Tamil Nadu

North Chennai

CC/128/2021

V.Sanath Kumar,S/o.Sridhar Chetty - Complainant(s)

Versus

The Cheif Manager,Bank of Baroda - Opp.Party(s)

M/s.K.Venkateswarn,B.Aravindan

31 Oct 2023

ORDER

Complaint presented on  :13.09.2021

 Date of disposal            :31.10.2023

                                                                                  

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

CHENNAI (NORTH)

@ 2^ND Floor, T.N.P.S.C. Road, V.O.C. Nagar, Park Town, Chennai – 600 003.

 

                PRESENT : THIRU. G. VINOBHA, M.A., B.L.,                          :PRESIDENT

                                      TMT. KAVITHA KANNAN, M.E.,                         : MEMBER-I

                                      THIRU.V.RAMAMURTHY,B.A.,B.L.,PGDLA.,   :MEMBER-II

                                     

C.C. No.128/2021

 

DATED TUESDAY THE 31^ST  DAY OF OCTOBER 2023

1. V.Sanath Kumar,

Son of Sridhar Chetty,

 

2. V.Pragneshkumar,

Son of V.Sanath Kumar,

 

3. V.Suneeth,

W/o.V.Sanath Kumar,

All residing at New No.29,

Old No.13, New Avadi Road,

Chennai-600 010.

                                                                          …..Complainants

 ..Vs..

The Chief Manager,

Bank of Baroda No.144,

Moore Street,

chennai-600 001.

                                                                                             …..Opposite Party.

 

Counsel for Complainants                   : M/s.K.Venkateswaran & B.Aravindan

Counsel for opposite party                   : M/s.R.Sreedhar and 4 others.

 

ORDER

THIRU.V.RAMAMURTHY,B.A.,B.L.,PGDLA.,   :MEMBER-II

This complaint has been filed by the complainant against the opposite parties under section 35 of the Consumer Protection Act, 2019 prays to direct the opposite party to pay a sum of Rs.200000/-each towards damages sustained by the complainants on account of the aforesaid unfair trade practice and as well as the deficiency in service inflicted by the opposite party on the complainant and to pay the total difference amount being a sum of Rs.20433/- and costs.

1.THE COMPLAINT IN BRIEF:

          The complainants submits that complainants have availed the Fixed Deposit Scheme of the Opposite Party Bank and had deposited a sum of Rs.3 Lakhs for each fixed deposit vide deposit No.527804, No.527805, No.527806 on 12.06.2013 for a period of 7 years and 6 months and the date of maturity is 17.12.2020 and the maturity value in respect of the aforesaid deposits being a sum of Rs.6,00,345/- each.  When the complainants approached the opposite party on the date of maturity i.e. 17.12.2020, the opposite party bank paid lessor amount instead of paying the maturity amount mentioned in the Fixed Deposit Certificate.  The complainants submits that the opposite party bank had arrived a sum of Rs.5,92,146/-, Rs.5,94,228/- and Rs.5,94,228/- and the said payment is subject to TDS and the net value after deduction of TDS as per income tax guidelines being Rs.5,67,436/-, Rs.5,73,877/- and Rs.5,73,877/- was credited to the beneficiary savings account.  An amount of Rs.24,710/-, Rs.20,351/- and Rs.20,351/- has been deducted towards TDS and hence there was shortfall of Rs.8,199/-, Rs.6,117/- and Rs.6,117/-.  The complainants states that the opposite party bank who had at the time of receiving the deposit from the complainants had assured that the maturity value in respect of aforesaid deposit would be a sum of Rs.6,00,345/- and that being the case the payment arrived by the opposite party is totally against the maturity value as assured by the opposite party.  The complainants states that even assuming for a moment the TDS to be deducted on the maturity value and the same to be deducted from Rs.6,00,345/- and the balance amount to be credited into the complainants’ saving account would be Rs.5,75,635/- after TDS of Rs.24,710/- but without paying the said amount the opposite party had whimsically arrived maturity value according to its fancies and from that amount the opposite party have deducted TDS and thereby given credit to the net value into the complainants’ bank account and the same is unknown and it would clearly reveals the indifferent attitude of the opposite party.  The total shortfall is Rs.20,433/-.  The complainants further states that when the complainants approached the opposite party on several occasions to set right the same and sought for payment of difference amount, the opposite party failed to consider the claim.  The complainants states that when the complainants brought the same to the knowledge of Banking Ombudsmen with regard to the indifferent attitude and deficiency in service by the opposite party and after enquiry the Banking Ombudsmen had directed the complainants to approach the Consumer Forum or any legal authority with law for redressal of claim made by the complainants.  The complainants further states that they issued a legal notice to opposite party on 15.07.2021 and the same was duly served but the opposite party had not come forward to give any reply and hence the complainants were constrained to file this complaint.  Therefore, the complainants prayed this Hon’ble Forum to direct the opposite party to pay Rs.2,00,000/- towards damages sustained, Rs.20,433/- being total difference amount with interest and cost of this complaint.  Hence this complaint.

