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Judgment
THIS complaint has been filed by Chairman, Kisan Sahkari Chini Mills Ltd. Employees Provident Fund Trust, Shahjahanpur and General Manager, Kisan Sahkari Chini Mills Ltd., Powayan, Shahjahanpur (UP). The case of the complainant is that there are 626 employees working under its control and as per provisions of Provident Fund Act, deductions are made from the salaries of the employees towards Provident Fund, which are required to be deposited with the Commissioner of Provident Fund or as per convenience of the employees, it can be deposited with the Provident Fund Trust formed for the welfare of the employees of the institution. The employees had agreed to form a Provident Fund Trust and the Trust invested the amount of Provident Fund in the Term Deposit Account of the post office. The details of the amount invested are given in para 9 of the complaint. The total amount of Rs. 1,40,85,000 was invested in the Provident Fund Trust Account with the post office - OP No. 5 between 25.9.1993 and 25.1.1997. The said deposits were for the period of 5 years from the date of investment. The maturity period of the said deposits was between 25.9.1998 and 25.1.2002. When some of the said deposits matured, the OP No. 5 denied payment of interest on the deposits on the ground that the said accounts were against the rules and as such the interest was not payable. The complainant approached higher postal authorities, but without any success. According to the complainant in respect of earlier deposits made between 19.3.1991 and 31.3.1992 interest was paid on the said deposits and as such the OP No. 5 acted arbitrarily in refusing to pay interest on the deposits in respect of which complaint has been filed. According to the complainant the accounts are neither irregular, nor illegal and the sum invested in the term deposit is personal specie of the employees and the Provident Fund Trust is only custodian for the same. It is also stated that the Sub-Post Master concerned had accepted the deposits and the Postal Department is under the obligation to pay the interest. The maturity amount on some of the deposits was paid and this complaint has been filed for directions to the OPs for payment of interest on the said deposits at the prevailing rate as per interest schedule of the Post Office from the Term Deposit Account. The total amount payable towards interest is stated to be Rs. 92.25 lakh approx., details of which are given at page 243 of the record. The complainant also seeks directions to OP to pay interest on unpaid term deposits. Likewise, a sum of Rs. 1 lakh is sought on account of mental agony and physical hardship besides a sum of Rs. 1 lakh towards cost of litigation.
THE OPs in their reply have admitted that the complainant had opened 33 five years time deposit accounts amounting to Rs. 1,40,85,000 at Pawayan Sub-Post Office under Shahjahanpur Head Post Office during September, 1993 to January, 1997. The amount invested was under Provident Fund Trust Account. However, at the time of maturity of the deposits the Sub-Post Master noticed that the Accounts were opened as Provident Fund Trust Accounts and no such category is provided under the Post Office Rules for opening of such account/deposits. Therefore, the annual interest was denied and the Trust was advised to close account without interest. The Trust did not take the payment, but filed complaint, in question. According to the OPs, as per rules, Accounts can be opened as Provident Fund Accounts, but the complainant opened Provident Fund Trust Account, which was not permissible under the rules. It is further alleged that the Accounts were opened by the complainant in contravention of the rules and, as such, the complainants are not entitled to any interest for the same.
WE have heard Counsel appearing on both sides. They have submitted before us that there is no dispute that the claimants are entitled to the invested amount, and the dispute is restricted to payment of interest on the said deposits. The stand taken by the parties has been canvassed before us by the Counsel appearing for them.
IT is also not disputed that the accounts/deposits in question are not in accordance with the rules, but according to the Counsel for the complainant, the complainants are entitled to interest inasmuch as the post office itself is the party to the opening of irregular accounts. Learned Counsel for the OP stated that since the accounts were irregular, the complainants are not entitled to any interest on the same and in this behalf reliance has been placed on the judgment of the Apex Court in Post Master, Dargamitta H.P.O., Nellore v. Raja Prameelamma (Ms), (1998) 9 SCC 706.
