CITI BANK vs J. RAMSAI

THE complainant case is thus: the complainant is a Citi Bank card holder bearing No. 5425 5960 3825 7002 with validity till July, 1998. On 21.8.1997, he went to buy a wall clock from M/s. Saraspathy and Co., a shop situated at Usman Road, Chennai. THE shopkeeper refused to accept the card declaring that the same was invalid. He was not given reason by the shopkeeper. THE complainant contacted the Citi Bank over phone from the same shop to check on the status of his card. He was informed by the bank that he had sufficient drawing power and also well within the fund limits. Still, the shopkeeper refused to accept the card without proper reason. Because of this complainant was put to shame amidst other customers in the shop and thus suffered loss of reputation. After the incident, the complainant did not receive any letter nor phone call or any other mode of communication from the Citi Bank stating that the card has been invalidated. When the complainant visited Delhi on 27.8.1997, he went to the shop known as "Personality" where he was humiliated. On contacting the Citi Bank Branch at New Delhi, he was told that the card has been invalidated by the Citi Bank, Chennai. No proper reason was given. THE complainant sent a registered letter to the opposite party for explanation for invalidation. THEy stated that the validity was misread by the Master Card Member Bank as 7/99 whereas it should be 7/97 instead of 7/98. It just shows that there was negligence on the part of the opposite party. During to the negligence and the deficiency in service, the complainant suffered loss of reputation. THE allegation that the complainant left his card at the merchant establishment is false. He has his Bank card with him during his trip to Delhi. THE card was withheld by "Vitan" at Chennai on 2.9.1997. THE opposite party failed to render proper, and due service to its consumer. Hence, the complainant prays for compensation of Rs. 1.50 lakhs along with a sum of Rs. 1,500/- towards costs.

IN the version filed by the opposite party, the opposite party has stated as follows: It may be true that the complainant held a credit card issued by the Bank. As regards the incident dated 21.8.1997, the opposite party denies it. The member establishment is assigned a floor limit and any card member attempts to charge over the floor limit, then the member establishment contacts the opposite party for an authorization and only then this opposite party will be aware of the transaction. Otherwise any transaction within the floor limit need not be brought to knowledge of the opposite party. Therefore, any refusal or decline of the card of any card member by any member establishment cannot be known to this opposite party unless such merchant establishment specifically informs the Bank of the same. This opposite party cannot be held liable for any act done by any third party without their knowledge. Therefore, the allegations made in the paragraph 4 of the complaint are not true. The Bank had informed him about his sufficient drawing power and if at all the shopkeeper had refused for reasons best known to him, the opposite party cannot be taken for a task. The allegations made in the paragraph 5 of the complaint are denied as false. The complainant had himself informed in the earlier occasion about his intentions to surrender the credit card. The complainant allegations that there is deficiency in service cannot be accepted at all. There is no tangible evidence or proof. The opposite party prays that the complaint may be dismissed. The lower Forum by its order dated 12.4.2000 directed the opposite party to pay compensation of Rs. 50,000/- and cost of Rs. 500/-.

Aggrieved by the same, the opposite party has come forward with this complaint.