 

 

2.WRITTEN VERSION OF OPPOSITEPARTY IN BRIEF:

The  opposite party submits that it is a financial institution which is a Nationalized Bank dealing with various financial products including savings, loan, fixed deposits etc. and deny all the allegations and averments made in the complaint filed by the complainants except those that are specifically admitted.  The opposite party submits that complainants have filed this complaint, which is false, frivolous and vexatious and the same has been filed with malafide intention and to seek unjust monetary benefits from the opposite party and on that count alone the complaint deserves to be dismissed with costs.  The opposite party accepts that the complainants have availed Fixed Deposit Scheme and had deposited a sum of Rs.3 Lakhs vide deposit No. 527804 on 12.06.2013 for a period of 7 years 6 months and the date of maturity is 17.12.2020 and the maturity value in aforesaid deposit was computed by the system as Rs.6,00,345/-.  Similarly, two more deposits of Rs.3 Lakhs each vide deposit No.527805 and 527806 on 12.06.2013  for a period of 7 years and 6 months and the date of maturity is 17.12.2020 and the maturity value in aforesaid deposits was Rs.6,00,345/-.   The opposite party submits that complainants have not presented the complaint with proper facts and they misrepresented this Hon’ble Forum in such a manner that the opposite party has assured to pay the value as referred in the term value deposit.  It is clearly stated in the term deposit receipt that the maturity value is subjected to TDS.  It means the amount stated in the term deposit is the total amount from which the TDS value would be deducted.  The opposite party states that it has been clearly explained to the complainants about the contents stated in fixed deposit scheme while availing the scheme and the complainants would have also been explained about the deduction of TDS in the maturity value.  The complainants are now sticking on to the amount mentioned in the Fixed Deposit receipt and now making an attempt to deviate the issue and also trying to demand money from our bank.  Further the opposite party also refuses the request made by the complainants in Para No.4 seeking an amount of Rs.20,433/- with ulterior motive.  The amount received by the complainants of Rs.5,67,436/-, Rs.5,73,877/- and Rs.5,73,877/- was the actual value after deduction of TDS.  The opposite party admits the fact that the complainants have sent a legal notice dated 15.07.2021 to opposite party which was suitably replied by the Bank through their counsel on 06.10.2021 but the complainants without waiting to get the reply from the Bank had hurriedly filed this complaint.  The opposite party submits that their bank is a nationalized bank working in an organized manner and the value generated was fully system generated and there would be no misrepresentation in calculation of the maturity value with deduction of TDS.  The opposite party states that there is no deficiency in service and hence the complaint is not maintainable.  Under these circumstances, it is therefore prayed that this Hon’ble Commission may be pleased to dismiss the vexatious complaint with costs and thus render justice.