ADMITTEDLY, the deposits made by the complainants, after formation of the Trust, are the Provident Fund deductions from the salary of the employees. This Commission had the occasion to deal with irregular deposits which pertain to National Saving Certificates, Kisan Vikas Patras and Post Office Monthly Income Scheme and this Commission has taken a consistent view that in case of irregular deposits 6% interest be paid to the depositors. The full Bench of this Commission in The Chief Post Master General, Maharasthra Circle and Another v. Sweetoo Harendra Mehta, R.P. No. 2006 of 2009, The Chief Post Master, Chennai and Another v. M/s. Sun Beam Courier Pvt. Ltd., R.P. No. 3390 of 2008, Shri Gurudatta Zilha Parishad Employee Cooperative Patsanstha Ltd. v. Sub Post Master, Post Office, Paranda, R.P. No. 681 of 2007 and The Chief Post Master, Chennai and Another v. Shri Chuda Milk Products Cooperative Organisation Ltd., R.P. No. 2651 of 2007, to which one of us (Shri R.K. Batta, J.) is a party, after placing reliance on the judgment of the Apex Court in Post Master. Dargamitta HPO. Nellore v. Raja Prameelamma (supra) has held that the Complainant is not entitled to any interest on the account which was contrary to the rules. Accordingly, the order passed by Fora below in the said cases being contrary to the decision of Hon''ble Supreme Court were set aside. However, it was observed in Shri Gurudatta Zilha Parishad Employees Cooperative Patsanstha Ltd. v. Sub-Post Master Post Office Paranda (supra), and The Chief Post Master, Chennai and Another v. Shri Chuda Milk Products Cooperative Organisation Ltd. (supra) as under: "However, keeping in view the fact that it was not only the complainants who were at fault in purchasing the Kisan Vikas Patras in violation of the Rules, the responsibility lays with the officials of Petitioner in issuing the Kisan Vikas Patras in violation of the Rules, we had directed Counsel for the Respondents to seek instructions from the Ministry of Finance to pay the Respondents some interest."
THE said cases related to Kisan Vikas Patra which had been issued in violation of the rules. In the case of Chief Post Master General Circle and Another v. Sweetoo Harendra Mehta (supra), and The Chief Post Master, Chennai and Another v. M/s. Sun Beam Courier Pvt. Ltd., controversy was related to NSS Accounts which were issued contrary to the rules. In all these cases, relying upon a similar case of Shri Chuda Milk Products Cooperative Organisation Ltd., (R.P. No. 2651 of 2007), where after obtaining approvals of Ministry of Finance, it was agreed to pay interest at the Post Office interest rate. Orders were passed to pay 6% interest p.a. from the date of deposit till realization. At this stage, it is necessary to quote the following paragraph from the judgment in Chief Post Master General Circle and Another v. Sweetoo Harendra Mehta (supra), and The Chief Post Master, Chennai and Another v. M/s. Sun Beam Courier Pvt. Ltd., which are as under: "However, in a similar case bearing R.P. No. 2651 of 2007, the Petitioner after obtaining approval of Ministry of Finance has agreed to pay interest at Post Office interest rate. Earlier also, in another case Counsel appearing on behalf of Chief Post Master after taking instructions from the Finance Ministry, agreed to pay interest at the rate of 6% on the deposited amount from the date of deposit till the date of payment. Since Ministry of Finance has agreed to pay interest @ 6% p.a. in the earlier case, taking it as a precedent, we direct the Petitioner to pay interest on the face value of the deposited amount @ 6% p.a. from the date of deposit till realization."
IN Secretary of Posts and Anr. v. Basant Pal, R.P. No. 3061/99 and Secretary of Posts and Anr. v. Mrs. Hardeep Kaur, R.P. No. 3962/99, to which one of us (Shri R.K. Batta, J) is a party similar view has been taken in the case of Irregular Post Office Monthly Income Scheme Account. The same view was followed in Suptd. of Post Office and Ors. v. Helpline Grahak Mandal and Anr., R.P. No. 12/2010.
THE same principle, which has been applied to the case of NSS and Kisan Vikas Patra, Post Office Monthly Income Scheme, has to be applied and extended to the Provident Fund Trust Account in the case under consideration. The deposited amounts remained with OPs and in our opinion, the complainant is entitled to receive interest on the deposits on equitable considerations and the principle of unjust enrichment. Therefore, we hold that the OPs shall pay to the Complainants interest @ 6% per annum on the deposited amount from the date of deposit till the date of payment. The complainant is also entitled to receive the deposited amounts. The OP shall pay the said amount to the Complainant within 8 weeks from today, failing which the Complainant would be at liberty to get the orders executed under Section 25 and 27 of Consumer Protection Act, 1986. The complaint is allowed in aforesaid terms with costs of Rs. 25,000 to be paid by OPs to the complainant. Complaint allowed.