DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

Udyog Sadan, C-22 & 23, Qutub Institutional Area

(Behind Qutub Hotel), New Delhi-110016

Case No.671/2009

Sh. Uday Ratra

Vasundhara Farm

C/o SP  Master

I.A. Dharuhera

Haryana-123110                                                                 ….Complainant

Versus

Standard Chartered Bank

17 Parliament Street

Sansad Marg

New Delhi-110001                                                   ….Opposite Party

                                                          Date of Institution        : 28.08.09        Date of Order                 : 22.07.17

Coram:

Sh. N.K. Goel, President

Ms. Naina Bakshi, Member

ORDER

The case of the complainant, in nutshell, is that  all account statements for  fiscal year 2008-09 and earlier 11 years show no deductions of tax on interest nor was any proof of T.D.S. certificates being mailed by the OP despite his having priority and excel banking status was provided; that complainant only became aware of the deductions, contrary to his instructions in August 2008 upon viewing the Bank’s computer display screen; that he immediately submitted the ITR-2 form upon receipt of the TDS certificates to concerned tax office to claim tax wrongly deducted for the last two years as per statutory time limitation; that no tax refund can be claimed for earlier years due to expiry of limitation period; that examination of TDS Certificates reveals the following deductions:-

Para 9 of the complaint reads as under:-

“Additionally the Complainant was informed by the bank staff every time he asked for a TDS certificate over the last twelve years that as form 15 G was filled no tax was deducted and no TDS certificate is available. The complainant only upon receiving the TDS certificates from Bank Officer Shri Ashim  Kumar Dey Signed and dated 19/11/2008 (enclosed) did he become aware of the regular deductions, which were contrary to his instructions.”

It is further stated that neither of the above deductions were ever mentioned in the monthly account statements mailed to the complainant nor any proof was provided of TDS certificate having been dispatched by the OP Bank ; that the complainant became aware of the deductions only on receiving the TDS certificates from the OP which were contrary to his instructions.  Complainant has claimed Rs.20,00,000/- as compensation   alongwith interest @ 24% p.a. for 11 years.

In the reply the OP has inter-alia that the complaint is  time barred U/s 24A of the Consumer Protection Act inasmuch as the cause of action for filing the complaint had arisen in favour of the complainant in the year 1997 and the present complaint has been filed in the year 2009. It is further stated that the OP cannot be held negligent or deficient in service in terms of the Consumer Protection Act nor does the complaint raises any consumer dispute.  It is, however, stated as follows:-

“2.     It is submitted that under the Income Tax Law, one of the sources of the income is “interest income”. In the year 1995, Finance Bill proposals introduced tax deduction at source (TDS) on fixed deposit on  interest incomes of Rs.5,000/- and above per anum. The above  was later increased to Rs.10,000/- per anum. It is submitted that the directions issued  by the Income Tax Authorities are  mandatory to be followed by all bankers under the provisions of Income Tax Act, 1961. Hence forth,  in accordance with the law of the land, every bank deducts tax (TDS), if the total interest earned on all the fixed deposits of the customer in bank is greater than Rs.10,000/- during a financial year.  The tax liability  for the purpose of TDS is determined at the branch level. Whenever the bank pays an interest on the fixed deposits, it checks it for TDS liability. If it qualifies, the TDS is deducted. TDS is also deducted on interest accrued (but not yet paid) at the end of the financial year viz. 31^st March every year. Thus, if the interest is expected to be more than Rs.10,000/- in a year, the bank must deduct TDS. It is deducted on the total interest amount and not on the amount that exceeds Rs.10,000/-. It is further submitted  that as per the provisions of Section 203(1) and 203 (2) of the Income Tax Act, 1961, every  bank has to issue a TDS certificate to the respective deductee. As per the existing  procedure to the effect that tax has been deducted along with certain other particulars. This certificate, usually called the TDS certificate, has to be furnished within a period of one month from the end of the relevant financial year. Further as per   process, post generation of TDS certificate (TDC’s) TDC’s with local address is sent to respective region team for onward dispatch to customer through local courier and TDC’s with foreign  address is directly is dispatched from central team from Chennai. It is further submitted that in case of the returned TDC’s (undelivered due to various reasons), the same is retained for one year post which it is destroyed. It is further submitted that bank is having the TDS package for issuance of duplicate TDC if customers request for TDC’s the same is issued to him….

3.       It is submitted that form 15 G and 15 H are submitted to banks by depositors/customers who do not want that TDS be deducted from their interest earned on fixed deposits. A person who is below 65 years can file the Form 15G. It is submitted that in accordance with the recent revision in the Income-tax Guidelines, Form 15-H has been replaced by Form 15-G. The deposit of the customers will be exempted from tax deductions if Form 15-G has been submitted for the same in the beginning of the financial year with the bank. It is further relevant to clarify here that the Form 15-G has to be submitted at the beginning of every financial year to avoid deduction of tax in the particular account. In the event the Form 15-G is submitted by the customers at the middle of the financial year, the tax would not be deducted post submission of the said  Form, however, the bank would be unable to refund the tax deductions prior to submission of the Form 15-G. The bank may consider the depositors request to exempt customer from TDS deductions if such customer submits the declaration in the prescribed format at the beginning of every financial year. Taxes once recovered will be paid to the Revenue Authorities and therefore can not be refunded back to the customer. Such exemptions from TDS are subject to the provisions of the Income Tax Act, rules and regulations as applicable from time to time.  

