alleging deficiency in service, accordingly, the consumer complaint was filed on 19.12.2011 and the dispute was settled as per the impugned order, supra.
(5) It is the contention of the Complainant, to which there is no challenge that the Special Term Deposits receipts were actually issued after some days after the deposits were kept and on the receipt thereof, immediately, the Complainant raised the dispute about maturity value of each deposits shown in the respective F.D.R. As contended in the appeal memo, after keeping deposits on 29.10.2008, Special Term Deposits Receipts were issued to them and by their letter dated 20th November, 2008, the Complainant – Milind, (whose money was invested in the name of his mother – Sunita, himself and his sister – Varsha) raised the objection regarding correctness of the calculation of the maturity value. In the said letter giving the maturity value as per his own calculation, which according to him based upon the information collected from other nationalized banks, he requested to recheck the amount of maturity shown by the Bank and also warned that in case the Bank did not agree for such calculation, he had no alternative but to withdraw the amounts and to approach other nationalized banks. The Bank replied the said letter vide its letter dated 9th February, 2010 and informed him that Complainant’s request has been referred to their concerned department for clarification and they would revert back to him as soon as they receive the clarification. Experiencing that there was no satisfactory reply from the Bank, the Complainant had kept on writing to the Bank on 19.11.2009, 29.06.2010 and 13.07.2011, but in vain. In the communication dated 13.07.2011 the Complainant categorically brought to the notice of the Bank his anxieties in the following words:
“I have already given a copy of the chart published by the RBI for guidance of the Bank – Your Branch has disregarded the RBI’s guidelines. Bank’s action in retaining my funds is keeping me in dark is certainly improper and objectionable. I hope Bank will follow the RBI’s guidelines in the matter.”
Only after consumer complaint was filed, in the affidavit filed on behalf of the Bank by Mr.Raju Narayane (Branch Manager), Sahakar Nagar Branch, dated 24th February, 2012, it has tried to explain in the following words:
“These amounts were deposited as per the prevailing rate of interest as mention in the above table. We calculate the maturity value mentioned in the above table as per RBI guidelines. For the purpose of calculation of interest on term deposit i.e. quarterly compounding interest on the basis/reckoning the year at 365 days for the year, hence, the interest so far paid to the complainant is correct and it is in order. There is no manual intervention hence evidence of a chart is being submitted.
The practice of the Bank compounding the interest on quarterly basis is taken three months from the date of issue/deposit irrespective of number of days in intervening months of a quarter. In the cited case e.g. date of issue is 29th Oct., 2008 for Rs.14.00 lacs for the period of 1000 days. The quarter will be completed on 29th January, 2009 as per calendar months hence the interest paid is in order.
As per the interest calculation done by the complainant, we assume that, they are considered calculation of interest for full year of 360 days instead of 365 for the year, which is not correct. We have explained all these facts to Mr.Mukund Barve every times. However he has remains unconvinced.”
Along with said Affidavit details of calculation of the interest was also given. It appears therefrom that from the date of receipt of the deposits each quarter total amounting to 10 quarters (912 days) were taken into account on the basis of completion of three months and for a part of quarter before the maturity 88 days in the last quarter were taken into account (thus, 912 + 88 = 1000). The chart attached as Annexure-I to the said affidavit in detailed explained the same.
(6) It is not in dispute that the Term Deposits were of 1000 days. It is not in dispute that the interest of 1000 days was paid and the interest @11% per annum was agreed under the reinvestment plan and for which the interest was payable on quarterly basis. Dispute is only about making calculation. The Complainant wanted to rely upon the R.B.I. guidelines but those guidelines are not before us. Complainant tried to rely upon one chart, a copy of which is produced and it was stated to be calculation as per R.B.I. guidelines by a different Co-operative Bank. We are afraid, in the absence of any guidelines produced before us, the submission in respect thereof cannot be appreciated.
(7) The guidelines issued by a Master Circular No.NBG/PBBU/LIMA/18/2010-11 dated 23rd August, 2010 issued by the Bank to all its Branches which inter alia contained Annexure – “General Guidelines on Term Deposits”, is on record. Referring to clause 51 of those guidelines which speaks for Bank’s Reinvestment Plan, it reads as under:
“Bank’s Reinvestment Plan:
The object of the bank’s reinvestment plan is to accept amounts in certain round sums for specified periods in special term deposits which provide for automatic reinvestment in a term deposit with the Bank of the interest, earned thereon at quarterly intervals till the maturity of the principal. A special term deposit receipt on the Bank’s engraved form will be issued to the depositor; the receipt will indicate the rate as applicable to an ordinary term deposit but will incorporate a clause to the effect that the benefit of reinvestment of interest at quarterly intervals will accrue to the depositor.”
(8) With advantage, we also rely and refer to clause 37 of the same circular under the head “Term Deposit from Illiterate Persons” and it reads as under:
“The official signing a deposit receipt (in case receipt is being insisted upon) should explain to the depositor the implications and conditions attached to payment of interest or renewal or repayment and append a suitable certificate of his having done so on the reverse of the application form.”
Clause 37 is referred only to endorse that the Bank is always anxious as a policy matter and to ensure better customer service, they adopted a course to keep informed the depositor about the conditions to payment of interest. If, in case of such self imposed obligation, nay, it from the normal obligation on part of the Bank towards its customers/investors to inform them about the rate of interest (and its calculation) on deposits. In the case before us, the Bank, in spite of the concerns immediately raised by the Complainant about the calculation of the maturity value i.e. interest per quarterly rest, which is reflected from the correspondence referred earlier; for a long time failed to inform the Complainants about their stand (of calculation of interest) as to whether they would stick up to the maturity amount shown by them on the Term Deposit Receipts or would accept the grievance to recalculate the reinvestment value as expected by the Complainants. The Complainant, as referred earlier, in those circumstances, due to failure of the Bank, failed to exercise his discretion either to continue their deposits with the Appellant Bank or to use their discretion to shift those deposits to other Bank in order to earn better returns. Thus, it is a clear case of failure of the Bank to function in a expected manner and discharge their obligations towards the Complainant at its depositor within the meaning of Section 2(1)(g) of the Consumer Protection Act, 1986. Therefore, considering the totality of the circumstances, even though the Bank might have correctly calculated the maturity value and might not have violated guidelines of Reserve Bank of India, still in the above referred circumstances and proved deficiency in service on the part of the Bank, grant of compensation as per the impugned order cannot be faulted with.
(9) The Respondents/Complainants did not prefer any appeal against the impugned order and thus, acquiesced with the same.
(10) For the reasons stated above, we find no reason to interfere with the impugned order and holding accordingly, we pass the following order:
O R D E R
(i) Appeal stands dismissed.
(ii) In the given circumstances, both parties to bear their own costs.
Pronounced on 24th August, 2012.
