BEFORE THE DISTRICT CONSUMER DISPUTES

REDRESSAL COMMISSION, JALANDHAR.

Complaint No.394 of 2021

      Date of Instt. 30.11.2021

      Date of Decision: 26.06.2024

Arnav Gupta (aged 31 years) s/o Sh. Kamal Gupta r/o 509, Cheema Nagar, Near PPR Mall, Mithapur Road, Jalandhar.

..........Complainant

Versus

1.       State Bank of India, Jalandhar personal banking branch, 37 Cool      Road, Jalandhar City, through its Manager.

2.       Senior Manager, State Bank of India, Jalandhar personal, banking     branch, 37 Cool road, Jalandhar City.

….…..Opposite Parties

Complaint Under the Consumer Protection Act.

Before:        Dr. Harveen Bhardwaj             (President)

                   Smt. Jyotsna                            (Member)                                          Sh. Jaswant Singh Dhillon       (Member)   

Present:       Sh. V. K. Gupta, Adv. Counsel for Complainant.

                    Sh. A. K. Arora, Adv. Counsel for OPs.

Order

Dr. Harveen Bhardwaj (President)

1.                The instant complaint has been filed by the complainant, wherein it is alleged that the complainant is the account holder of saving account No.65018181154 with the OPs as such is the consumer of the OP. The complainant had opened some FDR accounts with the OPs, which are on record. All these FDR's accounts were opened by complainant from his personal income and savings and entire amount of these FDR's were transferred from his personal account with opposite party bearing account number 65018181154. It is made clear that complainant is sole and exclusive owner and holder of these FDRs which is evident from the fact that Bank used to deduct TDS (Income Tax) from the accrued interest and used to deposit the same with the Income Tax department against Permanent Account Number (PAN) of complainant. However due to love and affection names of father/mother were added as a second applicant in these FDR's, though no amount was transferred/contributed by the mother/father of complainant. Further the operation of accounts was either or survivor and standing instructions were given to opposite parties for auto renewal of these fixed deposits. The complainant has opened these FDR's accounts with long tenure intentionally with an objective for future requirements and to earn more interest. These FDRs are free from all sorts of encumbrances/charges or lien. The complainant approached to OPs on 20.08.2021 to verify actual status of above-mentioned FDR's as he was in need of money and requested concerned clerk/official to provide copies of the statement of accounts of these FDR accounts. After receipt of statement of accounts of FDR's complainant shocked to learn that FDR's pertaining to the account numbers 65215752002, 65215752670, 65215752284, are already en-cashed on 03.12.2019 on account of personal use. The complainant was highly surprised and shocked as he never got en- cashed these FDR and he never gave any request for the liquidation of these FDR's then how the FDRs are liquidated for his personal use. Immediately complainant requested the concerned clerk to provide the request letter submitted for the liquidation of FDR's. The said clerk failed to provide any request letter to that effect and has intimated complainant that in-fact these FDRs are liquidated by the bank itself in order to liquidate the outstanding dues of some OD limit jointly availed by father and mother of complainant. The complainant immediately requested concerned officials to provide complete detail with respect to OD facility availed by his father and mother, earlier he shows his reluctance to provide the same. When complainant asked him that he will call the police authorities and the media persons he agreed to provide entire details, and he informed complainant that father and the mother of complainant have two FDR accounts with the Bank i.e. FDR no.65045009791 for Rs.34,00,000/-with maturity value of Rs.84,84,510/- and FDR account number 65045010071 for Rs.28,00,000/- with maturity value Rs.69,87,244/-. Against both these FDRs they have availed Over Draft facility from the Bank i.e. Rs.30,60,000/- and Rs.26,92,000/- respectively. It is also informed to complainant that there was some overdue amount left in said OD account after adjusting the FDR no.65045009791 and 65045010071 as such to adjust said amount above mentioned FDR's were liquidated by the bank and proceeds were transferred to satisfaction of the dues of the Bank. The complainant immediately enquired that whether any charge or lien was over the FDR's obtained by complainant then the answer from the Bank official was in negative as no charge was ever created. Moreover, even the original FDRs receipts are lying in possession of complainant till date. Thereafter complainant raised objection against the act of Bank on two accounts firstly that as per RBI norms in case any person has availed "Over draft" facility against FDR then by no stretch of imagination Bank will permit any excess in OD limit since as per RBI guidelines FD margin is kept so that overdue does not exceeds the Face value of the FDR and interest thereon. As such Bank was supposed to liquidate the FDR no.65045009791 and 65045010071 when the overdue in OD accounts exceeded the face value and interest on FDR no.65045009791 and 65045010071 Secondly since all the FDR's i.e. 65215752002, 65215752670, 65215752284 were obtained by complainant Bank was bound to issue notice to complainant before liquidating the FDRs. Thereafter on demand of complainant concerned official failed to provide any such notice issued to complainant. Thereafter, complainant requested the branch Manager to refund the amount of the complainant with immediate effect but of no use. Thereafter, complainant got issued legal notice dated 10.09.2021 to the OP, but all in vain and as such necessity arose to file the present complaint with the prayer that the complaint of the complainant may be accepted and OPs be directed to pay the FDRs with upto date interest and further OPs be directed to remove the hold on from the account number 65119424004 of the complainant and to pay Rs.5,00,000/- as compensation for causing mental tension and harassment to the complainant and Rs.50,000/- as litigation expenses.

