State Consumer Disputes Redressal Commission
1. State Bank Of India vs Sh. Shamsher Singh on 20 November, 2009
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, UNION TERRITORY, CHANDGIARH STATE CONSUMER DISPUTES REDRESSAL COMMISSION, UNION TERRITORY, CHANDGIARH Appeal No.318 of 2008 1. State Bank of India, Zonal Office through its Regional Manager, SCO No.43-48, Bank Square, Sector 17, Chandigarh. 2. State Bank of India through its Chief Manager/Principal Office, SCO No.10, Sector 10, Panchkula. ..Appellants. V E R S U S Sh. Shamsher Singh Gadgala resident of House No.C-24, Kenderiya Vihar, Sector 14, Panchkula. ..Respondent. BEFORE: HONBLE MR. JUSTICE PRITAM PAL, PRESIDENT. HONBLE MAJ. GEN. S. P. KAPOOR (RETD.), MEMBER.
PRESENT: Sh.
S. P. Singh, Advocate for the appellant.
Sh. V. P. Chatrath, Advocate for the respondents.
MAJ. GEN. S. P. KAPOOR (RETD.), MEMBER.
1. This is an appeal against order of District Consumer Disputes Redressal Forum-II, U.T., Chandigarh (for short hereinafter to be referred as District Forum) dated 25.3.2009 passed in complaint case No.953 of 2008 : Sh. Shamsher Singh Gadgala Vs. State Bank of India and another.
2. Briefly stated the case of the complainant is that he had deposited a sum of Rs.15.00 lacs in the Senior Citizen Saving Scheme Account No.10275486434 with OP No.2 on 03.05.2005 and the quarterly interest was 33750/-. It was averred by the complainant that in the month of March 2005, he went to the office of OP No.2 to check whether they are going to deduct TDS but it was told to the complainant that no income tax was going to be deducted and the complainant was to pay it directly to Income Tax Department. The complainant, it was next averred, included the interest paid to him in his income tax return for the financial year 2005-06. As per the complainant, after paying income tax, he filed his income tax return financial year 2005-06. The allegation of the complainant is that OP No.2 vide its letter dated 22.07.2006 asked him to submit Form No.15-H/15-G within seven days, otherwise, OP No.2 would recover TDS from him. As per the complainant, this letter dated 22.7.06 was received by him only on 25.08.2006. Further the case of the complainant is that he was shocked to know from his bank passbook entry that OP had already deducted a sum of Rs.12,516/- from his Saving Fund Account on 18.08.2006. A TDS certificate in this regard was also received by the complainant by which time, he had already submitted income tax return for the next financial year i.e. 2006-07. The complainant, it was averred, also served legal notice but to no avail. Alleging the act and conduct of OPs as deficiency in service on their part, the complainant has filed the present complaint.
3. The version of OPs is that they followed the instructions of Ministry of Finance, Department of Economic Affairs related to TDS. It was further pleaded that a notice was also issued to the complainant vide letter dated 22.07.2006 intimating him to submit Form No.15-H/15-G or proof of income tax paid for the year 2004-05 and 2005-06 within 7 days of the date of the letter, which was not complied with by him. OPs further pleaded that a sum of Rs.12516/- was rightly deducted by the Bank from the saving bank account of the complainant on 18.08.2006 and on the next day i.e. 19.08.2006, the said amount was further deposited in the account of Central Government and TDS certificate was issued to the complainant without any delay on 06.09.2006. Pleading no deficiency in service on their part, OPs prayed for dismissed of the complaint.
