ICICI Bank LTD vs Kishore Kumar Bodke

Prem Narain, Presiding Member

This appeal has been filed by the appellant ICICI Bank Ltd. against the order dated 11.7.2017 of the State Consumer Disputes Redressal Commission, Karnataka, (in short 'the State Commission') passed in Appeal No.74 of 2012.

Brief facts of the case are that the respondent has an account with the appellant bank. The appellant bank noticed that one credit card was being used which had the same KYC as that of the respondent/complainant, which included the driving licence and the pan card of the respondent. As there was outstanding against that credit card, the appellant bank attached Rs.1,58,688/- from the saving account of respondent Kishore Kumar Bodke. When the same was noticed by the complainant in his account, he inquired from the bank and the bank informed the factual position in this regard. The amount remained attached for 41 days and later on it was found by the bank that the respondent/complainant was the true customer who had not obtained any credit card and some other person had made use of KYC documents of respondent complainant. That person, may be, with connivance of some of the bank employees, obtained the credit card. The bank then released the amount of Rs.1,58,688/-, which was attached by the bank. However, the complainant felt aggrieved that his credentials were doubted by the bank and the complainant as well as his parent were involved unnecessarily in correspondences by the bank. Consequently, he filed a consumer complaint before the State Commission alleging deficiency of service on the part of the appellant and requesting for direction to the opposite party to pay Rs.49,00,000/- as compensation to the complainant.

The complaint was resisted by the opposite party by stating the actual facts as stated above. However, the State Commission allowed the complaint and passed the following order:-

"The above complaint is allowed holding that the OPs are jointly and severally liable to pay a sum of Rs.5.00 lakhs with interest at the rate of 8% per annum to the complainant from the date of complaint till realization.

OPs are directed to comply with the said order within 8 weeks from the date of receipt of copy of this order."

Hence the present appeal.

Heard the learned counsel for both the parties and perused the record.

Learned counsel for the appellant stated that the action of the bank was bona fide as the bank noted credit card transactions from one account which had same KYC documents as those of the respondent/complainant. It was necessary to ask the respondent/complainant as to whether he was using the credit card. As there was outstanding against the credit card, an amount of Rs.1,58,688/- was taken from the savings account of the respondent/complainant. When the bank was satisfied with the response of the complainant that he was a genuine customer and had not taken any credit card, it was realised that somebody had obtained illegally the KYC documents of the respondent/complainant and he obtained the credit card from the bank and that may be in connivance with some of the bank officials. Accordingly, the amount of Rs.1,58,688/- was attached from the account of the respondent/complainant. The amount remained outside of the account of the complainant only for 41 days and therefore, at the most the complainant is entitled to interest of saving bank account on the amount of Rs.1,58,688/-. Learned counsel has further argued that this is the general accepted principle of law that the bank has lien on all the amounts maintained by the different customers with the bank. The bank is also duty bound to check if any fraud is happening on any account. From this angle, inquiry was made from the complainant. There might be some harassment of the complainant in the process of inquiry, however, the same was done in good faith and in discharge of the official duty of the bank. The State Commission has allowed unreasonably high compensation of Rs.5,00,000/- to the complainant/respondent for which there is no basis.

On the other hand, learned counsel for the respondent/complainant stated that the application form for credit card filed by the appellant bank does not bear the signature of the bank officials and therefore, its veracity is doubtful. Though the bank is saying that a pre-attachment notice was given to the respondent, but the same is not true. The respondent has received no such notice and the bank has filed no details of its posting and dispatch. Moreover, the respondent is an NRI living in USA, therefore, there is no question of receiving notice by him. It was stated by the learned counsel for the complainant that the complainant had faced lot of mental agony and harassment when amount of Rs.1,58,688/- was debited without any reason from his account. Moreover, in the name of inquiry his parent was troubled and harassed by the bank officials. The complainant has further suffered mental agony as bank officials treated him like cheat or some culprit for an offence. The complainant is a responsible reputed person and the State Commission has rightly awarded a compensation of Rs.5,00,000/- to the complainant.

I have carefully considered the arguments advanced by the learned counsel for the parties and have examined the record. Right from the very beginning, the bank has maintained that the amount of Rs.1,58,688/-was attached as there was outstanding against a credit card which had the same KYC as that of the respondent/complainant. The attachment was done during an inquiry, which was done in good faith in the performance of the official duty. It is incumbent on all the banks to verify the KYC documents and to make inquiries in respect of any account where any kind of suspicion is made. Moreover, Hon'ble High Court of Madhya Pradesh in State Bank of India Vs. Smt. Goutmi Devi Gupta, C.R. No. 884 of 2001, has held the following:

