FILMALAYA PVT. LTD. vs Corporation Bank

THIS is a rare complaint by a depositor alleging negligence in Banking service. The complainant is therefore claiming compensation from the Corporation Bank on account of Financial Loss suffered by Filmalaya Pvt. Ltd. as a result of defective banking services in relation to his two accounts.

IT is necessary to state the facts of this Complaint. Filmalaya (P) Ltd. is a famous studio at Andheri (W), Bombay. Since last 30 years the studio is hired by various producers for shooting films. Opposite Party, the Corporation Bank (for short Bank) had estabalished a small counter next to the Filmalaya studio at Ceasar Road, Bombay. Filmalaya Pvt. Ltd. opened Account No. 16 on 1.12.1979 and another Account No. 162 on 20.12.1985 with the Bank counter. According to complainant Account No. 16 was meant for hiring business of the studio while Account No. 162 was operated for payment of telephone, electricity bills and incidental maintenance of the studio. Pradeep Roy was the cashier in the employment of complainant and was handling day to day bank work of depositing cheques, cash and also used to withdraw cash from the Bank. However, the cheques were being signed by complainant. During the period from 18.8.1986 to 23.8.1987 an amount of Rs. 2,42,021.50 was found to have been misappropriated from both Accounts No. 16 and 162. The complainant alleged that misappropriation is a result of gross negligence and glaring dereliction of duties by the Bank Officials. IT is further alleges that the Bank officials were a party to the misappropriation alongwith their cashier Pradeep Roy. The incident was reported to Police Station, D.N. Nagar, Bombay on 23.8.1987. The Police after the investigation filed the chargesheet in criminal Court against Pradeep Roy. He was convicted on his own admission for committing the offences of forgery and misappropriation. According to complainant, the Bank official Shri V.R. Shanbag, who was Sub-Manager at the counter of the Bank at the relevant time was immediately transferred out of Bombay in order to protect him. The complainant has incorporated in the complaint the statement showing the details of amounts involved which resulted in his loss. According to complainant the fraud was committed with the common intention by his Accountant Mr. Pradeep Roy and Mr. V.R. Shanbag, the Bank Employee. The fraud and misappropriation is divided into three methods as under:- (i) Rs. 39.060.00 were misappropriated as a result of Forged cheques passed by the Bank officials. (i) Rs. 13,765.00 were misappropriated in relation to cheques drawn on Account No. 16 but passed by Bank officials making withdrawal from Account No. 162. (iii) Rs. 1,89,209.50 was misappropriated from the Cash sent for deposit in both accounts but the full amounts were not entirely deposited.

The complainant has given the full details of cash amount sent for deposit, dates and the short- fall commencing from 18/8/1986 to 4/10/1986 amounting to Rs. 1.89,209.50. Thus the complainant submitted that the aforesaid amount could not have been misappropriated by Pradeep Roy without the connivance of Bank officials and hence, according to him, due to the negligence on the part of Bank Administration, he was put to loss which amounts to deficiency in the service of the Bank. The complainant took up the matter with Bank officials but he could not get any redress. However, the Bank owned the liability of Rs. 30,700.00 only vide their letter dated 26/4/1989. Complainant approached this Commission through this complaint to claim the compensation on account of the loss suffered by him as a result of negligent service of the Bank.

In answer to the allegations contained in the complaint, the Bank filed written objection. The main objections are noted below: - The Bank submitted that, (i) The complainant twisted the facts and is trying to pass on the loss suffered by him on account of fraudulent acts of his employee, on the Bank. (ii) That this Commission has no jurisdiction as Civil Court has jurisdiction. (iii) That the transaction is not arising out of customer service extended by the Bank as it is a creditor and debtor relationship; (iv) and some technical objections.

It is to be noted that Corporation Bank is opposite party but the version on behalf of the Bank.