3. POINTS FOR CONSIDERATION:

1. Whether there is any deficiency in service on the part of the opposite party as alleged in the complaint?

2. Whether the complainants are entitled to the reliefs prayed in the complaint. If, so to what extent?

The complainants had filed proof affidavit, written arguments and documents Ex.A1 to Ex.A8 were marked on their side.The opposite party had filed written version, proof affidavit, written arguments, and documents Ex.B1 to B4 were marked on their side.Oral arguments of learned counsel for complainants heard.

4. Point No.1:-

The complainants alleged that they deposited in the opposite party’s bank as Fixed Deposit on each complainant name for an amount of Rs.3,00,000/- on 12.06.2013 for a period of 7 years and 6 months and the maturity amount would be Rs.6,00,345/- on the maturity date of 17.12.2020 vide Deposit No.527804, 527805 and 527806.  The complainants alleged that opposite party instead of paying the maturity amount had paid lessor amount than the amount mentioned in the Fixed Deposit Certificate.  The opposite party had arrived at a sum of Rs.5,92,146/- Rs.5,84,228/- and Rs.5,84,228/- which is subject to TDS as per income tax guidelines and after deduction of TDS the amount credited by the opposite party was Rs.5,67,436/-, Rs.5,73,877 and Rs.5,73,877/- thus there was a short fall of   Rs.8,199/-, Rs.6,117/- and Rs.6,117/-.  The complainants alleged that when the matter was brought to the knowledge of opposite party, it was not explained properly and the reason for less credit was not informed and further the revised rate of interest was suppressed and the opposite party had whimsically arrived maturity value according to its fancies and TDS have been deducted from that amount thus the opposite party caused deficiency in service which resulted in mental agony to complainants.  The complainants have filed three Fixed Deposit Receipts which are marked as Ex.A1 to A3, Statement of Accounts as Ex.A4, Communication given by the opposite party as Ex.A5, Online complaint given to Banking Ombudsman as Ex.A6, Communication by Banking Ombudsman as Ex.A7 and Legal Notice as Ex.A8.

5. On the other hand, the opposite party had denied all the allegations of the complainants and contended that complainants had misrepresented in such a manner that the opposite party had assured to pay the value referred in the term value receipt.  The opposite party contended that it is clearly stated in the term deposit receipt that the maturity value is subjected to TDS which means the amount stated in the term deposit receipt is the total amount from which the TDS value would be deducted.  The opposite party clearly explained to the complainants about the contents stated in the fixed deposit scheme while availing the scheme and the complainants would have also been explained about the deduction of TDS in the maturity value.  The opposite party contended that the amount received by the complainants was the actual value after the deduction of TDS.  The opposite party admits that complainants had sent a legal notice on 15.07.2021 which was suitably replied by the opposite party on 05.10.2021 and the complainants without waiting for the reply had filed this consumer complaint in a hurried manner.  The opposite party further contended that their bank is the nationalized bank working in an organized manner and the value generated was fully system generated and there would be no misrepresentation in calculation of the maturity value with deduction of TDS.  The opposite party hence contends that there is no deficiency in service on the party of opposite party.  The opposite party have filed reply notice which is marked as Ex.B1, Accounts statement of 1^st complainant as Ex.B2, Accounts statement of 2^nd complainant as Ex.B3 and Accounts statement of 3^rd complainant as Ex.B4. 

6. After carefully gone through the averments, documents and oral submissions, it is an admitted fact that complainants had deposited three Term Deposits for a sum Rs.3,00,000/- each on 12.06.2013 for a period of 7 years 6 months and 5 days with a maturity value of Rs.6,00,345/- each on 17.12.2020.  The rate of interest was 9.34% and the maturity value is subject to TDS.  The Term Deposit Receipt No. 527804, 527805 and 527806 are in the name of complainants 1 to 3 as evidenced from Ex.A1 to A3. 

