IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, ALAPPUZHA
Friday the 16th day of October, 2020
Filed on 23 .01. 2019
Present
1. Sri.S.Santhosh Kumar, Bsc.LLB(President)
2. Smt. C.K.Lekhamma BA. LLB(Member)
In
CC/No.25/2019
Between
Complainant:- Opposite party:-
1. Ms.Sandra.G(aged 18 yrs) 1. The Zonal Manager.
D/o Madhusoodanan Corporation Bank Zonal office
Madhurangam House Apoorva Chambers
Avalookkunnu Ward Sunny Mead lane, Palayam
Thathampally.P.O Trivandurm
Alappuzha.
2. The Branch Manager
2. Sarang.M.(Minor, aged 10yrs) Corporation Bank
S/o Madhusoodanan Vayalar Branch
3.Sri. Madhusoodanan(aged 51 yrs)Rep: by its Branch Manager)
S/o Soman(Adv. P.K.Mathew for OP 1&2)
(Party in Person)
O R D E R
SRI. S. SANTHOSH KUMAR (PRESIDENT)
Complaint filed under Sec.12 of the Consumer Protection Act, 1986.
Material averments briefly discussed are as follows:-
Complainant Nos.1 and 2 are the children of the 3rd complainant. The 3rd complainant filed application before the Hon’ble District Court seeking permission to sell share of the minors in the property jointly owned by him along with his minor children as OP (G&W) No.38/2011. The Hon’ble District Court permitted the 3rd complainant as guardian to sell the property as per order dated 29.03.2012. Thus the property was sold and the shares of minors were deposited in the 2nd opposite party bank and FD receipts were kept in the safe custody of District court.
An amount of Rs.3,95,834/-each were deposited in the name of complainant No.1 and 2 on 03.09.2012 as per FD receipt NO.598657 and 598658. The maturity date of 1st complainant’s FD was 08.08.2018 and the maturity value was Rs.6,71,089/-. The maturity date of 2nd complainant’s FD is 03.09.2022 and the maturity value was Rs.9,63,931/-.
On attaining majority 1st complainant applied for releasing the FD and it was allowed. When the complainants approached the bank it was informed that 1st complainant is entitled only for Rs.6,27,286/- instead of maturity value of Rs.6,71,089/-. It was informed that an amount of Rs.43,803/- was deducted as TDS yearly. An amount of Rs.44,785/- was deducted from the FD account of the 2nd complainant towards TDS.
The act of 2nd opposite party bank in deducting TDS without any sanction from the court or getting consent from the 3rd complainant is not correct. The 2nd opposite party bank knowingly that the deposit is in the name of minors and that too made as per the directions of the court has committed mischief which amounts to deficiency of service. The 2nd opposite party bank is bound to inform either the court or to the guardian regarding the intention to deduct tax at source. The bank never insisted for production of PAN details of 3rd complainant. The 2nd opposite party bank had also not issued certificate on every occasion of deduction of tax from 03.09.2012 to 08.08.2018. Though the complainants requested the branch manager of 2nd opposite party bank to release the amount it was not done blaming the computerized accounting system. On getting knowledge about the deduction complainants 1 and 2 submitted necessary documents to avoid further deduction. On 17.11.2018 complainants issued notice to the opposite parties demanding to rectify the request. On 13.12.2018 a reply notice was issued rejecting the request. Hence the complaint is filed, to release an amount of Rs.43,803/- unauthorisedly deducted from FD receipt No.598657 and release an amount of Rs.44,785/- unauthorisedly deducted from FD No.598658. Complainants are also seeking an amount of Rs.5,000/- as cost.
2. Opposite parties No.1 and 2 filed a version mainly contenting as follows:-
The complaint is not maintainable and this Forum has no jurisdiction to entertain such a complaint. It is true that an amount of Rs.3,95,834/- was deposited as per the order of Hon’ble District Court, Alappuzha. It was encashed by the 1st complainant as per her request. The bank had deducted TDS at the rate of 20% from the accrued interest and had remitted to the Income Tax Department within the stipulated time. 20% was deducted as the party had failed to produce the PAN card.
No sanction is required from the court for deducting Income Tax as section 194 (A) of Income Tax Act is mandatory. The allegation that the bank did not disclose regarding deduction of TDS is false as the TDS certificate is given to the party regularly. The bank may not be penalized for deducting Income Tax under 194 (A) of the Act. Instead of filing the case the complainants can very well approach the IT department for refund of the amount. No mistake was committed by the opposite parties and they had deducted the amount as per the Income Tax Act. There is no deficiency of service or defective service from the part of these opposite parties. Complainants have not sustained any injuries due to the act of the bank. Compensations claimed are highly exorbitant. Hence complaint may be dismissed.
