PER SHRI. S.B.DHUMAL - HON’BLE PRESIDENT :
1) In brief consumer case is as under –
Shri.Ashok Kumar Puri, settled a private trust for the benefits of his minor daughter Ms.Komal Puri vide Trust Deed dtd.29/05/1985. He appointed State Bank of India as a Sole Trustee of Ms.Komal Puri Trust. The trust was started with the corpus of Rs.40,000/- which was entrusted with the Opposite Party - State Bank of India Executor and Trustee Division. The Complainant Ms.Komal Puri is daughter of Settlor Shri.Ashok Kumar Puri. Alongwith complaint she has produced xerox copies of Trust Deed at Exh. ‘A’.
2) According to the Complainant, during the course of discussion with her father, Officer of the Opposite Party had represented that they have expertise in the field of finance and investment Therefore, her father appointed Opposite Party as Sole Trustee under the aforesaid Trust Deed dtd.29/05/1985. However, the Opposite Party has committed blatant defaults in its performance and have deliberately failed to compensate the Complainant for the loss damage caused to her on account of breaches of trustship obligations and deficiency in service. Instead of investing funds with financial institutions, like UTI, IDBI which fetched better return, the Opposite Party invested the funds to protect the interest of their own bank. After lapse of period of about 21 years the Complainant received from the Opposite Party a sum of Rs.3,41,611.37 paise as a part maturity amount and securities being 1,000 unites of SBI Magnum fund and 170.026 units of TATA Mutual Fund which fetched the total redemption amount of Rs.36,128/-. Thus, the Complainant has received only sum of Rs.4 Lacs from the Opposite Party. As per the Complainant, if the amount was invested prudently by Opposite Party, then by conservative estimate, she ought to have received Rs.10 Lacs and could have even been in the range of Rs.30 Lacs if invested in proper reputed shares.
3) The Complainant has alleged that she has suffered financial loss due to the deficiency in service on the part of Opposite Party. It is contended that cause of action took place in the month of July, 06 upon maturity of the trust. The Complainant has requested to direct Opposite Party to pay to the Complainant a sum of Rs.9,59,000/- for the loss and damage suffered by her on account of deficiency in service on the part of Opposite Party. Further she has claimed for Rs.20,000/- towards cost of this proceedings.
4) Alongwith complaint, the Complainant has produced xerox copies of Trust Deed dtd.29/05/85 and xerox copies of correspondence with the Opposite Party.
5) Opposite Party has filed written statement and thereby resisted claim of the Complainant contending interalia that allegations made in the complaint are false. Opposite Party is a Public Sector Bank. The Complainant’s father entered into a Trust Deed with the Opposite Party dtd.29/05/85 making Opposite Party a Sole Trustee to deal with the funds of Komal Puri Trust and invested Rs.40,000/- as Corpus Fund. Opposite Party has denied allegations of deficiency in service and contended that as a Sole Trustee, Opposite Party was having absolute authority to deal with Trust funds, without intervention of the Settlor. Investment in the mutual funds is subject to the market risk. Opposite Party Bank invested in Trust fund to protect interest of the beneficiary. It is admitted by the Opposite Party that initially for period of 6-7 months the amount was not deposited. However, they have compensated the beneficiary for that lapse. Opposite Party has avoided those investment where safety of fund was risky and whose returns are unpredictable and risky and invested in those fund, which was advised by the Settlor in the writing.
6) Entire amounts of the Trust Funds are handed over to the Complainant after maturity of the Trust on 02/07/2006. Settlor was given reasonable facilities for periodical inspection of documents as well as any accounts report and document relating thereto. It is contended that allegations made in the complaint are imaginary, false and there is no deficiency in service on the part of Opposite Party and therefore, the complaint may be dismissed with cost.
7) The Complainant has filed written argument as well as Opposite Party has filed written argument. Heard oral submissions of Ld.Advocate for both the parties.
8) Following points arises of our consideration and our findings thereon are as under -
Point No.1 : Whether the Complainant has proved deficiency in service on the part of Opposite Party ?
Findings : No
Point No.2 : Whether the Complainant is entitle to recover compensation or cost of this proceeding from the Opposite Party ?
