Punjab

Ludhiana

CC/16/35

Swatantar Kausal - Complainant(s)

Versus

Post Office - Opp.Party(s)

L.D.Gupta Adv.

22 Mar 2017

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, LUDHIANA.

 

Consumer Complaint No. 35 of 11.1.2016

Date of Decision            :   22.03.2017 

1.Swatantar Kansal and Sons HUF through Amit Kansal s/o Late Sh. Swatantar Kansal, as Karta, 27-Mall Enclave, Mall Road, Ludhiana-141001.

2.Amit Kansal s/o Late Sh. Swatantar Pal Kansal, Karta of M/s Swatantar and sons, HUF, 27-MALL Enclave, Mall Road, Ludhiana-141001.

….. Complainants

                                                         Versus

1.The Senior Supdt.of Post Offices, Near Mini-Secretariat, Ferozepur Road, Ludhiana.

2.The Post Master, Lajpat Rai Post Office, Clock Tower, Ludhiana.

…Opposite parties

             (Complaint U/s 12 of the Consumer Protection Act, 1986)

 

QUORUM:

SH.G.K.DHIR, PRESIDENT                                     

SH.PARAM JIT SINGH BEWLI, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainants                    :          Sh.L.D.Gupta, Advocate

For OPs                          :          Sh.Ankur Ghai, Advocate

 

PER G.K.DHIR, PRESIDENT

 

1.                Complainant Sh. Swatantar Kansal formed an HUF with name and style of Swatantar Kansal and Sons. Sh.Amit Kansal complainant and Mrs. Kanchan Kansal wife of Sh. Swatantar Kansal were members of this HUF. Death of Sh. Swatantar Kansal took place on 25.1.2008 and thereafter, Sh. Amit Kansal, being the only surviving son is Karta of said HUF. This complaint is filed through Karta of HUF. PPF account No.45384 dated 26.2.1997 of HUF was opened in Lajpat Rai Market Branch Post Office at Ludhiana. Various amounts to continue to be deposited in this PPF account on different intervals. After assuming the role of Karta, an application was filed along with affidavit on 11.12.2008 for informing the concerned branch office regarding change of name of Karta of HUF. Name of Amit Kansal was substituted as Karta in place of Late Sh. Swatantar Kansal. After lapse of 15 years period, the PPF account  matured on 29.11.2012 and an     amount of Rs.5,06,989/- inclusive of accrued interest stood outstanding in the above referred PPF account of HUF. Instead of closing this account, the complainant decided to extend the period of deposit for another five years and that is why, OPs were approached who readily extended the period of five years w.e.f. 29.11.2012. This extension was allowed on the same terms and conditions, on which, the account was originally opened. Complainant deposited the following amounts even after extension of the account w.e.f. 29.11.2012:-

Date of deposit	Amount of deposit	Balance after this deposit
10.01.2013	Rs.1,00,000/-	Rs.06,06,989/-
05.08.2013	Rs.1,00,000/-	Rs.07,06,989/-
Interest credit by OP for 2013-14	Rs.58,463/-	Rs.07,65,452/-
09.06.2014	Rs.1,00,000/-	Rs.08,65,452/-
Interest credit by Op for 2014-15	Rs.73,699/-	Rs.09,39,151/-

The above referred amounts along with accrued interest was duly entered in the account books of Ops as well as in the passbook supplied to the complainant. In July 2015, when the complainant visited Ops office in connection with some other work, then he was disclosed by the authorities that they have wrongly extended this account due to mistake. Complainant was disclosed as if he will be paid interest only up to 29.11.2012 and no amount will be paid on amounts deposited after 29.11.2012. Complainant was advised to stop depositing the further amount. Thereafter, the complainant issued email dated 23.7.2015 to Ops for calling upon them to clarify the present status of his account, but no reply was received. On 18.9.2015, the complainant personally approached Ops for claiming as if Ops cannot refuse the payment of accrued interest, but Ops advised the complainant to immediately withdraw the amount for avoiding further loss of interest. OP1 assured that they will move the higher authorities for permitting payment of interest accrued after 29.11.2012 as a special case. Vide cheque No.418837 dated 8.10.2015, OP1 made payment of Rs.7,64,771/- to the complainant by illegally deducting the amount of Rs.2,22,913/-, the accrued interest amount during the period from 29.11.2012 to 8.10.2015. Details of less received amount worked out in para no.13 of the complaint and are given below:-

a)Balance amount as on                                       Rs.09,39,151/-

  31.03.2015 as per entries in the passbook

  and account books of this amount.

b)Amount of interest accrued from 01.4.2015     Rs.   48,532/-

  to 8.10.2015

  Total (a+B)                                                        Rs.09,87,683/-

c)Amount received vide cheque                            Rs.07,64,770/-

  dated 8.10.2015

  Amount illegally deducted Rs.2,22,913/-

Complainant had been deprived from use of his money for such a long period and as such, due to less payment of Rs.2,22,913/-, he has suffered mental tension. So, directions sought to OPs to make payment of Rs.2,22,913/- with interest @18% per annum from due date till payment. Compensation for financial loss and mental harassment of Rs.1 lac, but litigation expenses of Rs.55,000/- more claimed.