4. The learned District Forum, in its analysis of the complaint, recorded that the only dispute involved was as regards the deduction of TDS for the financial year 2005-06 on the interest paid by the OP Bank to the complainant. It further recorded the stand of the OP is that the Bank had only followed instructions of the Ministry of Finance relating to the deduction of TDS from the complainant. The learned District Forum after minutely going through the terms and conditions of RBI governing the Senior Citizens Saving Scheme 2004 was of the clear view that the interest paid by the Bank to the depositor under the scheme was fully taxable and also the TDS system was applicable to the scheme as it had been once again clarified that the tax would be deducted at source. As per the learned District Forum, no steps were taken by the Bank to inform the complainant well in time i.e. before 31.3.2006 as regards their decision i.e. whether the tax was to be deducted at source or the depositor had to submit Form 15G/15H or to pay the tax amount to the Government himself. It further recorded that the OPs kept on lingering the matter for no reason and in the meantime, the date for filing the Income Tax return had expired and the complainant was forced not only to pay the Income Tax at his own level but also filed the I.T. Return showing such a deposit. Referring to letter No.F2/8/2005-NS-II dated 23.6.2006 issued by Ministry of Finance, the learned District Forum recorded that this letter was of no help to the OP Bank as the same was only for those banks who had not deducted the TDS at their own level and also not obtained Form 15G/15H from the depositors. As per the learned District Forum, the case of the complainant had become a case of double taxation as on one hand, he deposited the tax amount of Rs.12516/- at his own level whereas on the other hand, a similar amount was also deducted from his saving bank account in the month of August, 2006 by OP No.2. In the view of the learned District Forum, the complainant had certainly suffered a financial loss of Rs.12516/- on account of callous and careless act of OP in handling his account. In view of the above analysis, the learned District Forum allowed and the complaint and directed the OPs to refund the complainant a sum of Rs.12516/- wrongly deducted from his saving bank account on account of TDS in relation to interest paid under Senior Citizens Saving Scheme along with interest @9% from 18.08.2006 till the date of realization. OPs were also directed to pay the complainant a further amount of Rs.5000/- as compensation on account of mental agony/pain and physical harassment suffered by him besides Rs.2,500/- as cost of litigation. The order was directed to be complied with within a period of six weeks of the receipt of certified copy of the order.
5. Aggrieved by the said order of the learned District, Forum, OPs have filed the present appeal. The appeal having been taken on board, notice was sent to the respondent/complainant and record of complaint case summoned from the District Forum. Sh. S. P. Singh, Advocate appeared on behalf of the appellants/OPs whereas Sh. V. P. Chatrath, Advocate represented the respondent/ complainant.
6. Sh.
S. P. Singh, Advocate learned counsel for the appellant submitted that there was no deficiency in service on the part of the Bank because the Bank had duly informed the complainant about the TDS to be deducted in case, he did not either submit Form 15G/H to the Bank or produce any documents showing the payment of the due income tax to the authorities vide their letter dated 22.7.2006 and since, the complainant did not respond to this letter within the stipulated time period, as per instructions on the subject received from the Ministry of Finance vide its office memorandum dated 23.6.06, the due amount of income tax was deducted. He also drew the attention of the Bench to the Banks letter dated 28.7.07 vide which the certificate of TDS had been sent to the complainant. He emphatically submitted that there was no deficiency in service on the part of the Bank and the learned District Forum had erred in passing the impugned judgment and therefore, prayed that the appeal be allowed and the complaint be dismissed. He further submitted that as per the law laid down by the Honble Apex Court in the case of Shanti Prasad Jain and Union of India Vs. The Director of Enforcement, Foreign Exchange Regulation Act and another, AIR 1962 SUPREME COURT 1764, it has been held that the relationship of a Bank and a customer is that of a debtor and a creditor and not of a trustee and a beneficiary and he, therefore, submitted that the Banks did not come under the ambit of Consumer Protection Act, 1986 and therefore, the complaint, as it is, was not maintainable before the Consumer Fora. The learned counsel for the appellants also submitted that there was further infirmity in the impugned order as the learned District Forum had granted the complainant interest @9% per annum and had also granted a compensation of Rs.5,000/-, which amounted to giving him dual relief, which is not permissible under law.
7. Sh.
V. P. Chatrath, Advocate learned counsel for the respondent/complainant submitted that the learned counsel for the appellants is misleading the Court and the actual fact is that till 31.3.2006, the Bank was not at all aware whether they are to deduct the TDS or not and it in fact asked the complainant to pay the income tax due by himself after taking into account the accrued interest on the aforesaid deposited amount, which the complainant had done. He also brought to the notice of the Bench that the order of the Ministry of Finance cited by the learned counsel for the appellant is itself dated 23.6.2006 and was later than the time when the complainant had already deposited his due income tax. Also further referring to the letter of Bank dated 22.7.2006, he submitted that even though this letter is dated 22.7.2006, it was in fact received by the complainant only on 25.8.2006 and on receiving the same, the complainant immediately went to the Bank on the next day and handed over his letter dated 26.8.2006 to the Manager of the OP Bank explaining the whole position and informing the Bank that he had already paid the due income tax including on the amount of accrued interest on the deposited amount. The learned counsel emphatically submitted that the impugned order is well reasoned detailed and justified and it requires no interference.
