The District Consumer Disputes Redressal Commission, Central Mumbai, has directed the Central Bank of India to pay within 30 days Rs30.65 lakh of interest amount on a PPF account to a complainant that was denied citing a government notification and discontinuation of a scheme meant for Hindu Undivided Family (HUF). The complainant, Achal Shyamsundar Goenka, is the senior most member of his family.
𝗕𝗮𝗻𝗸 𝗳𝗮𝗶𝗹𝗲𝗱 𝘁𝗼 𝗶𝗻𝘁𝗲𝗿𝗽𝗿𝗲𝘁 𝘁𝗵𝗲 𝗻𝗼𝘁𝗶𝗳𝗶𝗰𝗮𝘁𝗶𝗼𝗻: 𝗖𝗼𝗺𝗺𝗶𝘀𝗶𝗼𝗻
In the matter, the commission said the bank “failed to interpret” the notification and its clarification, adding that there was “misuse of dominant position”. The commission also directed Rs40,000 towards mental agony and litigation costs. If the accumulated interest is not paid in time, it will attract 6% interest per annum.
Goenka, who represented the HUF in the matter, subscribed to the PPF scheme 1968 in 1992 for a maturity period of 15 years. This was renewed in 2007 and by March 2019, the PPF account had a balance of Rs64.85 lakh. In Sept 2019, when a claim was made, the bank said that only Rs34.20 lakh will be given that was accumulated till March 31, 2011 and not the interest thereafter, for which even the entry in the passbook would be reversed.
𝗕𝗮𝗻𝗸 𝘀𝗮𝗶𝗱 𝗶𝗻𝘁𝗲𝗿𝗲𝘀𝘁 𝗰𝗮𝗻𝗻𝗼𝘁 𝗯𝗲 𝗽𝗮𝗶𝗱 𝗯𝗲𝘆𝗼𝗻𝗱 𝟮𝟬𝟭𝟭
The bank told the complainant that as per the notification the interest in the PPF accounts opened in the name of HUF cannot be paid beyond 2011.
In November that year, Goenka was told that the PPF account had been closed. As Goenka was in dire need of money, Rs34.20 lakh was collected and a legal notice was served for the remaining amount. The bank replied that the complainant was not entitled for the remaining.
During the hearing, the commission observed that Goenka had deposited money from time to time till March 31, 2013 and interest on the deposit was also credited. Entries in the passbook were also maintained till April 2019.
While the bank cited the notification of Dec 2010 that accounts opened in the name and/or by HUF could not be extended beyond 2005, the commission observed that the bank “failed to interpret” the directions which stated that “if the accounts have not been extended and the amounts are retained, without further subscriptions, then interest at PPF rate would be paid on those accounts which attained maturity after 13.05.2005 and closed by the subscribers before 07.12.2010” and that amount is retained in account.
The commission further said that “there is no material in statement made by the opposite party that they have never travelled beyond the guidelines and directions of the RBI and Government of India” and directed that the money be paid.