NOT filed. However, an objection is filed by a Deputy General Manager of the Bank dated nil without the identity of his name. There is no verification. There is no mention about the specific authority in the objection from the Bank administration. The said objection is more or less in argumentative nature and no denial of basic facts alleged in the complaint in relation to the misappropriation and the amount of loss. 5. The complainant and the opposite party Bank filed number of documents in respect of their contentions. We have also heard Shri B. Chatterjee for the complainant and Shri P. .Narayan Bhat, Advocate for the Corporation Bank. On the basis of the rival contentions raised before us, the following points arise for our determination: - (1) Whether the complainant has been put to a financial loss of Rs. 2,42,034.50 on account of the misappropriation and fraud as alleged in the complaint? (2) Whether the loss caused to the complainant is as a result of negligence in the service of the Corporation Bank? (3) Whether the complainant is entitled to claim the compensation for Rs. 2,42,234.50 and interest at 21% p.a.? Our answer is in the affirmative for the reasons given below: -

There are some admitted facts. Filmalaya Pvt. Ltd. was having Account No. 16 and Account No. 162 with the Corporation Bank and Pradeep Roy used to go to the Bank for day to day transactions. It is also an admitted fact that the incident of misappropriation of the amount in the aforesaid two accounts was reported to D.N. Nagar Police Station, Bombay on 23.8.1987; and chargesheet was submitted to the Metropolitan Magistrate, 27th Court Explanade, Bombay on 29.2.1988. It is also a fact that Pradeep Roy was convicted on 16.6.88 on his own admission for the aforesaid offences and was sentenced to imprisonment, (the details are found in a letter from Sr. Inspector of, Police dated 25.10.1989) placed on record. It is also a fact that the Corporation Bank in their letter dated 26/4/1989 admitted that there were material alterations in the cheques and, therefore, they owned the liability for the loss in respect of the four cheques and offered to settle the claim of Rs. 30,700.00. However, the rest of the claim made by the complainant was rejected. It is also a fact that the complainant took up the matter with the Corporation Bank.