2.                Notice of the complaint was sent to the OPs, who filed reply and contested the complaint by taking preliminary objections that the complainant is estopped by his own act & conduct from filing the present complaint. It is further averred that the present dispute cannot be settled in a summary manner, since complicated questions of law and facts are involved in the present case, thus this commission is not a appropriate forum to decide the present dispute between the complainant and the OPs. The said case cannot be decided without leading evidence and as such the matter is liable to be referred to the Civil Court, which is the only Forum for decision of the said case on merits after leading evidence by both the parties and giving opportunity of cross examination of the witnesses. It is further averred that the FDRs of the complainant were credited by the respondent bank on 03.12.2019 in the Saving bank account of the Kamal Gupta & Yoshita Gupta and the said fact was well within the knowledge of the complainant that the FDRs, which is the subject matter of the present complaint have been credited by the respondent bank on 3.12.2019. The complainant kept mum over the matter for a period of about two years and has no right whatsoever to file the present complaint against the OP. It is further averred that there is no deficiency of service or unfair trade practices on the part of the OPs and that being so, the present complaint is not maintainable before this Commission. On merits, it is admitted that the complainant is the account holder of saving account No.65018181154 with the OPs. It is also admitted that the parents of the complainant namely Kamal Gupta and Yoshita Gupta had two FDRs account with the bank bearing FDR No.65045009791 for Rs.34,00,000/- with maturity value of Rs.84,84,510/- and FDR account No.65045010071 for Rs.28,00,000/- with maturity value of Rs.69,87,244/-, but the other allegations as made in the complaint are categorically denied and lastly submitted that the complaint of the complainant is without merits, the same may be dismissed. 

3.                Rejoinder to the written statement filed by the complainant, whereby reasserted the entire facts as narrated in the complaint and denied the allegations raised in the written statement. 

4.                In order to prove their respective versions, both the parties have produced on the file their respective evidence.

5.                We have heard the learned counsel for the respective parties and have also gone through the case file very minutely.

6.                It is admitted that the complainant is the account holder of saving account No.65018181154 with the OPs. The passbook of the complainant of the saving account No.65018181154 has been proved as Ex.C-1. It is not denied that the parents of the complainant namely Kamal Gupta and Yoshita Gupta had two FDRs account with the bank bearing FDR No.65045009791 for Rs.34,00,000/- with maturity value of Rs.84,84,510/- and FDR account No.65045010071 for Rs.28,00,000/- with maturity value of Rs.69,87,244/-. Both the parents of the complainant had availed the over draft facility on their FDRs from the bank for Rs.30,60,000/- and Rs.26,92,000/- respectively. There is a dispute regarding the liquidation of the FDRs of the complainant by the bank in order to adjust the overdue amount left in the OD account of the parents of the complainant. The parents of the complainant alongwith the brother of the complainant have filed the four complaints challenging the deficiency in service by the OPs for liquidating the FDRs of the complainant without the consent of the complainant and without notice to the complainant illegally and unlawfully. The unfair trade practice has been alleged by the complainant and his family members. The family members have filed four complaints. The present complaint alongwith three other complaint pending in this commission are being decided today only since the subject matter in all the complaints is interlinked.

