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Judgment
Subhash Chandra, Presiding Member
This Appeal under Section 58(1)(a)(iii) of the Consumer Protection Act, 2019 (in short the Act) challenges the order dated 12.02.2020 of the State Consumer Disputes Redressal Commission, Gujarat (for short the State Commission) in Complaint No.16 of 2013 allowing the complaint and directing the Appellant herein to pay to the Complainants ₹28,12,720/- with interest @ 6% p.a. from the date of closure of the accounts held with them along with ₹10,000/- towards harassment and mental agony and ₹5,000/- towards costs of complaint within 60 days. The Appeal has been filed praying to set aside the impugned order and pass any other order.
There is a delay of 330 days in filing of this Appeal from 18.02.2020, the date on which the order was received. However, in view of the Suo Moto Writ Petition (Civil) No.3 of 2020 in Re : Cognizance for Extension of Limitation, the period of limitation for filing the Complaints/Suits/Revision Petitions/Appeals had been extended and the period from 15.03.2020 to 28.02.2022 needs to be exempted while calculating the period of limitation in view of the Covid Pandemic 19. Accordingly, the delay of 43 days is condoned in the interest of justice and in light of the reasons provided in the application for condonation of delay.
The facts of the case in brief are that the Respondents had opened 4 MIS Accounts and other Term Deposit Accounts with Indian Post at Godhra through the services of one R. C. Trivedi SAS Agent while in the employment of Western Railways. He subsequently relocated to USA. However, when he returned and checked his Accounts, he found that a sum of ₹56,22,922/- had been withdrawn without authorization. Alleging negligence on the part of the Appellant, the Respondents had filed the above Complaint before the State Commission which came to be decided on contest by way of the impugned order.
It is the Appellants case that 15 accounts were opened by the Respondents with the Civil Lines Post Office, Godhra through one R. C. Trivedi SAS Agent on different dates and monthly interest on 4 MIS Accounts was credited to the Respondents saving bank account number 31200 held with Head Office, Godhara. These 4 accounts were closed without submitting the original passbooks by way of application as permitted under MIS Rules. The other 10 Term Deposit Accounts were also closed. All these accounts had been operated by the Respondents through R. C. Trivedi SAS Agent. The Appellant contends that as per Rule 24 A of the Standardized Agency System, the responsibility, in case an agent manipulates the investors money, lies with the Authority who in this case was the District Collector and not the Department of Posts. It is the Appellants case that the Respondents failed to maintain custody of the passbooks and has accepted that these remained with the agent, as admitted by the Respondents. Hence, as per Rule 15 of the Post Offices Savings Banks General Rules 1981, the responsibility lay with the Respondents and their agent. It was, therefore, contended that the impugned order did not appreciate the facts of this case and deserves to be set aside for this reason. Reliance was placed on this Commissions order in Pratibha Pratishthan vs. Manager Allahabad Bank 2007-NCDRC-0-44 in which it was held that in a case of fraud committed by the trustees and its authorized representatives in connivance with the officers of the Bank is not required to be dealt with under the Act. Reliance was also placed on this Commissions order in Satna Syndicate Bank vs. Central Bank of India 1993-NCDRC-0-5 which held that a Consumer Forum was not the appropriate Forum for adjudicating complex and complicated issues of facts requiring extensive evidences. Appellant also relied on this Commissions order in Superintendent of Post Offices, Balughat vs. Mahendra Nath Basak, Secretary, Safanagar High School, 1995-NCDRC-0-115 which held that fake entries in passbook alone cannot be deemed to be construed as deficiency in service on the part of the Bank or Post Office. It was also submitted that the Respondents had obtained 4 cheques of ₹3 Lakhs each in the name of Tejas P. Mehta from R. C. Trivedi, their SAS Agent. This fact was also not disputed by the Respondents. It was also stated that the Respondents had not made any complaint regarding operation of the saving bank account which was opened by them into which the MIS and Term Deposit Accounts were being credited. Interest was also withdrawn by the Respondents between 2004 and 2012 without any dispute. The present complaint was stated to be not maintainable as it related to a dispute between the Respondents and R. C. Trivedi, SAS Agent and any fraud committed by the agent of the Respondent would not fall within the domain of a consumer dispute. It was also stated that if an agent acts on behalf of his agency, his actions would not bind the employer.