3. On the above pleadings following points were raised for consideration:-
- Whether there is deficiency of service from the side of opposite party bank ?
- Whether the 1st complainant is entitled to realize an amount of Rs.43,803/- from the 2nd opposite party bank as prayed for?
- Whether the 2nd complainant is entitled to realize an amount of Rs.44,785/- from the 2nd opposite party bank as prayed for?
- Whether the complainants are entitled to realize an amount of Rs.5,000/- as cost.?
- Reliefs and Cost?
- Evidence in this case consists of oral evidence of PW1 and Exts.A1 to A4 from the side of the complainant and the oral evidence of RW1 and Exts.B1 to B4 from the side of the opposite parties.
- Point No.1 to 4
For the sake of convenience these points are considered together. 3rd complainant got examined as PW1 and marked Ext.A1 to A4. Ext.B1 was marked during cross examination. The branch manager of 2nd opposite party bank was examined as RW1 and marked Exts.B2 to B4.
Complainants case in nut shell is as follows:-
As per Ext.A3 order of the Hon’ble District Court, Alappuzha. In OP(G &W) an amount of Rs.3,95,834/- each were deposited with the 2nd opposite party bank in the name of 1st and 2nd complainants who were minors. The maturity value was Rs. 6,71,089/- and Rs. 9,63,931/-respectively. The fixed deposit of the 1st complainant was matured on 8/8/2018 and when she approached the bank it was informed that she is entitled only for Rs. 6,27,286/- and that an amount of Rs. 43,803/- is deducted as TDS. Similarly an amount of Rs.44,785/- was deducted from the amount due to the 3rd complainant. Hence complaint is filed for realizing the said amounts along with Rs.5000/- as compensatory cost. 3rd complainant is the father of 1st and 2nd complainant. He got examined as PW1 and Ext.A1 to A4 were marked. Opposite parties filed a joint version contenting that as per Sec.194 A of the Income Tax Act. it is the statutory duty to deduct TDS and they had only done it. It was also contended that sanction is not necessary either from the court or from the party to deduct income tax since it is mandatory. TDS certificate were issued to the party as and when income tax was deducted and hence there was no deficiency of service from the part of the bank. The complaint which is vexatious is only to be dismissed. 3rd complainant who is the father of 1st and 2nd complainants got examined as PW1 and Ext.A1 to A4 were marked. During cross examination of PW1 Ext.B1 was marked. The present manager of 2nd opposite party bank was examined as RW1 and Ext.B2 to B4 were marked. Both parties have filed detailed argument notes in support of their contentions.
The fact that as per Ext.A3 order the sale proceeds of the property which was the share of the minors (Rs.3,95,834/-) were deposited as fixed deposit in the 2nd opposite party bank is not in dispute. It is also an admitted case that the maturity date of fixed deposit in the name of 1st complainant was 8/8/2018 and that of 2nd complainant is 3/9/2022 on the date of attaining majority. According to PW1 an amount of Rs. 43,803/- was deducted as TDS on the maturity amount due to 1st complainant and an amount of Rs.44,785/- was deducted as TDS from the amount of 2nd complainant. In the argument note filed by the 3rd complainant it is stated that out of the TDS deducted from the amount of 1st complainant he has received a refund of Rs.9,250/- and so the claim of 1st complainant is reduced to Rs. 34,543/-. Now the main grievance of PW1 is that before deducting TDS 2nd opposite party bank has not obtained permission from the court and consent from complainants. As rightly pointed out by the learned counsel appearing for the opposite parties it is a statutory obligation under the Income Tax Act and so either the permission of court or the consent of the complainants is not necessary to deduct tax. It was contented by PW1 that instead of deducting income tax at the final stage that is on maturity of the FD tax was deducted every year. Such a contention has no muscles to stand why because TDS is to be deducted every year whenever the interest is accrued. The income is deducted for every assessment year. The percentage of Income Tax and the slab varies as per the union budget and so deduction of tax cannot be postponed to the final stage of maturity of the fixed deposit.
