State Consumer Disputes Redressal Commission
Smt.M.Hymavathi, vs Idbi Bank, on 24 July, 2007
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II
BEFORE THE DISTRICT CONSUMER
DISPUTES REDRESSAL FORUM-II
HYDERABAD
C.C.No.330/2007
Between:-
Smt.M.Hymavathi,
W/o M.Vidyasagar Reddy,
Aged:38
years, Occ: Housewife,
R/o
Plot No.15, Sairam Nagar Colony,
Uppal,
Hyderabad-39.
.Complainant
And
1.
The Manager, IDBI Bank,
Opp:Khan Lateef Khan Building,
Basheerbagh, Hyderabad.
2.
The Registrar, IDBI ,
IDBI Towers, Cuffi Parade,
Mumbai-400005. .Opp.parties
Counsel
for the Complainant : T.Srinivasa
Rao
Counsel
for the Opp.parties 1 &b 2
:
QUORUM :: SRI B.KRISHNA RAO,
B.A., B.L., President,
DR.G.KUMARA
SWAMY NAIDU, M.A.,Ph.D.,LL.B, Member.
SMT. B.J.S.MRIDULANJALI,M.A.,M.Phil., Member
ON THIS THE 24th DAY OF July,2007
(Per Honble Dr.G.Kumara Swamy Naidu,Member on behalf of
the bench)
@ @ @
O R D E R
1. The above complaint is filed on behalf of the complainant under section 12 of C.P. Act of 1986 requesting this Forum to direct the opposite parties to pay the total bound amount of Rs.75,000/- along with interest for Rs.1,00,000 towards compensation for mental agony and to pay Rs.5,000/- towards cost of the complaint to the complainant.
2. The complainant prayed deficiency of service on the part of the opposite parties. The complainant stated that the complainant purchased IDBI Deep Discount Bond 96 three bonds on 18th March 1996 the value of Rs.5,300/- each. The opposite parties issued certificates Nos. 00802842, 03204106 and 00802841. The complainant selected second option i.e. on December 1st,2006 at Rs.25,000/- for each bond which is mentioned in the bond. The complainant made a representation on 01.11.2006 along with Xerox copies of the bonds for redemption of all three bonds for total amount of Rs.75,000/-. After the receiving of complainants representation the opposite parties sent reply to the complainant on 17.11.2006 inviting the complainant on 17.11.2006 inviting the complainant to see the column No.5 of opposite parties reply notice. Extract of the column No.5. The redemption of the above bonds is compulsory as per IDBI notice exercising the call option (i.e. DD/RMB-01/08/2000 EEB/RRB 18/03/2001). Hence you requested to submit the duly discharged original Bonds along with the Redemption bonds and 15G. It is suggested that the correct address and bank details may please be filled in the redemption bonds. After seeing the opposite parties notice the complainant got utterly shocked. Immediately complainant approached the opposite party branch office in Hyderabad and enquired about this matter. Opposite parties staff verbally told that opposite parties office suomotto exercised the first option i.e. 01.08.2000 at 1,000/- the complainant asked the apposite parties staff how can you exercise the first option with out informing to the complainant. The opposite parties staff blindly said that it is our banks decision. The complainant asked the opposite parties staff if you had informed this fact to the complainant she would have withdrawn amount on 01.08.2000. The opposite parties verbally said that they sent information to the complainants residence by post. The complainant said that she did not receive any information from the opposite parties office. The complainant asked the opposite parties staff if the opposite party opted the first option why opposite party kept the bond amount with all these years without information to the complainant. The complainant issued legal notice on 19.02.2007 and the same was received by the opposite party but they did not turned up either paid the amount or give reply so for. This attitude amounts to deficiency of service on part of the opposite party and breach of trust. Hence the complainant filed this complaint for seeking directions.
3. The opposite parties filed their counter.
They stated that the opposite parties for the purpose of opposing the reliefs in the complaint as also, the admission of the complaint and opposite party reserve the right to file a detailed affidavit if required at a later date and the opposite parties deny each and every statement, submission, contention, pleading and averment contained in the complaint. As if the same were specifically traversed and denied herein. All the same for specifically denied the objection of the opposite parties non-joinder. The complainant suffers from non-joinder of parties and needs to be dismissed in limine. Hence the complaint was filed subsequently, the complainant should have filed against IDBI Ltd., and not against IDBI. The opposite party made public issue of IDBI Deep Discount Bonds under IDBI Flexi Bonds 1996 Series, in March 1996 with the object of raising resources needed by it from the public. By offering the Bonds to the public, the opposite party did not offer to sell any goods or offer to make available any banking, financial or other services to the public. The underlying purpose of investment made by the complainant in IDBI Seep Discount Bonds under IDBI Flexi bonds 1996 series being a commercial purpose, the complaint is wholly outside the purview of provisions of the Consumer Protection Act, 1986 and the complaint is, therefore, not maintainable. It is true that the complainant was a holder of one Deep Discount Bonds under IDBI Flexi bonds 96. According to the bond regulations the complainant was supposed to surrender the bond for redemption on the redemption date, which the complainant did not comply with , due to which the bondholder did not receive the redemption amount. Its clearly mentioned in the bond that the holder of this Bonds /IDBI shall have the option to redeem the bond on any of the following dated at the deemed face value mentioned. IDBI has clearly inscribed on bond certificates that The holder(s) of this bond/IDBI shall have the option to redeem the bond on any of the following dates at the deemed face value mentioned.