On behalf of the Respondents, it was contended that the Appeal is barred by limitation under section 24 of the Act. On merits, it is stated that it was because of the connivance of the agenct with the Post Master that the amount which stood in the name of the Respondents was withdrawn illegally. It was stated that the Appellant Department had initiated legal action against the persons who had committed fraud and that some of them had been found guilty, resulting in charge sheets and initiation of recovery proceedings. It was argued that the employer was liable for the acts and misdeeds of its employees and that in this case, the Appellant Department had vicarious liability towards investors such as the Respondents. It was submitted that the Appellants contention that some amount had been withdrawn on 08.01.2010 was misleading since it was only a transfer of funds in order to create a Term Deposit on account of maturity of an old Fixed Deposit. It is, therefore, prayed that the Appeal be dismissed.
The State Commission in its order has held as under:
6. It is further submitted by the Mr. Mehta that there was no power of attorney given by the complainant to anybody else to operate the account or to withdraw the amount nor withdrawal form was signed by the complainants. However, on 6-3-2013 the Postal Department had deposited only Rs.202/- and in absence of the complainants, Rs.28,12,720/ was withdrawn. Details are stated in Annexure A and B a Statement of the withdrawal of the amount. It is further submitted that with these details, the complainants had filed complaint with the Postal Department but the Postal Department had denied the claim of the complainants. Moreover, the main contention of the Postal Department is that the Department is not liable as Mr. R.C. Trivedi was not the agent of the Postal Department and he was appointed by the District Collector and thereby the Postal Department cannot be held liable for vicarious liability as claimed by the complainant. It reveals from the record that Mr. R.C.Trivedi is appointed as Agent to collect F.Ds. and said F.Ds. are to be credited with the Postal Department. In absence of the complainants in India, the amount was withdrawn and it is misappropriated by Mr. R.C. Trivedi. Mr. R.C. Trivedi was arrested by the C.B.,I. in fraud case, It transpires from the record that since September, 1990 said Mr. Trivedi was arrested in fraud cases of about Rs.3.29 cr. And still he is in jail and the criminal proceedings are continuing. It is an admitted position that the matter is pending with Judicial Department but as it is submitted that he not an agent of the Postal Department and therefore, the Postal Department is not liable to indemnify the loss as claimed by the complainants.
As we have discussed hereinabove and the statements of withdrawal Annexure A and B shows that in absence of the complainants the amount was withdrawn by Mr. R.C. Trivedi. Learned advocate Mr. Mehta has referred a case of Revision Petition No. 3063 of 2011 to 3067 of 2011 wherein Honourable National Commission has held that the agent defrauded any amount and the amount is lost by the Account Holder, in that circumstances, the Postal Department or any Department is liable under the principle of vicarious liability and the for act of the agent and the fraud committed by the agent, the Department is liable to indemnify the loss to the account holder. So, it can be decided in favour of the complainants that the Postal Department has to refund the amount as claimed by the complainant. Moreover, misappropriation is traced out on record with the Postal Department by its servant or agents in the questioned transactions are somehow committed crime i.e. illegal withdrawals and in absence of the Pass Books given to the Depositors which are compulsory with the withdrawing person. Here in the case, it was not so done and therefore, it is negligence on the part of the Postal Department to facilitate the withdrawals of the amount from the questioned account by the agent. For this negligent act by the Agent, the Postal Department itself is liable for the offence committed by the agent and it also reflects the relation of the complainant and the Postal Department is that of consumer of Postal Department and due to negligence on the part of the Postal Department, the complainant has lost huge amount and therefore, the State Commission is empowered to deal with the Issue involved in the present case. Further, the Postal Department has come with a case that a criminal case is pending and therefore the matter should not be proceeded here in the State Commission. But, according to our view, criminal courts are not empowered to indemnify the loss sustained by the complainants and therefore, only the civil courts or the Consumer forums are empowered to indemnify the loss sustained by the complainants in the questioned transactions.
