AT HYDERABAD.

F.A. 1426/2005 against C.D. 1460/2004, Dist. Forum-I, Hyderabad     

Between:

Azam Khan

S/o. Jahangir Khan

Age: 40 years,

R/o. 11-3-830

New Malleypally

Hyderabad.                                                            ***                         Appellant/

                                                                                                 Complainant 

                                                                    And

State Bank of Hyderabad

Mallepally Branch

Hyderabad.                                                          ***                         Respondent/

                                                                                                Opposite Party

Counsel for the Appellant:                          Mr. Mohd. Muneeruddin

Counsel for the Resp:                                 Mr. S. Kishan  Rao                                                                 

QUORUM:

                          HON’BLE SRI JUSTICE D. APPA RAO, PRESIDENT     

&

SMT. M. SHREESHA, MEMBER

THURSDAY,  THE TWENTY  EIGTH DAY OF AUGUST  TWO THOUSAND EIGHT

Oral Order: (Per Hon’ble Justice D. Appa Rao, President)

                                                          *****

          The unsuccessful complainant is the appellant. 

          The case of the complainant in brief is that he is the natural father,  guardian and authorised signatory of his son Ahmed Khan holding savings bank account.  He is also having a separate S.B. account in his name having ATM facility.   He is having a credit balance of Rs. 26,601/-  as on 7.8.2004.  He issued a cheque on  2.9.2004 on  his account for Rs. 24,236/- in favour of M/s. Magna Finance Ltd., towards payment of instalment of vehicle loan.  Despite the fact that there was sufficient credit balance on 7.8.2004 the cheque

was dishonoured  by the respondent bank.  The said fact was informed by M/s. Magna Finance Ltd., and charged Rs. 1,000/- towards dishonour of cheque, Rs. 3,500/- towards penal charges and late payment fee.  When  contacted the  bank,  it  informed that  there was computer defect, and it  was  rectified  and if presented it would honour the cheque.  The aforesaid cheque was returned  though he had sufficient funds in his account.   This constitutes deficiency in service.  For no fault of his, the cheque was returned.  On that he got his pass book up-dated.   He found that an amount of Rs. 16,500/- was debited to his account, and the description was shown as ‘ATM OD AMT RECV’.  There upon he lodged a complaint.  There is no ATM  OD facility annexed to S.B. account.   The bank has refused to pay the amount covered under the cheque constituting deficiency in service,   and therefore claimed Rs. 16,500/- besides compensation of Rs. 23,500/- and costs of Rs. 5,000/-.

          The bank resisted the complaint.  It  denied  the facts alleged in the complaint.  It alleged  that the complainant has been maintaining two accounts, one in his name and another in the name of his minor son.  He has been operating both the accounts.  He withdrew  in all Rs. 16,500/- on  14.7.2004 and 15.7.2004  from ATM,  though there was no balance.   When the complainant was asked to return the amount he did not remit, and as there was no alternative, and by virtue of general lien over accounts, adjustment of Rs. 16,500/- was made from the account of his  son.   He wanted to enrich himself  by evading  payment of Rs. 16,500/- drawn from ATM.   Since Rs. 24,500/- deposited by him on  2.9.2004  was adjusted towards the amount drawn from ATM there was no sufficient amount to be paid to the financier under the cheque, and as such the cheque was dishonoured.  There was no deficiency in service on its part.  Having withdrawn Rs. 16,500/- by using ATM card,  he was taking false plea.  He was suppressing the material facts.  Therefore it prayed for dismissal of the complaint with costs.

          The complainant in proof of his case filed his affidavit and Exs. A1 to A3 while the respondent filed Exs. B1 to B3.   The Dist. Forum after considering the evidence placed on record opined that  the complainant had withdrawn the amount by using ATM card. Since he has been maintaining both the accounts  and in view of the fact that he was not having amount in his account, an amount of Rs. 16,500/- was adjusted.  Since the complainant was not having the amount for which the cheque was issued  the same was returned for want of sufficient funds.  Therefore, it cannot be said that the bank was deficient  in its service,  and therefore dismissed the complaint.

          Aggrieved by the said decision the complainant preferred  this appeal contending that the Dist. Forum did not appreciate the facts in correct perspective.  When admittedly, there was no amount in his account, he could not have withdrawn the amount using  ATM card.   There was no proof that he had actually withdrawn  Rs. 16,500/- using ATM  card.  Therefore, he prayed that the appeal be allowed, and consequently the complaint.

          It is an undisputed fact that the complainant was having two accounts one in his name, and another in the name of his son.  Both the accounts have been maintained by him alone.   He has ATM facility evidenced under Ex. B3.  