On August 1, 2000 at Rs.10,000/-. On December 1, 2005 at Rs.25,000/-. On September 1,2011 at Rs.50,000/-. On June 1, 20016 at Rs.1,00,000/-. On June 1, 2021 at Rs.2,00,000/-. Accordingly, IDBI exercised call option and advised all the bondholders including the complainant vide letter dated 25.05.2000 to surrender duly discharged bonds certificates to M/s Investors Services of India Ltd., Navy Mumbai who are the Registrar & Transfer Agent of IDBI, by July 15, 2000 to enable the bondholders/complainant to receive redemption precedes by 1/8/2000. The call option notice was dispatched to complainant on 1/6/2000 by UCP.
Also the opposite party has taken care to forward a Reminder intimation Notice to the complainant about the Call option vide its letter dated 22.09. 2000. The opposite party have clearly indicated therein that No interest will be payable on the bonds after August 1, 2000. In addition to the personal communication to the investor the opposite party has also published the notice in the Leading National Newspapers in the year 2000. The opposite party has also published a Reminder Notice on October 7, 2002. Despite said facts, the complainant did not surrender the original bond certificate to the Registrar/ IDBI for redemption, which was binding on the investor as per bond regulations. Therefore, the point does not arise to pay the interest on delayed payment of redemption amount. The opposite party has acted according to the rules formulated and performed duties as per bond regulations. Therefore, there is no deficiency of service on the part of opposite parties. Hence the complaint is liable to be dismissed.
4. The complainant filed Affidavit. In the affidavit the complainant stated that she is consumer as stated by National Commission in a judgment Neela Vasant Raje versus Amogh Industries reporter in 1993 (3) CPR 434 (NC) and reported in 1998 CPJ by page No.589.
The opposite parties stated in their counter that the complainant suffers from non-joinder of parties and needs to be dismissed. In reply the complainant in her complaint made IDBI as apposite parties as it is mentioned in the bonds. The bonds clearly shows the name and address of the opposite parties. The opposite parties liable to pay Rs.75,000/- each bond along with interest and Rs.1,00,000/- as compensation and cost of Rs.5,000/- for the complaint.
5. The opposite parties filed counter affidavit.
They stated that there was no mistake on the part of the opposite parties. It is Unless the complainant surrenders duly discharged bond certificates, the opposite party cannot redeem the bond according to bond regulations.
Opposite party is entitled to pay Rs.10,000/- per bond on submission of bonds to opposite parties and willing to pay the same. The opposite parties submitted that National Commission in its decision in UTI V/s Kavita Gupta (Revision Petition No. 909 of 95 decided on January 24, 1997) and in other decisions held that the Consumer Protection Act, 1986 does not envisage payment of any amount over and above the actual loss suffered by the complainant. Hence the complaint is dismissed.
6. The points for consideration in this case are
i) Whether there is any deficiency in service on the part of opposite party towards the complainants ?
ii) Whether the complainants are entitled for any of the reliefs prayed for in the complaint ?
Point No.i
7. After going through the complaint filed complainant and affidavit and written Arguments and counter, counter affidavit filed by the opposite parties. Exhibits filed by both parties. The complainant purchased IDBI Deep Discount Bonds 3 Nos., on 18.03.1996 for the value of Rs.5,300/- each bond and intended for redemption of bond as the complainant needed money for her family expenditure and selected second option (i.e. on December 1st, 2006 at Rs.25,000/- for each bond) which is mentioned in the bond and representation made on 01.11.2006 along with Xerox Copies of the bonds. After receiving of complainants representation the opposite parties sent reply to complainant on 17.11.2006 inviting the complainant to see the column No.5 of opposite parties reply notice. Extract of the column No.5.
The redemption of the above bonds is compulsory as per IDBI Notice exercising the call option (i.e. DDB/RMB-01/08/2000 EEB/RRB-18/03/2001). Hence you requested to submit the duly discharged original Bonds along with the redemption application form & 15G (in duplicate). Immediately complainant approached the opposite party branch office in Hyderabad and enquired about this matter. The opposite parties staff verbally told that opposite parties office suomotto exercised the first option i.e. August 01.2000 at Rs.10,000/- the complainant asked the opposite parties staff how can you exercise the first option with out informing to the complainant. The opposite parties staff blindly said that it is our Banks decision. The complainant asked opposite parties staff if you had informed this fact to the complainant she would have withdrawn amount on 01.08.2000. The opposite party verbally said that they sent information to the complainants residence by post. The complainant said that she did not receive any information from opposite parties office. Opposite parties staff if the opposite party opted the first option why opposite party kept the bond amount with all these years without information to the complainant. The opposite parties sent call option notice to the complainant on 01.06.2000 by UCP.
