DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, PALAKKAD
Dated this the 16th day of November, 2021
Present :Sri.Vinay Menon V., President
: Smt.Vidya A., Member Date of Filing: 11/05/2018
CC/65/2018
Ramanathan,
S/o.Bhageeradhi PS
Puzhavakkathu Madathil House,
Kanniyampuram Amsam, Desam,
Ottapalam Taluk
PO Kanniyampuram
Palakkad
Presently residing at
Puzhavakkathu Madathil House
Sankarapuram Madevaskhethram Quarters
PO Pulamanthol,
Malappuram District - Complainant
(By Adv.K.Dhananjayan)
Vs
- The Industrial Development Bank of India
IDBI Tower, WTC Complex,
IDBI Cuffe Parade,
Mumbai – 400 005
- The Director
The Industrial Development Bank of India
IDBI Tower, WTC Complex,
IDBI Cuffe Parade,
Mumbai – 400 005
- The Chairman & Managing Director
The Industrial Development Bank of India
IDBI Tower, WTC Complex,
IDBI Cuffe Parade,
Mumbai – 400 005
- The Manager
The Industrial Development Bank of India
IDBI Bank Ltd.,
Builtech Foundation,
Chittur Road, Near North Police Station,
Palakkad – 678 013 - Opposite parties
(By Adv.M.S.Bhavadas for OPs 1 to 4))
O R D E R
By Sri.Vinay Menon V., President
Brief facts of the complaint.
1. The complainant is aggrieved by the conduct of the opposite parties, whereby an investment of Rs. 10,000/- made in IDBI DEEP DISCOUNT BOND, 1998-A was not returned to him after 17 years and 6 months in accordance with the terms and conditions as Rs. 1,00,000/-.
2. Case of the complainant is that, he, along with some of his relatives, subscribed by investing Rs. 10,000/- in IDBI DEEP DISCOUNT BOND, 1998-A, an investment vehicle floated by the opposite parties. At the time of investment, it was assured that upon attaining maturity after 17 years and 6 months, the complainant and his relatives would be able to receive Rs. 1,00,000/-. Eventhough the complainant made demand after the maturity period, the opposite party did not honour their commitment and failed to deliver the maturity amount as agreed upon. Aggrieved by this violation of the terms and conditions of the investment proposal tantamounting to deficiency in service, this complaint is filed seeking matured bond value of Rs.1,00,000/- with interest at the rate of 12% from 17.05.2016 and for compensation and incidental reliefs.
3. The opposite parties entered appearance and filed version denying all the allegation. They urged that the non-payment of Rs. 1,00,000/- was due to the opposite parties exercising their call option (redemption), on 16/11/2005 which the complainant was bound to honour, in accordance with the terms and conditions administering the issuance of the Bond. The opposite parties exercised their call option after giving notice to the public as well as the complainant and the amounts due to the complainant after deducting TDS was still lying with the opposite parties and the complainant could avail that amount any time. The opposite parties sought for dismissal of the complaint.
4. The following issues arise for consideration:
1. Whether the exercise of call option by the opposite parties is in accordance with the terms and conditions of the proposal?
2. Whether there is any deficiency in service on the part of the opposite parties?
3. Reliefs and cost, if any.
5. Evidence on the part of the complainant consisted of Exhibits A1 to A3. B1 to B6 were marked on the part of opposite parties.
Issue 1
6. Exhibit A1 is the Bond issued in favour of the complainant and his relatives. One of the conditions laid out on the face of the document reads as follows:
“The holder(s) of this Bond/IDBI shall have the option to redeem the Bond on any of the following dates at the deemed face value mentioned below:”
From this it is clear that either of the parties had a right to redeem the Bond in accordance with the aforesaid condition. By Exhibit A3 communication, the opposite parties had clearly explained the circumstances under which the Bond was redeemed after 7 years.
7. Exhibit B3 is a public notice issued by the opposite parties calling for redeeming the Bond it had issued to those similarly placed as that of the complainant. Exhibits B5 and 6 are two decisions rendered by the National Consumer Disputes Redressal Commission in R.P. No. 3930/2013 (dated 25.11.2013) and R.P. No. 3107/2012 (dated 28.11.2016.). These decisions are on all fours with the facts and circumstances and endorse the legality of the conduct of the opposite parties in redeeming the Bonds in accordance with the offer document and the Bond conditions.
8. At the time of hearing one argument raised by the counsel for the complainant is that in accordance with Section 94 of the Indian Evidence Act 1872, when the language used in a document is plain in itself, and when it applies accurately to existing facts, evidence may not be given to show that it was not meant to apply to such facts. We are unable to accede to this contention raised by the counsel for the complainant. Here we are dealing with interpretation of the clauses in a Bond. It is the interpretation of a contract as between the parties and the terms and conditions contained in the Bond will be taken en masse. Indian Evidence Act does not deal with the situations as is the subject matter of this complaint. Even if we go by the argument by the counsel for the complainant, the entire document will have to be considered to arrive at a conclusion as to the rights and liability of the parties. And a plain reading of Ext.A1 also affirms the legality of the action of the opposite party.
The second argument is that a Bond is a Fixed Deposit made by the complainant with the opposite party. This contention is also without merits. A fixed deposit is a sum of money lent to the bank by a person who receives interest for the deposit so made by him. The depositor is a creditor and the bank is a debtor. Tannan’s Dictionary of Banking Terminology (21st Edition, 2006) defines a Bond as an agreement under seal whereby one person binds himself to another by either performing or refrain from performing an action. A Bond and Fixed Deposit may have similarities, but they are not the same. Hence that contention by the counsel for the complainant will not hold water.
9. Hence it is only apt to hold that the exercise of call option/redemption by the opposite parties is in accordance with the terms and conditions of the proposal.
Issues 2 and 3
10. In view of the finding in issue no. 1, it follows that there is no deficiency in service on the part of the opposite parties. In the facts and circumstances of the case there will be no order as to cost.
Accordingly, the complaint is dismissed.
Pronounced in the open court on this the 16th day of November, 2021.
Sd/-
Vinay Menon V
President
Sd/-
Vidya.A
Member
APPENDIX
Exhibits marked on the side of the complainant
Ext.A1 – Original of the Bond bearing certificate no. 269093.
Ext.A2 –Photocopy of lawyer’s notice dated 01/03/2018.
Ext.A3 - Original of the notice dated 09.03.2018 issued by opposite parties to
the complainant
Exhibits marked on the side of the opposite party
Ext.B1 - Photocopy of the Communication dated 31.08.2005 issued by IDBI to Bondholders.
Ext. B2 – Certificate details of the complainant
Ext. B3 – Copy of public notice published in The Indian Express newspaper.
Ext. B4 (series) – Photocopies of Exhibits A2 and A3.
Ext. B5 – Judgment dated 28.11.2018 in R.P. 3107/2012 on the file of the NCDRC, New Delhi
Ext. B6 - Judgment dated 25.11.2013 in R.P. 3930/2013 on the file of the NCDRC, New Delhi
Witness examined on the side of the complainant
NIL
Witness examined on the side of the opposite party
NIL
Cost :No cost allowed.
