DR. SADHNA SHANKER, MEMBER

1.       This appeal has been filed under section 51 of the Consumer Protection Act, 2019 (hereinafter referred to as the ‘Act 2019’) in challenge to the Order dated 07.02.2023 of the State Commission in complaint no. 105 of 2020, whereby the complaint of the complainants was partially allowed and the opposite party - bank was directed to pay damages of Rs. 20 lakh to the complainants along with Rs. 1,00,000/- as costs of the complaint.

2.       We have heard the learned counsel for the appellants – bank (hereinafter referred to as the ‘bank’) and the learned counsel for the respondents – complainants (hereinafter referred to as the ‘complainants’) and perused the record including the State Commission’s impugned Order dated 07.02.2023 and the memorandum of appeal.

3.       The brief facts of the case are that the father of the complainant no. 1 availed the locker facility (Locker No. 39F) from UCO Bank, Civil Lines Branch, Allahabad. As the father of the complainant No. 1 died on 04.02.1994, the said locker was transferred in the names of complainant No. 1, his wife, Mrs. Deepali Agrawal and his daughter, Ms. Sonali Agrawal. The bank has been charging rent regularly by debiting the rent amount from the saving bank account of the complainant No. 1. It is alleged in the complaint that complainants kept jewellery, gold ornaments and other valuables including cash total worth Rs. 35,96,200/- in the locker. The complainants got the information through electronic and print media that a burglary took place in Civil Lines Branch of UCO Bank, Allahabad in the night of 29^th / 30^th April, 2018. It has been reported by the media that the burglars had succeeded in breaking open the door of the strong room and cut the steel lockers with the help of gas cylinders and gas cutters and looted all the gold ornaments, jewellery and valuables including cash, kept in the locker. The complainants provided details of the gold ornaments and cash kept in the locker. It has been further alleged by the complainants in their complaint that even after burglary the entire bank premises including the locker room were lying open, unnoticed and unguarded till the morning of 01^st May 2018. The said burglary was noticed by the bank employees only in the morning of 01^st May 2018 when the said branch opened after a continuous closure of 03 days and 04 nights. The complainants’ locker was also broken along with other lockers and gold ornaments jewellery, other valuables and cash were looted. The FIR was lodged by the bank on 01.05.2018 at 02.00 p.m. The bank had not informed the complainants and other customers about the incident, and they got to know through the media. The loss was caused to them on account of negligence and misconduct on the part of the bank, in not making proper / bank – like security arrangements.

4.       The complainant no. 1 visited the bank on 02.05.2018 and found that the locker no. 39AF was opened by cutting the same with the help of gas cutter and all the gold ornaments jewellery, valuables and cash kept therein were removed and the empty jewellery boxes were lying scattered near the locker. The complainant no. 1 submitted a list of the gold ornaments, jewellery, other valuables and cash kept in locker to the branch Manager on 03-05-2018 estimating the loss to the tune of Rs. 34,00,000/-. It has also been alleged in the complaint that the complainant no. 1 made a complaint on 17-05-2018 to the Governor, Reserve Bank of India informing him about security lapses and lapses of duty on the part of the bank, as a result of which loss was caused to them. The complainant got a reply from RBI, Kolkata stating that the matter was taken up with UCO Bank and the bank has been advised to review the security arrangements of the branches having lockers to prevent recurrence of such incidence in future. It further said that the RBI is closely monitoring the progress in the matter. The complainants also reported the matter to the Managing Director and Chief Executive Officer of the bank on 19.05.2018 regarding security lapses on the part of the bank but the bank did not bother to reply their letter.  It is further alleged in the complaint that even after the incident when the locker was not in use, the bank had charged locker rent amount to Rs. 5200/- by debiting the amount from the savings bank account of the complainant no. 1 on 14.05.2018. Admittedly the bank had acted negligently in not having proper / bank-like security arrangement for protection of the valuables of the complainants kept in their safe deposit locker. It is further alleged that there was no security guard posted at the branch, either during day time or during night time to safeguard intrusion by unauthorized person in the branch.

5.       It is further alleged that there was no security guard posted in the branch for the last many years and the burglars could easily bring gas cylinders and cutters inside the branch and move with them to the strong room and break open the safe deposit lockers without any obstruction. The windows at the backside of the building were of weak grills with aluminum frames. There was no arrangement of light to cover the bank and there was total darkness. The complainants further alleged that the security system did not raise any alarm when the burglars entered the bank building and walked to the strong room. There was no security arrangement inside the branch near the area leading to strong room and safe deposit vault. The complainant alleged that as there was no proper security for protection of safe deposit lockers and the complainants suffered a loss of Rs. 34,00,000/-..