Further, it is pertinent to note that The Post Offices Savings Banks General Rules, 1981, Rule 24A makes it clear that any misappropriation of the investors' money by the agent in the case of misappropriation, appointing authority concerned should deal with the matter and take suo moto prompt action in the matter and see that the investigation of the cases are not delayed in any circumstances. It is the duty of the Appointing authority to obtain information, ascertain the extent of such misappropriation, locate the defrauded and investors realize the losses from the agents and/or from the sureties and should also take steps for issue/antedated of certificates etc. The Paying authority is responsible for proper payment of the Commission. This Rule clearly states that the appointing authority has to take steps about the amount to be realized to the complainants, Here in the present case, the agent is appointed by the Postal Department and the selection is made by the Collector but the business of the Collector is only to select the person and the name should be referred to the Postal Department and the Postal Department Authority is empowered to appoint the person as an agent. So, here in the case of misappropriation of the money by the agent, in that circumstances, the Postal Department has failed to take expedient steps for the recovery of misappropriated amount, then the complainants would be entitled to get refund of the amount from the Postal Department itself. The amount can be recovered jointly and severally. Here, in the case, it is established that there is no dispute regarding the agent appointed by the Postal Department and the criminal proceedings are going on and thereby the misappropriated amount is not recovered and refunded to the complainants. So, the State Commission is of the considered opinion that as per annexure A, Rs.28,12,720/- is liable to refunded to the complainants by the Postal Department.
The finding of the State Commission is that in light of the fact that the Respondents had not given any Power of Attorney to anyone to operate the account and the fact that R. C. Trivedi had been arrested by the CBI in a fraud case indicates that the Appellant had been remiss in allowing the operation of the such account. It is also held that it is the Postal Department that has to be held liable under the principle of vicarious liability since in the absence of the passbooks that are provided to depositors, it was negligence on the part of the Postal Department to facilitate the withdrawals. It is also held that the agent is appointed by the Postal Department and only the selection is done by the Collector and therefore, the liability is with the Postal Department as the appointing authority.
From the facts of this case, as narrated above, it is apparent that although the accounts with the Post Offices were opened through the agency of SAS Agent, there was no authorization issued by the Respondents to the said agent to operate the accounts and to either withdraw the amounts or close the same. It is not in dispute that the 4 MIS accounts and 10 Term Deposit Accounts were closed and the money was withdrawn from the saving banks account with the Head Office Godhra. The fact of criminal case against agents, including R. C. Trivedi, has not been denied by the Appellant. Its case is that the responsibility for the actions of the SAS agent lies with the District Collector who had appointed the agent. The finding of the State Commission that the agent is appointed by the Postal Department through the agency of District Collector has not been disputed. The appointment of an agent through the office of District Collector is a mechanism that the Postal Department has adopted across the country in order to appoint agents on its behalf. Such a mechanism has not been disputed by the Appellant and therefore, it cannot seek to transfer the responsibility for the actions of the agent to the District Collector who has merely acted on its behalf to select an individual for appointment by the Postal Department.
The case laws relied upon by the Appellant are of no avail to it since they do not pertain to the fact of responsibility of an agent who has acted in connivance with the Postal Authorities since there was neither any Power of Attorney nor any signed cheques/withdrawal slips provided by the account holder to the agent. The ratios of these judgments do not apply to the instant case.
For the foregoing reasons and in the facts and circumstances of this case, we do not find any reason to interfere with the impugned order which is a reasoned and objective order based on the facts of the case. The Appeal is, therefore, found to be without merits and is accordingly, dismissed with no order as to costs.
Pending IAs, if any, also stand disposed of with this order.