State Consumer Disputes Redressal Commission
State Bank Of India. vs Sh. Kuldeep Verma & Ors. on 30 October, 2019
H. P. STATE CONSUMER DISPUTES REDRESSAL
COMMISSION SHIMLA
First Appeal No. : 227/2018
Date of Presentation: 21.02.2018
Order Reserved on : 16.05.2019
Date of Order : 30.10.2019
......
State Bank of India Branch Office Theog District Shimla through
its Branch Manager.
...... Appellant/Opposite Party No.1
Versus
1. Sh. Kuldeep Verma son of late Shri Liaq Ram resident of
village Halai Post Office Sarion Tehsil Theog District
Shimla.
......Respondent No.1/Complainant
2. IFFCO Tokio General Insurance Company Ltd. 1st Floor
Savitri Bhawan Khalini Shimla through its authorized
officer.
......Respondent No.2/opposite party No.2
3. Standard Chartered Bank Connaught Place New Delhi
through its Manager.
......Respondent No.3/opposite party No.3
Coram
Hon'ble Justice P.S. Rana (R) President
Hon'ble Ms. Sunita Sharma Member
Whether approved for reporting?1 Yes.
For Appellant : Mr. Hem Singh Thakur vice Mr.
Arvind Sharma Advocate.
For Respondent No.1 : Mr. Jeevesh Sharma Advocate.
For Respondent No.2: Mr. Jagdish Thakur Advocate.
For Respondent No.3: Mr. Dhiraj Kanwar Advocate.
1
Whether reporters of the local papers may be allowed to see the order? Yes.
State Bank of India Versus Kuldeep Verma & Ors.
F.A. No.227/2018
JUSTICE P.S. RANA (R) PRESIDENT:
O R D E R :-
1. Present appeal is filed against order dated 10.01.2018 passed by Learned District Forum/Commission in consumer complaint No.64/2014 titled Kuldeep Versus State Bank of India & Ors.
Brief facts of Consumer Complaint :
2. Shri Kuldeep filed consumer complaint under Consumer Protection Act pleaded therein that complainant is owner of JCB machine having registration No.HP-09C-1832.
It is pleaded that machine was duly insured with opposite party No.2. It is pleaded that complainant paid premium to Insurance company to the tune of Rs.20000/-(Twenty thousand) by way of cheque annexure- -CI dated 30.08.2013. It is pleaded that drawyer bank of premium was SBI Theog Branch District Shimla (H.P) and payee was IFFCO Tokio General Insurance Co. Ltd. It is further pleaded that complainant had sufficient funds in his account situated in State Bank of India Theog Branch District Shimla (H.P) at the time of issuance of cheque in question. It is further pleaded that JCB machine of the complainant met with accident on dated 18.09.2013 at place Mahog Tehsil Theog District Shimla (H.P) and three persons died. It is further pleaded that information was given to Insurance 2 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 company. It is pleaded that cheque in question was dishonoured and Insurance company cancelled Insurance policy ab-initio for non receipt of premium amount paid through cheque No.205848 dated 30.08.2013. It is pleaded that cheque was returned on the ground that drawyers signature to operate account was not uploaded in the comuter system by home bank i.e. State Bank of India Theog Branch Shimla (H.P). It is further pleaded that premium amount was not paid to Insurance company due to deficiency in service on the part of State Bank of India Theog Branch. Complainant sought relief for payment of Rs.1836879/-(Eighteen lac thirty six thousand eight hundred seventy nine) alongwith interest @ 12% per annum from opposite party No.1 i.e. SBI Theog Branch. In addition complainant sought relief of compensation to the tune of Rs.100000/-(One lac) from respondents for mental harassment. In addition complainant sought relief of payment of costs. Prayer for acceptance of complaint sought.
3. Per contra version filed on behalf of opposite party No.1 i.e. SBI Theog Branch pleaded therein that IFFCO Tokio General Insurance Co. Ltd. presented cheque in question for collection in State Bank of India New Delhi Branch. It is pleaded that IFFCO Tokio General Insurance Co. Ltd. did not send cheque in question directly to SBI Theog Branch for 3 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 encashment. It is further pleaded that present consumer complaint filed by complainant in order to harass opposite party No.1. It is further pleaded that complicated questions of facts and laws are involved in present matter and complainant be relegated to civil court. It is pleaded that complainant has no cause of action against opposite party No.1 because cheque was not presented for encashment at Theog Branch and cheque was not returned unpaid to complainant by SBI Theog Branch Shimla (H.P). Prayer for dismissal of complaint sought by opposite party No.1.