THE complainant has further alleged that he was put to loss of Rs. 2,42,034.50 due to the negligence of Bank. THE loss is split up in three different methods. By the first method, the loss of Rs. 29,928/- and Rs. 9,132/- is alleged as a result of forged cheques, which were passed for payment. By the second method, the amount of Rs. 1,37,065/- was allowed to be withdrawn by the Corporation Bank by Pradeep Roy from Account No. 162 although cheques were issued on Account No. 16. THE third method of loss alleged by the complainant is that he has been put to a loss of Rs. 1,89,209.50 by short deposit. Pradeep Roy, while depositing the cash in the aforesaid two accounts of the complainant used to show full deposit but actually used to deposit less amount. For example the complainant has stated that on 29.9.1986 Rs. 16,800/- were sent with Pradeep Roy for depositing in the account of the complainant. THE Pay-in-Slip dated 14.3.1987 shows that Rs. 800/- only were credited in the Account No. 16 of complainant whereas its corresponding counter foil stamped and signed by the Bank Officials shows the credit of Rs. 16,800.00. Thus Rs. 16,000.00 were allowed to be misappropriated. THE complainant has given complete statement in the complaint showing details of misappropriation from cash amount sent for deposit and how less deposits were allowed to be made by Bank officials. According to complainant, he sustained losses on account of the negligence on the part of the Bank to acknowledge the receipt of full amount although the less amount was actually deposited in his account. Complainant claims loss of Rs. 1,89,209.50 ps. by this method. Corporation Bank in its written objection did not specifically deny the allegations made by the complainant as regards the loss caused to the complainant on account of the forged cheques and the short deposits. The Corporation Bank has not also disputed the amount of short deposit. According to the Corporation Bank, the entire loss has been caused to the complainant on account of the fradulent act of the employee of the complainant, Pradeep Roy. It is further stated by the Corporation Bank that Pradeep Roy confessed that he is totally responsible for all the misappropriation. In short, according to the Corporation Bank, the complainant suffered loss but it is not on account of the negligence of the Bank but on account of his own employee, Pradeep Roy. But there is no denial as regards the loss caused to the complainant. Thus in our view the loss caused to the complainant is not only denied but has been positively proved by the complainant. The Corporation Bank filed the statement of accounts in respect of the Accounts No. 16 and 162 of the complainant from Bank registers. In that statement, the entries of cash deposits made in Pay-in- Slips are not tallying, but it does tally with the corresponding counter foils which were in the possession of the complainant. The complainant has filed zerox copies of counter foils. Thus, the modus-operandi adopted for fraud is very clear. The actual cash was sent by complainant with Pradeep Roy for deposit in the current accounts. But while writing the Pay-in-Slips, Pradeep Roy used to write less amount. For example, counter foil of Pay-in-Slip dated 29.9.1986 No. 912391 shows Rs. 16800/- has been credited. But its corresponding Pay-in-Slip shows only Rs. 800/- as deposit. The difference between the amount shown in the Pay-in-Slip and the corresponding counter- foil of Rs. 16,000/- is the amount of misappropriation. There was no reason for suspicion for the complainant as the correct amount has been shown as credited in the Bank, Pradeep Roy used to show correct figures in the corresponding counter foil. According to the complainant, when there was apparent difference in the amount shown in Pay- in-Slip and its corresponding counter foil, how it was not noticed by the Corporation Bank Employee? How were the Bank employees blindly putlg their endorsement of rubber stamp and signatures showing "Cash Received" on counter foils and accepting less cash in the corresponding Pay-in-Slip? By this method the complainant has claimed that loss of Rs. 1,89,209.50 ps. was caused to him. Corporation Bank deliberately avoided to explain in their reply these allegations made in the complaint. We are, therefore, convinced that the complainant has been put to loss due to the negligence on the part of the Bank Employee. The fraud was going on for a long period of more than one year from 24.6.1986 to 27.12.1987 in respect of 56 deposits on various dates. It could not have materialised without the active participation of the employee of the Corporation Bank. The complainant has pointed his finger towards Mr. Shanbag, the Bank Employee. There cannot be a mistake for 56 deposits spread out over a period of one and half years, unless there was quid-pro-quo between Pradeep Roy and Mr. Shanbag. It is very difficult for us to accept the reply of the Bank that the entire amount has been misappropriated by Pradeep Roy, in view of the facts and circumstances proved in this case. According to us, it was impossible for Pradeep Roy without any active participation of the Bank Employee to commit such a fraud on such a large scale. Thus, the averments made in the complaint are duly supported by contemporaneous documents viz. the Pay-in-Slips and its corresponding counter foils. It is clearly established that the complainant was put to a loss of Rs. 1,89,209.50 ps. on account of the negligent service of the Bank. The Bank employees at the small counter could easily have detected this fraud by the use of reasonable skill and diligence and could have avoided the loss to the complainant. In action on the part of Bank employees in this case can safely be atributed to their participation in the fraud. The inference is further fortified from the fact that the Bank neither brought it to the notice of the complainant as a common courtesy nor reported the matter to the higher officials of the Bank but remained mute spectators as if the Bank has no concern to protect the deposit of its valued customer. In our view, there cannot be a better example of negligence than the one which we have come across in this complaint. As regards the amount of forged cheques of Rs. 30,050/- the Bank itself has admitted the liability in their letter dated 26.4.1989. Similarly, it is proved that the complainant was put to a loss of Rs. 13,765/- by allowing Pradeep Roy, to withdraw the amount from Account No. 162 although the directions were given by the complainant for withdrawal in respect of Account No. 16. We, therefore, record our finding that the complainant has proved that he has been put to loss of total amount of Rs. 2,42,021.15 by the three methods as stated in the complaint as a result of fraud and misappropriation. It is well-known in the Banking system in our country that there is always an element of trust between the Bank and the customer. The business of the Bank depends upon the trust of the various depositors. In order to maintain the trust, the banker is bound to act according to the directions given by the customers. In the absence of such directions according to usage in the locality and applicable to the matter in hand, the banker is also bound to use reasonable skill and deligence in his work and if he fails in his duty, he will be liable for damages. "The Madras High Court in the case of R.J. Mohamad Jekab Saheb and Others v. The Indian Bank Ltd. and Others (A.I.R. 1975-Madras 220) relying on the decision of the Supreme Court (AIR-1965-SC-1711) has held that it is the duty of the Banker towards its customers to act according to the directions of the customers. In the absence of the directions according to usage in the locality and applicable to matter in hand, the banker is bound to use reasonable skill and deligence in his work otherwise he will be liable for damages. In the instant case, it is clearly established that the Corporation Bank was utterly negligent in rendering the proper and usual services to the complainant inasmuch as the Bank has not taken the care to verify whether the cash amount shown in Pay-in- Slip is the same written in the corresponding counter foils. From the various counter foils filed by the complainant the corresponding Pay-in- Slips produced by the Corporation Bank clearly show that the Bank did not discharge its legitimate and usual duty as a Banker to verify the correct mention of amount in the Pay-in-Slip and the corresponding counter foil. In our view, this is clearly a deficiency in the working of the Corporation Bank. The incident is not an isolated item of one day but is spread over one and half years'' period. It clearly shows the collaboration between Pradeep Roy and the Bank employee. In our view, there cannot be any other inference except the collaboration between Shri Pradeep Roy and the Bank Employee continuously. In our view it is manifestly an act of negligence on the part of the Bank in the discharge of its legitimate duty. We are shocked to find that although the needle of suspicion was pointing towards Mr. Shanbag, he has been hurridly transferred with promotion, thus giving him a clean chit by the Bank Management. It seems after the conviction of Pradeep Roy, Mr. Shanbag is back in Bombay with a clean chit from the Bank.

