Date of Filing:17.11.2008<br /> Date of Order:27.02.2009<br /> <br /> <br /> <br /> BEFORE THE II ADDITIONAL DISTRICT CONSUMER DISPUTES REDRESSAL FORUM SESHADRIPURAM BANGALORE-20<br /> <br /> <br /> Dated: 27TH DAY OF FEBRUARY 2009<br /> PRESENT<br /> <br /> <br /> <br /> Sri S.S. NAGARALE, B.A, LL.B. (SPL.), President.<br /> Smt. D. LEELAVATHI, M.A.LL.B, Member.<br /> Sri BALAKRISHNA. V. MASALI, B.A, LL.B. (SPL.), Member.<br /> <br /> <br /> COMPLAINT NO: 2470 OF 2008<br /> <br /> Vikram Malhotra<br /> Proprietor, Vidushi Academy<br /> No. 41, Basappa Road<br /> Shanti Nagar, Bangalore 27 Complainant<br /> <br /> V/S<br /> <br /> Manager<br /> IDBI Bank Ltd.<br /> IDBI House, 56<br /> Mission Road, Bangalore Opposite Party<br /> <br /> ORDER<br /> By the President Sri. S.S. Nagarale<br /> <br /> This is a complaint filed under section 12 of the Consumer Protection Act 1986. <br /> The facts of the case are that complainant in the course of running of Academic Centre for International Communication and Linguistic Solutions in respect of International Languages had availed the service of opposite party to remit the payment to a client overseas and issued instructions for the payment as well as the required formalities as desired by the opposite party for Remittance Direction to the opposite party were made for the payment to his client in Iran which was sought through electronic transfer on 07.12.2007 of US Dollar 2415/- which has converted in Indian Rupee and valued Rs. 95,561/-. All the required formalities of the bank were duly fulfilled and the complainant also informed the recipient about the transfer of the funds. The opposite party debited the Bank A/c of the complainant with a sum of Rs. 95,561/- on 11.12.2007 and the bank charges of Rs. 900/-. Opposite party bank assured complainant that the funds will be remitted to the recipient destination and complainant should now feel assured and may also inform his client that payment made by him shall reach him as desired with the indication of remittance amount deposited opposite party as per the charged by bank towards the payment of his invoice. The complainant through their correspondence for the payment informed the recipient also in Iran that he shall receive the payment as per his invoice that it was shocking for the complainant when he received a call as well as e-mail from his client that he had not received the payment which was informed by the complainant on the basis of assurance of bank of remittance while accepting the money. As the bankers have cleared his payment on 11.12.2007 and the opposite party were duty bound to keep the complainant informed which they failed. According to the last information gathered by complainant no payment can be kept pending beyond 7 days as per the International Business Standards in the banking regulation set by RBI guidelines where there are electronic transfers. It is for these reasons before accepting the money all the data is collected and opposite party took all the required details but did not send the remittance thus affecting the reputation of the complainant and financial loss. The complainant submitted that he has suffered heavy loss due to inaction and due to deficiency of the bank. The opposite party is a service provider and deficient in service. Opposite party be directed to pay compensation for the loss and mental agony suffered by him. Complainant has claimed refund of US $ 2414 equal to Indian Rupee Rs. 95,561/-, besides Rs. 900/- paid towards bank charges along with interest and compensation of Rs. 1,00,000/- for loss of his business and mental agony suffered on account of deficiency of service by opposite party.<br /> 2. Notice issued to opposite party. Opposite party put in appearance through advocate and defence version filed. Opposite party submits that the amount had been remitted on the request of the complainant through their correspondent bank i.e. Citi Bank on 11.12.2007. Subsequent to the transfer they were advised by Citi Bank, New York on the same day by swift that transaction has been blocked by Office of Foreign Assets Control whose function comes under United States Department of the Treasury. The opposite party informed the same to the complainant immediately and took up the issue with the Citi Bank and sought their advice to recall the amount. The opposite party coordinated with the complainant and sent the necessary application form on 26.12.2007. The opposite party submitted that they have also repeatedly reminded their correspondent bank to take up the issue and they were yet to receive refund. Opposite party has sent reminder to OFAC on 25.11.2008 asking for the status for which they were yet to get any reply. The opposite party submitted that complaint lacks merits and deserves to be dismissed.<br /> 3. Affidavit Evidences filed.<br /> 4. Arguments are heard.<br /> 5. The points for consideration are:<br /> “1. Whether there was deficiency in service on the part of opposite party Bank?<br /> 2. Whether the complainant is entitled direction for payment of US $ 2414 against the opposite party?<br /> 3. Whether the complainant is entitled for interest?<br /> 4. Whether the complainant is entitled for compensation for mental agony?”