But the complainant did not received the call option notice. The complainant stated that since it is an important notice they should send the notice by registered post or courier. The opposite parties intentionally sent the notice by UCP to escape from their liability. But the opposite party has also published the notice in the Leading National Newspapers and the opposite party agreed to ready to pay the amount of Rs.10,000/- per each bond as per first option. The complainant filed Exhibits A1 to A7. As per Ex.A1,A2 and A3 are Xerox Copies of IDBI Deep Discount Bond, it is clearly shows that there are four options for the complainant.
On August 1, 2000 at Rs.10,000/-, On December 1, 2006 at Rs.25,000/-
On September 1, 2011 at Rs.50,000/-
On June 1, 2016 at Rs.1,00,000/-
and mentioned that the holder (s) of this bond /IDBI shall have the option to redeem the bond on any of the above days deem face value mentioned. As per Ex.A4 is a Registered letter to the opposite party from the complainant, dated 01.11.2006. Ex.A5 is reply letter to the complainant from the opposite party, dated 17.11.2006. Ex.A6 is Legal Notice to the opposite party issued by the complainant, dated 19.02.2007. Ex.A7 is Xerox Copies of postal acknowledgments. The opposite party filed Ex.B1 to B7. As per Ex.B1 is Xerox copy of Principle Terms of the Bonds. Ex.B2 is Xerox Copy of Exercise of Call Option, dated 25.05.2000. Ex.B3 is Deep Discount Bond (Public), Serial Nos.1007366 and 107367 also serial No. 238222 page No.4412, dated 25.05.2000.
The opposite party has also taken care to forward a remainder intimation of the call option by this letter dated September 22, 2000. In addition to the personal communication to the investor the opposite party has also published the notice in the Leading National Newspapers in the year 2000 and sent to the complainant for redemption of bonds also . The opposite party stated that they give paper publication. As per Exs.B4 and B5 are Exercise of Call option by IDBI, dated September22, 2000. Ex.B6 and B7 are Xerox Copy of IDBI Flexi bonds.
8. Even though the complainant not submitted redemption certificates along with certificates and selected second option. But the opposite party stated that they acted as per rules and regulations. The complainant not eligible for the second option. The complainant issued legal notice on 19.02.2007. The opposite party received the legal notice, but not given any reply to the complainant. However the opposite parties agreed to refund an amount of Rs.10,000/- for each bond (i.e.) first option on Aug, 2000, but not replied to the legal notice. It comes under deficiency of service on the part of the opposite party. This point is accordingly answered against the opposite parties and in favour of the complainant. Hence the opposite parties liable to pay an amount of Rs.10,000/- along with interest @ 9% for annum, and also compensation cost of the complaint to the complainant.
Point No.ii:
9. In view of our clear finding on point No.i) the complainant proved deficiency of service on the part of the opp.parties 1 & 2 and the opposite parties agreed to pay an amount of Rs.10,000/- each bond. Hence, we are opined of that the opposite parties 1 and 2 are liable to pay an amount of Rs.10,000/- (Rupees Ten thousand only) each bond and interest @ 9% for annum from August 1, 2000 till the date of payment and compensation of Rs.6,000/- (Rupees Six thousand only) with cost of Rs.1,000/- (Rupees One thousand only) to the complainant.
10. In the result, we direct the opposite parties 1 and 2 jointly and severally to pay an amount of Rs.10,000/- (Rupees Ten thousand only) for each bond and interest @ 9% for annum from August 1, 2000 till the date of payment and compensation of Rs.6,000/- (Rupees Six thousand only) along with cost of Rs.1,000/- (Rupees One thousand only) to the complainant.
11. The above order shall be complied within one month from the date of receipt of this order.
Dictated to steno, transcribed and typed by her, pronounced by us on this the 24th day of July, 2007.
MEMBER MEMBER PRESIDENT APPENDIX OF EVIDENCE Exhibits marked on behalf of the complainants:-
Ex.A1/- :
Ex.A2/- : Xerox Copy of Ex.A3/- : Xerox Copy of Ex.A4/- : Xerox Copy of Ex.A5/- : Xerox Copy of Exhibits marked on behalf of the opp.party :-
Ex.B1/- : A copy of Principle Terms of the Bonds Ex.B2/- : A copy of Exercise of Call option by IDBI, dated 25.05.2000.
Ex.B3/- : A copy of Deep Discount Bond, (Public) Ex.B4/- : A copy of Exercise of Call option by IDBI, dated September22, 2000.
Ex.B5/-- : A copy of Exercise of Call option by IDBI, dated September22, 2000.
Ex.B6/- : Xerox Copy of IDBI Flexi bonds.
Ex.B7/- : Xerox Copy of IDBI Flexi bonds.
MEMBER MEMBER PRESIDENT