NANDED DIST. CENTRAL CO-OPERATIVE BANK LTD., & ORS. vs VEERBHADRA

This revision petition has been filed under section 21(b) of the Consumer Protection Act, 1986 against the order dated 21.11.2014, passed by the Maharashtra State Consumer Disputes Redressal Commission (hereinafter referred to as ''the State Commission'') in RP No. 27/2014, vide which, the said petition was allowed and the matter was remitted to the District Forum to consider the claim of the complainant for payment of outstanding dues. The said revision petition had been filed before the State Commission, challenging the order passed by the District Forum in Execution Application No. 03/2014 in Consumer Complaint No. 225/2005.

The facts of the case are that the respondent/complainant had made three fixed deposit, totalling 89,400/- with various branches of the District Central Cooperative Bank Nanded. However, the petitioner bank was unable to pay the amount of fixed deposit on maturity following some direction dated 20.10.2005 from the Reserve Bank of India (RBI) under section 35(A) of the Banking Regulations Act, 1949. As stated in the Memo of Petition, the said direction was issued by the RBI, as a number of deficiencies and irregularities in the working of the petitioner Bank were discovered by NABARD during their investigation. The complainant filed consumer complaint No. 225/2005 before the District Forum, seeking directions to the petitioner Bank to pay his money back. The District Forum vide their order dated 19.06.2006, directed the petitioners to repay the amount of deposit with interest @13.5% p.a. An appeal filed against the order of the District Forum was dismissed by the State Commission on 27.09.2013, following which, an execution application No. 03/2014 under section 27 of the Consumer Protection Act, 1986 was filed by the complainant. As per order dated 03.05.2014, the execution proceedings were ordered to be closed, observing that the petitioner Bank had complied with the order in question. The District Forum observed that on the amount of fixed deposit, the direction was to pay simple interest only, and the same had been paid. Being aggrieved against the order of the District Forum, the complainant filed Revision Petition No. 27/2014 before the State Commission. As per the impugned order dated 21.11.2014, the State Commission gave the following directions:-

"1. Revision Petition is allowed and the impugned order passed by District Consumer Forum is set aside.

The District Consumer Forum, Nanded is directed to consider the complainant''s claim for outstanding dues by making deductions of the amount withdrawn by the complainant from the total amount, i.e., principal amount + interest which was due on each date when the complainant withdrawn the amount from time to time.

No order as to cost."

During hearing before us, the learned counsel for the petitioner stated that since they had already complied with the order of the District Forum in the consumer complaint, the State Commission had wrongly directed them to consider the claim of the complainant for outstanding dues by making deductions of the amount withdrawn by the complainant from the total amount, i.e., principal amount + interest, which was due on each day, when the complaint had withdrawn the amount from time to time. However, the said contention was opposed by the learned counsel for the respondent, saying that vide impugned order, the District Forum had only been directed to consider the claim of the complainant for outstanding dues. There was no need for the petitioner Bank to file the present revision petition, rather they should have waited for the decision of the District Forum, as per the directions issued by the State Commission.

We have examined the entire material on record and given a thoughtful consideration to the arguments advanced before us.

The main apprehension expressed by the learned counsel for the petitioner Bank says that by virtue of the impugned order of the State Commission, the complainant/respondent shall be given the benefit of compound interest, whereas only simple interest had to be paid on the amounts deposited under fixed deposit receipts. In this regard, it shall be worthwhile to quote from the order passed by the State Commission, which reads as follows:-

" On perusal of the record we find much force in the submissions of Shri Nandedkar, learned counsel for the revision petitioner. Because though the complainant/revision petitioner is not entitled to claim compound interest, he is entitled for simple interest @13.5% p.a. on the entire amount of deposits. But it appears from the statement of account submitted by opponents vide their application dated 11.03.2014 that they have wrongly deducted the amount withdrawn by the complainant from time to time from the principal amount of deposits instead of making deductions from the total amount due on each date of withdrawal. But District Consumer Forum committed error in holding that the statement of account given by the opponent is correct. Such erroneous finding cannot be sustained. "

It has thus been made clear in the impugned order that the complainant is not entitled to claim compound interest on the amount in question. However, as per the observations given above, the State Commission directed that when the amounts were withdrawn by the complainant from time to time, the details of which have been mentioned in the reply before the District Forum filed by the Bank, such deduction should be considered to have been made from the total amount, i.e., principal + interest, and not from the principal alone.

After a close examination of the material on record, it is hereby directed that while considering the claim of the claimant as per impugned order of the State Commission, the District Forum shall take into account, the rules/regulations/instructions on the subject, as to whether at the time of partial withdrawal, the deduction is to be considered made from the total amount, or from the principal amount only. The District Forum shall also consider, if at the time of making partial withdrawal, any penalty clause involving change of rate of interest is applicable or not. This direction is being given because in the orders of the executing court, i.e., the District Forum as well as in the order of the State Commission, this point has not been considered at all. The District Forum shall then pass the final order, taking into account the relevant statutory provisions applicable. With these observations, this revision petition stands disposed off.