SHAMLAL vs NEW BANK OF INDIA

WHETHER the complainant is entitled to compound interest on the Fixed Deposit Receipts inherited by him from the deceased depositors thereof, is the solitary narrow question in this complaint.

IN view of what follows hereinafter, the facts may be noticed with utmost brevity with relevance to the issue aforesaid alone. The complainant is a legal heir of late Smt. Savitri Devi and late Sh. Rajeshwar Dass Gupta who had obtained six Fixed Deposit Receipts of various denominations beginning with the year, 1974. Both the aforesaid persons died on the same day of 17th of February, 1975. The complainant obtained a succession certificate from the Court of the Additional Senior Sub Judge, Kaithal on the 15th of January, 1992. On presentation thereof to the opposite party New Bank of INdia (hereinafter called the Bank), the latter on the 6th of February, 1992, paid a total sum of Rs. 71,154/- comprised of Rs. 33,000/- as principal amout and Rs. 38,154 as interest. Dis-satisfied with the calculation of the interest the complainant gave a Legal Notice to the Bank who on re-calculation paid a further amount of Rs. 7,666/- vide Ann. C. 3. The core of the complainant''s case is that he is entitled to the payment of compound interest on the Fixed Deposit Receipts and not of merely the contracted rate of interest as calculated by the Bank. On this premise a further sum of Rs. 64,115.47 paise was claimed from the Bank and when no redress was made the present complaint was filed to secure the payment of the said amount alongwith Rs. 50,000/- as damages for mental suffering and humiliation etc. In resolutely defending the complaint, the Bank in their written statement has given the detailed break-up of each Fixed Deposit Receipt and taken the firm plea that the payments made by it were correctly calculated on the contracted rate as also in accord with the relevant instruction therefor. The stand is that the complainant was pointlessly harassing the Bank and the complaint should be dismissed with heavy costs.

In support of the complaint, an affidavit of the complainant Sham Lal has been adduced in accord with the averments in the complaint. Therein, it had been vaguely suggested that there is a rule in the Bank that in the case of a deceased person the Bank would pay compound interest on the deposits of the receipts. However, in this cross-examination Shri Sham Lal had to concede that he could not tender any Circular of the Bank to show that it was liable to pay compound interest on the F.D. Rs. in question. Reliance was also sought to be placed on the documentary evidence. However, the calculations made by the complainant were seriously assailed as patently erroneous on behalf of the opposite party.

IN rebuttal, a detailed affidavit of Shri H.R. Gupta Branch Manager of the New Bank of INdia was placed on the record. IN para 7 thereof, he categorically asserted as under: "That there is absolutely no circular of either Reserve Bank of INdia or of New Bank of INdia or of any other Bank regarding payment of compound interest on F.D. Rs. " The aforesaid stand was more than fully reiterated by Mr. Gupta in his cross-examination. He stated therein that there was no circular which laid down that in case of the death of the deceased compound interest will be paid on the amount of the deposit to the legal representative of the deceased. He further firmly stated that the same principle regarding the payment of interest applies as is applicable to the original investments. Reliance was placed on the documentary evidence which was not at all challenged on behalf of the complainant.

IT bears repetition that the solitary question herein is whether the Bank is liable to pay compound interest on the Fixed Deposit Receipts after the death of the deceased. Mr. Rajeev Nagpal, the learned Counsel for the complainant had himself fairly conceded that herein he could rest himself only on a statutory or other policy instruction of the Bank which he alleged was not being made easily available. However, at the stage of arguments, the Bank very fairly produced its circular letter dated the 11th of September, 1990 to all branches and the authenticity of the said document was not assailed and was brought on the record as OP l/l. It would be somewhat manifest from the above that the complainant''s claim herein that he is entitled to compound interest has not the least foundational base. On his own showing he attempted to rest himself on some supposed policy letter of the Bank prescribing the payment of compound interest on the deposits of deceased persons. However, no such document could at all be produced till the very end of the trial and in his cross- examination he had conceded that there was no Circular or document to that effect. On the other hand, the Bank in its pleadings as also in the forth-right testimony of Shri H.R. Gupta have in categoric terms stated that there was no Circular whatsoever either of the Reserve Bank of India or that of the opposite party or for that matter of any other Bank even regarding the payment of compound interest on the Fixed Deposit Receipts of deceased persons. The cross-examination of Mr. Gupta seems to have only rebounded on the case of the complainant. However, what is a clincher in the matter is the document OP 1/1 which was fairly produced on behalf of the Bank and not challenged on behalf of the complainant. The very heading thereof is with regard to the interest payable on the deposits of the deceased depositors. Therein, the relevant part is as under:- "Interest shall be paid in the manner indicated below: (i) at the contracted rate on the maturity of the deposit; (ii) in the event of the payment of deposit being claimed before the maturity date, the Bank may at its discretion pay interest as provided in paragraph 8 above without charging penalty indicated therein.

IT would be plain from the above that the policy letter upon which the complainant primarily harped in fact gives the lie-direct to his case. IT is manifest therefrom that even in the case of the deposits of deceased persons, the payable interest is at the contracted rate. This again has to be on the maturity of the deposits. IT further suffices to mention that the complainant is under some mis-apprehension in calculating the interest on the full amount not from the date of their maturity but from their original date which was shown to be patently unjustifiable.

WE regret our inability to find any merit in the complaint which is hereby dismissed. Though we were seriously pressed to impose penal costs we refrain to burden the consumer-complainant there- with. Complaint dismissed.