Present         (1)      Nisha Nath Ojha,   

                              District & Sessions Judge (Retd.)                                                                               President

                    (2)      Sri Sheo Shankar Prasad Singh,

                              Member

Date of Order : - 09.07.2015

                    Sri Sheo Shankar Prasad Singh

1. In the instant case the Complainant has sought for following reliefs against the Opposite parties:-

1. To release of amount of Deep Discount Bond as per deemed face value on 30.09.2007 ( @ Rs. 25,000/- each face value and the total no. of 4 Bonds ) Rs. 1,00,000/-.
2. Interest 18% from the date of deemed face value i.e. 30.09.2007 till actual payment.
3. Compensation of Rs. 65,000/-.
4. Litigation cost of Rs. 10,000/-.

2. Brief facts of the case which led to the filing of complaint case are as follows:-

1. The brief facts leading to the filing of the present complaint petition is that as the as karta of Hindu Undivided Family  per share namely Indu Devi, and Juhi Kumari deposits with Opposite Parties for sum of Rs. 22,000/- individually and jointly to be matured on 30^th September 2007 as follows :-

2. On 31^st January 1997 the amount as deposited by way of IDBI Deep Discount Bond were to be re – paid on the deemed face value therefore the complaint were before these opposite parties for the purpose of repayments as on 30 September 2007. But these opposite parties refused to pay the said amount under deemed face value as on 30^th September 2007 saying that these payments would be as on 30^th April 2001. Thereafter complainant wrote letter to these opposite parties for repayment on 30.09.2007 on the deemed face value of the IDBI Deep Discount Bond.
3. The complaint ran from pillar to post for release of amount under deemed face value but these opposite parties have turned deaf ears to their requests which shows that these opposite parties are not complying with terms and condition of the bond which amount to deficiency in service as per section 2(1)(g) of the Consumer Protection Act, 1986.

3. Following assertions have been made by the Opposite Party No. 1 and 2 in their written statement :-

1. The opposite party states that the complainant has filed the complaint with ulterior motive to gain illegally at the expense of the Opposite Party and is attempting to mislead the Forum by using the proceedings as a lever to bring undue pressure on the Opposite Party to extort money.
2. The Opposite Party wants to submit and state that the complainant is not consumer as per section 2 (d) of the Consumer Protection Act and there is no relationship of service provider and consumer between the Opposite Party and the complainant. The Opposite party has not provided any services to the complainant nor has the complainant availed of service from the Opposite Party. The complainant has also not adduced any evidence whatsoever of any fees paid for the alleged service provider and thus the complainant cannot / is not be considered as a consumer and therefore this complaint is not maintainable against the Opposite Party either in law or on facts and is liable to be dismissed on this ground alone.
3. It is true that the complainant as the Karta of Hindu Undivided Family  consisting of co – parceners namely Indu Devi and Juhi Kumari is the holder of four Deep Discount Bonds under the scheme IDBI Flexibond’s 97 bearing bond Certificate Nos. 7787320, 787321, 787322, 787323 under Folio Nos. FDD – 106955, FDD – 106956, FDD – 106957 and FDD – 106958 respectively. However, the complainant has wrongly stated that the maturity date of the Bonds was September 30, 2007. In terms of early redemption option stipulated on offer documents, the dates of early redemption along with the redemption amount has been specified on the face of the Bond certificate which are as under :

On April 30, 2001Rs. 10,000/-

On September 30, 2007Rs. 25,000/-

On July 31, 2012Rs. 50,000/-

On May 31, 2017Rs. 1,00,000/-

As per offer document date December 6, 1996, IDBI had the right to exercise call option on 30.04.2001 and the same had been printed on the face of the Bond to avoid any confusion / misinterpretation by bondholders.