7. On perusal of Ex.A4, the account statement of each term deposit and Ex.B2 to B4, the account statement submitted by the opposite party for term deposits it is observed that opposite party had credited the accrued interest on regular intervals of six months and also deducted TDS on the accrued interest for every six months.  The accrued interest amount after deducting TDS was credited into complainants term deposit account as principal amount so that interest for the accrued interest amount will be given for the rest of the period till maturity date.  Normally Fixed Deposit or Term Deposit are cumulative in nature, where the interest is credited at regular intervals into the customer account as further deposits and for such credited interest amount again the interest will be given at the rate prescribed in the Fixed Deposit/Term Deposit Receipt and based on this the maturity value would be calculated. Such periodical credit of interest as deposits is observed in the accounts statement of complainants which are marked as Ex.B2 to B4.  The allegation of the complainant is that there was short fall of Rs. 8,199/-, Rs.6,117/- and Rs.6,117/- together a sum of Rs.20,433/- while computing the total maturity value. The complainants further alleged that opposite party had arrived the maturity value as Rs.5,92,146/-, Rs.5,94,228/- and Rs.5,94,228/- instead of maturity value of Rs.6,00,345/-  each thus there is a total deficit of Rs.20,433/-.  The complainants further alleged that opposite party had suppressed the revised rate of interest.  It is observed from the averments of the complainants that complainants are on wrong notion that TDS was calculated on the maturity value of the Term Deposit.  It is observed from Ex.A4 and Ex.B2 to B4 the interest on the principal amount was credited into the complainants account as deposits after deduction of TDS at regular interval of every six months.  Hence it is evident that TDS was deducted every six month in each financial year and not as contended by the complainants.  Reserve Bank of India in its circular No. Ref. DGBA.CDD. No. H - 1311/13.01.299/2008-09 dated August 5, 2008 to all the banks including nationalized banks in the application of TDS stated as “On ‘cumulative’ type of investments, if the interest is credited every year, tax deduction has to be made if the interest credited during the financial year exceeds the threshold limit of Rs. 10,000/. Thus, in the case of ‘cumulative’ type of investments, though the interest is payable on the date of maturity, tax deduction is still to be made whenever the interest credited or paid exceeds the threshold limit during the financial year”.  According to the above circular whenever the interest is credited into the customer’s account the TDS shall be deducted in that financial year itself and in this instant case the opposite party had credited the interest amount every six months after deducting TDS on the interest amount on each occasion in each financial year as per Reserve Bank circular which is evidenced from Ex.A4 and Ex.B2 to B4.

          8. The reason for less amount in the maturity value of the term deposit would be that every six months the TDS was deducted from the accrued interest amount and hence there was less credit in the principal amount which resulted in the less accrual of interest in the subsequent periods.  For example, in the case of 1^st complainant a sum of Rs.1,524/- was deducted as TDS from the interest amount of Rs.15,235/- on 26.03.2015 and the interest generated for the TDS amount of Rs.1,524/- for the remaining period of maturity i.e. from 26.03.2015 to 17.12.2020 is a loss to the complainant.  If the same principle is applied for the other TDS deductions, the total amount of such interest on the TDS would be the shortfall amount of Rs.8,199/-.  The same principle also applies for other complainants.  If the TDS was not deducted at periodic intervals, the complainant would have got the maturity value of Rs.6,00,345/- as mentioned in Term Deposit Receipt.  Complainants are at wrong notion that TDS have to be deducted on the maturity value of Rs.6,00,345/-.  But as per the RBI Circular as stated supra, the opposite party have to deduct the TDS on interest amount whenever it was credited into the customer account.  The relevant portion of RBI circular with regard to exemption of TDS is given below :

“In case of ‘cumulative’ type of investments, interest is payable on the date of maturity. In such cases,whether the TDS is required to be deducted on entire interest payable on the date of maturity or on deemed date of payment i.e. on accrual basis every year.

On ‘cumulative’ type of investments, if the interest is credited every year, tax deduction has to be made if the interest credited during the financial year exceeds the threshold limit of Rs. 10,000/-. Thus, in the case of ‘cumulative’ type of investments, though the interest is payable on the date of maturity, tax deduction is still to be made whenever the interest credited or paid exceeds the threshold limit during the financial year.”

