ORDER

BY SRI.H.R.SRINIVAS, PRESIDENT.

This is the Complaint filed by the Complainant U/S Section 35 of Consumer Protection Act 2019, against the Opposite Parties (herein referred in short as O.Ps) alleging the deficiency in service in not paying the entire maturity value of Rs.1,00,000/- in respect of the investment of amount of Rs.2,500/- in Deep Discount Bond and thereby, deficiency in service and unfair trade, and for refund of the same along with cost of the proceedings and Rs.20,000/- as compensation for causing him pain, suffering mental agony and hardship and for other reliefs as the Commission deems fit.

2.      The brief facts of the complaint are that;

The complainant invested Rs.2,500/- in the Deep Discount Bond series 1 issued by OPs and the distinctive number is 0000198905, under folio No.SI02912240-0, during February 1993.  The face value of the certificate was Rs.1,00,000/- to mature on 01.02.2018. He had an option of encashing the same in the 5^th, 9^th, 12^th, 15^th or 20^th year and on completion of 25^th year the bond value of Rs.1,00,000/- to be plaid.  After maturity when he requested through a letter dated 24.08.2020 to pay the amount of Rs.1,00,000/-, OP 2 sent a letter dated 28.08.2020 that it exercised call option on the deep discount bond after completion of nine year i.e., February 01, 2002 for the face value of Rs.9,600/-, and after deducting TDS of Rs.724/-, is ready to pay a sum of Rs.8,876/- and further informed that the call option was intimated by issuing notices to the various bond holders in the local and various newspapers.  Hence denied to pay Rs.1,00,000/- which amounts to unfair trade practice.  OPs have to obey the terms and conditions of the bond.  He is a practicing advocate staying in the same address for about 32 years but did not receive any of the letters and notice said to have been issued by the OPs regarding exercising its call option.  No notice has been sent to him by OP informing the exercise of call option. He had to issue a legal notice demanding OPs to pay Rs.1,00,000/- for which again OPs replied denying the claim. Hence there is deficiency in service, unfair trade practice and prayed the Commission to allow the complaint.

3.      Upon the service of notice, OP1 and 2 appeared before the Commission and filed his version contending that the complainant has not approached the commission by following the procedure and there is lapse on its part.  In the offer document OPs have reserved the right to exercise the call option in respect of the Deep Discount Bonds, series 1 issued by them at the end of 5^th, 9^th, 12^th, 15^th and 20^th year.  Further it is the bounden duty of the bond holder to intimate to OP1 and 2 regarding the change of address for communication.  It has issued and sent letters to all bond holders on 24.07.2001 and also published in the Prajavani Newspaper and Times of India newspaper, Bangalore edition on 01.07.2001 informing the public and bond holders regarding the exercise of call option at the end of 9^th year.  Reminder was also issued on 09.05.2005, 03.07.2006, 05.03.2009 and 30.06.2019.  Even a registered post on 30.09.2016 was addressed to the complainant to the recorded address.  Reminder was also issued in Vijaya Karnataka Newspaper on 22.06.2017 intimating the exercise of call option.  Complainant has not opted to encash the deep discount bond even after several reminders and has filed this complaint in order to make wrongful gain.   OPs have every right and authority to exercise the call option and accordingly have exercised the same by issuing paper publication and also intimation to the complainant. The last reminder issued on September 2016 sent to the recorded address, 35/5, Puttanna Road, Basavanagudi, Bangalore, 560 004, through registered post and the same was returned undelivered, which means complainant has changed the address and has not intimated the same.  As on the date of filing of the reply also, there was no request for redemption and documents were submitted. As they have exercised call option, they are not bound to pay Rs.1,00,000/- to the complainant.  Hence the claim of the complainant cannot be accepted. There is no cause of action for the complaint hence prayed the forum to dismiss the complaint.

4.      In order to prove the case, both parties have filed their affidavit evidence and produced documents. Arguments Heard. The following points arise for our consideration:-

1) Whether the complainant has proved deficiency in service on the part of the Opposite Parties?

2) Whether the complainant is entitled to the relief prayed for in the complaint?

5.     Our answers to the above points are:-

POINT NO.1:            In the Affirmative

POINT NO.2:            Partly in the affirmative.

                                For the following.

REASONS

6.     POINT No.1:-

   Perused the complaint, version, affidavit evidence and the documents produced by respective parties.  It is not in dispute that the complainant deposited Rs.2,500/- in Deep Discount Bond to mature at the end of 25^th year upon which OP has to pay Rs.1,00,000/-. 

        7.     It is also not in dispute that as per the bond produced and the terms and conditions, both have a right of redemption as well as exercising call option at the end of 5^th, 9^th, 12^th, 15^th, 20^th year.