7.                The complainant has alleged that he is the exclusive owner of the FDRs, which were opened by the complainant from his personal income and saving. The complainant has proved on record the copies of the FDRs as Ex.C-2 to Ex.C-6. Perusal of these FDRs show that five FDRs are with the mother Yoshita Gupta as second account holder and one FDR with Sh. Kamal Gupta as second account holder. One FDR was opened in the year 2008 and five FDRs were opened in the year 2014 having different date of maturity. This fact has been denied by the OPs that the complainant is the exclusive owner of all the FDRs. It has been alleged by the OP that there are second account holders also, therefore, they are also owners of the FDRs as the same are in the joint names of the complainant and his parents. The complainant has produced on record the statement of account Ex.C-7 to Ex.C-11 to show that these FDRs were got opened by the complainant from the account in which the complainant was first account holder. All these statement of account clearly show that no amount has been transferred in the account of the complainant either from the account of Yoshita Gupta, mother or Kamal Gupta, the father of the complainant. The complainant has alleged the deficiency in service and negligence of the OPs, who have liquidated his FDRs without the consent of the complainant as the complainant had never given any undertaking to liquidate his FDRs in case of over draft in the FDRs of the parents of the complainant. The complainant has challenged the legality of the act of the OPs and has also alleged deficiency in service and unfair trade practice.