In the present case the complainants have failed to give form 15G/15H Declaration to avoid TDS deduction and hence the opposite party have deducted TDS from the interest at regular intervals as per the above circular.  When the issue was brought to the knowledge of Banking Ombudsman by the complainants, the Banking Ombudsman clearly stated as “It is noted that you never submitted any Form 15G/H to your branch for non-deduction of TDS on Interest Paid for Fixed Deposit”as seen in Ex.A7. Had the complainants submitted Form 15G/H Declaration every year, they would have avoided deduction of TDS and got the full maturity amount.  Hence it is the failure on the part of complainants to submit Form 15G/H Declaration to the bank on every financial year.  In the absence of submission of Form 15G/H declaration by complainants, the opposite party have acted as per RBI guidelines and the deduction of TDS at regular intervals were as per the RBI Circular and therefore no deficiency is observed on the part of opposite party. 

9. The complainants further alleged that revised rate of interest was suppressed and the TDS was deducted on the value arrived by the opposite party instead of maturity value.  On perusal of Ex.A5, we found no revision of interest rate taken place and on perusal of Ex.B2 to B5, the TDS was deducted at the rate of 10% of interest amount accrued on every six months as per RBI Circular as stated supra and hence the allegations of the complainants are not maintainable.

          10. Based on the above facts and observations, this Commission is of the considered view that opposite party had credited the interest at regular intervals of six months and TDS was deducted at the time of crediting interest as per RBI Guidelines and the shortfall in the maturity value is due to TDS deduction at regular intervals as per RBI guidelines and hence we conclude that the opposite party has correctly calculated the TDS and after deducting the said TDS has given credit to Rs.567436/- Rs.573877/- and Rs.573877/- which is the actual value of after deduction of TDS and hence there is no force in the contention of the complainant that there is shortfall of Rs.20433/- and it is further found that there is no deficiency in service or unfair trade practice is observed on the part of opposite party. Point No.1 is answered accordingly.

11. Point No.2.

            Based on the findings given to the PointNo.1 since there is no deficiency in service and unfair trade practice observed on the part of Opposite party, Therefore, the complainants are not entitled for shortfall amount of Rs.20433/- or damages for deficiency in service and unfair trade practice as claimed in the complaint. Point no.2 answered accordingly.

          In the result, the complaint is dismissed. No costs.     

          Dictated by the Member-II to the Steno-Typist taken down, transcribed and computerized by him, corrected by the President and pronounced by us in the open Commission on this the 31^st  day of October 2023.

 

MEMBER  I                  MEMBER  II                                         PRESIDENT

LIST OF DOCUMENTS FILED BY THE COMPLAINANT:

 

Ex.A1	12.06.2013	Fixed deposit receipt bearing No.527804.
Ex.A2	12.06.2013	Fixed deposit receipt bearing No.527805.
Ex.A3	12.06.2013	Fixed deposit receipt bearing No.527806.
Ex.A4	17.12.2020	Statement of accounts.
Ex.A5	30.03.2021	Communication given by the opposite party along with statement.
Ex.A6		Online complaint given by the complainant to the banking ombudsman.
Ex.A7	31.05.2021	Communication given by the banking ombudsman mail communication given by the 1st complainant to the opposite party.
Ex.A8	15.07.2021	Legal notice issued by the complainant.

 

LIST OF DOCUMENTS FILED BY THE OPPOSITE PARTY.:

 

Ex.B1	15.07.2021	Reply notice to the complainant with acknowledgement.
Ex.B2	05.11.2022	Accounts of statement and interest certificate of V.Sanathkumar.
Ex.B3	05.11.2022	Accounts of statement and interest certificate of V.Pragnesh kumar.
Ex.B4	05.11.2022	Accounts of statement and interest certificate of V.Suneetha.