AS. regards the forgeries committed in relation to four cheques, the Corporation Bank has admitted in its reply that the four cheques were imaterially altered and yet were passed for payment by the Bank. The Bank also agreed to pay Rs. 30,700.00 towards the loss caused to the complainant vide their letter dated 26.4.1989 addressed by the Chairman of the Bank to the complainant. When the Bank itself has admitted that the forged cheques were passed for payment on four different occasions that itself is an admission on the part of Bank to have rendered deficient service to the complainant causing him the loss. In view of the clear admission given by the Bank in its reply in answer to the allegations made by the complainant in his complaint as regards the passing of forged cheques, we find that the Bank itself admitted the deficiency in the service. Similarly, the Bank has admitted that although the direction of the complainant was to pay from his Account No. 16, the payments were actually made from another Account No. 162. The complainant has stated that he intentionally maintained two different accounts. Therefore, according to the complainant, his direction to the banker were not properly carried out in relation to a particular account. Complainant alleged in Para 5 of his complaint that when funds in A/c No. 16 got exhausted the Corporation Bank Officials facilitated Pradeep Roy to withdraw more amount from complainant''s other A/cs No. 162, when actually cheques were issued from A/cs. No. 16. Zerox copies of those cheques are at Ex. ''D. Collectively, Opposite party admits this fact but justifies the act saying that the Bank can choose to do so in order to honour the cheque. In our view the Bank is not legally correct to do so. When any account holder issues a cheque in relation to his particular account, it is his direction to the Bank. The Bank has no option to choose to withdraw the amount from a different account of the same account holder. It will be contrary to the direction of an account holder. The Orissa High Court in the case of State Bank of India v. Rathi Samba Murty (AIR 1988 Orissa 50) has taken a view that "The cheque of one account cannot be used in respect of another account even though the same person may be having two accounts. We do not find that in the instant case, the Bank had any instructions from the complainant to encash the cheque from A/c. No. 162 if the cheque is issued from A/c. No. 16. The only inference from these facts emerges that the Bank acted without due diligence, just to facilitate Pradeep Roy to commit misappropriation.

