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Judgment
A.S. Bopanna, J.—The petitioner is before this Court seeking for issue of mandamus to the second respondent to pay interest up to 31.03.2011 as per PPF scheme on the contributions made by the petitioner during the period 01.04.2006 to 31.03.2011. The petitioner has also made an alternate prayer in that regard.
The facts in brief are that the petitioner had opened an account bearing No. 101 (New No. 54044696822) on 13.03.1986 with the first respondent under the Public Provident Fund Scheme, 1968. The said account was maintained with the first respondent till 31.03.2011 to which the amount was credited and in respect of the amount deposited, the interest was also credited to the said account. The account which had been opened initially on 13.03.1986 was renewed up to 13.03.2001 and thereafter up to 13.03.2006. Till the said period there is no dispute between the parties. On maturity i.e., on 13.03.2006, it was once again renewed up to 31.03.2011. In respect of the amount deposited by the petitioner, the interest was also initially credited. However, the notification dated 07.12.2010 was issued by the Ministry of Finance referring to an earlier notification dated 13.05.2005 that such deposit of the PPF account was to be made only by individuals and not on behalf of the Hindu Undivided Family (''HUF'' for short). The account of the petitioner was on behalf of the HUF from the beginning and was continued so, even on renewal for the periods 13.03.2006 to 31.03.2011. In that light, the interest which had been deposited to the account of the petitioner was not permitted to be withdrawn since according to the respondents, the deposit could not have been made in the name of HUF for the subsequent renewal during the periods from 13.03.2006 to 31.03.2011. The petitioner had addressed communications to both, the respondents No. 1 and 2. Both the respondents have relied on the notification dated 13.05.2005 and 07.12.2010 to contend that the petitioner would not be entitled to interest for the said period from 13.03.2006 to 31.03.2011. It is in that circumstance, the petitioner is before this Court.
The first respondent-Bank has filed its objection statement. The first respondent contends that the account was opened only as an agency of the second respondent -- Department in respect of the scheme and all amounts credited to the said PPF account would be transmitted to the second respondent and the payment of interest on the said amount would be regulated by the notifications issued by the second respondent. It is contended that though the first respondent had not issued any written communication to the petitioner with regard to the change made by the notification, the petitioner had been informed of the same. It is further contended that even if that be the position, the amount has been subsequently deposited on behalf of the HUF. The amount deposited has been transmitted to the second respondent immediately thereafter and the second respondent having initially remitted the interest to the account of the petitioner have thereafter directed the first respondent to withhold the same and as such the first respondent cannot be held liable. In that light, they contend that the petition filed against them is without basis and the same be dismissed.
The second respondent has not chosen to file the objection statement.
In the light of the rival contentions, there cannot be serious dispute to the fact that by the notification dated 13.05.2005 and 07.12.2010 a change has been brought about to provide that the PPF account cannot be deposited on behalf of the HUF, but the benefit would be to individuals. Prior to the said notification, the petitioner had opened the account on behalf of the HUF for the first time from 13.03.1986 and was being continued in the same status when the renewal was made on 13.03.2006, when the notification no doubt was in force, but not intimated to the petitioner nor did the first respondent decline renewal of account. The question therefore presently is as to whether the petitioner could be denied the interest for the renewal and amount deposited subsequent to 13.03.2006 merely because a change has been brought about by the said notification, more so in a circumstance when the amount deposited to the said account even after the issue of notification has been accepted by the first respondent which was received without demur and transmitted to the second respondent and furthermore when the interest had been credited to the account by the second respondent, that too only thereafter when a direction had been issued not to pay the interest?
From the materials available on record, there is nothing to indicate that the petitioner was informed of the notification providing that the amount cannot be deposited on behalf of the HUF. This is relevant, more so in a circumstance that as noticed, the petitioner had for the first time opened the account on 13.03.1986 and was renewed subsequently on 13.03.2001 and thereafter on 13.03.2006 up to 31.03.2011. Hence unless it was specifically brought to the notice of the petitioner and even after that he had devised any other means to continue the deposit in the same status, only then the petitioner could have been held responsible for opening an account contrary to the notification/guidelines. To put this in perspective, it would be appropriate to refer to the decision of the Hon''ble Supreme Court in the case of Bhagwati Vanaspati Traders Vs. Senior Superintendent of Post Offices, (2014) 4 RCR(Civil) 938 relied on by the learned counsel for the petitioner. The emphasis in the said decision is to the aspect that the depositor should not be denied the benefit of his investment when no illegality has been committed by the depositor. The said consideration no doubt was made while considering the amount that had been deposited in the National Savings Scheme with the Post Office and a similar justification for denial of the benefit was made. Keeping that in view, in the instant case, when I have already noted that there is no material to indicate that the petitioner had been intimated of the change made in the regulations and in that light when the first respondent has accepted the deposit without demur even subsequent thereto, the petitioner cannot be denied the benefit of interest accrued thereto, more particularly in a circumstance where the second respondent at the first instance had also credited the interest to the account of the petitioner maintained with the first respondent and only thereafter had issued the instructions not to pay the said amount. That apart the amount belonging to the petitioner was utilised by the second respondent.
However, the question that would arise for further consideration in the instant case is as to which of the respondents should be held liable to pay interest in the present facts. As noticed, though the account is opened with the first respondent and the amount is deposited therein, the amount collected under the said head would be transmitted to the second respondent by the first respondent. Then in respect of such amount, the second respondent would credit the interest to the account of the depositor maintained with the first respondent. In the instant case, as noticed the second respondent had at the first instance deposited the interest to the account of the petitioner with the first respondent. If that be the position, the initial liability to pay the interest would be that of the second respondent.
If at all there are any grievances/disputes inter se between the first and the second respondents with regard to the responsibility for the said act, the same can only be agitated amongst themselves and appropriate adjustments be made in that regard. Therefore, at the outset, it will be the liability of the second respondent to deposit the interest to the account of the petitioner and any dispute amongst the respondents No. 1 and 2 will have to be resolved amongst themselves. Therefore, the petitioner is held entitled to interest on the said amount notwithstanding the change. In the present facts and circumstances the second respondent is directed to deposit the interest accrued on the said amount in the same manner as had been credited at the first instance. The credit of interest shall be made by the second respondent to the account of the petitioner with the first respondent within eight weeks from the date of receipt of a copy of this order. The first respondent shall immediately thereafter disburse the interest amount to the petitioner on receipt of the same from the second respondent.
With the above directions, the petition stands disposed of.