Case Law Details
Savitri Srivastava & Anr Vs State Bank of India (NCDRC Delhi)
Conclusion: In present facts of the case, NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI (NCDRC) have observed that the Deficiency in service and unfair trade practices are both evident in this case since the respondent bank acted contrary to the mandate of the petitioner and denied the payment of interest at the rate intimated by it to the petitioner vide certificate dated 12.12.2008.
Facts: In present facts of the case, the Revision Petition was filed under section 21 of the Consumer Protection Act, 1986 which assails order dated 06.02.2015 of the State Consumer Disputes Redressal Commission, Uttar Pradesh, Lucknow.
In brief, the facts were that the Petitioner invested USD 1,39,995/- in June 2006, in Reinvestment Plan – Special Term Deposit Receipt (in short, STDR) scheme under the Foreign Currency (F.C) Non Resident Accounts Receipt for a period of five years @ Rs.5.43% per annum rate of interest. Although the investment was for a period of five years, the respondent bank intimated them, on being contacted, that the STDR was valid for one year period only. It was contended that the petitioner had invested the amount for five years and the bank assured them that the amount would be renewed on maturity on 20.06.2007 for a further period of five years. However, the STDR was renewed on 20.06.2007 and the period was again shown to be for one year instead of five years. On the protest of the petitioners, the respondent bank issued a letter/certificate dated 12.12.2008 certifying that the FCNR deposit which was to be renewed for a period of five years from 20.06.2007 till 20.06.2012 had been renewed by their system for a period of 12 months and that the FCNR had been renewed for five years as mandated by the petitioners at the prevailing rate of interest of 5.43% per annum.
However, despite the issue of this letter/certificate the respondent bank renewed the FCNR for a period of one year only on account of which the petitioners suffered loss of interest. On the grounds of deficiency in service and unfair trade practices by the respondent bank, the petitioners approached the District Forum, Ghaziabad seeking a sum of USD 31166.33 being the difference of interest along with other reliefs. The District Forum vide order dated 02.05.2013 allowed the complaint of the petitioner/complainant and directed the respondent bank to pay interest at the prevailing rate for five years with effect from 20.06.2006.
The State Commission set aside the order of the District Forum on the ground that the petitioner had not raised the objection regarding the period of deposit when the STDR was pointed out on 20.06.2006.
The National Commission took into consideration a letter/certificate signed by the Branch Manager, State Bank of India, dated 12.12.2008 wherein it was mentioned that:
“as per your mandate, the FCNR (B) deposits were to be renewed for a period of 5 (five) years but in our system these were renewed for 12 months. We have already taken up the matter with our concerned department for renewal of the same for 5 years instead of 12 months. This letter may be treated as a proof of the above FCNR (B) is renewed for 5 years”.
The said document was not denied by the State Bank of India, the respondent bank. It was evident that the first deposit made by the petitioner was dated 20.06.2006 which was at the rate of 5.43%. On the basis of this document, it was evident that the bank renewed the deposit for a further period of five years at the same rate of interest (5.43% per annum).
It was further observed that the petitioner had mandated that the STDR be issued for a period of five years at a time when the prevailing rate of interest was 5.43%. Upon realizing that the STDR had been issued only for a period of one year, they had made efforts with the respondent bank to renew the deposit and ensured that the STDR was extended to five years. The only objective for such request could be the desire to avail the rate of interest of 5.43% per annum. Since the bank had admitted vide letter dated 12.12.2008 that the mandate of the petitioners was for a period of five years for the STDR, the denial of such a FDR and rate of interest amounts to deficiency in service and an unfair trade practice. In the face of clear admission by the respondent Bank with regard to the applicable rate of interest of 5.43% per annum, the respondent Bank cannot now resile from its stated position to the petitioner.
Accordingly, the order of the State Commission was set aside and the Order of the District Forum was affirmed.
FULL TEXT OF THE JUDGMENT/ORDER OF NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
1. This Revision Petition under section 21 ‘b’ of the Consumer Protection Act, 1986 assails order dated 06.02.2015 of the State Consumer Disputes Redressal Commission, Uttar Pradesh, Lucknow (in short, the ‘State Commission’) in appeal no.1238 of 2013 arising out of the order dated 02.05.2013 of the District Consumer Disputes Redressal Forum-I Ghaziabad (in short, the ‘District Forum’) in complaint Nos.28 of 2011 and 29 of 2011. This order will also dispose off Revision Petition No.1257 of 2015 which is filed by the wife of the present petitioner against appeal No.1239 of 2013 and complaint nos. 28 of 2011 and 29 of 2011 for the sake of convenience.