Findings : No
Reasons :-
Point No.1 :- Following facts are admitted facts that vide Trust Deed dtd.29/05/85 Shri Ashok Kumar Puri settled the private Trust for the benefit of his minor daughter Ms.Komal Puri and appointed present Opposite Party as Sole Trustee. The said Trusts was named as Komal Puri Trust. True copy of Trust Deed dtd.29/05/85 is produced on record. It is admitted that the Settlor Shri.Ashok Kumar Puri has started aforesaid Trust in the name of his daughter Ms.Komal Puri with corpus of Rs.40,000/- which were entrusted to the Opposite Party on the terms and conditions contending in the Trust Deed.
As per the terms and conditions of the Trust Deed “the Trustees shall invest the sum of Rs.40,000/- in fixed deposit with the Trustees Bank or in any other Nationalized Bank or in any Government Securities or Unite Trust of India or in any such scheme which is allowed by the Government for the investment of the trust property.”
As per Trust Deed, the Trustee shall until the said Komal Puri attains the age of 21 years, accumulate income of the trust property and shall invest the same so that it accumulates with the Trust Fund and farms part of the Trust Fund till and until the said Komal Puri attain the age of 21 years. Upon the said Komal Puri attaining age of 21 years, the Trustees shall hand over and pay the 30 % of such capital and accumulated income to the said Komal Puri for specific purpose mentioned in the Trust Deed. It is stated that the Trust shall hand over the capital and income which still remains with them after payment under Clause III to the said Komal Puri on the day she completes age of 25 years and enters into 26th years of the year life.
In this case it is admitted fact that the Opposite Party has paid corpus and accumulated income thereon i.e. about Rs.4 Lacs to Komal Pujari on/about 02/07/06.
It is submitted on behalf of Complainant that amount entrusted with the Opposite Party as a corpus was not invested prudently by the Opposite Party. Opposite Party has not discharged contractual obligation diligently and due to deficiency in service on the part Opposite Party the Complainant has suffered heavy loss. According to the Ld.Advocate for the Complainant in case if the amount was invested in the funds like IDBI or UTI Mutual Fund with the lucrative scheme, the Complainant might have received good returns and during span of 21 years she could received Rs.30 Lacs from the Opposite Party. Even on conservative estimate the Complainant ought to have received Rs.10 Lacs. It is alleged that Opposite Party kept the amount in Term Deposit with their own bank to protect their own interest. By letter dtd.28/08/06 addressed to the Complainant Opposite Party informed the Complainant that her father was always taking more than keen interest in the management of trust fund though he had appointed Opposite Party as a sole trustee. According to the Ld.Advocate for the Complainant, Opposite Party has rendered their services for consideration and as such they are liable to the Complainant to compensate the loss she has suffered due deficiency in their services.
Ld.Advocate for the Opposite Party has submitted that allegations made by the Complainant are false and afterthought. There is no deficiency on the part of Opposite Party. Opposite Party Bank invested the corpus as per the directions given by the Settlor in the Trust dtd.29/05/85. In support of his contention he has referred to clause no.1 on page no.2 of the Trust Deed. It is not alleged by the Complainant that Opposite Party invested the amount by disobeying the directions of Settlor. According to the Opposite Party, the amount invested in the mutual funds and shares are always subject to market risk. Opposite Party has prudently taken decision regarding investment throughout entire period. The amount was not only invested in the fixed deposit of SBI Bank as alleged but investment was made as per the directions of Settlor. The Opposite Party has already paid amount to the Complainant which was 10 times of the any corpus of the Trust. Therefore, the complaint deserves to be dismissed.
As discussed above, it appears from the evidence on record that the Opposite Party has invested the corpus as per the directions given by the Settlor. Further it appears that Settlor was keenly observing the investment made by the Opposite Party and from time to time he had given suggestions to the Opposite Party. It appears that the Complainant was expecting high returns. Complainant’s expectations are imaginary. As the Complainant could not get high returns, it cannot be said that there was deficiency in service on the part of Opposite Party. Main object of the Trust was to protect interest of the beneficiary. Considering the evidence on record, it appears that Opposite Party had taken reasonable steps to protect interest of the beneficiary. Therefore, we hold that the Complainant has failed to prove deficiency in service on the part of Opposite Party. Hence we answer point no.1 in the negative.
Point No.2 :- The Complainant has failed to prove deficiency in service on the part of Opposite Party. Opposite Party has not committed breach of terms and conditions of the Trust Deed. Therefore, the Complainant is not entitled for any compensation or cost of this proceeding from Opposite Party. Hence, we answer point no.2 in the negative.
For the reasons discussed above, we pass following order -
O R D E R
i.Complaint No. 76/2007 is hereby dismissed with no order as to cost.
ii.Certified copies of this order be furnished to the parties.
