BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD : THIRUVANANTHAPURAM

PRESENT:

SHRI. G. SIVAPRASAD : PRESIDENT

SMT. BEENA KUMARI .A : MEMBER

SMT. S.K. SREELA : MEMBER

C.C. No. 93/2008 Filed on 12/05/2008

Dated: 15..10..2010

Complainant:

P. Vijayakumari, T.C.9/2035(2) Kochar Road, Edappazhinjy, Sasthamangalam, Thiruvananthapuram. (Formerly at Quarter No.D/15, Veterinary College Campus, Mannuthy – P.O., Trissur).

(By Adv. C.S. Rajmohan)

Opposite parties:

1. The Manager, Industrial Development Bank of India, Panampally Nagar, Kochi.

2. The Manager, Industrial Development Bank of India, Thiruvananthapuram.

    

(By Adv. Anithas Jacob)

This O.P having been heard on 15..07..2010, the Forum on 15..10..2010 delivered the following:

ORDER

SHRI.G. SIVAPRASAD, PRESIDENT:

The case of the complainant is that, complainant purchased IDBI Deep Discount Bonds on 18/3/1996, that option was provided to redeem the bonds after 1^st August 2000, that if the purchaser encashes it on 1/8/2000 she would get Rs. 10,000/-, that if it is on or after 12/1/2006 she would get Rs.25,000/- and so on, that as per the provisions of the bond, the bond can be encashed through any of the branch of the opposite parties, that after issuance of the said bond, nothing was heard from the opposite parties, that complainant was working at Veterinary College, Mannuthi, that after retirement from service, complainant sent an application for change of address, but that application was returned unserved, that on enquiry with the 2^nd opposite party, the Bank authorities told her to accept Rs.10,000/- and return the bond, that the final denial of the payment was done by the opposite party on 12/5/2007, that as per the provisions of the bond opposite parties have to pay an amount of Rs. 25,000/- to the complainant, that even after repeated demands opposite party has not paid the said amount. Hence this complaint to direct opposite parties to pay an amount of Rs.25,000/- with 12% interest thereon from 12/1/2006 along with Rs.10,000/- towards compensation and cost.

2. Opposite parties filed version contending inter alia that complainant is the holder of one Deep Discount Bond 1996 vide No. FDDB0713069 and certificate No. 00748843, that as per the provisions of the bonds, the terms of Early Redemption Option stipulated in offer documents, that the dates of early redemption along with redemption amount has been inscribed on the face of the Bond Certificate which are as under:

On August 1, 2000 : Rs. 10,000/-

On December 1, 2006 : Rs. 25,000/-

On September 1, 2011 : Rs. 50,000/-

On June 1, 2016 : Rs. 1,00,000/-

That the holder of the bond shall have the “Put Option” to withdraw the bond on any of the above dates at the deemed face value as mentioned on the face of the bond, likewise, IDBI had also an option to withdraw/redeem the bonds by exercising “Call Option”, that the call option notice as well as reminder letters dated 31/5/2000 and 4/10/2000 respectively were dispatched to the complainant by registered notice addressed at QTR No.D/15, Veterinary College Campus, Mannuthy, that complainant had not forwarded the bond certificates for redemption to M/s. Investor Services of India Limited till date, and that unless the complainant surrenders duly discharged bond, opposite parties cannot pay the maturity amount of the bond. Complainant is not entitled to claim the amount of Rs. 25,000/- with interest accrued @ 12% along with compensation. There is no deficiency in service on the part of the opposite parties. Hence opposite parties prayed for dismissal of the complaint.

3. The points that arise for consideration are:

1. Whether complainant is entitled to get redemption amount of Rs. 25,000/- with interest thereon?

    

2. Whether there is deficiency in service on the part of the opposite parties?

3. Whether complainant is entitled to get compensation along with cost?

In support of the complaint, complainant has filed affidavit and has marked Exts. P1 to P3. In rebuttal, opposite party has filed affidavit and has marked Exts. D1 to D8.

