SANTOSH SHARMAN vs ALLAHABAD BANK

-COMPLAINANT is appellant. This appeal is directed against order dated 24. 8. 2006, passed by District Consumer Disputes Redressal Forum, Dhanbad, in Consumer Complaint No. 217 of 2005, whereby the complaint was disposed of as under: ''''so in the circumstances stated above this complaint case is allowed and complainant is ordered to pay all the due premium within 40 days. In the meantime the O. P. is also to be ordered to pay compensation of Rs. 500. 00, but in this case cheque of the complainant was dishonoured for that dishonoured cheque OP is not to be punished. O. P. has already agreed to pay a rebate of Rs. 1,000. 00 so let this case be disposed of in the light of grace given by the O. P. to complainant. ''''

THE complainant had taken Life Insurance Policy for a sum of Rs. one lac, which commenced from 28. 12. 2001. The yearly premium payable for the said policy was Rs. 7,480. 00. In respect of the yearly premium due, in the month of December, 2003, the complainant deposited cheque No. 605331 dated 15. 3. 2004 for Rs. 7,704. 40 paise [rs. 7,480. 00 premium amount + Rs. 224. 00 interest for delayed payment] drawn on Allahabad Bank, Kumardhubi branch. The L. I. C. of India deposited the said cheque on the next day with its banker, Bank of India, Chirkunda Branch, through pay-in-slip No. 11794. On 20. 3. 2004 the Bank of India, Chirkunda branch returned the cheque with cheque return memo from Allahabad Bank with endorsement ''''refer to Drawer''''.

L. I. C. of India claimed to have intimated the complainant regarding dishonour of cheque by letter dated 21. 3. 2004 by post. The cheque was accepted by L. I. C. of India, subject to realization and in the event of dishonour of cheque the receipt granted therefor stood automatically cancelled. In the passbook of the complainant''s Bank account produced before the District Forum, no debit entry was made for the aforesaid amount. The policy was already in lapsed condition on that date, when the aforesaid cheque was deposited and as such dishonoured cheque had no effect on lapsation of the policy. In the policy itself it was mentioned that a grace period of thirty days was provided for payment of premium, where it was payable on yearly basis.

ACCORDING to the Allahabad Bank, Kumardhubi branch, the cheque in question was received from the Bank of India, Chirkunda branch for clearance on 18. 3. 04, but due to sudden technical fault in computer the said cheque could not be cleared and it was returned to the Bank of India, Chirkunda branch vide cheque return memo with remarks ''''refer to Drawer'''' on the same date i. e. 18. 3. 04 itself. It has further been stated that liability of Allahabad Bank was over as soon as the aforesaid intimation was sent to the Bank of India. It was also admitted that due to the technical fault in Computer in the cheque return memo the remarks was made ''''refer to Drawer'''' and not with the remarks ''''insufficiency of Funds''''. After hearing the parties at length and perusing the record, we find that on the question of lapse of the policy and its renewal / revival the District Forum on agreement between the complainant and the L. I. C. of India passed the following orders: ''''the learned Advocate Mr. Dutta concedes to the fact that policy of the complainant may be renewed subject to payment of three yearly due premium with interest after going through the formalities required. The O. P. is also agreeable that in the total amount of interest calculated for default payment is not payable by the complainant in its entirety for the relief and comfort of the complainant. O. P. is ready to give the grace of Rs. 1,000. 00 to the minus to the amount paid as interest. In other words entire interest cannot be realised. O. P. will give entire amount less Rs. 1,000. 00 of the amount. '''' although there was certain clerical mistakes in the aforesaid part of the impugned order, but it is clear that the complainant was ready to pay the entire due premium amount with interest for renewal/revival of the policy and L. I. C. of India agreed to give rebate of Rs. 1,000. 00 towards the amount of interest payable.

IN their statements on affidavit filed in this appeal on 19. 3. 2007, the L. I. C of India in paragraph 12 stated as under: ". . . . . . . . . The answering respondent is ready to abide the order of the learned Forum and a sum of Rs. 1,000. 00 will also be waived from the total amount of interest being charged by the L. I. C. as late fine. "

Hence, we find no reason to interfere with the part of impugned order whereby aforesaid directions were given on agreement between the complainant-appellant and L. I. C of India. In last portion of the impugned order, the District Forum considered the question deficiency in service so far dishonour of cheque was concerned. But surprisingly only the role of L. I. C. of India in this regard was taken into consideration and was held that since it had already agreed to give a rebate of Rs. 1,000. 00, the opposite party (L. I. C. of India) was not to be punished for dishonour of cheque and the complaint was disposed in the light of grace given by the opposite party to the complainant. We notice that the District Forum committed a gross error in not considering the liability of Allahabad bank, Kumardhubi branch in respect of dishonour of the cheque in question, which was very important in the facts and circumstances of the case. Hence, we have gone into this aspect of the matter and found that admittedly the said bank on account of sudden technical fault in computer on 18. 3. 2004 same day returned the cheque with endorsement in the cheque return memo ''refer to Drawer''. It is relevant to mention that the said cheque was received by Allahabad Bank on 18. 3. 2004 itself and was returned on the same day for the aforesaid reason.

IN our considered opinion, Allahabad Bank, Kumardhubi branch had no business to return the cheque with aforesaid remarks immediately on the same day on which it was received and for sudden technical default in the computer, it could not be cleared. The sudden technical fault must have been removed/corrected in the computer very soon either on the same day or on the next day, hence the cheque ought to have been retained as per the norms for sometime so that it could have been cleared in a day or two. No rule or circular has been produced before us to show that it was mandatory to return the same day on which it was received and the bank was bound to do so. The said bank was aware that there was sufficient fund in the complainant''s account with them and, therefore, there was no other difficulty in clearance of the cheque.

WE, therefore, hold Allahabad Bank, Kumardhubi branch negligent and deficient in service in returning the cheque in question the same day without clearing the same with remarks, which were unwarranted, without waiting for rectification of technical fault in the computer for atleast up to the next day. It is absurd on their part to say that their liability was over as soon as intimation was sent to the Banker of L. I. C. of India (The Bank of India, Chirkunda Branch ). In such circumstance, the Allahabad Bank, respondent No. 1 herein is directed to pay a sum of Rs. 20,000. 00 to the complainant-appellant as compensation within two months, failing which the said amount shall be realised by the complainant with interest @ 12% per annum, after expiry of two months from today () till payment. With aforesaid observations, directions and modification in the impugned order, the appeal is disposed of. There shall be not order as to costs. Appeal allowed.