PAWAN RANA vs Canara Bank

THIS is a case in which there was no abnormal delay in crediting the rupee equivalent to the amount received in DM to the account of the complainant by the respondent bank. Case of the petitioner

THE petitioner was the complainant before the District Consumer Forum. The complainant is the sole proprietor of M/s. Rana Jewels, Bhandia Bldg., 113, Johari Bazar, Jaipur 302003. The complainant is an exporter of precious stones and against its export he receives the payments from his overseas buyers through their banks.

The complainant was informed by his overseas buyer that he has remitted DM 5092 on 18.9.1991 through his banker - Swiss Volks Bank, Bern, Switzerland to Canara Bank, Bombay instructing to transfer the funds in favour of the beneficiary (complainant) having account with Bank of Baroda, International Banking Cell, Ramganj Bazar, Jaipur.

WHEN the payment has not been made till 25.10.1991, the complainant faxed on 25.10.1991 to Swiss Volks Bank and further wrote a letter on 29.10.1991 complaining that no such payment for DM 5092 remitted on 18.9.1991 has been received by the complainant. The complainant was informed by Swiss Volks Bank, Bern, Switzerland by FAX message dated 5.11.1991 in clear terms that: "They have transferred the funds for DM 5092 on 18.9.1991 by Telex Transfer to Canara Bank, Bombay in favour of the complainant having account with Bank of Baroda, International Banking Cell, Ramganj Bazar, Jaipur."

ON receipt of the said FAX message, the complainant approached his banker-Bank of Baroda, International Banking Cell, Jaipur and his banker immediately contacted Canara Bank, Bombay through telex on 9.11.1991, informing them to remit the funds in Indian rupees by bank draft drawn on Jaipur but they did not respond. Canara Bank, Delhi (non-complainant No. 2) sent a Bank Draft for Rs. 81,512 (DM 5092 @ 6.2450 = Rs. 81,537 less commission/service charge Rs. 25 = Rs. 81,512) to Bank of Baroda, Jaipur which was credited to complainant''s account on 13.12.1991 through Canara Bank, Jaipur. The complainant claimed that he has suffered heavy losses on the following account: He has also filed an affidavit in support of his complaint. The case of the respondent Nos. 1, 2 and 3

THE amount which is deducted from the remittance merely covers handling charges and the same cannot be termed as commission or charges for consideration of service rendered and they have no privity of contract with the beneficiary.

FURTHER, the foreign bank has communicated with the wrong office i.e., overseas branch of Canara Bank at Bombay whereas the same where to be sent to their Foreign Department. The correct position is that on 30.10.1991, the Telex payment order was received from Foreign Bank or the remitting bank on the basis of which the money could not be remitted to complainant by Foreign Department of Canara Bank at Bombay on 30.10.1991. The same was passed by mail to Foreign Department, Delhi which was having jurisdiction over the centre where the complainant was located. The said instructions were received by Foreign Department of Canara Bank, Delhi on 25.11.1991. Immediately, on 26.11.1991, Delhi Office of Foreign Department of Canara Bank issued FITT voucher 179.2532.91 dated 26.11.1991 for DM 5092 favouring Bank of Baroda for credit to M/s. Rana Jewels Account No. 10319.

The money was not received on 20.9.1991, nor any instructions were received till 30.10.1991 by Foreign Department of Bombay of Canara Bank, therefore, by the conduct of Canara Bank Foreign Department, Bombay and Delhi, or H.O., the complainant cannot be said to suffer any loss. It is also submitted that the complainant cannot be said to suffer any loss, as per Telex dated 30.10.1991. The Canara Bank were to pay DM 5092 value on 20.9.1991. The exchange rate ruling on that date was DM 6.65650 = Rs. 100. Had the remittance been executed on that day, this amount paid to the beneficiary would have been Rs. 77,562 as against the amount of Rs. 81,537 paid on account of conversion on 4.12.1991. In other words, the beneficiary has been benefited to the extent of Rs. 3975.