8.                Perusal of the record produced by the complainant shows that the complainant has proved the statements of account and as per the record, he got opened the FDRs for Rs.1,55,000/- on 03.11.2008 for 10 years with the maturity date of 01.11.2018 in the name of Arnav Gupta and Yohsita Gupta. This amount of Rs.1,55,000/- was transferred for STDR from the personal account of the complainant Ex.C-1. On 09.11.2015, the STDR was prepared for Rs.1,25,000/- for 4 years 11 months having the maturity date of 05.10.2019. Ex.C-1 shows the transfer from account no.098541507142 for Rs.1,00,000/- and the amount of Rs.52,616/- was credited in the account of Arnav Gupta on 05.11.2014 from the account no.098541507142. These are sweep accounts having different account numbers of sweep, which is sort of FDR also. Similarly, the other amount withdrawn for the opening of the FDR is clearly proved from Ex.C-1 and Ex.C-7 to Ex.C-11 that the FDRs were got opened by the complainant with his mother and father from his personal account being first account holder. The account statement of the complainant nowhere shows that the same was transferred in this account from the account of the parents of the complainant, but even if for the sake of arguments, it is assumed that the second account holder is either father or mother of the complainant, even then the parents have every right to transfer any amount in the account of their children from their own account. There is no bar in doing so as the parents have full right over their children. The onus is upon the OPs to prove that the parents of the complainant namely Yoshita Gupta and Kamal Gupta have deposited the amount in the account of the complainant purposely having intention not to repay the loan, but there is no such plea or defence or proof given by the OPs. The matter is between the children and parents. The OPs have nothing to do with this. Unless and until, they have the proof that the amount was deposited or transferred in the account of the complainant for preparing FDR in order to avoid the repayment of loan. The OPs are to get the interest from the loan given by the OPs to their consumers as per rules only. The OPs cannot go beyond the conditions, rules and RBI guidelines of the policy. Ex.C-15 shows that the messages were sent to the complainant by the OPs that the hold has been placed on his account no.65045006348 for Rs.3,55,000/-, account No.65119424559 for Rs.18,691/-, Account No.6527179074 for Rs.2,34,000/- and XXXXX424004 for Rs.18,691/-. The messages sent to the complainant proved as Ex.C-15 and the messages sent to another son of Kamal Gupta namely Akshit Gupta, complainant in other case are the same messages which have been proved in that case as Ex.C-17. All these messages relate to same account number. This is not the case of the OPs that the notice was sent to the complainant before sending messages or before liquidating the FDRs. The copies of the FDR proved by the complainant as Ex.C-2 to Ex.C-7, nowhere shows that the complainant has ever authorized the OPs to adjust the amount of the FDR for the repayment of overdue of amount of any third person i.e. not belonging to the complainant, may it be the father or mother of the complainant having different FDRs in their names. There are instructions on the back of FDR Ex.C-5, Ex.C-6 and these instructions relate to the renewal of the deposit automatically in order to save the consumer/customer from any loss of interest. Except this, there is no such instruction or undertaking by the complainant to the bank to disburse or adjust the amount in any other account or in the FDRs account of the parents of the complainant. The act of the OP in liquidating the FDRs of the complainant without his consent and without notice is illegal and this is clear cut unfair trade practice. Though, there are the names of Yoshita Gupta and Kamal Gupta as a second account holder, but there are no instructions either from Kamal  Gupta or from Yoshita Gupta to adjust the amount from these FDRs in their FDRs having No.65045009791 and 65045010071. More so, the FDRs Ex.C-2 to Ex.C-6 clearly shows that these FDRs have been referred to Arnav Gupta i.e. the complainant only with no other name either of Yoshita Gupta or of Kamal Gupta. Perusal of Ex.OP1-2/5 to Ex.OP1-2/9 shows that the FDRs have been closed by the bank belonging to the complainant mentioning the reason for closing and request for personal use, but there is no reference for what personal use nor there is any letter for closing the FDRs for personal use. These FDRs were closed and the amount was debited and adjusted in the FDR accounts of the parents of the complainant without the consent and notice and knowledge of the complainant. Even the Ombudsman has categorically mentioned the rules in its decision vide Ex.C-20 by mentioning, that ‘With reference to the trailing mail, we advise that bank's submission w.r.t. the captioned complaint has been examined and accordingly Banking Ombudsman's decision in this regard is "We may close it. But one thing is clear that in FD margin is kept so that overdue does not exceed the face value and interest thereon. This was not followed which bank should keep in mind in future". Even the banking Ombudsman has categorically mentioned the rules in its decision vide Ex.C-16 having annexure-1 and Ex.C-18. The Ombudsman has mentioned the rules in its decision and has categorically observed that the bank has closed the FDRs, which are not related with the loan taken by Kamal Gupta or by Yoshita Gupta. The observation of Ombudsman reads as under:-

                   ‘With reference to the trailing mail, we advise that bank's submission w.r.t. the captioned complaint has been examined and accordingly Banking Ombudsman's decision in this regard is "We may close it. But one thing is clear that in FD margin is kept so that overdue does not exceed the face value and interest thereon. This was not followed which bank should keep in mind in future". The conciliation meeting was held and as per Ex.OP1-2/10, the bank was allowed to act as per the existing banking law and practices. In the written statement, the OP has alleged that the OP has got general right of set off on these FDRs, since both Kamal Gutpa and Yoshita Gupta have taken loans from the complainant and loan account of both the borrowers became irregular and both the borrowers did not liquidate their loan account. In reconciliation meeting also it was mentioned that the bank is to act as per existing law, but the OP has not produced on record any existing law or any rule or any guidelines or policy of RBI to show that the OP has got right of set off on these FDRs, which are not related to the loan amount. This fact has clearly been observed even by the Ombudsman that bank cannot do this as the FDR margin is kept so that overdue does exceed the face value.