IN view of the facts and circumstances of this case mentioned above, we hold that to pass the forged cheques, not to obey the directions of the complainant and to allow one''s employee to help commit the misappropriation etc. with connivance of the Bank employee are the clear instances of the deficiencies in the service of the Bank. The defence of the Corporation Bank that Pradeep Roy the Accountant of the Company is entirely responsible for putting the complainant into loss cannot be accepted in view of the evidence on record. The complainant has indicated that Mr. Shanbag, Bank Officer who was passing the payments in the discharge of his duties was actually in active collaboration with Pradeep Roy. A zerox copy of the letter dated 20.8.1987 written by Pradeep Roy is filed by the complainant on record. In that letter Pradeep Roy has stated that he was misappropriating the amount for a period of two years from the Corporation Bank out of Account No. 16 and 162 and then Manager Mr. Shanbag was with him in the said misappropriation. Pradeep Roy further stated that out of amount of Rs. 2,45,000/- he has retained for himself an amount of Rs. 1,45,000/- and the Manager of the Bank has taken Rs. 1,00,000/- cash. He also expressed that his services should not be terminated and that he shall make good the aforesaid amount and also will pay the amount of Rs. 1 lakh from Mr. Shanbag. The said letter is in the hand writing of Pradeep Roy. It is an admitted fact that Mr. Shanbag was the Manager working at the counter of the Corporation Bank which was being operated by Mr. Pradeep Roy at the material time. It is the allegation of the complainant that in order to protect Mr. Shanbag, he was transferred by the Bank out of Bombay after the fraud was detected. It is the allegation of the complainant that in order to protect Mr. Shanbag, he was transferred by the Bank out of Bombay after the fraud was detected. It is alleged that the Corporation Bank officials were supporting Mr. Shanbag. In answer to this allegation, the Bank has come out with the explanation that Mr. Shanbag was transferred as he was promoted. In fact, the Corporation Bank has filed the affidavit by Mr. Shanbag who is presently working at the Corporation Bank as Dy. Manager, Foreign Exchange Department, Nariman Point at Bombay. In addition, there is very interesting material placed on record by the complainant. There is one zerox copy of the certified copy of telegram dated 27.8.87 sent by Pradeep Roy to Mr.Shanbag at Jaypura Kalasha Road, Kogri in Karnataka. The subject matter in telegram is as under: - "Come soon to Bombay with the full amount received by you from me. Question of your and my career at stake. No delay. I am in big trouble. Reply by return telegram at Filmalaya address."

The complainant wants to show that the message in the telegram clearly indicated that Mr. Shanbag as an employee of the Corporation Bank was party to the fraud and misappropriation, helping Pradeep Roy to misappropriate the amount. According to the affidavit filed by Mr. Shanbag, he never received the telegram of the description filed by complainant, and that he has been falsely implicated by Pradeep Roy. He has filed his affidavit dated 7/12/1990, stating his denial. In order to show his innocence, he has filed a letter dated 17/7/1987 addressed to him by the Manager of the Corporation Bank showing that he was promoted. In order to show that he has no connection with Pradeep Roy, he has placed zerox copy of his letter dated 30/1/1987 sent by Superintendent Telegraph''s Office, Bangalore addressed to him. It is stated that the next of the aforesaid telegram was due to service fault. According to Shanbag, he received the telegram dated 22/8/1987 from Bombay but he did not reply the said telegram as the message was not clear to him. However, there is admission in the letter sent by Mr. Shanbag to the Superintendent of Telegraph Division that he has received a reply paid telegram dated 22/8/1987 from Bombay but he could not make out anything. It clearly appears that the Corporation Bank tried to shield Mr. Shanbag from the prosecution. Further it appears that he was deliberately shifted from Bombay immediately after the fraud was complained of to the Bank by the complainant. The circumstances further helped Mr. Shanbag to get himself cleared as Pradeep Roy admitted his crime in the Court without trial and the curtain was drawn so far his involvement is concerned. After going through the entire case papers, we have no doubt in our mind that Mr. Shanbag in capacity as a employee of the Corporation Bank helped Pradeep Roy to commit the fraud in question which resulted in the financial loss to the complainant. Mr. Shanbag has admitted in his affidavit in Para 6 mat he was Sub- Manager at the Branch of Corporation Bank in question at the material time till his transfer. The Corporation Bank has not stated anywhere that there was any other officer competent to pass cheques for payment involved in this case. Thus, in our view this is not the case where Pradeep Roy as employee of the complainant is alone responsible for the losses caused to the complainant but the facts and circumstances of this case clearly establish that the Corporation Bank through its employee''s negligent acts of omissions and commissions helped Pradeep Roy to commit the fraud. The unique aspect of this case which is worth consideration is that the Bank has treated this complaint as if it is against Mr. Shanbag and not against the deficiency in the service of the Bank. No affidavit is filed on behalf of the Bank''s authorised official. But Mr. Shanbag the main suspect has filed the affidavit and the documents. The entire tenor of his affidavit is in his self defence and not in the defence of the Bank Administration. Nothing is said about the forged cheques and short deposits except that Pradeep Roy is alone responsible. Thus we find that there was clear deficiency in the service of Corporation Bank through its employee at the counter in question which put the complainant into loss. We are, therefore, of the opinion that Corporation Bank is liable to compensate the complainant for his loss caused to him as a result of mis-appropriation in which Bank employees are party. It is a well settled principle governing the vicarious liability that an employer is liable for the loss caused to a customer through the wrongful acts of an employee or agent. In that case, the employer is liable for fraud perpetrated in the course of employer''s business whether the same is done for the benefit of employer or not. As discussed above, we have clearly found that the complainant has been put to loss in this case due to the wrongful act of the employees of the Bank in the course of Bank''s day to day business.