          Evidently the complainant had deposited an amount of Rs. 24,500/- on 2.9.2004 in the account of his son.  When he issued a cheque in the name of M/s. Magna Finance Ltd., and when it was presented it was returned on the ground of insufficient funds.   The allegation of the complainant is that he has sufficient amount and the bank ought to have honoured the cheque.  The bank asserts  that the complainant had withdrawn an amount of Rs. 16,500/- on 14.7.2004  and 15.7.2004  by  using  his ATM card which resulted over draft in

his account.  Since he did not pay, this amount has been adjusted from out of the account of his son as they were having lien.   On that the complainant got up dated his pass book to know the reasons for dishonouring the cheque issued  by him.  Then,  he could know that an amount of Rs. 16,500/- was debited to the account of his son,  showing the description as “ATM OD AMT RECV”   vide Ex. A1.

          The complainant alleges that when there is no OD facility attached to  ATM  of his account,  it cannot deduct the said amount.  This has led to dishonouring of the cheque, and it is illegal.  He asserts that a sum of Rs. 16,500/- was debited in  his son’s  by dubbing it an  ATM OD.  When he does not have ATM OD facility for his account nor he used ATM card for withdrawing  the amount  as alleged, debiting an amount of Rs. 16,500/- without any  express authority and contrary to established procedure and practice of bank constitutes deficiency of service.  

Undisputablly on 7.8.2004 the respondent has dishonoured the cheque for Rs. 24, 236/-.  In the S.B. account of his son, he had a credit balance of Rs. 26,601-17.  Equally on 2.9.2004,  when the bank had dishonoured the cheque for Rs. 24,236,  issued by the complainant on  S.B. account of his son, he had credit balance of Rs. 24,999/-.  The bank while admitting the same alleges that on 2.9.2004 an amount of Rs. 16,500/- was adjusted towards the amount withdrawn from ATM.  It further alleges  that the complainant had cleverly deposited the amount in his son’s  account in order to evade payment to the bank,  thinking that if the amount has been deposited in his account, the bank would  adjust towards ATM OD amount.   However,  this amount was adjusted in  the. Complainant’s  account immediately, therefore there was no amount, for honouring the cheque.  When the complainant issued a cheque for Rs. 24.236/-  in  favour of M/s. Magna Finance Limited , on the same day i.e., on

2.9.2004 it was dishonoured for want of sufficient funds.  At para 7 of the counter  there was a mention that “When  there is ATM facility he has withdrawn excess amount of Rs. 16,500/- instead of mentioning the real facts before the Forum  the complainant is harping on one only that is account No. 011 900 27454.  Had he paid overdrawn amount of Rs. 16,500/- in account No. 011 900 35297 in time, this situation would not have arisen.”    

The complainant asserts that   the question of withdrawing excess amount by using ATM card  will not arise as no OD facility would be attached to ATM card.   We have gone through the conditions mentioned on the reverse of Ex. B1 for issuing ATM Card.  At clause 19 there is a categorical mention  that “ATM does not offer cash advances.  It is therefore, the card holder’s obligation to maintain sufficient balances in the designated account to meet cash withdrawal and service charges where the ATM is not running   on-line, the transactions in the ATM will be accounted for the next working day.”   On the reverse of it,  one of the conditions is “I/We agree to keep  sufficient balance in the account at all times to enable you to make debts for withdrawals made by me/us as also for the charges  on account of the use of ATM  by me/us.

 Apart from it, withdrawal up to Rs. 3,000/- per day in two designated denominations Rs. 50/- and Rs. 100/- is allowed.  Minimum amount that can be withdrawn is Rs. 100/- and withdrawal should be in multiples of Rs. 100/-.  In the light of fact that no advance can be drawn from the ATM,  it is not known how the complainant could withdraw the same from his account.  The bank could not file any documents to show that Rs. 16,500/- was withdrawn by using ATM card on 14.7.2004 and 15.7.2004.    There cannot be any over draft attached to ATM card account.  In the light of the fact that he could not have  withdrawn Rs. 16,500/- as  the  withdrawal  of  such  an  amount  was

prohibited, the contention of the bank cannot be up held.  When the bank could not show that he had withdrawn the amount from ATM,  and when the bank alleges that the complainant had withdrawn excess amount of Rs. 16,500/- by way of OD facility,  which ex-facie could not have been made,  in view of prohibition under clause 19 of Ex. B1,  we do not agree with the contention of the bank in this regard.   Immediately the complainant gave notice under Ex. A2  mentioning all  these facts.  The  bank replied to  it under

Ex. B1,  stating that the complainant has withdrawn Rs. 16,500/- by using ATM card by way of OD, we reiterated the same  cannot be countenanced,  more so in the light of conditions stipulated for operating ATM card.  Undoubtedly the bank has committed irregularity in debiting Rs. 16,500/- in the account.   This is a sort of manipulation made in order to get over payment of the amount.   Considering the nature of loss sustained by the complainant, we feel that Rs. 5,000/- could be awarded towards mental agony and loss caused to the complainant for  dishonouring the cheque. 

In the result the appeal is allowed, consequently the complaint is allowed in part directing the bank to pay Rs. 16,500/- wrongly debited in  his account besides Rs. 5,000/- towards compensation  and costs of  Rs. 2,000/-.  Time for compliance four weeks.

          PRESIDENT                                               LADY MEMBER

                                                Dt. 28. 8. 2008.