IMPORTANT POINTS
1. TDS cannot be charged arbitrarily; it can only be calculated on basis of interest accrued.
2. Income Tax to be charged as 10% if interest exceeds Rs. 10,000.

ORDER

Pukhraj R. Bora, President.—Being aggrieved by the Judgment and Order passed by the District Consumer Disputes Redressal Commission, Alibaug-Raigad in consumer complaint No.CC/273/2018 on 29/10/2018, opponent therein has preferred the present appeal.

Facts of the case

2. Respondent/complainant had filed aforesaid consumer complaint alleging deficiency in service on the part of the appellant Bank on the ground that it had illegally and unauthorizedly deducted amount of Rs. 2005 as TDS from the amount of interest payable to him on his F.D.R. made in the appellant bank. As is revealing from the record, Respondent/complainant had invested an amount of Rs.35,000/- with the appellant bank by way of F.D.R. The amount was deposited on 15/12/2012 and was liable to mature on 15/12/2017. Maturity amount was stated to be Rs.54,617.82. In the consumer complaint before the District Commission it was alleged by the complainant that though against the F.D.R. amount he was entitled for claiming loan, the same was illegally refused to him. It was his further allegation that though no TDS was liable to be deducted from the amount of interest payable on his F.D.R., it was illegally deducted and he thus received the said amount less after maturity. Respondent/complainant had therefore claimed compensation of Rs.6,00,000/- from the appellant bank and has also claimed refund of amount deducted towards TDS.

Contention of the Appellant

3. Appellant bank opposed the complaint by filing its written statement. It was the contention of the bank that the scheme under which the deposit was made by the respondent, no loan was liable to be granted against the said deposit. According to the bank the request made by the respondent/complainant for loan against the said FDR was therefore rightly not accepted by the bank. It was the further contention of the bank that since for the financial year 20152016 and 2016-2017 the interest paid to the respondent/complainant was more than Rs.10,000/-. The tax was deducted at source. The bank had therefore prayed for dismissal of the consumer complaint.

District Commission Decision

4. The District Commission after having considered the evidence of the parties and the documents placed on record by them partly allowed the consumer complaint and directed the appellant bank to pay Rs.25,000/- by way of damages for mental agony and pain suffered by him. The TDS amount of Rs.2005/- was directed to be recovered from the Income Tax Department by filing Income Tax Return. Aggrieved by the impugned order, bank has preferred present appeal.

5. Heard Shri.Prashant Shinde, learned counsel appearing for the appellant bank. Learned counsel referring to the documents on record and relying on the provisions of the Income Tax Act, more particularly section 194A of the said Act submitted that the bank has acted well within its jurisdiction and no illegality has been committed by the bank. Learned counsel further submitted that the TDS statement is generated automatically on the basis of the PAN number of the investor of the bank and accordingly the tax is deducted from the amount payable to the account holder by way of interest. Learned counsel submitted that in the case of the respondent/complainant, digital record was evidencing that he has earned the interest exceeding Rs.10,000/- in one financial year. TDS was therefore liable to be deducted from the amount of the interest payable to him.

6. Learned counsel submitted that the bank in its written statement has given the particulars about the TDS deducted. Learned counsel further submitted that in the financial year 2015-2016 the total interest paid to the respondent/complainant was of Rs.13,020/- and as such the TDS of Rs.1111/- was deducted. Similarly, for the financial year 2016-2017 since the amount of interest was Rs.14,521/-, tax of Rs.1022/- was deducted at source. Learned co