THE complainant has also alleged that since his amount from A/c No. 162 was allowed to be misappropriated by the Bank Administration he had to face difficulty about the funds. He had hardship for carrying on day to day business since his deposits had been syphoned away by the method of defalcation. According to the complainant, he came to be dishonoured seriously discrediting his reputation in the market and other inter-related consequences. THE complainant, therefore, claimed punitive interest at the rate of 21% p.a. compounded quarterly like the financial institutions. THE complainant further alleged that the Bank was insured to cover such losses and, therefore, even if any loss is caused to the Bank, it has been indemnified by the Insurance Policy. THE Bank can, therefore, reimburse the amount forthwith from the Insurance Company without any further delay. We find substance in this claim of the complainant. THE complainant has placed on record the zerox copy of the New Insurance Policy issued by the United India Insurance Company Ltd. under the heading "Bankers Indemnity Insurance Policy". THE aforesaid policy was issued on 30/6/1987 and was covering the amount of Rs. 30 lakhs. THE premium paid to the Insurance Company by the Bank was Rs, 1,92,000.75. THE Policy period was from 1.7.87 to 30.6.88. On the front page, the conditions of the Insurance Policy are prescribed. THE conditions B, C and D are reproduced below: - B. In Transit : By reason of any Money and/or Securities being lost, stolen, mislaid misapapropriated or made away with whether due to the negligence of fraud of the employees of the insured or otherwise. Whilst in transit in the hands of such employees, such risk of the transit to commence from the moment the same is received by the employee on behalf of the Insured and to continue untill delivery thereof at destination.

C. Forgery Or Alteration : By reason of the payment made in respect of fictitious or forged or raised cheques and/or drafts and/or genuine cheques and/or Travellers Cheques and/or Gift cheques and/or drafts and/or fixed deposit receipts (excluding Bills of Discount and other credit facilities) issued by the insured bearing forged endorsement or the establishment of any credit to any customers on the faith of such documents whether received over the Counter or through the Clearing House or by Mail.

D. Dishonesty : By reason of the dishonest or criminal act of the employee(s) of the insured with respect to the loss of money and/or securities wherever committed and whether committed singly or in connivance with others.