THE case was heard by a District Forum at Jaipur, which held that the complainant is not a consumer and there has been no deficiency in service by the respondents/opposite parties. Aggrieved by the order of the District Forum, complainant filed an appeal before the State Commission, Rajasthan. THE Commission held that the complainant is a consumer under the Consumer Protection Act and has given detailed reasons for the same. However, the State Commission came to the conclusion that it is not proper to hold that the respondents had rendered deficiency service to the complainant. Dissatisfied by the order of the State Commission dated 6.1.2003, the complainant has come up in appeal. Findings Swiss Volks Banks which has sent DM 5092 to the Rana Jewels, Jaipur mentioning complainant''s account number and the value of consignment which was remitted on 18.9.1991. This is clear from the following correspondence from Swiss Volks Banks addressed to Rana Jewels on 5.11.1991. "We refer to your letter of 29.10.1991 and inform you that we telexpaid on 18.9.1991 an amount of DM 5092 to Canara Bank. Bombay instructing them to transfer the amount to your account with Bank of Baroda, International Banking Call, Ramganj Bazar, Jaipur - 302003/India. With regards, Swiss Volks Bank"

BANK of Baroda wrote to Canara BANK, Overeseas Branch on 9.11.1991 that: "We understand from M/s. Rana Jewels that you have received an amount of DEM 5092 remitted by Swiss Volks BANK. Kindly remit the funds to us in Indian rupees by your draft drawn on Jaipur. Please treat the matter as most urgent." Reminders were sent by the Bank of Baroda again on 11th and 12th November, 1991 to the Canara Bank. On 16.11.1991, the complainant took up the matter, again wrote to the Chief Manager, Foreign Department, Canara Bank, Bombay claiming interest @ 24% and other reliefs. Canara Bank sent a communication by registered post on 26.11.1991 to Bank of Baroda, Jaipur asking them to send a receipt for DEM 5092. On 29.11.1991, Bank of Baroda sent a receipt to the Canara Bank and on 30.12.1991 the amount was credited to the account of the complainant in Indian rupees. Foreign Exchange Association of India which has drafted Foreign Exchange Dealers'' Association of India Rules with the approval of the Reserve Bank of India which have come into effect on 1.6.1991 lays down clearcut rules/procedure for inter-bank TT settlement and dispatch. "Authorized Dealers should ensure smooth settlement of their inter-bank transactions. The buyer-bank shall arrange payment of the rupee equivalent on the settlement day (i.e., date of delivery) and the seller bank shall lay down foreign currency funds simultaneously on the same day. Delay in payment of rupee equivalent funds by the buyer bank, in respect of inter-bank TT transactions in foreign currencies, the buyer bank shall pay interest for the relative period of delay at the maximum rate of interest determined by the Indian Banks'' Association from time-to-time in respect of inter-bank lendings/borrowings during the relevant period. It is, therefore, absolutely necessary for banks to reconcile all dealing items and other large value items within a period 24/48 hours by demanding cable/telex confirmation regarding receipt of expected credits in ''nostro'' accounts from the correspondents maintaining those accounts but in any event not later than a maximum period of 15 days."

AS the respondents have not filed any appeal against the order of the State Commission holding the complainant to be a consumer under the Consumer Protection Act, we do not go into this issue.

THE above detailed analysis indicates that there has been delay in crediting the rupee proceeds of DM 5092 to the account of the complainant by the respondent Bank. THE complainant has claimed relief under several heads totalling Rs. 30,000 but he has not produced vouchers in support of expenditure incurred on typing, fax, photocopy, telex and also proof for loss of difference in foreign exchange and rotational profits, etc. Still on the ground of delay in crediting the rupee proceeds of DM 5092, the complainant deserves to be awarded compensation, which is quantified at Rs. 5000, taking note of the fact that he has been benefited from improvement in exchange rate to the tune of Rs. 3,975.

Accordingly, while disposing of the complaint, the opposite parties are directed to pay amount of Rs. 5,000 by way of compensation in addition to Rs. 2,500 towards cost. Complaint disposed of.