NAVODAYA URBAN CO-OPERATIVE BANK LTD., & ORS. vs VIMAL W/O HARIBHAU NAIK, & ANR.

These two appeals have been filed under section 19 read with section 21(a)(ii) of the Consumer Protection Act, 1986 passed by the Maharashtra State Consumer Disputes Redressal Commission (hereinafter referred to as ''the State Commission'') in consumer complaints No. CC/15/158 & CC/15/159, allowing the said complaints.

Briefly stated, the facts are that the complainants in question, Haribhau Naik and Vimal who are husband and wife, made various fixed deposits with the opposite party (OP) Navodaya Urban Co-operative Bank Ltd, Nagpur and fixed deposit receipts (FDRs) to that effect were issued by the Bank. In CC/15/158, the maturity value of the deposits made by the complainant is 32,06,752/- whereas in CC/15/159, the maturity value of the deposits made by the complainant is 20,59,770/-. It is stated that upon maturity of these fixed deposits, the amount in question was credited by the OP Bank in the respective savings accounts of the depositors, but they did not allow them to withdraw the aforesaid amount from their savings bank accounts. The complainants issued legal notice to the OP Bank, but they did not send any reply to the same. The complainants also took-up the matter with the Reserve Bank of India (RBI) and the Commissioner and Registrar, Department of Cooperation, Government of Maharashtra, but to no effect. The consumer complaints in question, were then filed, seeking directions to the OPs to pay the maturity amount to them alongwith interest @12% p.a. and also to grant compensation for mental pain/agony and cost of litigation etc.

During hearing before the State Commission, an Advocate appeared for the OP Bank and sought adjournment to file the written version of OPs but thereafter, none attended the hearing before the State Commission and also, the OPs did not file their written version. Based on the evidence presented by the complainants, the State Commission allowed the consumer complaints and directed the OPs to pay the amounts in question alongwith interest @12% p.a. from the date of the complaints till realisation. The OPs were also directed to pay compensation of 1 lakh to each of the complainants and 10,000/- as cost of litigation. Being aggrieved against the orders passed by the State Commission, the OP Bank is before this Commission by way of the present appeals.

During proceedings before this Commission, a copy of letter dated 18.03.2017 sent by the Chief Executive Officer (CEO) of the appellant/OP Bank to the complainants was produced, in which it has been stated that the Bank was capable to pay them the maturity amount alongwith interest as per current rates applicable in 24 equal instalments. The time frame and the frequency of payment these instalments has not been stated, however, in the said letter. During hearing, the learned counsel stated that he shall seek instructions from the OP Bank as to how much amount they were prepared to pay to the complainants immediately and the balance in how many instalments. Accordingly, an affidavit was filed by the CEO, in which it has been stated that the process of closure of the appellant Bank had started in the year 2015 and hence, the complainants were not permitted to withdraw the amounts as per directions of the RBI. The Bank was not having effective recovery machinery for recovering the loans and advances given to the customers and hence, they were not having enough funds to pay money to the complainants. The CEO stated in the affidavit that the Bank was prepared to deposit a sum of 10 lakh with this Commission and to pay the balance amount to the complainants in 24 equal instalments. The time frame for the payment of the said instalments has not been indicated. However, during hearing before this Commission, the learned counsel argued that the Bank was not in a position to make payments to the complainants, keeping in view the restrictions imposed by the RBI vide their letter dated 13.12.2016 and the directions given to them under section 35A of the Banking Regulations Act, 1949 as per order dated 09.12.2016. However, they had credited the maturity amount to the savings bank accounts of the complainants.

We have examined the entire material on record and given a thoughtful consideration to the arguments advanced before us.

A perusal of the impugned order passed by the State Commission reveals that the appellant/OP Bank did not contest their case before the State Commission, neither they filed any written version to the complaint. Upon notice, an Advocate appeared on their behalf before the State Commission, but on subsequent hearings, no one was present for the Bank before the State Commission. This kind of conduct on the part of the OP Bank amounts to an admission of the allegations made in the consumer complaints against them and hence, the deficiency in service on the part of the OP Bank is duly proved.

Further, the OP Bank is trying to take shelter under the directive issued by the RBI, for not undertaking their routine banking operations except with the prior approval of the RBI. It is clear that the said restrictions have been imposed by the RBI due to malfunctioning of the OP Bank itself. The complainants/consumers cannot be made to suffer for the acts of omission and commission made by the Bank, keeping in view the fact that the Bank has used the money deposited by the complainants in the shape of fixed deposits for a considerable time.

In the affidavit filed by the CEO before this Commission, it has been stated that the Bank was prepared to deposit a sum of 10 lakhs with this Commission and also to pay the balance amount to the complainants in 24 equal instalments. It is evident, therefore, that if adequate steps are taken by the Bank for mobilisation of funds, they could be in a position to return the money of the complainants and for that purpose, if required, they could obtain the approval of RBI as well. A consumer has every right to demand and get back his hard-earned money from the Bank and he could not be deprived of the same for the wrong-doings on the part of the Bank.

Based on the discussion above, we do not find any merit in these appeals, based on which, any modification would be required in the impugned orders passed by the State Commission. It is held, therefore, that there is no infirmity, illegality, irregularity or jurisdictional error in the orders passed by the State Commission and the same is upheld. The present appeals are ordered to be dismissed, being devoid of any merit. There shall be no order as to costs.