4. Points (i) to (iii): Admittedly, complainant purchased IDBI Deep Discount Bond by investing Rs. 5,300/- on 18/3/1996. The said bond was purchased, when the complainant was working at Veterinary College, Mannuthi. According to complainant there is provision for redemption option, accordingly, complainant approached opposite parties with redemption option after December 2006. Ext. P1 is the copy of the IDBI Deep Discount Bond. It is seen inscribed on the face of the bond that the redemption amount would come to Rs. 25,000/- on December 1, 2006. On perusal of Ext. P1 it is seen that there is provision for options to redeem the Bond on many days at the deemed face value mentioned. Ext. P2 is the copy of Advocate Notice dated 8/5/2007 calling upon opposite parties to pay an amount of Rs.25,000/- with interest from 1/12/2006 within 5 days from the date of the said notice. Ext. P3 consists of postal receipt and acknowledgement card. According to opposite parties they have sent call option notice on 25/5/2000 and requested all the bond holders including the complainant to surrender duly discharged bond certificates to M/s. Investor Services of India Limited, Navi Mumbai, in order to enable the bond holders to receive the redemption proceeds by 1/8/2000. Ext. D4 is the copy of call option notice. Ext. D3 is the copy of the paper publication dated 12/5/2000 regarding call option notice. The counsel for the complainant has relied on the decision of the National Commission in IDBI Vs. T.K. Nagarathan IV (2008) CPJ 136 (NC) Wherein on a similar set of facts the National Commission upheld the orders of the District Forum and the State Commission directing to release the amount due on the redemption date subsequent to the exercise of call option with interest at 10% and costs, as there was no evidence that the complainant therein was personally intimated. Complainant has also cited that decision of the State Commission (Kerala) dated 12/01/2010 in V. Narayan Nambeesan Vs. IDBI, wherein also similar facts considered. We find that the situation stated in the above cases is the same herein also. It is the case of the opposite parties that call option exercised by the opposite parties was communicated to the complainant by Ext. D5. On perusal of Ext. D5 it is seen that it is a copy of exercise of call option by IDBI addressed to bond holder. Nowhere it is seen that the same was communicated to the complainant personally. Opposite party has failed to produce any acknowledgement of the letter or communication sent by IDBI to the complainant or postal receipts showing the date of communication. In the absence of any documents in support of the complaint taken by the opposite parties it is difficult for us to accept the contention that call option exercised by the opposite parties was in fact served on the complainant. No copy of the letter sent to the complainant was produced, what has been produced is only a Specimen. Publication in the Newspaper was found by the National Commission in the abovesaid case as inadequate. The contention of the opposite parties that bank has published in the newspaper (Malayala Manorama) about the intention to exercise the call back option does not carry weight in the days of electronic revolution. Opposite party cannot escape its liability by merely publishing something in a newspaper. Inview of the above we find complainant is entitled to get redemption amount of Rs. 25,000/- with interest at 8% from the date of complaint (12/05/2008).

In the result, complaint is allowed. Opposite parties are jointly and severally directed to pay an amount of Rs. 25,000/- towards redemption amount with interest at 8% from 12/05/2008, the date of complaint. Opposite parties shall also pay jointly and severally the complainant a sum of Rs. 2,000/- as cost. The said amounts are to be paid within 2 months from the date of receipt of this Order, failing which complainant shall be entitled for interest at 12% from the date of this Order.

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.

Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the open Forum, this the 15^th day of October, 2010.

G. SIVAPRASAD PRESIDENT.

BEENA KUMARI. A.,

MEMBER.

S.K. SREELA,

MEMBER.

ad.

C.C.No. 93/2008

APPENDIX

I. Complainant's witness:

PW1 : P. Vijayakumari

II. Complainant's documents:

P1 : Copy of IDBI Deep Discount Bond 96

P2 : Copy of Advocate notice dated 8/5/2007

P3 : Postal receipt and acknowledgement card

III. Opposite parties' witness:

DW1 : Tomy Sebastian

IV. Opposite parties' documents:

D1 : Principal Terms of the Bonds

D2 : Copy of Call option Notice

D3 : Copy of paper cutting

D4 : Copy of call option notice

D5 : Copy of exercise of call option by IDBI addressed to bond holder

D6 : Copy of Microfilm of advertisement published on 7/10/2002 in Indian Express.

D7 : Copy of list of bond holders including the name of complainant to whom the letter of call option was dispatched through UCP on 31/5/2000

D8 : Order of the Hon'ble District Consumer Disputes Redressal Forum, Nagpur.

PRESIDENT