V R Kollali vs VIJAYA BANK

THE complainant has filed this complaint for a direction to the opposite party (for short, the ''O.P.'') to pay a sum of Rs. 15 lakh as compensation alleging ''Deficiency of Service'' on the part of the O.P.

THE facts in this case are as follows: The complainant is having an Account in the O.P. Bank. In the course of his business, he issued a Cheque to M/s. Trinity Investments Consultant and Services, Bangalore, for Rs. 62,930 drawn on the O.P. Bank. The said Cheque was presented by M/s. Trinity Investment Consultant and Services through its Banker for encashment. But the O.P. Bank returned the said cheque with an endorsement ''Insufficient Funds''. The complainant after coming to know of the return of the cheque contacted the O.P. and enquired as to why the cheque was not honoured. The O.P. Bank admitted its mistake and requested the holder of the cheque to re -present the cheque. On representation, again the cheque was returned with the same endorsement. Thereafter, it appears, M/s. Trinity Investments Consultant and Services wrote a letter dated 25.4.2000 to the complainant stating that they did not expect a professional like the complainant to issue a cheque without adequate funds. This has made the complainant to file the complaint before this Commission.

On service of Notice issued by this Commission, the O.P. has filed its version. The case of the O.P. as per the averment made in the version is that due to change in the Account Number of the complainant from Account No. 6161 to Account No. 6259, there was a confusion in the Bank and, therefore, the cheque was returned with an endorsement ''Insufficient Funds''. It is not the case of the O.P. that there were no sufficient funds available in the Account of the complainant as per its version.

FROM these pleadings, the only question that arises for consideration is: Whether the complainant is entitled for compensation from the O.P. establishing the deficiency as averred in the complaint?

THE complainant has produced a xerox copy of the cheque issued to M/s. Trinity Investments Consultant & Services which is marked as Exhibit C -2. Copy of the Legal Notice issued by the complainant to the O.P. is marked as Exhibit C -3. The letter written by M/s. Trinity Investments Consultant & Services to the complainant is marked as Exhibit C -9. In the said letter it is seen that M/s. Trinity Investments Consultant & Services have stated as follows: ''We did not expect a professional like you to issue cheque without adequate funds to honour the Cheque.''

This statement made by M/s. Trinity Investment Consultant & Services is definitely an injury to the reputation of the complainant. The complainant has produced the letter received by him from the O.P. as Exhibit C -6. The contents of the said letter read thus: ''Inadvertently the captioned cheque which was presented for payment on 19.4.2000 and on 23.4.2000 (twice) was returned unpaid by oversight. We regret for the error. A Demand Draft in favour of the payee of the cheque is enclosed herewith. Kindly bear with us for the inconvenience caused to you in this regard.'' The complainant has produced a Statement of Account relating to his Account No. 6259, which is marked as Exhibit C -7. From this statement, we find that as on the date of presentation of the cheque, sufficient funds were available in the account of the complainant. The O.P. except saying that due to confusion the cheque was not honoured has not produced any other material to justify its action. Further, the O.P. itself in its letter Exhibit C -6 admits the mistake on its part in not honouring the Cheque. The O.P. in its version has stated that the complainants Account Number has been changed from 6161 to 6259. Assuming that the Account Number has been changed, the complainant being a regular and old customer of the O.P. Bank, the O.P. Bank ought to have ascertained the funds available in the Account of the complainant with reference to the old and new Account Number before returning the Cheque with an endorsement ''Insufficient Funds''. In the instant case, no such steps appear to have been taken by the O.P. before returning the cheque. Non -honouring of the cheque by the O.P. may also give rise to a cause of action to M/s. Trinity Investments Consultant & Services to initiate proceedings against the complainant under Section 138 of the Negotiable Instruments Act. Further, in the business circle, if a cheque issued is dishonoured, it would be an injury to the reputation also. The contents of the letter written by M/s. Trinity Investments Consultant & Services amount to interference with the reputation of the complainant. Therefore, we are of the considered view that the conduct of the O.P. in not honouring the cheque, even though sufficient funds were available in the Account of the Complainant, amounts to ''Deficiency in Service'' and also has caused an injury to his reputation. Hence, we are of the view that awarding a sum of Rs. 50,000 as compensation in favour of the complainant for deficiency in Service, mental agony and hardship would meet the ends of justice.

IN the result, we pass the following Order: (1) The complaint is allowed in part. (2) The O.P. is directed to pay Rs. 50,000 to the complainant as compensation within four weeks from today. (3) If the O.P. fails to pay the above said amount to the complainant within the above said time limit, the O.P. is directed to pay interest at 12% per annum on the said sum of Rs. 50,000 from the date of this order till realization. (4) The O.P. is also directed to pay Rs. 5,000 to the complainant towards costs of these proceedings.

Complaint partly allowed.