The condition ''B'' clearly stated that any loss of money by reason of misappropriation or fraud of the employee of the insured or otherwise has been indemnified. Similarly, in condition No.''C'', the loss by reason of the payment made in respect of bogus or fictitious or forged or raised cheques is covered. The condition ''D'' covers the loss by reason of dishonest or criminal act of the employees committed singly or in connivance with others. We find that period of misappropriation is in between the period 24.6.86 to 27.12.87. In view of the indemnity on account of the loss occasioned to a Bank, in case it is required to pay to a customer, we fail to understand why the Bank should be hesitant to make good the loss of customer when the Bank is aware that the Bank can claim that amount from the insurer. In view of the interest of the Bank being indemnified by the Insurance Company, in such an eventuality if the Bank refused to settle the claim of the Account holder when the Bank is aware that the customer is put to a loss on account of fraud and misappropriation, we see that it also amounts to a deficiency in the service of the Bank. When account holder opens the account in a Bank, he expects the service from the Bank. The minimum expectation of account holder is that his deposits are safe in the Bank and, therefore, he deposits the money in the Bank. In the case of current account, the rate of interest is minimum. If the same amount is invested in the securities, a customer may earn more profits. He is aware that Bank can earn more profits on his deposits by way of an interest. And it is an open secret that the Bank earns interest on the deposits of the account holders. The rate of interest paid to the account holder is much less than what the Bank gets from lending loans. Therefore, the customer reasonably expects prompt, dependable and a courteous service from the Bank. If such service is not rendered it would certainly amount to deficiency on the part of the Bank. It is common knowledge that the Banks in order to attract the deposits from the public display huge advertisements on streets and in costly magazines to induce the depositors to invest in an attractive scheme of that Bank. There is nothing wrong in this in order to get more deposits in a competitive business world. In all these advertisements, every Bank promises a very prompt, dependable and courteous service. In the instant case we find that the Bank has not extended the simple common courtesy to inform the complainant about the misappropriation being committed continuously in relation to the two accounts of the complainant.

THE Opposite Party Bank has tried to wriggle out of the issue by making some untenable submissions. Shri Bhat, the learned Advocate appearing for the Bank has raised the objection about the jurisdiction of this Commission. According to learned Counsel there is no negligence on the part of the Bank. According to him if there is any negligence, that is on the part of Pradeep Roy, the employee of the complainant. We see no substance in this objection. THE next objection raised by Shri Bhat is as regards limitation. He submitted that the cause of action arose on 28/8/1987 in respect of Account No. 16 when a cheque of Rs.910.00 was drawn by the complainant for clearing. THE entire approach of Shri Bhat on the point of limitation is misconceived. It is found that the complainant perused the matter with Bank demanding the amount of loss and the bank by its letter dated 26/4/1989 offered to pay Rs. 30,700.00 in respect of the four cheques which were found to be forged. In view of the aforesaid acknowledgement in writing signed by the Opposite Party dated 26/4/1989 about the right of the complainant, under Section 18 of the Limitation Act 1963 fresh period of limitation has to be computed from 26/4/1989. In our view the fresh period of limitation has to be computed from 26/4/1989 and therefore, also the complaint is within limitation. Lasly, Shri Bhat has argued that the complainant is not the consumer as his service was without any consideration. We are not prepared to accept this argument for the simple reason that u/ Sec. 2(o) of the Consumer Protection Act, the ''service'' includes banking. THE service of the Bank in our view is not a free service since the bank charges commission on collection of outstation cheques and also on demand drafts. Moreover, the Bank earns profit by way of interest on the deposit money of the customers and therefore, it cannot be said to be a free service. Thus, this objection of Shri Bhat does not hold any ground. THE last objection of the bank that the transaction is not arising out of customer service extended by the Bank as it is a creditor and debtor relationship. But as discussed above we do not subscribe to this view. In our view this case squarely falls within the limit of Consumer Protection Act. In the result, we have to allow this complaint of the complainant and pass the following order :- ORDER The opposite party, Corporation Bank, Mangala Devi Road, Bangalore through their Branch Office at S.V. Road, Andheri (W), Bombay is directed to pay Rs. 2,42,034.50 ps. to the complainant within a period of two months from the date of this order, failing which the aforesaid amount shall carry interest at the rate of Rs. 18% p.a. till the realisation of the amount. We also quantify the cost of complaint at Rs. 5000.00 to be paid by the Bank to the complainant to cover his expenses of the litigation. Complaint allowed.