4. Per contra separate version filed on behalf of opposite party No.2 pleaded therein that opposite party No.2 presented cheque in question to its bank i.e. Standard Chartered Bank Connaught Place New Delhi i.e. Opposite party No.3 for encashment. It is pleaded that thereafter opposite party No.3 presented cheque in question for encashment in SBI Branch New Delhi. It is further pleaded that cheque was returned back by SBI New Delhi with remarks that drawyer signature to operate account was not uploaded by Drawee Bank i.e. Opposite party No.1 in computer system. It is pleaded that cheque in question was not encashed and cheque in question was returned back by opposite party No.3 to Insurance company. It is further pleaded that thereafter Insurance company cancelled 4 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 Insurance policy ab-initio as per terms and conditions of Insurance policy for non-payment of premium amount. It is further pleaded that Insurance company did not commit any deficiency in service. Prayer for dismissal of complaint against Insurance company sought.
5. Opposite party No.3 did not file any independent version.
6. Learned District Forum/Commission on dated 01.03.2016 dismissed original complaint in default. Thereafter Kuldeep Verma filed appeal No.77/2016 before State Commission which was disposed of on dated 16.05.2016 and State Commission allowed the appeal and set aside the order passed by learned District Forum/ Commission and restored complaint to its original number.
7. Thereafter on dated 06.01.2017 learned District Forum/Commission decided present consumer complaint afresh and ordered opposite party No.1 i.e. State Bank of India branch office Theog District Shimla to pay a sum of Rs.1540000/-(Fifteen lac forty thousand) alongwith interest @ 9% per annum from the date of filing complaint till payment to complainant within 45 days from date of order. Learned District Forum/Commission further ordered that in addition State Bank of India Theog Branch would also pay a sum of Rs.20000/-(Twenty thousand) to complainant as 5 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 compensation on account of harassment and mental agony. In addition Learned District Consumer Forum/Commission ordered that opposite party No.1 would pay litigation costs to the tune of Rs.5000/-(Five thousand) to complainant.
8. Thereafter State Bank of India Theog Branch Shimla (H.P) filed F.A. No.33/2017 before State Commission and same was dispose of on dated 27.11.2017. State Commission set aside order of Learned District Consumer Forum/Commission and again remanded back the matter to Learned District Consumer Forum/Commission with direction to obtain evidence of parties relating to controversial facts by way of affidavits as provided under section 13(4) of Consumer Protection Act 1986.
9. Thereafter again Learned District Consumer Forum/ Commission disposed of consumer complaint afresh on dated 10.01.2018. Learned District Consumer Forum/Commission ordered opposite party No.1 i.e. State Bank of India branch office Theog District Shimla to pay a sum of Rs.1540000/-(Fifteen lac forty thousand) alongwith interest @ 9% per annum from the date of filing complaint till payment to complainant within 45 days from date of order. Learned District Forum further ordered that in addition State Bank of India would also pay a sum of Rs.25000/-(Twenty five thousand) to complainant as compensation on account of 6 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 harassment and mental agony. In addition Learned District Consumer Forum/Commission ordered that opposite party No.1 would pay litigation costs to the tune of Rs.10000/-(Ten thousand) to complainant.
10. Feeling aggrieved against order passed by Learned District Consumer Forum/Commission State Bank of India Theog Branch filed present appeal before State Commission.
11. We have heard learned Advocates appearing on behalf of parties and we have also perused entire record carefully.
12. Following points arise for determination in present appeal.
1. Whether appeal filed by appellant is liable to be accepted as mentioned in memorandum of grounds of appeal and whether not uploading signature of complainant in computer system on the part of appellant amounts to deficiency in service and whether Multi City cheque (MCC) of SBI is payable at all branches of SBI in India?