8. We have gone through the record on file as well as the impugned order and have heard the learned counsel for the parties. The issues that need discussion are as under: -
(a) Is the complainant a consumer? (b) Was the OP Bank justified in deducting TDS? 9. Coming
to the first issue with regard to the complainant being a consumer, the authority cited by the learned counsel for the appellant in the case of Shanti Prasad Jain and Union of India (Supra) is of the year 1962 when the Consumer Protection Act, 1986 had not even come into existence and the same came into existence only in the year 1986 and furthermore, the order pertains to a Civil Appeal. It needs no reiteration on our part to state that as per the C. P. Act, services inclusive the Banking services very much fall under the ambit of C. P. Act and in this context, Section 2(1)(o) is relevant, which defines as under: -
Services means service of any description which is made available to potential [users and includes, but not limited to, the provision of] facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, [housing construction], entertainment, amusement or the purveying of news or other information.
10. Now coming to the main issue with regard to the deduction of TDS, a perusal of the documents indicate that the Bank had for the first time intimated the complainant about filing the proof of tax paid or submitting Form 15H/15G only vide its letter dated 22.7.2006. However, there was no evidence on record with regard to this letter having been dispatched on 22.7.2006 or the date on which, it had been received by the complainant. It is also not on record as to by which mode of dispatch, this letter had been communicated to the complainant. In this context, the categoric pleading of the complainant is that this letter was received by him only on 25.8.06 by which time, the OP Bank had already deducted the TDS. It is also interesting to note that the Bank had sent another letter to the complainant dated 28.7.06, which had the TDS Certificate annexed with it but it is relevant to point out that whereas this letter itself is dated 28.7.07, the attached TDS Certificate is dated 6.9.06. It is very apparently and glaringly clear that in the instant case, the Bank has tried to manipulate documents to cover up its negligence and we take a serious note of that. From the evidence on record, we are constrained to observe that the Bank had failed in its duty to inform the complainant well in time either to submit Form No.15H/15G or show the tax payment receipt and otherwise the Bank would deduct the TDS before 31.3.2006 and thereafter, the Bank unauthorisedly deducted a sum of Rs.12,516/- from the account of the complainant and paid the same to the income tax department, whereas the complainant had also paid tax for the accrued interest before filing his I.T. Return for the year 2005-2006.
11. In view of the foregoing discussion, we find no infirmity in the learned District Forum holding the appellant Bank guilty of deficiency in service. Coming to the award of learned District Forum, we again finds no infirmity in the same as the learned District Forum had rightly allowed interest @9% on the amount unauthorisedly deducted by the Bank from the account of the complainant and since, this interest only covers the loss of interest accruing due to deprivation of the amount to the complainant as per the FDR rate of interest on the deposit, the learned District Forum was well within its right to further grant the complainant a compensation of Rs.5,000/-. In view of this, finding no infirmity in the impugned order, the same is upheld.
12. In view of the foregoing discussion, we find no merit in the appeal and the same is dismissed with costs, which we quantify as Rs.5,000/- as the complainant has been unduly dragged in to avoidable litigation.
13. Copies of this order be sent to the parties free of charge.
Pronounced.
20th November 2009.
Sd/-
[JUSTICE PRITAM PAL] PRESIDENT Sd/-
[MAJ. GEN. S. P. KAPOOR(RETD.)] MEMBER Ad/-
STATE COMMISSION Appeal No.318 of 2009 PRESENT: Sh. S. P. Singh, Advocate for the appellant.
Sh.
V. P. Chatrath, Advocate for the respondents.
Dated the 20th day of November, 2009.
ORDER Vide our detailed order of even date recorded separately; this appeal filed by the OPs has been dismissed with costs of Rs.5,000/-.
(MAJ GEN S. P. KAPOOR (RETD.)) MEMBER [JUSTICE PRITAM PAL] PRESIDENT (NEENA SANDHU) MEMBER Ad/-