BEFORE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SHIMLA, H.P.
Consumer Complaint No: 136/2004
Date of presentation: 31.03.2004
Date of decision: 31.07.2009
Shri Rakesh Goel, Proprietor
M/S Goel Brothers Shop Below BCS
<aim Bye Bass Road, Shimla.
… Complainant.
Versus
The Manager,
Corporation Bank, Shop No.228 to232,
Block No.23, Commercial Complex,
Kasumpti Zone, Centre, Shimla-171009.
…Opposite Party
For the complainant: Mr. Peeyush Verma, Advocate.
For the Opposite Party: Mr. Varun Dev, Advocate vice
Mr. Yadupati Sood, Advocate.
O R D E R:
Sureshwar Thakur (District Judge) President:-
This complaint has been filed by the complainant, by invoking the provisions of Section 12 of the Consumer Protection Act, 1986, against the OP-Bank. The complainant avers that he in the month of September, 2000, deposited a sum of Rs.1.00 lac with the OP-Bank in the shape of FDR for a period of one year and on its maturity, he was paid its proceeds. Again, in the month of September, 2001, he deposited a sum of Rs.50,000/- with the OP-Bank, which was to mature in the month of September, 2002, and on its maturity, he renewed the said FDR for a further period of one year, and interest so accrued, i.e. Rs.4,122/-, was withdrawn by him. On maturity of the said FDR, he requested the OP-Bank to transfer the amount to his saving bank account, but the OP-Bank did not transfer the amount, hence, written request dated 24.01.2004 was addressed to the OP-Bank. The complainant further proceeded to aver that since he stood guarantor for one Shri Ajay Gupta, who failed to return amount of loan advanced by the OP-Bank to him, as such, the OP-Bank has set up their right to lien over amount of the FDR. He further alleged that the action of the OP-Bank in not releasing the amount of the FDR is illegal, arbitrary and smacked unfair trade practice. Hence, it is averred that there is apparent deficiency in service on the part of the OP and accordingly relief to the extent as detailed in the relief clause be awarded in his favour.
2. The OP-Bank, in its written version, to the complaint, raised preliminary objection vis-à-vis maintainability of the complaint, lack of cause of action, suppression of material fact and status of the complainant, as a consumer. On merits, it is admitted that the complainant had deposited a sum of Rs.1.00 lac in the month of September, 2000 and the amount of FDR was paid to him and subsequently, a sum of Rs.50,000/- was also deposited by him, which was renewed for further period of one year and the amount of interest accrued on said FDR was withdrawn by him. The OP-Bank further admit that the amount of FDR which was payable to him, on its maturity, was not transferred to his saving bank account, as the OP-bank has a right of general lien and set off in terms of section 171 of the Indian Contract Act on amount of FDR and had also right to retain amount of FDR, as the complainant had stood guarantor for one Shri Ajay Gupta, undertaking thereon to pay loan amount advanced to said Shri Ajay Gupta. Since, the aforesaid Shri Ajay Gupta, did not pay the amount of loan, as such, the OP-Bank, was well within its right to retain the amount of FDR of complainant. Hence, it is denied, that, there was any deficiency in service on their part or that they have indulged in an unfair trade practice.
3. Thereafter, the parties adduced evidence, by way of affidavits, and, documents in support of their respective, contentions.
4. We have heard the learned counsel for the parties at length and have also thoroughly scanned the entire record of the case.
5. The complainant, stood guarantor to one Shri Ajay Gupta, who had obtained a loan from the OP-Bank. The later failed to repay the loan advanced by the OP-Bank to him. The liability of the guarantor, being co-extensive with the principal borrower, hence, the OP-Bank proceeded to recover the loan from the guarantor, who, is, the complainant. The OP-Bank in securing the amount, as borrowed by the principal borrower from it, had, proceeded to encash the FDR deposited by the complainant with the OP-Bank, comprising, a, sum of Rs.1.00 lack. The complainant, is, aggrieved by the said act of the OP-Bank in proceeding to encash, a sum of Rs.1.00 lac comprised in the FDR deposited by the complainant with the OP-Bank,for, setting off, the, amount of loan as advanced to the principal borrower, who, had failed to fulfill his obligation.
6. The OP-Bank, has defended, its, aforesaid act on the strength of a general lien, the bank has, on, securities, which, also, comprise the FDR deposited, by, the complainant with the OP-Bank, whose sum was encashed by the OP-Bank,in, exercise of its general lien, so as to ensure repayment by the complainant, who, was the guarantor of the loan, which the principal borrower failed to repay to the OP-Bank. In exercise of general power of lien, reliance, has been placed on case law as reported in AIR 1956 Punjanb 118 in case Punjab National Bank Ltd., versus Satyapal Virmani. We are in agremetn with the contention as urged by the learned counsel for the OP-Bank in seeking to encash the value of the FDR deposited by the complainant with the OP-Bank, in, exercise of the general power of lien, which extends to securities inclusive, of, the FDR.
7. Nonetheless, it is also necessary, to, bear in mind the terms and conditions, which were obliged to be carried out by the complainant under the guarantee furnished by him for securing the repayment of the loan by the principal borrower, in case, he so defaults in its payment to the OP-Bank. It is only in the eventuality of an express recital in the guarantee agreement arrived, at, between the complainant and the OP-Bank empowering the OP-Bank, to, proceed against the security, of, the guarantee lying with it, for setting off the loan obligation of the principal borrower when the later has defaulted, that, the, general lien, as has been exercised, could be exercised on the part of the OP-bank. However, a perusal of the agreement of guarantee entered interse the complainant and the OP-Bank, does not detail, the, fact of such an express clause empowering the OP-Bank to proceed against the value of the FDR, as, deposited by the complainant with it so as to set off the outstanding payments of the principal borrower. Hence, we are, constrained to vindicate the act of the OP-Bank, in, proceeding to, in the garb of its power of general lien extending to securities to set it off against the value of the FDR. In coming to the above conclusion, we draw support from a decision rendered by the Hon’ble HP State Consumer commission, in case Smt. Kuldep Kaur Gulati and others versus Allahabad Bank, in Original Complaint No.2 of 2005, decided on March 8, 2006.
8. Resultantly, we allow the complaint and direct the OP-Bank to refund the amount of FDR to the complainant, along with interest, as was prevalent on the amount of FDR on 10.09.2003, till making entire payment. Besides, this the OP-bank shall also pay cost of litigation to the complainant, which is assessed at Rs.2,000/-. These payments shall be paid, by the OP-Bank, to the complainant, within a period of forty five days after the date of receipt of copy of this order. With this, the complaint stands disposed of finally. The learned counsel for the parties undertook to collect the certified copy of this order from the office, free of cost, as per rules. The file after due completion, be consigned to record room.
Announced on this, the 31st day of July, 2009.
(Sureshwar Thakur)
President.
NMehta) (Karuna Machhan) (Charanjit Singh)
Member Member.
Tags: Corporation Bank