2. Final order.
Findings upon point No.1 with reasons:
13. Complainant filed affidavit in evidence. There is recital in affidavit that complainant is owner of JCB machine in question having registration No.HP-09C-1832. There is recital in affidavit that JCB machine in question was duly 7 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018
insured with IFFCO Tokio General Insurance Co. Ltd. at the time of accident. There is recital in affidavit that accident took place on dated 18.09.2013 at place Mahog Tehsil Theog District Shimla (H.P) and JCB machine was totally damaged. There is recital in affidavit that deponent paid premium amount to Insurance company vide cheque No.205848 dated 30.08.2013 and cheque was not encashed and was dishonoured on the ground that signatures of complainant were not uploaded in computer system by drawee bank. There is recital in affidavit that Insurance company cancelled Insurance policy ab-initio on the concept of non-payment of premium amount. There is recital in affidavit that deponent has sustained loss due to deficiency in service on the part of drawee bank i.e. SBI Theog Branch. State Commission has carefully perused all annexures filed by complainant.
14. Opposite party No.1 i.e. SBI Theog Branch filed affidavit of Sh. Nipat Bajaj Manager SBI Theog. There is recital in affidavit that cheque in question was not sent by Insurance company directly to SBI Branch Theog but same was presented at SBI Branch New Delhi. There is recital in affidavit that SBI Branch Theog could not be penalized for illegal act of opposite party No.3 i.e. Standard Chartered Bank Connaught Place New Delhi. There is recital in affidavit that Standard Chartered Bank sent cheque for collection to SBI 8 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 Branch New Delhi instead of SBI Branch Theog Shimla (H.P). There is recital in affidavit that cheque in question was not received in SBI Branch Theog for encashment and on this ground SBI Branch Theog be exonerated from liability.
15. Opposite party No.2 filed affidavit of Sh. Rajiv Ranjan General Manager IFFCO Tokio General Insurance Co. Ltd. There is recital in affidavit that version filed by opposite party No.2 be treated as evidence of opposite party No.2. There is recital in affidavit that cheque was dishonoured and Insurance policy was cancelled ab-initio by Insurance company as per terms and conditions of Insurance policy.
16. Opposite party No.3 did not adduce any independent evidence.
17. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch i.e. Home Branch of cheque that cheque in question was not presented for encashment by Standard Chartered Bank at SBI Theog Branch Shimla (H.P) but was presented for encashment at SBI New Delhi Branch and on this ground appeal filed by SBI Theog Branch Shimla (H.P) be allowed is decided accordingly. It is proved on record that complainant has issued cheque in question to the tune of Rs.20000/-(Twenty thousand) as premium consideration amount to Insurance company vide 9 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 annexure-CI dated 30.08.2013 in favour of IFFCO Tokio General Insurance Co. Ltd. It is proved on record that thereafter IFFCO Tokio General Insurance Co. Ltd. submitted cheque for encashment before Standard Chartered Bank New Delhi. It is proved on record that thereafter Standard Chartered Bank New Delhi submitted cheque for encashment at SBI New Delhi Branch. It is proved on record that SBI New Delhi Branch dishonoured cheque on the ground that signature of drawyer were not uploaded in computer system by home branch i.e. SBI Theog Branch Shimla (H.P).
18. Even SBI Theog Branch Shimla (H.P) has admitted in document Annexure-C15 dated 20.09.2013 that signature of complainant namely Kuldeep account holder were not uploaded in system as on 07.09.2013 and thereafter SBI Theog Branch has apologize for dishonour of cheque. State Commission is of the opinion that SBI Theog Branch was under legal obligation to upload signature of drawyer in computer system for online payment facility. State Commission is of the opinion that SBI Theog Branch is vicariously liable for non action and laxity of its employee under law.