2. In brief, the facts as per the petitioner are that the facts of the case have taken from Revision Petition No.1256 of 2015, he had invested USD 1,39,995/- in June 2006, in Reinvestment Plan – Special Term Deposit Receipt (in short, STDR) scheme under the Foreign Currency (F.C) Non Resident Accounts Receipt No.655252 for a period of five years @ Rs.5.43% per annum rate of interest. Although the investment was for a period of five years, the respondent bank intimated them, on being contacted, that the STDR was valid for one year period only. It is contended that the petitioner had invested the amount for five years and the bank assured them that the amount would be renewed on maturity on 20.06.2007 for a further period of five years. However, the STDR was renewed on 20.06.2007 and the period was again shown to be for one year instead of five years.
3. On the protest of the petitioners, the respondent bank issued a letter/certificate dated 12.12.2008 certifying that the FCNR deposit which was to be renewed for a period of five years from 20.06.2007 till 20.06.2012 had been renewed by their system for a period of 12 months and that the FCNR had been renewed for five years as mandated by the petitioners at the prevailing rate of interest of 5.43% per annum. However, despite the issue of this letter/certificate the respondent bank renewed the FCNR for a period of one year only on account of which the petitioners suffered loss of interest. On the grounds of deficiency in service and unfair trade practices by the respondent bank, the petitioners approached the District Forum, Ghaziabad seeking a sum of USD 31166.33 being the difference of interest along with other reliefs. The respondent bank filed written statement and affidavit before the District Forum categorically admitting their readiness to pay the petitioner/complainant the interest for the period of 2007 till 2012 at the prevailing rate of interest which was 4.57% and not 5.43% per annum. The District Forum vide order dated 02.05.2013 allowed the complaint of the petitioner/complainant and directed the respondent bank to pay interest at the prevailing rate for five years with effect from 20.06.2006. The respondent bank approached the State Commission which set aside the order of the District Forum on the ground that the petitioner had not raised the objection regarding the period of deposit when the STDR was pointed out on 20.06.2006.
4. This order is impugned before us on the ground that the State Commission has not considered the fact that the petitioner had given a written mandate regarding renewal of the STDR for a period of five years at the rate of interest applicable at that point of time and the bank had erroneously renewed the STDR for a period of one year only each time.
5. It was also averred that the State Commission was failed to appreciate and consider that the respondent bank had admitted this error vide certificate dated 12.12.2008 and thereafter failed to rectify the error. It was also stated that the State Commission had failed to consider that the respondent bank did not pay the petitioners the amount deposited with interest that had been admitted by them in their written statement as well as in the affidavit filed before the District Forum. Therefore, deficiency in service and unfair trade practices is alleged on the part of the respondent and a direction sought for the payment of interest at the admitted rate of 5.43% with effect from 20.06.2007 till the deposits were withdrawn.
6. We have heard learned counsels for both the parties and perused the material available on record.
The District Forum has held as under:-
“ …..the complainant had opened FDR in June 06. The complainant has filed paper no. 5 Ga/9 which is the rate chart issued by State Bank of India. According to this, rate of interest for FDRs made in American Dollars at that time has been shown to be 5.47% per annum. In the opinion of the Forum, since this rate was prevalent on 01.06.06, as is mentioned in paper no. 5 Ga/9 and the complainants had opened FDR on 20.6.06, thus as the complainants had said to open for five years, hence according to paper no.5 Ga/9 they are entitled for interest at the rate of 5.47% per annum. As the Forum has mentioned hereinabove, at the beginning itself due to its own mistake, bank made it for one year in place of five years and after one year upon complaint renewed it on paper for five year (5Ga/5). In reality, due to error in system this was again renewed for one year. Hence, it will be considered that the entire amount of the complainants had been made in FDR from the beginning itself for five years. Hence, they are entitled for interest at the same rate which was prevalent in June-06. The Complainant is also entitled for appropriate compensation”.