<br /> 6. Complainant in the course of running Academic Centre for International Communication and Linguistic Solutions in respect of international languages had availed the service of opposite party bank to remit the payment to his client in overseas and issued instructions for payment to the opposite party bank. The opposite party debited in the bank account of complainant sum of Rs. 95,561/- and bank charges of Rs. 900/- with the assurance that funds will be remitted to the recipient destination. The opposite party has clearly admitted in the defence version that the said amount has been debited in the account of complainant and the amount had been remitted through their correspondent bank i.e. Citi Bank, New York on 11.12.2007. It is admitted case of the opposite party subsequent to the transfer of the amount they were advised by the Citi Bank, New York that the transaction had been blocked by Office of Foreign Assets Control (OFAC) and the opposite party bank took the issue with their representative of Citi Bank, New York and sought their advise to recall the amount and necessary application form was sent. The opposite party has submitted this transaction was a recently occurred transaction. They need to wait to get the amount back. It is also admitted case of the opposite party that they have repeatedly reminded there correspondent bank and they were yet to receive the refund and they need to wait till OFAC office clears the payment. The opposite party bank collected Rs. 900/- as service charge for remitting the amount to the destination. But unfortunately, the amount did not reach to the recipient as per the instructions of the complainant. The opposite party bank remitted the amount through their correspondent bank i.e. Citi Bank, New York and the transaction has been blocked by the Office of Foreign Assets Control (OFAC). For this blocking of transaction the complainant cannot be held responsible. It is the duty and obligation of the opposite party bank to see that the amount is sent to the destination as per the instructions of the complainant. The opposite party bank having accepted the amount and the bank charges of Rs. 900/- could have remitted amount to the recipient through proper channel. The opposite party bank definitely has committed deficiency in service in not sending the amount to the recipient after having accepted the job. The complainant herein is a customer coming under the definition of ‘Consumer’ under the Consumer Protection Act and the opposite party bank is a service provider. It has committed deficiency in service in not knowing the proper procedure or rules or guidelines as to how the amount should be sent to outside country particularly to Iran. It appears that bank is not aware of the guidelines of RBI. The opposite party bank has committed mistake or deficiency in service in sending the amount through Citi Bank, New York. For this mistake or deficiency of service complainant is nothing to do with and no fault can be attributed to the complainant. The opposite party bank can definitely be held responsible for not sending amount to the destination. The opposite party is doing banking service. It should be aware of the rules and regulations and method of sending amount to a foreign destination. But in this case the opposite party bank without following the rules and regulations and RBI Guidelines made mistake in remitting the amount through their correspondent bank i.e. Citi Bank, New York and the amount having blocked by the OFAC and therefore, the amount did not reach to the beneficiary. No doubt the opposite party bank is having correspondence with the OFAC to get the amount released. It is submitted this being a recent transaction they need to wait for some more time to get the amount back. The complainant cannot be asked to wait indefinitely for the transaction to be realized. The complainant has already suffered lot financially and mentally since the amount had not been reached to his client. The reputation of the complainant is at stake. The complainant has suffered lot and he had gone severe mental agony due to holding up of money and there will be loss of business and reputation of the complainant in international market. Therefore, all these things happened due to inaction and deficiency of service on the part of opposite party. The opposite party bank shall be directed to pay immediately Rs. 95,561/- plus Rs. 900/- the service charge to the complainant. The opposite party bank debited this amount in the account of complainant on 11.12.2007 and from that date naturally complainant is entitled for interest on that amount because the complainant parted with his money and the amount having not reached to the recipient. Without there being any fault on the part of complainant he has suffered lot both mentally and also in business. Therefore, the complainant shall have to be suitably compensated for deficiency of service on the part of the opposite party bank. The complainant has prayed Rs. 1,00,000/- as compensation for mental agony on account of deficiency of service by the opposite party. However, on the facts and circumstances of the case granting of compensation of Rs. 20,000/- will meet the ends of justice apart from the refund of amount with interest. In the result I proceed to pass the following:<br /> ORDER<br /> 7. The Complaint is allowed. The opposite party bank is directed to pay Rs. 95,561/- the amount remitted by the complainant. The opposite party bank is also directed to pay Rs. 900/- service charge collected from the complainant. The complainant is entitled for interest on the above amount at 12% p.a. from 11.12.2007 till payment / realization.<br /> 8. The opposite party is also directed to pay Rs. 20,000/- as compensation for mental agony and loss of reputation apart from the above amount.<br /> 9. The opposite party bank is directed to comply the order within 30 days from the date of this order.<br /> 10. Send the copy of this Order to both the parties free of costs immediately. <br /> 11. Pronounced in the Open Forum on this 27TH DAY OF FEBRUARY 2009. <br /> Order accordingly,<br /> <br /> <br /> PRESIDENT<br /> We concur the above findings.<br /> <br /> <br /> MEMBER MEMBER<br />