6.       The complainants filed a complaint before the State Commission with the following prayer:

      (a)         that by a suitable order or direction passed in favour of the complainants and against the Bank, the Bank be directed to pay to the complainants a sum of Rs. 40,96,200/- as damages for the loss suffered by them on account of the negligence, misconduct and deficiency in service on the part of the bank, along with interest @18% per annum.

      (b)         costs of the complaint be awarded to the complainants, as against the bank.

      (c)         any other suitable order or direction which this Hon’ble Commission may deem fit and proper in the ends of justice and in the circumstances of the case, may very kindly be passed in favour of the complainants and against the opposite party-bank in addition to or substitution for the reliefs claimed.

7.       The bank has contested the complaint by filing the written statement and stated that the complainants are not consumers of the bank as defined under section 2(7) of the Act 2019 since they have not availed the services from the bank and no cause of action had arisen for filing the present complaint against the bank. Also, the State Commission has no jurisdiction to entertain the complaint, as such, the complaint is not maintainable and is liable to be dismissed with heavy costs. It is alleged that the bank is neither required to know the details of items kept by the locker holder in the locker nor has the bank knowledge about the details of items kept in the locker. It is furthermore submitted that the burglary took place during the intervening night of 29/30^th April, 2018 and the bank was closed for three days due to holidays on 28^th, 29^th and 30^th April, 2018 and opened on 01.05.2018. It is also admitted that the burglary came to notice on 01.05.2018 i.e. at the time of opening the bank branch. FIR was lodged. The bank took all the required steps and made every security arrangements like installation of CCTV cameras, smoke censors, alarm system, double lock system and the same were in proper working condition on the date of incident and complied with all the required security arrangement as per Bank / RBI guidelines. It is submitted that there is no negligence on the part of the bank and the security arrangements in the bank were in accordance with the bank’s norms.    

8.       The State Commission vide its impugned Order dated 07.02.2023 partially allowed the complaint and directed the bank to pay Rs. 20 lakh to the complainants for deficiency in service in maintenance of locker and taking security measures, failing which, simple interest at the rate of 9% per annum shall be payable on the aforesaid amount from the date of that judgment till the date of payment. Compensation of Rs. 1,00,000/- was also awarded.

9.       Aggrieved by the said Order of the State Commission, the bank filed the instant appeal before this Commission.

10.     Learned counsel for the bank has argued that the State Commission has failed to appreciate the crucial fact that the bank had followed all the relevant rules and procedure in regard to standard parameter about the security of lockers. The bank had hired expert agencies to look after the security arrangements and there are no serious breaches of prescribed parameters and all suggestions or recommendations put by local police or said expert agency are fully complied with. He has further argued that strong room and safe deposit vault are made and maintained by the bank with all standard security requirements and which conforms with all safety norms. It is further submitted that all security of the bank including the strong room of the bank branch is being maintained as per security standard which is being inspected from time to time. It is further argued that the theft took place after working hours and there was no security guard. He further argued that as per bank’s procedure, the security guard for 24X7 hours is provided for cash chest branch only and all the CCTV cameras were working properly at the relevant time, the branch manager regularly used to inspect the alarm system every day as is usual practice. He further submits that since the theft was committed after closure of business hours, the bank or its officials cannot be held responsible for the same. It is further argued that the accused persons cut the wires of the sound alarm system and CCTV cameras and broken the lockers in question and the there is no negligence on the part of the bank. In support of his contention, he relied upon the decision in the case of UCO Bank vs. R. G. Srivastava (1996) 1 CPR 1997 and the decision of the Hon’ble Supreme Court in the case of Amitabh Dasgupta vs. United Bank of India (2021) 14 SCC 177 wherein it has been held that the value and existence of alleged stolen ornaments from the bank lockers have to be proved by filing a civil case before concerned civil court.

11.     Learned counsel for the complainants vehemently argued that as per the admission by the bank in the FIR dated 01.05.2018 the concerned branch was closed on 27^th  April 2018 after completing the daily work and opened on 01^st May 2018 and in the intervening night of 29 – 30^th April 2018 in which 16 lockers, including the locker of the complainants were broken and the all jewellery, gold ornaments and other valuables kept in the locker of the complainant were burgled and taken away. He further argued that they got the information about the burglary incident on 02.05.2018 from print media, local newspaper and not from the bank. Accordingly, on the next day i.e. on 03.05.2018 the complainants submitted itemwise list of the jewellery, gold ornaments and other valuables which has been kept in the locker, which has been received and acknowledged by the branch manager. He further argued on the serious security and safety deficiencies weaknesses and lapses on the part of the bank pointing out that the bank was unguarded and exposed to risk after business working hours as admitted by the bank.  It is further argued that the safety and security equipments were old and outdated and the bank has not been reviewing its security and safety arrangements and failed to demonstrate whether it had installed updated security and safety equipments. Further, he argued that the bank has failed to bring any evidence on record to show the safety and safety equipment installed in the bank were in perfect working condition and regularly maintained and tested. The burgler security alarm system did not work. The bank has admitted that they have installed a digital fire cum burglar alarm system on 15.01.2019 raising doubts about the efficacy of the earlier burglarly alarm system and the quality and strength of the safe deposit lockers were obviously inferior to the quality of the cash vault of the bank. As admitted by the bank, the burglars tried to break the cash vault but could not do so.