4. Subsequent to the issue of said Bonds, the lending rates started declining and it was not commercially viable for IDBI to continue to pay higher interest on such bonds. Therefore, IDBI decided to exercise the call option available on April 30, 2001 and redeem the Deep Discount Bonds – 97 at maturity value of Rs. 10,000/- per bond.
5. Accordingly, IDBI sent the call option notice dated 28.02.2001 under certificate of posting and requested all the bondholders including the complainant to surrender duly discharged bond certificate(s) to Opposite Party no. 2 viz. M/s Karvy Computershare Private Ltd., the Registrar & Transfer Agent to the issue, on or before 16.04.2001 to enable the bondholders/ complainant to receive redemption proceeds by 30.04.2001. Annexure – II is the certificate true copy of call option notice date February 28, 2001.
6. On call option notice dated 28.02.2001 that IDBI had clearly informed and mentioned therein “ No interest will be payable on the bonds beyond April 30, 2001” i.e. Call Option date so as to avoid any confusion/ misinterpretation by bondholders and make the redemption proceeds available to them by April 30, 2001. The Opposite Party had also published a Reminder Notice on 07.10.2002 requesting all the bond holders to surrender the duly discharged original bonds and obtain the redemption amount. Further the Opposite Party published Notice, every six months, in leading News Papers inter alia stating that IDBI Ltd. had issued number of Deep Discount Bonds under various Flexi Bonds Schemes during 1992 to 1999 redeemable over a period of 15 years to 30 years. Subsequently, in accordance with the terms set out in the offer Document of the respective Bond issues, IDBI Ltd had redeemed these bonds early by exercising call option on various dates. Annexure – III is the set of certificate true copies of advertisements published in various News Papers at intervals of 6 months.
7. It was clearly stated in the offer Document “ the bondholders must get his name registered with IDBI decides to exercise early redemption option or if IDBI decides to exercise the call option. The Bonds will be redeemed only on the surrender of the duly discharged Bonds certificates by the registered Bondholders.
8. The complainant has not yet surrendered the duly discharged certificate Nos. 787320, 787322 787321 and 787323 for redemption and hence the redemption proceeds of Rs. 40,000/- ( Rs. 10,000/- per Bond ) could not be remitted to him. Despite the call option being exercised by IDBI and the intimation and publication of the Notice regarding the call option, the complainant did not bother to surrender the duly discharged four Deep Discount Bonds to obtain the redemption proceeds of Rs. 40,000/- from IDBI.

The statement/fact clearly mentioned on the face of the Bond, is as follows : “The holder of this Bond shall have the option to withdraw the bond (money) on any of the dates at the deemed face value as mentioned on the face of the bond”. Like – wise, IDBI had also an option to withdraw/redeem the bonds by exercising “ Call option” on similar date mentioned on the face of the bond. Thus it is clear that the date September 30, 2007 is one of the dates, on which ‘put’/’call’ option was available to the Bondholder/IDBI Ltd. respectively and NOT the date of maturity as interpreted by the complainant. The complainant has concealed the fact that IDBI had also an option to withdraw the bond. Therefore, it is ineffective to discuss the case in the Forum, hence the case may be disposed on this ground alone.

9. There is no deficiency of service or failure in discharge of duty on the part of the Opposite Party. Further, the Opposite Party had taken utmost care in intimating the complainant of the exercise of call option hence there is no cause of mental agony or harassment and the claim of compensation does not arise.
10. The Opposite Party states that the complainant has not shown any cause of action as against the Opposite Party which gives cause to enforce the legal injury for redress. On this ground alone the complaint ought to be dismissed.
11. The Opposite Party states that the Forum has no territorial jurisdiction to entertain and try the complaint within the meaning of Section 11 (2 ) of the Consumer Protection Act, as the Registered Office of the Opposite Party is situated at Mumbai, the bonds were issued in Mumbai and the redemption payment is effected from Mumbai and verily the complainant does not have any right to file a complaint against the Opposite Party within the jurisdiction of the District Forum.

The Opposite Party being a Government banking Company endeavours to strictly abide and comply with the applicable laws and order of Court and Tribunal including the Forum. The Opposite Party had always been investor friendly and makes all endeavours to satisfy the legitimate claims of its investors. It is humbly submitted that the Opposite Party should not be penalised for the negligence and mistake of the complainant.