9.                It has been held by the Hon'ble National Commission in a Revision Petition No.2227 of 2007, decided on 16.08.2007, titled as ‘Sangli Bank Ltd. Vs. Mrs. Sushila Bajaj & Anr.’ that ‘Nonpayment of a matured Fixed Deposit Receipts by bank Deficiency in service Complaint allowed by forum below Revision petition filed Held, bank had an intention to recover loan taken by complainant's son against such Fixed Deposit Receipts though plea of Bank's lien over such Fixed Deposit Receipts was not taken Deficiency in service proved No case made out for interference’. It has been held by the Hon’ble Supreme Court in Civil Appeal No.6945 of 2004, decided on 25.10.2004, titled as ‘Anumati Vs. Punjab National Bank’ that ‘Joint Fixed Deposit Receipt Attachment and set-off of joint account against individual liability of one of the joint holders of account/receipt is not permissible in the absence of express consent or undertaking of the other joint holder of it If the amount of joint account is appropriated by the bank for individual liability of one, and other joint holder is refused the payment against the terms of option allowed to be exercised at the time of opening of the account, it is certainly a deficiency and defect in the service and the Bank is liable to make good the loss to the account.’ It has been held by the Hon’ble State Commission, in an Appeal No.1238 of 2004, decided on 05.04.2006 titled as ‘Kewal Krishan & another Vs. Allahabad Bank’ that ‘Complainant along with his wile had made a fixed deposit of Rs. 38,982/- is respondent bank which was to mature on 14.07.04 on 'either or survivor basis' - Maturity value of the same was Rs. 52,426/- Complainant had an unregistered firm in the name of M/s R.C. Sales Corporation of which he was the sole proprietor The firm had taken loan from the bank to the tune of Rs. 20,000/- A sum of Rs. 24,457,65/- was outstanding against the firm which was deducted from the amount of complainant as per order of District Forum giving rise to present appeal. The complainant had never given any authority to bank to appropriate the amount from his personal account for non-payment of loan by Corporation Appropriation of amount is not in consonance with the spirit of Section 171 of the Contract Act Amount of complainant and his wife could not be appropriated without the permission of both of them Respondent's Bank directed to pay the entire maturity value along with interest is the date of payment Appeal allowed.’ It has been held by the Hon’ble State Commission, Maharashtra, in First Appeal Nos.166 to 168 of 2009, decided on 13.01.2012, titled as ‘Shriman Malojiraje Sahakari Bank Ltd. & Anr. Vs. Shri Atmaram Pandurang Bobade’ that ‘Plea of Bank that deposit receipts stand as security for a loan taken by another person - No documents were produced regarding consent of complainant for such security - Held, said dishonour is a failure on part of opponent Bank in discharging their contractual obligation - Deficiency in service - Direction to Bank opponent to honour payment of fix deposit.’

10.              Even the undertakings given by the parents namely Yoshita Gupta and Kamal Gupta Ex.OP1-2/3 and Ex.OP1-2/4 nowhere shows that they have ever undertaken that in case of any overdue, the amount shall be adjusted from the FDRs in which they are second party alongwith their son. More so, the banks, as per the RBI rules and guidelines and Ombudsman observation keep the margin in the FDRs, so that overdue does not exceed the face value and the interest thereon. This is responsibility of the OPs how to calculate and how to fix the margin in the FDRS and they cannot take the advantage of the accounts of the other relative/consumers in their bank. This is clear cut unfair trade practice on behalf of the OPs and deficiency in service and thus, the complainant is entitled for the relief.  

11.              In view of the above detailed discussion, the complaint of the complainant is partly allowed and OPs are directed to refund the money of FDRs belonging to the complainant, bearing Account No.65215752002 having maturity value of Rs.81,509/-, Account No.65215752670 having maturity value of Rs.1,93,641/-, Account No.65215752284 having maturity value of Rs.1,70,983/- with interest @ 9% per annum from the date of closing/liquidation the FDR, till its realization. Further, OPs are directed to remove hold on funds imposed on account No.65119424004. Further, OPs are directed to pay a compensation to the complainant, to the tune of Rs.20,000/- for causing mental tension and harassment to the complainant and Rs.10,000/- as litigation expenses. The entire compliance be made within 45 days from the date of receipt of the copy of order. This complaint could not be decided within stipulated time frame due to rush of work.

12.              Copies of the order be supplied to the parties free of cost, as per Rules. File be indexed and consigned to the record room.

Dated          Jaswant Singh Dhillon    Jyotsna               Dr. Harveen Bhardwaj     

26.06.2024         Member                    Member               President