THAT the complainant is a credit card holder is not in dispute. In the version, the opposite party would conveniently say that it may be true that the complainant held a credit card issued by the Bank which only shows to what extent the opposite party is prepared to stoop to. It is alleged by the complainant that when he presented the card on 21.8.1997 at a shop in Chennai, it was refused to be accepted by the shopkeeper and that when he informed the Citi Bank over phone from the shop, he was told that he had sufficient drawing power and also within the limits. The allegation made by the complainant is admitted by the opposite party in his version in paragraph 4. What all they would say is that if the shopkeeper had refused, it is for their own reasons and, therefore, the opposite party cannot be held responsible for any act done by the third party such as shopkeeper. It is not known why the opposite party brags about their facility of credit card and makes advertisement in the media to lure the public to take up the card membership of the opposite party. By issuing credit card, the opposite party assures that the credit will be available to the holder of the card and on its presentation, it will be honoured. If a shopkeeper refused to accept or declined to accept a credit card issued by the Bank like the opposite party, then the opposite party cannot simply wash their hands off saying that they have no hold over the third party namely the shopkeeper otherwise the purpose of having a credit card will be lost if the credit card is not honoured. There is no point in holding one. With a view to facilitate shopping, avoid carrying heavy cash and for other purposes, credit cards are floated by the Banks and opted by the consumers. Because of the customers feel assured that the credit card issued by the Banks would be acceptable to all the shopkeepers and on its presentation it would be honoured so that they can boldily step into a shop and buy commodities to the limit available to them. Therefore, if a shopkeeper refuses to accept that would amount to a refusal by the issuing Bank itself and, therefore, the Bank cannot escape by finding a convenient peg in the form of shopkeeper to escape from their lapses. The complainant has also stated that a similar incident took place at Delhi and that when he presented the card, it was declined. In Ex. A1 the complainant has set out in detail the incident that took place in Chennai and that took place in New Delhi. In their reply, Ex. A2, while expressing their regret, they have stated as regards the first incident, M/s. Saraspathy Watch and Co. was referred to a Master Card member Bank for authorization on 21.8.1997 and they have inadvertently misread the expiry date on the complainant''s card as ''07/994'' instead of ''07/98''. In the said reply the opposite party declined to prevent any fraudulent charges usage on the card. Such a case is not found in the opposite party''s version where they have clearly stated that they are not responsible if a shopkeeper refuses to accept the card. It is to be pointed out that if the complainant went to the shop in Chennai on 21.8.1997 and if the shopkeeper has misread the expiry date as 07/99, it would mean that the card was valid till July, 1999 in which case he ought to have honoured the card. Very probably either the opposite party or the shopkeeper has misread it as 07/98 instead of 07/99. Therefore, the fact that the opposite party was made aware of the refusal by the shopkeeper namely Saraspathy Watch & Company and they further admitted that if the complainant contacted the Citi Bank over phone, the City Bank informed that his card account was regular. In Ex. A2, it is stated that they were informed by the merchant establishment namely Saraspathy Stores that the complainant had left the card at their premises. This letter is dated 29.9.1997. It is not so stated in the version. If really, he had left the card with Saraspathy Stores, then the complainant could not have produced the card when he was at Delhi and when he went to purchase at the shop on 27.8.1997. There is nothing stated in their letter about the Delhi incident though it has been mentioned by the complainant. The complainant again sent a notice through his lawyer on 14.10.1997 to which also there is no reply. Finally, we find from Ex. A6 that the card was left with Vitan on 2.9.1997. In their reply, the opposite party had taken a definite stand that the card of the complainant was regular. That means that he had the necessary credit limit. Yet the card was not accepted at the shop "Saraspathy & Company" in Chennai and in Delhi at the shop "Personality". The refusal by the shopkeeper at Chennai is attributed to a mistake in misreading which itself would amount an act of negligence. As we said the credit cards are resorted to by commoner and customers of Bank so that instead of carrying cash and making themselves vulnerable they can have a card and transact more easily and thus to facilitate their dealings, the cards are opted for by the customers. For issuing card and for the service, the opposite party definitely charges heavily. There are apparent and concealed charges. Under various heads such as service charges, surcharges and some ununderstandable heads, a customer is penalized and hefty sums are taken from the purse of customers by the Bank like the opposite party without even their knowing the customers are made to pay more amounts than they should. When a customer presents his card in a shop after purchase and when it is not accepted or honoured, definitely, it would erode his reputation and humilitate him in the eyes of others. He would stand exposed to the meaningful glares and chuckles of the other customers in the shop when his card is rejected by the shopkeeper, though the customer had sufficient credit limit to honour the bill. Thus irreparable damage to one''s prestige would be caused by such an act. The opposite party is squarely responsible for the same. There is thus enormous deficiency in service. The opposite party cannot penalize customers like the complainant and make them a prey of their greed. It further amounts to unfair trade practice. Hence, we find no reasons to differ from the conclusion arrived at by the lower Forum.

IN the result, the appeal is dismissed with cost confirming the order of the lower Forum. Cost awarded is Rs. 500/-. Time for compliance: Two months. Appeal dismissed.