        8.     It is the contention of OPs that they have exercised their call option at the end of 9^th year and the deemed face value was Rs.9,600/- and it was ready to pay the said amount less TDS, which the complainant refused to accept.  Though OPs have made several publications in the newspaper and also produced the copies of the letter said to have been issued to the bond holders, there is no specific letter produced by OPs addressing to the complainant during the period when OP said to have exercised its call option. Though OPs have claimed that they have sent a notice through RPAD to the address on record, the said letter has not been produced to show to the commission that in fact it has issued the said letter under RPAD and the same has been returned with the endorsement of the postman that it is undelivered.

        9.     The counsel for the complainant has relied on the judgement delivered by the “State Consumer Dispute Redressal Commission of Union Territory Chandigarh” between “IDBI Bank –vs M/s Surjith Kaur” delivered on 1^st November 2019.  On perusing the same it exactly fits into the facts and circumstances of the present case and the same is rightly and aptly applicable.  The said State Commission has upheld the decision of the District Commission which allowed the IDBI Bank to pay the matured value of Rs.1,00,000/-. In view of the said decision we have to hold that the OPs did not issue any individual notice of its exercise of call option to the complainant prior to or immediately after the due date.  Further it only issued the letter through RPAD in the year 2016, when it has already exercised its call option in the year 2002 itself, which clearly shows that it did not bother to send the notice just prior to exercising its right of call option and further no documents are produced to show that it has addressed letters and made correspondences with the complainant.

10.   It is held in the decision cited above at para 6 that the contentions of the petitioner counsel that the bank has published an advertisement in the newspaper about its intention to exercise the call back option does not carry weight in the days of electronic revolution.  In today’s world, television is found in all most every urban house.  Complainant is a resident of Chitradurga “District Head quarters” and very few people had time to read all pages of newspaper to locate the advertisement. Hence the bank cannot escape its liability by merely publishing something in newspaper.  

11.   Further the Hon’ble Supreme Court of India had laid down the law that when notice is sent under certificate of posting, it is obligatory on the part of the sender to prove the service of notice in view of the statement on oath given by the addressee denying receipt of any said notice.  As discussed above, OPs have failed to prove the contention of successful delivery of alleged letter sent through post to the complainant.  In view of this we hold that there is deficiency in service on the part of OP in offering only Rs.8,876/- towards the maturity value after exercising the call option at the end of 9^th year. Hence we answer point NO.1 in the affirmative.

12.   Further OPs have relied on the decision rendered by the Bangalore Urban II Additional District Consumer Disputes Redressal Commission, Bangalore, in Complaint No.1416/2018.  The same need not be followed by this Commission as both the Commissions are of same power and the said commission is not superior to this Commission to follow the decision rendered by it.  On the other hand, the decision relied on and cited by the complainant i.e., rendered by the SCDRC, Union Territory of Chandigarh which is on a higher pedestal and superior Commission needs to be followed. Hence we answer point NO.l in the affirmative and in the result OPs are liable to pay Rs.1,00,000/- to the complainant along with interest at 12% p.a., from 01.02.2018 and further directed to pay a sum of Rs.10,000/- towards damages and Rs.10,000/- towards litigation expenses and answer point No.2 partly in the affirmative and pass the following;

ORDER

1. Complaint is allowed in part with cost.
2. OPs are directed to pay Rs.1,00,000/- to the complainant along with interest at 12% p.a., from 01.02.2018 to till the date of payment.
3. OPs are further directed to pay Rs.10,000/- towards litigation expenses and Rs.10,000/- towards cost of the proceedings to the complainant.
4. The OPs are further directed comply the above order within 30 days from the date of receipt of this order and submit the compliance report to this forum within 15 days thereafter.
5. Send a copy of this order to both parties free of cost.

Note:You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order failing which the same will be weeded out/destroyed.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open Forum on this 05^TH DAY OF OCTOBER 2021)

MEMBER                                PRESIDENT

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

Copies of Documents produced on behalf of Complainant/s:

Ex P1: The original Deep Discount Bond issued by OP for the face value of Rs.1,00,000/-

Ex P2: Letter written by me to OP2 dated 24.08.2020

Ex. P3: Reply given by them on August 28^th, 2020

Ex P4: Copy of the notice dated 23.09.2020

Ex P5: Letter written by OP dated 16^th October 2020

Es P6: Postal acknowledgements

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

RW-1: Sri.Vemuru Chandramouli

Copies of Documents produced on behalf of Opposite Party/s

Ex R1: Offer Document

Ex R2: Letter exercising of call option

Ex R3: Paper publication in Kannada and English

Ex R4: Closure of SIDBI Deep Discount Bonds(4 letters)

Ex R5: Photocopy of the endorsement of the postal authorities on the cover returned without service.

MEMBER                                        PRESIDENT