In our call option notice dated 28.02.2001 the IDBI had clearly informed and mentioned therein that “ No interest will be payable on the bonds beyond April 30, 2001 ” i.e. call option date so as to avoid any confusion/misinterpretation by bondholders and make the redemption proceeds available to them by April 30, 2001. The opposite party had also Published a Reminder Notice on 07.10.2002 requesting all the bond holders to surrender the duly discharged original bonds and obtain the redemption amount. Further the opposite party published noticed, every six months, in leading News papers inter alia stating that IDBI Ltd. had issued number of Deep Discount Bonds under various Flexi Bonds Scheme during 1992 to 1992 redeemable over a period of 15 years to 30 years. Subsequently, in accordance with the terms set out in the offer Document of the respective Bond issues, IDBI Ltd. had redeemed these bonds early by exercising call option on various dates. Here to annexed and marked as Annexure – III is the set of certified true copies of advertisements published in various News papers at intervals of 6 months.

It was been clearly stated in the offer document “ the bondholder must get his name registered with IDBI if he decides to exercise the call option. The bonds will be redeemed only on the surrender of the duly discharged bonds certificates by the registered bondholders ”.

The complainant has not yet surrendered the duly discharged bonds certificate nos. 787320, 787321, 787322 and 787323 for redemption and hence the redemption proceeds of Rs. 40,000/- ( Rs. Fourty Thousand only ) ( Rs. 10,000/- Ten Thousand only per bond ) could not be remitted to him. Despite the call option being exercise by IDBI and the intimation and publication of the notice regarding, the call option, the complainant did not bother to surrender the duly discharged four Deep Discount Bonds to obtain redemption proceeds of Rs. 40,000/- ( Rs. Fourty Thousand only ) from IDBI.

Subsequently to the issue of said Bonds, the lending rates started declining and it was not commercially viable for IDBI to continue to pay higher interest on such bonds. Therefore, IDBI decides to exercise the call option available on April 30, 2001 and redeem the Deep Discount Bonds 97 at maturity value of Rs. 10,000/- ( Rs. Ten Thousand only ) per bond.

Accordingly, IDBI sent the call option notice dated 28.02.2001 under certificate of posting and requested all the bondholders including the complainant to surrender duly discharged bond certificate(s) to opposite party no. 2 viz, M/s Karvy Computer Share Private Ltd, the registered & Transfer agent to the issue, on or before 16.04.2001 to enable the bondholders/complainant to receive redemption proceeds by 30.04.2001. Annexure – II is the certified true copy of call option notice date February 28, 2001.

We have gone through entire documents placed on the record and have heard the complainant only as opposite parties were not present during the hearing although they have filed written statement denying the assertions of the complainant made in the complaint petition.

So far objection of opposite parties regarding jurisdiction of forum is concerned. We hold that since the opposite parties has got its Branch Office at Patna and therefore this forum has jurisdiction to adjudicate the matter.

The only point for consideration in the case is as to whether the complainant was duly informed by the opposite parties about the decision of the IDBI for early redemption of the bond and whether those intimation had been duly received by the complainant or not.

The intimation was given to the investor by the IDBI under Certificate of posting and complainant denied its receipt.

Thereafter, IDBI gave the information to the investors by publishing notices in the Newspaper and the complainant in this regard submits that this information was published in the New paper of Mumbai and as such he has no occasion to go through that New items as he ordinarily resides in the state of Bihar.

From the above facts it manifests that the opposite parties could not place before us any documentaryevidence to prove that the complainant was in receipt of their notice in the year 2001 for surrendering of Bonds which ultimately caused pecuniary loss to the complainant. If the complainant would have been given intimation in time he would have received the redeemed value of the Bond much earlier. Thus we hold them liable for deficiency in service.

Therefore, We direct the opposite parties jointly and severally to pay to the complainant the redeemed value of the Bond as on 30.04.2001 together with an interest @ 12% ( Twelve ) per annum from that date ( i.e. 30.04.2009 ) within two months from the date of receipt of this order failing which the interest rate will be 15% ( Fifteen ) per annum till its final payment. Prior to that complainant will have to surrender the Bonds.

Aforesaid, opposite parties are further directed to pay Rs. 20,000/- ( Rs. Twenty Thousand only ) to the complainant as composite charge for compensation and litigation costs within the aforesaid period of two months.

Accordingly, this case stands allowed to the extent indicated above.

                                        Member                                                       President