In the argument note it is stated by PW1 that he has produced 2 documents and it is to be marked as Ext.A7 and A8 respectively. The first one is a letter dtd.8/5/2020 sent by 1st complainant to the Income Tax Officer, Alappuzha requesting for refund. The 2nd document is a reply letter dtd. 24/6/2020 sent by the Income Tax Officer, Alappuzha(TDS Alappuzha) to the 1st complainant. In the said letter it is stated that an amount of Rs.43,115/- is deducted for the financial year 2014-15 to financial year 2018-19 and to file income tax return to claim refund if any. It will show that if income tax returns are filed the amounts will be refunded by the income tax department. As stated earlier since it was mandatory to deduct income tax from the interest accrued during the respective financial years, opposite parties cannot be blamed for deducting the same. However it is noticed that whenever tax is deducted TDS certificates are to be issued by the respective party to the person from whom TDS is deducted. In this case since TDS were deducted from fixed deposit form16A is to be issued from the bank. Here it is seen that said certificates are not issued to the complainants. RW1 the manager of 2nd opposite party bank has stated that request was not made to PW1 to produce PAN and 15 G form. RW1 admitted that as soon as TDS is deducted certificates will be generated. But according to her it will be sent to the party as per request. If a party is unaware of deduction of tax it is not known how they can request the bank to sent the certificate. So from the evidence it can be seen that TDS certificate were not sent to the 1st and 2nd complainants or their guardian who is the 3rd complainant and hence there was deficiency of service from the part of the opposite party bank. The claim of PW1 that TDS was unauthorizedly deducted cannot be accepted since it was the mandatory duty of the opposite party bank to deduct TDS whenever income exceeds the particular limit. So it cannot be said that TDS was deducted unauthorizedly since it was the mandatory duty of the opposite party bank. However as discussed earlier there is no evidence to show that 16A form was sent to the parties as and when Income Tax was deducted. If PW1 had received form 16A she could have applied for PAN and produce 15G certificate for getting exemption from deduction. Hence on assessing the evidence as a hole it can be seen that the claim of the complainants to return the TDS from the opposite party bank cannot be accepted. As stated in the letter dtd. 26/6/2020 of the Income Tax Officer they can very well file income tax return and claim refund from the department. However it is seen that by not informing the parties regarding the reduction of income tax there was deficiency of service on the side of the opposite party bank for which they are liable to compensate the complainants. In the circumstances we are of the view that no order can be passed against the opposite party bank to return the TDS. They had already remitted the amount with the income tax department and the parties can claim refund from the income tax department after filing proper returns. From the argument note it is noticed that an amount of Rs. 9,250/- was returned by the income tax department. However since there was deficiency of service on the part of the bank by not informing the party regarding the deduction by issuing the form 16A for which complainants are entitled for compensation. We are limiting the same to Rs.5000/-each to complainant Nos.1 and 2. Opposite party bank is a nationalized bank which is Erstwhile Corporation bank and now Union Bank of India. Public money cannot be given as compensation for the dereliction of duty done by the officers of the bank. Hence the amount of compensation awarded will be paid by the bank to the parties and it shall be realized from the person concerned. These points are found accordingly.
7.Point No:-5
In the result complaint is allowed in part.
A. Complainants 1 and 2 are allowed to realize an amount of Rs.5000/-(Five thousand only) each from the opposite party bank.
B. Complainants are allowed to realize an amount of Rs.2000/-(Two thousand only) as cost.
C. PW1 is authorized to collect the amount for and behalf of complainants 1 and 2. After paying the amount to the complainants bank shall realize the amount from the concerned person.
Order shall be complied within one month from the date of the copy of receipt of this order.
Dictated to the Confidential Assistant, transcribed by him correct by me and pronounced in open Commission on this the 16th day of October, 2020.
Sd/-Sri.S.Santhosh Kumar(President)
Sd/-Smt. C.K.Lekhamma(Member)
Appendix:-Evidence of the complainant:-
PW1 - Madhusoodanan(complainant)
Ext.A1 - Letter to Corporation Bank
Ext.A2 - Letter from Corporation Bank
Ext.A3 - OP(G&W) No.38/11 Order
Ext.A4 - Letter dtd.9/10/2018
Evidence of the opposite parties:-
RW1 - Sharon.C.Nelson(witness)
Ext.B1 - Consolidate Deduction Certificate
Ext.B2 - Kshemanidhi Cash Certificate
Ext.B3 - Letter dtd.9/10/2018
Ext.B4 - TDS Intimations .
// True Copy //
To
Complainant/Oppo. party/S.F.
By Order
Senior Superintendent
Typed by:- Br/-
Compared by:-
