C.C.No: 167/2008

BETWEEN:
The Ongole Co-operative Building
Society Limited, No. N.1213,
Having its office at D.No.37-1-3(9)
Annavarapadu, Trunk Road,
Ongole, rep. by its President. ... Complainant.

Vs.

1. The Secretary of the Ongole Cooperative Bank Ltd.,
No.96, having its office at Rajapanagal Road, Ongole.

2. The Deputy Registrar of Cooperative Societies,
having its office at Santhapeta, Opp. to E.Seva
Centre, D.No.58-09-10, Ongole.

3. The Chairman of the Ongole Cooperative Bank Ltd.,
No.96, having his office at D.No.5-1-65,
The Bank premises situated in Rajapanagal Road,
Ongole. …Opposite parties.

COUNSEL FOR COMPLAINANT: SRI Y.V. SESHAIAH,
ADVOCATE, ONGOLE.

COUNSEL FOR OPPOSITE PARTY NO.1&3: SRI S. DASARADHA RAMI REDDY,
ADVOCATE, ONGOLE.

COUNSEL FOR OPPOSITE PARTY NO.2: IN PERSON

This complaint is coming on 25.02.2009 for final hearing before us and having stood over this day for consideration this Forum delivered the following:
ORDER:
1. This is a complaint filed by the complainant under Section 12 of Consumer Protection Act, 1986 against the opposite parties.

2. The averments in the complaint are as follows: The complainant is the Ongole Cooperative Building Society Limited, No. N.1213, Ongole. The complainant society is having fixed deposit bearing No.6230 in the 1st opposite party Bank. The said F.D.R. was matured on 02.12.2007 and the same was presented by the complainant for payment with the 1st opposite party. The complainant society is having Savings Bank Account No.5391. The 1st opposite party deposited an amount of Rs.7,88,131/- to the S.B. Account of the Complainant Society towards the maturity amount of F.D.R. By that time there was a balance of Rs.6,062/- in the S.B. Account of the complainant society, making a total of Rs.7,94,193/-. The complainant issued a cheque dated 07.01.2008 for Rs.7,90,000/- to U.T.I. Bank for collection. The said cheque was returned with an endorsement of ‘Refer to Drawer’ on 30.01.2008. The cheque issued by the complainant was dishonoured by the 1st opposite party. Thereafter the 1st opposite party approached the complainant and represented that the 1st opposite party Bank is not in financially sound position to pay the entire amount at a time and promised to pay the amount in installments of Rs.50,000/- each day by day. Believing the words of the 1st opposite party the complainant issued the cheques 1) Cheque No. 17661, dated 31.01.2008 for Rs.50,000/-; 2) Cheque No. 17662, dated 02.02.2008 for Rs.50,000/-; 3) Cheque No. 17663, dated 04.02.2008 for Rs.50,000/-; 4) Cheque No. 17664, dated 07.02.2008 for Rs.50,000/- and 5) Cheque No. 17665, dated 09.02.2008 for Rs.50,000/- respectively. For the above five cheques the 1st opposite party paid the amounts of Rs.50,000/- for the first 4 cheques and failed to honour the 5th cheque paying only Rs.25,000/- in the S.B.Account of the complainant. Again the complainant presented another cheque for Rs.50,000/- on 12.02.2008 bearing No.17666 and the same was returned without payment. Thus, the 1st opposite party dishonoured the cheque issued by the complainant though there is sufficient balance in his account by the said date to honour the cheque issued by him.

3. The complainant got issued legal notice dated 05.03.2008 requesting the 1st opposite party to pay the entire balance amount of Rs.5,69,193/- together with accrued interest thereon within a week from the date of service of the notice. The 1st opposite party received the notice and issued a reply admitting their liability to pay Rs.5,69,193/- and prayed time for payment till 2009. Thus there is deficiency in service on the part of the 1st opposite party for not settling the account of the complainant even inspite legal notice. Hence, the complaint.

4. The opposite party filed its counter and additional counter contending as fallows: The Ongole Co-operative Bank Limited was registered under the Provisions of A.P. Co-operative Societies Act and it is managed by elected members, called Directors. The Bank is functioning under the supervision of the Reserve Bank of India. On 12.10.2004 the Reserve Bank of India issued directions to close business transactions with effect from 16.10.2004. As such the functioning of the Bank came to stand still. The Reserve Bank of India in its discretion lifted the moratorium on 22.02.2007. Then all the depositors came forward and withdrawn their amounts. Still the bank has to pay some more amounts to the remaining depositors. At no point of time the complainant came to the bank and requested for payment of the amount. The bank has to get money from the borrowers, which is tune of Rs.3 crores and has to get Rs.4 crores from Charminar Bank, Hyderabad. Even though, the Chairman of the Bank promised to pay the amount in the year March 2008, again postponed the same to March 2009. The Government of Andhra Pradesh also issued G.O to that effect. In these circumstances, the complainant may be advised to wait few more months to get back his amounts as the opposite party is confident to collect amount due to the bank and pay to the complainant. The complainant is also aware of all these things and filed the petition. Under the circumstances the opposite party prays to court dismiss the complaint.

5. On behalf of the complainant Ex.A1 and Ex.A2 were marked. The Ex.A1 is the Legal Notice dated 05.03.2008 and Ex.A2 is the Reply Notice dated 26.03.2008. No documents are marked on behalf of the opposite parties.

6. The point for consideration is whether there is any deficiency in service by the opposite parties in payment of the Savings Bank Account to the complainant.

8. The opposite party in its counter categorically admitted its liability to pay the amount due to the complainant under the Savings Bank Account No.5391. The case of the complainant is that even though moratorium was lifted long back the opposite parties are not paying the amount lying in the Savings Bank Account of the complainant society.

9. The learned counsel for the opposite party argued that Reserve Bank of India issued direction to close business transactions with effect from 16.10.2004 and as such the functioning of the bank came to stand still and moratorium was lifted on 22.02.2007 and some of the depositors withdraw their amounts and still the bank has to pay amounts to remaining depositors including the complainant. He further argued that on 24.11.2008 Reserve Bank of India issued notice to the bank to pay penalty of Rs.36 crores 47 lakhs 943/- for committing default in maintains of required C.R.R/S.L.R and same has to be paid to the Reserve Bank of India. He further argued that bank has to get money from various borrowers and Rs.4 crores from Charminar Bank, Hyderabad and the Government issued G.O for paying the amount due by the Charminar Bank, Hyderabad from March’2009 and as soon as the amounts are received they are ready to pay the amount to the complainant and prayed to grant time till 31st March’2009 to pay the amount to the complainant. The Act of non-payment of the amount to the complainant by the opposite party bank amounts to deficiency in service by the bank. Since the opposite party undertake to pay the amount by 31.03.2009, I am of the opinion that time can be granted to the opposite party, while allowing the petition of the complainant.

10. In the result, petition is allowed directing the opposite parties to pay sum of Rs.5,69,193/- together with interest @ 9% p.a., from the date of filing of the petition till the date of realization. The opposite parties are further directed to pay Rs.2,000/- towards compensation and Rs.1,000/- towards costs of the litigation. For compliance time is granted till 30th April, 2009, failing which the opposite parties are further liable to pay an amount of Rs.5,000/- towards further compensation towards mental agony.