7. The State Commission on the other hand has held as under:-
“ ….after comprehensive appraisal of the arguments put by the above parties and documents and evidences available on records and the impugned order, we have found that when the complainants received the FDR of one year for the amount deposited on 20.06.2006, then at that point of time no objection was made by the complainants that the FDR had been made for five years and not for one year. Such objection was made by the complainants only on 20.06.2007 when again the FDR was renewed by the bank for one year then objection was made that they had got the FDR for five years period then the bank admitted that due to problem in the system FDR could not be renewed for five years and they accepted renewal for five years period. In such a situation, it cannot be accepted that the admission on 20.06.2007 of problem in the system of the bank, also be accepted to be there at the time when FDR for one year period was being done on 20.06.2006 because the form which was being filled with regards to the FDR, though it might have been filled by any one in it period was written as 12 months only and bank had issued the FDR for 12 months that is one year only that is from 20.06.2006 till 20.06.2007. Had the FDR being made by the complainants on 20.06.2006 for five years and because of fault of the bank it was made for one year, then on 20.06.2007 the complainants would not have got renewed the FDR after adding interest on the principle amount, which had been made for one year period from 20.06.2006 the complainants would not have got renewed the FDR after adding interest on the principal amount, which had been made for one year period from 20.06.2006 to 20.06.2007 which bank admitted to had been made for five years place on one year. This is one such fact which is evident of fact that on 20.06.2006, FDR was made only for one year and because on 20.06.2007, the rate of interest had reduced, the fact of FDR for next five years was stated by the complainants to have been from 20.06.2007 itself. The argument of the complainants in this respect is also not acceptable because had the FDR been made for five years period from 20.06.2006 then the renewed FDR would not have been made from 20.06.2007 till 20.06.2012 because the above period would have been six years period and the complainants would have got the FDR extended only for four years on 20.06.2007 which is not the case of the complainants. In such situation it cannot be said that on the voucher relating to term deposit dated 20.06.2006, the period of 12 months was not written by the complainants or with the approval of the complainants. In this relation, District Forum by accepting the complaint of the complainants as committed error and finding of the impugned order erroneous, above appeal liable to be accepted”.
8. From the above, it is manifest that the State Commission had held that the STDR was renewed for a period of one year (12 months) from 20.06.2006 to 20.06.2007, and thereafter, the rate of interest had reduced. The State Commission has concluded that the renewed FDR could not have been made from 20.06.2007 to 20.06.2012, since it would have been increased the STDR’s period to six years whereas the petitioner had got FDR extended only for four years on 20.06.2007 and that this was also not the case of the complainants.
9. The Petitioner has filed a letter/certificate signed by the Branch Manager, State Bank of India, Main Branch, Navyug Market, Ghaziabad dated 12.12.2008 mentioning that “
“as per your mandate, the FCNR (B) deposits were to be renewed for a period of 5 (five) years but in our system these were renewed for 12 months. We have already taken up the matter with our concerned department for renewal of the same for 5 years instead of 12 months. This letter may be treated as a proof of the above FCNR (B) is renewed for 5 years”.
10. This document is not denied by the State Bank of India, the respondent bank. The period shown in this letter is for five years from 20.06.2007 to 20.06.2012. It is evident that the first deposit made by the petitioner was dated 20.06.2006 which was at the rate of 5.43%. On the basis of this document, it is evident that the bank renewed the deposit for a further period of five years at the same rate of interest (5.43% per annum). It is, however, now stating that the rate of interest as on 20.06.2007 was 4.47% and is, therefore, contesting this FDR on the grounds that a period of deposit would stand extended to six years, on the basis of this letter which was not mandate of the petitioners.
11. It is manifest that the petitioner had mandated that the STDR be issued for a period of five years at a time when the prevailing rate of interest was 5.43%. Upon realizing that the STDR had been issued only for a period of one year, they had made efforts with the respondent bank to renew the deposit and ensured that the STDR was extended to five years. The only objective for such request could be the desire to avail the rate of interest of 5.43% per annum. Since the bank had admitted vide letter dated 12.12.2008 that the mandate of the petitioners was for a period of five years for the STDR, the denial of such a FDR and rate of interest amounts to deficiency in service and an unfair trade practice. In the face of clear admission by the respondent Bank with regard to the applicable rate of interest of 5.43% per annum, the respondent Bank cannot now resile from its stated position to the petitioner. The District Forum rightly held that this rate of interest be paid to the petitioner. On the other hand, the State Commission has erred in holding that there was no intimation by the petitioner to the respondent Bank with regard to the duration of the STDR, and therefore, has awarded 4.47% rate of interest on the basis of the prevailing rate.
12. The State Commission’s conclusion is that the renewal of STDR for a period of five years was with effect from 20.06.2007 to 20.06.2012, when the petitioner had sought a STDR only for five years was also argued in the State Commission to be a mitigating factor in favour of the respondent Bank. While it is a fact that the petitioner sought an STDR for a period of five years, it is also clear from the record that the Bank issued a certificate and the letter stating that the renewal had been done for a period of five years with effect from 20.06.2007. This is clear evidence of negligence by the bank in treating the account of a nonresident in a very casual manner. The State Commission has clearly failed to appreciate the facts of this case. Deficiency in service and unfair trade practices are both evident in this case since the respondent bank acted contrary to the mandate of the petitioner and denied the payment of interest at the rate intimated by it to the petitioner vide certificate dated 12.12.2008.
13. For the aforesaid reasons, the order of the State Commission is liable to be set-aside. Accordingly, the order of the State Commission is set aside and the Order of the District Forum is affirmed.
14. Revision Petition No.1257 of 2015 also stand disposed off in the above terms.
15. All pending I.As, if any, shall stand disposed off with this order.
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