4.      It is submitted that in the instant case the opposite party bank duly sent the TDS certificate for the respective applicable year (1998 to 2008) to the complainant at the address recorded with the bank and  none of the TDS certificates/communications sent to the complainant  returned back with the opposite party bank as undelivered. It is also pertinent to mention here that the complainant never raised any dispute with the opposite party bank with respect to the non receipt of his statements, TDS certificate and other communications and the opposite party bank has never received any complaints or enquiry from the complainant regarding the same for more than 10 years (1998 to 2008). However the complainant approached the opposite party bank only in the year 2008 with Form G, for the fund of Tax amount from the year 1999.  At this juncture, it is relevant to mention here that since the said application Form G is to be submitted at the beginning of  every financial year, as also explained hereinabove the opposite party bank was unable to refund the tax deducted prior to the submission of Form G with the opposite party bank.

5.      It is submitted that the opposite party bank has never received any Form 15-G or declaration in the said respect from the complainant till the year 2008.  It is also relevant to mention here that the complainant approached the opposite party bank only in the year 2008 with the grievance that despite annually submitting Form 15-G with the opposite party bank, TDS was deducted from his accounts. In this regard the opposite party bank  in bonafide gesture verified the entire  account details of the complainant for more than 10 years and provided duplicate copies of TDS certificates to the complainant (Original of the same were sent to the address of the complainant at the end of every financial year), which in ordinary  course of business the bank is not liable to maintain for such a long period. However the complainant sent various letters to the bank to seek clarifications with respect to the deductions of TDS. It is pertinent to mention here that each of the communication of the complainant was duly replied by the opposite party and the opposite party bank tried its best to resolve the grievance raised by the complainant but to no avail.

6.      It is submitted that as per statutory requirement, the details of TDS is always sent by way of a certificate to the customer at the end of every financial year, as prescribed under the Income Tax Act. It is submitted that aforesaid practice is followed by every bank whether National or Private and the opposite party bank has acted only in accordance with the law and in bonafide discharge of its duties. It is submitted that the opposite party bank has not committed any act or action which can be held negligent or deficient in service in terms of the Consumer Protection Act, 1986 and complainant may kindly be put to strict proof in support of his averments and allegations.  True copy of the TDS certificated issued by the opposite party bank to the complainant along with account statement of the complainant is annexed herewith and marked here as ANNEXURE OP-4(Colly).

 7.     It is submitted that in the year 2009 the complainant approached Hon’ble Banking Ombudsman, Delhi with the same grievance, and a meeting was called upon between the parties on 19.05.2009. It is submitted that in the above meeting the opposite party bank requested to the complainant to provide the bank with the original acknowledgement copy of the Form 15-G duly stamped by the bank official seal for the bank to investigate the matter and assist complainant accordingly.  The said request was further made vide letter dated 02.06.2009 Ref- 05/09/049508/RAN to the complainant. However complainant failed to provide  copy of the same to the opposite party bank and instead filed a complaint before this Hon’ble Forum Copy of the letter dated 02.06.20009 written by the opposite party bank to the complainant is annexed herewith and marked here as ANNEXURE OP-5(Colly).”

Others averments made in the complaint have been denied. It is prayed that the complaint be dismissed.

Complainant has filed a “rejoinder and affidavit in evidence.” It is stated as follows:-

“12.   further entry of “wrong address” in the annexure related to clients mail being returned does not provide that the mail was a TDS certificate but conversely proves the negligence of the OP in writing the wrong address in this instance as the complainant has received thousands of letters from the bank at the address submitted to the bank by him. The OP may be put to strict proof in support of his allegations and averments.”

“16.   It is repeated the bank’s staff regularly misled the complainant that as no tax was deducted, no TDS was available and the personal computer terminal of the staff is not easily accessible to customers to view so, it was reasonable for the complainant to conclude that his instructions as per form 15G were being adhered to and the monthly statements were an accurate and complete list of transaction taking place in his account.”

Complainant has filed a brief affidavit in evidence. On the other hand, affidavit of Sh. Anand Prakash, Constituted Attorney has been filed in evidence on behalf of the OP.

Written arguments have been filed on behalf of the parties.

We have heard the oral arguments on behalf of the parties and have also gone through the file very carefully.

According to the complainant himself as averred in his affidavit he lived in London (U.K.) from August 1997 till January 2007 for study and work purpose. Therefore, during this period he did not reside in India.  However, at the same time, his case is that he had been continuously providing Form 15G to the OP and the OP was assuring him that no income tax was being deducted and no TDS certificate was available. He has stated that he became aware of the deduction only on receiving the TDS certificate  from the OP which were contrary to his instruction. At the same time, his version is also that the above deductions were never mentioned in the monthly account statements sent to him nor proof was provided to him by the OP of having dispatched the TDS certificates to him. When he was not in India during this period but had been receiving monthly account statements at his given address regularly, we are not inclined to believe that the complainant had not been receiving TDS certificate from the OP during the period in question i.e. 1998 to 2008.

Secondly, if he is believed that the deductions were not mentioned in the monthly account statement, then it will lead to a conclusion that the OP had been sending wrong monthly account statements to the complainant by paying/showing less interest amount on the deposits made by the complainant in his account.  Therefore, the complainant could have easily calculated and possessed knowledge of the fact that he had been being paid less amount on his deposits with the OP and the OP had been wrongly making deductions under some head. Therefore, we are not inclined to believe that the complainant had come to know about the deductions only on receiving the TDS certificate from the OP in 2008. OP is a banking institution dealing with the public money. Its officials are presumed to be doing work in ordinary course of business unless to the contrary is proved.  The complainant has impugned the statements for the period w.ef. 1998-1999 to 2009. Therefore, in our considered opinion, the claim for the year 1998-1999 to 2005-2006 is atleast barred by limitation i.e. time barred. 

In view of the above discussion, we do not find any merit in the complaint and dismiss it with no order as to costs.

Let a copy of this order be sent to the parties as per regulation 21 of the Consumer Protection Regulations.  Thereafter file be consigned to record room.

Announced on 22.07.17.