12.     In view of the above facts, it was argued that the bank has failed in their duty to exercise due diligence in maintaining the lockers of the customers and providing adequate safety and security measures. In support of his contention, he relied on the decision in the case of State Bank of India vs. Gopal Prasad Mahanty & Anr., first appeal no. 388 of 2020 clubbed with first appeal no. 382 of 2020 and first appeal no. 383 of 2020 wherein this Commission has held as under:

“The very purpose for which the customer avails of the Locker hiring facility is so that they may rest assured that their assets are being properly taken care of. But in the present case the OP Bank failed to take care of the assets/valuable articles of the Complainants which were lying in the Lockers provided by the OP Bank. Although, the stolen goods were seized by the Police and the Complainants could identify only small quantity of their jewellery because most of the jewellery was in distorted shape due to rough handling by the burglars and substantial quantity of jewellery was melted and transformed into Gold Biscuits yet the OP Bank cannot be absolved from the deficiency in service on their part.”

13.     The main issue arises in this appeal is whether there was deficiency in service on the part of the bank and if so, what should be the quantum of compensation to be awarded in this case.

14.     In the present case, the bank has consistently relied on the provisions of locker agreement executed between the parties which states that “the bank shall not be liable for any loss or damage to the contents of the locker arising from any cause or event over which it is physically impossible for the bank to have any control”. Further that the bank cannot be held responsible for the contents of the locker as they do not have any information regarding the same.

15.     In this case, reliance is placed on the decision of Amitabh Dasgupta vs. United Bank of India (supra) wherein it has been categorically held that  the “banks owe a separate duty of care to exercise due diligence in maintaining and operating their locker or safety deposit systems. This includes ensuring the proper functioning of the locker system, guarding against unauthorized access to the lockers and providing appropriate safeguards against theft and robbery. This duty of care is to be exercised irrespective of the application of the laws of bailment or any other legal regime to the contents of the locker. The banks as custodians of public property cannot leave the customers in the lurch merely by claiming ignorance of the contents of the lockers”

16.     In this perspective, the deficiencies pointed out by the complainants regarding the safety and security systems of the bank have not been answered or contradicted by the bank. They have simply relied on manuals and guidelines without providing any actual implementation of the same. This is a clear case of deficiency in service on the part of the Bank regarding security and safety system in the bank. Admittedly, after the business hours, the branch was left unattended and no security guard was deployed. It is apparent that the security system alarm was outdated as it was changed on 15.01.2019. No evidence with regard to the maintenance of the security system, daily checks of the alarm system of the Manager has been placed on record. As recorded in the order by the State Commission there were lapses in the safety and security system, which is clearly a deficiency in service on the part of the bank. In the light of the above quoted judgment rendered by the Hon’ble Supreme Court, the bank need to exercise due care and due diligence in maintaining their lockers and security systems.

17.     As regards the loss on account of contents of locker, it is a settled legal proposition in terms of the decision in Amitabh Dasgupta (supra) that the dispute regarding the contents of the locker cannot be adjudicated before the consumer fora and must be evaluated by the civil court for proper appreciation of the evidence led by the parties.

18.     Learned counsel for the bank has argued that the compensation of Rs. 20 lakh along with cost of Rs. 1 lakh as awarded by the State Commission is on the higher side as it amounts to more than half of the value of the alleged valuables as claimed by the complainants to have been kept in the locker.

19.     Considering the facts and circumstances of the case, we are of the view that the bank was deficient in service in respect of lapses in the due care and attention to the safety and security of the lockers but the amount of compensation must be just and reasonable and the compensation of Rs. 20 lakh as awarded by the State Commission is on the higher side. We are of the opinion that the compensation of Rs. 10 lakh for deficiency in service on the part of the bank is just and reasonable.  We order accordingly. The Order of the State Commission stands modified to that extent. The amount be paid within six weeks from the date of this Order, failing which, the interest at the rate of Rs. 9% per annum shall be paid on the aforesaid amount from the date of this Order till the date of payment is made.  There will be no order as to costs. 

20.     The appeal stands disposed of in above terms.