19. State Commission is of the opinion that it is not expedient in the ends of justice and on the principles of natural justice to penalize complainant for non-action and 10 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 laxity of employee of SBI Theog Branch Shimla (H.P). State Bank of India has provided online facility to its customer throughout India. It is well settled law that bank is vicariously liable for consequences if premium is not paid to Insurance company and policy of Insurer is lapsed for non- payment of premium amount. See 2019(1) CPR 819 NC titled Manager Bajaj Life Insurance Company Versus Parvati Bai & Anr. See 2019(III) CPJ 42 SCDRC Punjab titled Harpreet Kaur Versus Kotak Mahindra Bank Ltd. & others. See 2006(II) CPJ 345 NC titled State Bank of Mysore & Anr. Versus K. Vasanth Kumar & Anr. See 2006(IV) CPJ 274 NC titled P.S. Sawhney Versus Canara Bank & others. State Commission is of the opinion that bankers are vicariously liable under section 77 of Negotiable Instruments Act 1881 for negligently dealing payment of cheque.
20. Cheque clearing process i.e. CTS 2010 was in operation when cheque in question was issued by complainant to Insurance company. In Cheque clearing process (CTS) physical movement of cheque is eliminated and electronic image of cheque is sent to home bank for clearing of cheque. In the present matter cheque in question could not be cleared by SBI New Delhi by way of electronic process because signatures of complainant were not uploaded by home branch i.e. SBI Theog Shimla (H.P) in the computer 11 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 system. Deficiency in service on the part of SBI Theog Branch Shimla (H.P) is writ large in the present matter and SBI Theog Shimla (H.P) is vicariously liable for the lapse of its employee.
21. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch i.e. Home Branch of cheque that JCB machine was used for commercial purpose and on this ground appeal filed by appellant be allowed is decided accordingly. State Commission is of the opinion that as per section 2(0) of Consumer Protection Act 1986 service of any description rendered by bank falls within definition of service under Consumer Protection Act. It is held that present matter falls within section 2(0) of Consumer Protection Act 1986 and present matter also falls within section 2(42) of Consumer Protection Act 2019 wherein service of Bank Authority is defined.
22. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch i.e. Home Branch of cheque that on the date of accident Insurance policy was operative and same was revoked subsequently and Insurance company could not be exonerated from liability and on this ground appeal filed by SBI Theog Branch Shimla (H.P) be allowed is decided accordingly. State Commission is of the opinion that there is positive recital in Insurance policy that if premium paid by way of cheque would be dishonoured then 12 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 in that eventuality Insurance policy would be void ab-initio. In the present matter cheque in question issued as premium consideration amount was dishonoured due to non-action and laxity of employee of SBI Theog Branch Shimla (H.P) because SBI Theog Branch Shimla (H.P) who was home bank of complainant did not upload signature of complainant in computer system despite the fact that original cheque book was issued from SBI Theog Branch Shimla (H.P) and IFSC Code number of SBI Theog Branch Shimla (H.P) was also mentioned in cheque in question. It is held that it is duty of home bank of complainant to upload signature of complainant in computer system for online payment.
23. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch Shimla (H.P) i.e. Home Branch of cheque that complicated facts and laws are involved in present matter and complainant be relegated to civil court for adjudication of dispute is decided accordingly. State Commission is of the opinion that it is not expedient in the ends of justice and on the principles of natural justice to relegate complainant to civil court for adjudication of dispute. State Commission is of the opinion that present dispute could be disposed of properly and effectively under Consumer Protection Act. Services of any description rendered by Banks falls under Consumer Protection Act.
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State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018
24. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch Shimla (H.P) i.e. Home Branch of cheque that complainant did not file any FIR/Rapat in order to prove that JCB met with accident and complainant also did not place on record bills of damaged JCB machine and on this ground appeal filed by appellant be allowed is decided accordingly. State Commission is of the opinion that deficiency on the part of SBI Theog Branch is writ large in the present matter because official of SBI Theog Branch did not upload signature of complainant in computer system for online payment. State Commission is of the opinion that consequently Insurance policy obtained by complainant from Insurance company became non-operative from ab-initio. State Commission is of the opinion that in view of above stated facts SBI Theog Branch could not be exonerated from liability in view of section 77 of Negotiable Instruments Act 1881.
25. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch Shimla (H.P) i.e. Home Branch of cheque that Learned District Consumer Forum/ Commission has imposed excessive punitive compensation to the tune of Rs.25000/-(Twenty five thousand) is decided accordingly. State Commission is of the opinion that Learned District Consumer Forum/Commission 14 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 has imposed reasonable compensation and it is not expedient in the ends of justice and on the principles of natural justice to interfere in punitive compensation order passed by Learned District Consumer Forum/Commission.
26. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch i.e. Home Branch of cheque that Learned District Consumer Forum/ Commission has granted excessive litigation costs to complainant to the tune of Rs.10000/-(Ten thousand) and on this ground appeal filed by appellant be allowed is decided accordingly. State Commission is of the opinion that complainant has engaged Advocate and has also paid litigation costs & other expenses and Learned District Consumer Forum/Commission has granted reasonable litigation costs to complainant.
27. Submission of learned Advocate appearing on behalf of State Bank of India Theog Branch i.e. Home Branch of cheque that after payment of entire O.D claim of JCB machine on the concept of total loss SBI Theog Branch Shimla (H.P) is entitled for salvage of JCB machine in question is decided accordingly. State Commission is of the opinion that after payment of entire O.D claim of Insurance amount by SBI Theog Branch Shimla (H.P) appellant is legally 15 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 entitled for salvage of JCB machine in question on the concept of total loss basis.
28. Submission of learned Advocate appearing on behalf of opposite party No.3 i.e. Standard Chartered Bank that name of Standard Chartered Bank be deleted from memo of parties is decided accordingly. In the present matter Standard Chartered Bank has played active role by way of presenting cheque in question before SBI New Delhi Branch. State Commission is of the opinion that it is not expedient in the ends of justice and on the principles of natural justice to delete Standard Chartered Bank Connaught Place New Delhi from memo of parties. Prayer of Standard Chartered Bank for deletion of name from memo of parties is declined.
29. Submission of learned Advocate appearing on behalf of complainant and opposite party No.2 that order of Learned District Consumer Forum/Commission is in accordance with laws and in accordance with proved facts and does not warrant any interference by State Commission is decided accordingly. State Commission is of the opinion that order of Learned District Consumer Forum/Commission warrants interference partly relating to salvage of vehicle in question on the concept of total loss basis. Point No.1 is decided accordingly.
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State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 Point No.2: Final Order
30. In view of findings upon point No.1 above appeal is partly allowed. It is ordered that complainant will handover salvage of JCB machine in question to SBI Theog Branch Shimla (H.P) within one month after receipt of certified copy of order. It is further ordered that complainant will execute subrogation deed in favour of SBI Theog Branch Shimla (H.P) relating to JCB machine in question. It is further ordered that complainant will transfer R.C. of JCB machine in question in favour of SBI Theog Branch Shimla (H.P) within one month on the concept of total loss basis.
31. Order of Learned District Consumer Forum/ Commission that appellant would pay a sum of Rs.1540000/- (Fifteen lac forty thousand) as IDV of JCB machine in question alongwith interest @ 9% per annum from date of filing complaint till actual payment is affirmed. Order of Learned District Consumer Forum/ Commission that SBI Theog Branch Shimla (H.P) would pay a sum of Rs.25000/- (Twenty five thousand) as compensation on account of harassment and mental agony is also affirmed. Order of Learned District Consumer Forum/Commission that SBI Theog Branch Shimla (H.P) would pay litigation costs to the tune of Rs.10000/-(Ten thousand) to complainant is also affirmed. It is further ordered that SBI Theog Branch Shimla 17 State Bank of India Versus Kuldeep Verma & Ors. F.A. No.227/2018 (H.P) will comply its part within one month from date of receipt of copy of order. Order of Learned District Consumer Forum/ Commission is modified accordingly.
32. Cheque annexure-CI issued by complainant in favour of Insurance company dated 30.08.2013, Document Annexure-C-15, Document Annexure-OP3 wherein cheque in question was dishonoured due to non upload of signature of drawee in computer system of SBI Theog Branch Shimla (H.P) and Covernote of Insurance policy Annexure-OPI shall form part and parcel of order.
33. Certified copy of order be sent to Learned District Consumer Forum/Commission for information forthwith and file of State Commission be consigned to record room after due completion forthwith. Certified copy of order be transmitted to parties forthwith free of costs strictly as per rules. Appeal is disposed of. Pending application(s) if any also disposed of.
Justice P.S. Rana (R) President Sunita Sharma Member 30.10.2019 KD* 18