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PUNJAB STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHANDIGARH
MR. J.S. KLAR, PRESIDING JUDICIAL MEMBER & MR. RAJINDER KUMAR GOYAL, MEMBER
HARPREET KAUR – Appellant
Versus
KOTAK MAHINDRA BANK LTD. & ORS – Respondent
Consumer Complaint No. 632 of 2018
Decided On : 26-03-2019
For the Appellant :Mr. Ramneek Vasudeva and Mr. Amandeep Singh, Advocates.
For the Respondent:Mr. P.M. Goyal, Advocate.
Vicarious liability of the bank for the wrongful acts of its employees, continuing cause of action, and the applicability of the Consumer Protection Act in cases of banking fraud.
Headnote:
Consumer Protection Act - Banking Fraud - Section 17(1)(a) of the Consumer Protection Act, 1986 - [IPC Sections 406, 420, 467, 468, 471 and 120-B] - The court found that the complainant's money was unauthorizedly withdrawn from her account by the bank officials. The court held the bank vicariously liable for the wrongful act of its employees and directed the bank to refund the amount with interest, and awarded compensation for mental harassment and litigation costs.
Fact of the Case:
The complainant deposited Rs. 40,00,000 in her account and requested for a fixed deposit receipt (FDR) of Rs. 20,00,000. She later discovered that a large fraud had taken place in the bank, with her money being wrongfully withdrawn. The bank delayed the matter and failed to return the amount, leading to the complaint.
Finding of the Court:
The court found that the complainant's money was unauthorizedly withdrawn from her account by the bank officials. The court held the bank vicariously liable for the wrongful act of its employees and directed the bank to refund the amount with interest, and awarded compensation for mental harassment and litigation costs.
Issues: The issues revolved around the unauthorized withdrawal of the complainant's money, the bank's liability, and the maintainability of the consumer complaint.
Ratio Decidendi: The court held that the bank was vicariously liable for the unauthorized withdrawal and that the complaint was not barred by time. It also emphasized the continuing cause of action until the money was returned to the complainant.
Final Decision: The court directed the bank to refund the amount of Rs. 20,00,000 with interest, and awarded compensation for mental harassment and litigation costs to the complainant.
ORDER :
MR. J.S. KLAR, PRESIDING JUDICIAL MEMBER
1. The complainant has filed this complaint under Section 17(1)(a) of the Consumer Protection Act, 1986 (in short the “Act” against opposite parties (in short OPs) on the allegations that on 11.5.2009, she deposited a sum of Rs. 40,00,000 in account No. 02540010006420. She requested OP No. 1 on 12.5.2009 to prepare her FDR amounting to Rs. 20,00,000 and pursuant thereto, OP No. 1 issued an FDR/Term Deposit Advice dated 12.5.2009 for 12 months and one day with maturity amount of Rs. 21,44,128.93 @ 7%. On 8.4.2009, she came to know that big fraud took place in OP No. 1/Bank and large number of customers were cheated by forging their signatures by erring bank officials of OPs. She immediately gave an application to OP No. 1/Bank in this regard. On 10.4.2010, even a complaint was also given by Vice President and Circle Manager Branch banking of OPs/Bank to SSP Mohali against the erring bank officials for registration of FIR against them in misappropriating huge amount of funds of the OPs/Bank and its customers. In pursuant to above said complaint, a formal FIR No. 08 dated 19.4.2010 was registered under Sections 406, 420, 467, 468, 471 and 120-B, IPC at Police Station, Mataur, District SAS Nagar, Mohali against the erring officials of OP No. 1/Bank. She visited OP No. 1/Bank time and again and requested for release/refund of her amount, however the bank manager and other officials prolonged the matter on one pretext or on the pretense that investigation was underway about it. OPs/Bank assured her that her amount would be returned along with interest and requested her to wait for some time. On 6.2.2016, she came to know that one official of OPs/Bank namely Sh. Harjot Singh Gill had admitted in statement in the Court of Judicial Magistrate Mohali, that a sum of Rs. 20 lac belonging to her was wrongly withdrawn from her account and he also admitted this that it was found that accused persons had withdrawn the money of the customers by forging their signatures. On 28.4.2011, even FSL report has also come in the above said criminal case, which is pending adjudication before Judicial Magistrate, SAS Nagar, Mohali, wherein it has been discovered that her signatures has been forged on certain documents, which clearly shows that her signatures were forged for transferring/withdrawing her amount by the bank officials of OPs bank from her account. She raised her claim seeking refund of the amount of Rs. 20 lac along with interest, which was wronglyfully withdrawn from her term deposit account by official of OP No. 1/Bank, but till date nothing has been done by OPs and matter has been delayed by bank authorities on one pretext or the other. On 11.7.2017, OP No. 1/Bank sent a letter to her, wherein reference has been made of above said letter dated 12.6.2017 and it was stated that the Bank had already reported the matter to the police regarding withdrawal of amount from her account and told her to wait for some time. Therefore, she filed this complaint praying that OPs be directed to refund the amount of Rs. 20 lac along with interest 12% per annum up to date thereon to her from the date of deposit in term deposit account with special costs, besides Rs. 2 lac as compensation for mental harassment suffered by her and Rs. 50,000 as litigation expenses.
2. Upon notice, OPs appeared and filed written reply and contested the complaint of the complainant by raising preliminary objections that the complaint is misconceived, being without any merits and deserves to be dismissed. The complainant has not come to the Forum with clean hands and is disentitled to any relief on account of suppression of material facts by her. The complainant is alleged to be not consumer of OPs and hence complaint before Consumer Forum is not maintainable. The complaint is barred by time, because the transaction in question took place in the year 2009 and complaint has been filed in the year 2019 and it is hopelessly barred by t