"xxxxxxxxSecond objection is also not tenable. S. 171 of the Contract Act gives statutory recognition to the concept of Banker's general lien. It provides that the Bankers may, in the absence of a contract to the contrary, retain as a security for a general balance of account any goods bailed to them. Money is a species of goods which may be the subject matter of bailment and over which lien may be exercised. The general lien of bankers, as judicially recognized, and dealt with in S. 171 attaches to all goods and securities deposited with them as bankers by a customer or by a third person on a customer's account, provided there is no contract, express or implied, inconsistent with such lien. There is no gainsaying that such a lien extends to FDRs also which are deposited by the customer.xxxxxx"

In view of the above legal position the decree holder in the present case cannot be directed to proceed first against the hypothecated property and then against the surety.

xxxxxxxxxBank has a general lien over all forms of securities or negotiable instruments deposited by or on behalf of the customer in the ordinary course of banking business and that the general lien is a valuable right of the banker judicially recognized and in the absence of an agreement to the contrary, a Banker has a general lien over such securities or bills received from a customer in the ordinary course of banking business and has a right to use the proceeds in respect of any balance that may be due from the customer by way of reduction of customer's debit balance. Such a lien is also applicable to negotiable instruments including FDRs which are remitted to the Bank by the customer for the purpose of collection."

Hon'ble High Court of Delhi in State Bank of Mysore Vs. Surjeet Kaur, 1993 (51) DLT 150 : 1993(2) BC 177 has held as follows:

"7. The aforesaid decision of this Court on which reliance was placed by the Executing Court had already been reversed by the Supreme Court in re: Syndicate Bank v. Vijay Kumar and others, AIR 1992 SC 1066. The Supreme Courtdecided that case on 5/03/1992 whereas the impugned order is dated 20/04/1992. It has been held by the Supreme Court that having regard to the mercantile custom as judicially recognized the bank has a general lien over all forms of deposits and securities made by or on behalf of the customer in the ordinary course of banking business. The Supreme Court not only relied upon the recital in the letters in the said case creating lien in favour of the bank but also pronounced about the right of the bank of general lien over all forms of deposits or securities made by or on behalf of the customer in the ordinary course of banking business."

From the above judgments, it is clear that there is a general lien of the bank on all the amounts deposited under different accounts of the customers and the bank can recover its dues as outstanding for recovery. Moreover, even if this aspect is not taken into consideration, the fact is that the amount of Rs.1,58,688/-remained out of the account of the complainant only for 41 days. The bank bonafidely returned the amount after inquiry to the account of complainant. The bank itself has reached to the conclusion that somebody has used the KYC documents of the respondent/complainant and has obtained the credit card from the bank and that may be in connivance with some officials of the bank. As the FIR has already been lodged by the bank after internal inquiry and the police inquiry will take care of the fraud that happened in the bank. However, it was necessary to inquire into this aspect as the KYC of the credit card holder exactly matched with the KYC documents of the complainant. Learned counsel for the respondent has tried to make out a case that the story of credit card with similar KYC might have been created to justify the action of the bank for debiting the amount of Rs.1,58,688/- to the account of complainant. Learned counsel however, did not explain any other reason for doing so. The bank will not take away any amount from the account of any account holder until somebody wanted to fraudulently withdraw the amount. In my view, no reason has been established by the respondent other than one given by the appellant for attaching of amount of Rs.1,58,688/-. Thus, doubt being created by the learned counsel for the respondent/complainant does not have any basis and cannot be accepted. In my view, once the bank had an outstanding on a credit card having same KYC, it was the duty of the bank to ascertain from the account holder having that KYC about the credit card. It is true that complainant has suffered some mental agony and harassment has been caused to his parent. However, that was due to a justified inquiry. Section 14 (1) (d) of Consumer Protection Act 1986 provides for compensation to be given to the complainant and it reads as under:-

"14(1)(d) to pay such amount as may be awarded by it as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party:

[provided that the District Forum shall have the power to grant punitive damages in such circumstances as it deems fit;]

From the above, it is clear that the consumer forum has power to award compensation to compensate for the loss and injury suffered by the complainant due to negligence by the opposite party. At the most, in the present case, the negligence can be that the amount of Rs.1,58,688/- has been taken by the bank without ensuring that the intimation has reached to the complainant, though after this, lot of e-mails exchange has happened between the parties. The net loss to the complainant is the interest on the amount of Rs.1,58,688/-that was taken out of the account of the complainant only for 41 days. As the complainant suffered mental agony and harassment and he needs to be compensated. In my view, in the facts and circumstances of the case, a compensation of Rs.35,000/- would be reasonable and sufficient.

Based on the above discussion, the First Appeal No.2126 of 2017 is partly allowed and order of the State Commission is modified to the extent that the appellant bank will pay Rs.35,000/- (rupees thirty five thousand only) as compensation to the respondent/complainant instead of Rs.5,00,000/- as ordered by the State Commission. Rest of the order of the State Commission is upheld.