2.                In joint written statement filed by OPs, it is pleaded interalia as if complaint is false, frivolous and vexatious; complainants have suppressed the material facts with malafide intention; this Forum has no jurisdiction because the complainants are not consumers and Ops are not service providers. It is claimed that Union of India has passed an Act known as Public Provident Fund, which is social beneficial legislation. Aim and object of the Act is to provide savings of the general public. So, services provided by Union of India does not fall in the   domain of Consumer Protection Act, particularly when charges were not levied for providing services. Rather, it is claimed that the complainants are not consumers, due to which, this Forum is barred by law to entertain the complaint. Complainants are claiming interest on deposits, which has been denied by the Public Provident Fund Scheme, 1968. Complainants can approach the Hon'ble High Court, if they want to challenge the rules and regulations. Account was opened in Lajpat Rai Market branch post office in the name of Sh. Swatantar Kansal and Sons HUF by showing   Swatantar  Kansal as Karta. Admittedly, after death of Sh. Swatantar Kansal, his son Sh.Amit Kansal applied and his name substituted as Karta of HUF. Admittedly, the complainant approached Ops for extension of the account for the period of five years w.e.f. 29.11.2012. Government of India vide notification published in official Gazette bearing No.G.S.R.956 (E) incorporated on amendment to the Public Provident Fund Scheme, 1968 for clarifying that account of PPF of HUF opened prior to 13.5.2005 shall be closed after expiry of 15 years from the end of the year, in which, the initial subscription was made. As per that amendment, the entire amount standing to the credit of the subscriber to be refunded after making adjustment, if any, in respect of any interest due from the loans taken by the subscriber. After the year ending 31.3.2011, no new or the old HUF PPF account could be initiated or carried onwards. Complainant wrongly kept HUF PPF account running after 31.3.2011 and as such, he is not entitled to interest on the deposit beyond the period of 1.4.2011. However, account of HUF of PPF of the complainant did show the excess amount of interest w.e.f.1.4.2011 to 29.11.2012 and as such, complainant liable to return and refund the excess taken amount. Rule 6 of the Public Provident Fund Scheme, 1968 deals with closure of PPF accounts opened in contravention of rules. That rules provides that accounts cannot be opened by artificial/juridical persons and if opened, then the account will be treated as invalid. The amount received from the subscriber cannot be treated as subscription under the PPF scheme, 1968. Ordinarily, no interest amount to accrue to the subscriber in such cases. Complainants were fully aware of the rules and regulations laid down by the Government of India and as such, act of extending PPF account of HUF beyond 31.3.2011 is an act of nullity. Complainant cannot take benefit of his own wrong and as such, he is not entitled to any interest on any amount. Government of India, Ministry of Communications and IT vide letter dated 13.12.2010 intimated all the Heads of circles and regions about the amendment in the PPF accounts in the name of HUF and as such, liability on OPs cannot be fastened for the acts of omission and commission committed in violation of rules. No cause of action accrued against OPs and besides, it is claimed that the complainants are estopped by their act and conduct from claiming any amount, particularly when account was illegal. Any act of incorporating the entries in the account books in contravention of existing law and rules alleged to be illegal and invalid. Each and every other averment of the complaint denied but by admitting that payment was made vide cheque to the complainants as per rules. No mischief was committed by Ops with anyone and as such, complainants are not entitled for any compensation or litigation expenses.

3.                Complainants to prove their case tendered in evidence affidavit Ex.CA Sh.Amit Kansal, complainant no.2, Karta of HUF along with documents Ex.C1 to Ex.C4 and thereafter, their counsel closed the evidence.

4.                On the other hand, counsel for OPs tendered in evidence affidavit Ex.RA of Sh. Suresh  Kumar, Superintendent Post Office, Ludhiana along with documents Ex.R1 to Ex.R3 and then closed the evidence.

5.                Written arguments not submitted by any of the parties. Oral arguments by counsel for parties addressed and those were heard. Records gone through carefully.

6.                Undisputedly, PPF account was opened in the name of HUF initially and that is why passbook Ex.C2 was issued, but after death of original Karta Sh. Swatantar Kansal, name of his son Mr.Amit Kansal was substituted on the basis of affidavit Ex.C3 submitted by him. Bone of contention remains as to whether the amount of interest payable on the amounts deposited after 31.3.2011 or not? Another contentious issue is as to whether the complainants are consumers on account of availing of PPF deposit services. Catena of cases hereinafter referred will show that in case the interest amount not paid on PPF deposit of HUF as per directions of Reserve Bank of India after particular date, but the amounts continued to be deposited in PPF of HUF, then on account of deficiency in service, the Postal Authorities or the authorities concerned getting the amount deposited in PPF liable to pay interest.

7.                As per case of State Bank of India vs. Balbir Kumar etc.,-2012(4)-CLT-462(Hon'ble Punjab State Consumer Disputes Redressal Commission, Chandigarh), in case interest not paid on the amount deposited in PPF account of HUF on the ground that same is not payable as per directions dated 25.5.2005 of RBI, then in view of deficiency in service on the part of the party concerned, the District Forum rightly directed for paying of the interest at the rate which was applicable to such deposits at the time of closure of PPF account. Same is the position in the case before us because here perusal of passbook Ex.C2 reveals that an amount of Rs.1 lac was got deposited on 24.3.2012 and another amount of Rs.1 lac on 10.1.2013, but Rs.1 lac more on 5.8.2013 and another amount of Rs.1 lac on 9.6.2014  and  interest for financial year of 2011-12, 2012-13, 2013-14 and 2014-15 was duly credited by incorporating entries in the passbook Ex.C2, but despite that this accrued interest denied specifically while closing the account on 8.10.2015 by paying Rs.7,64,770/- alone to the complainants through cheque, copy of which is produced on record as Ex.C4. Earlier by incorporating interest credit entry of Rs.73,699/- for financial year 2014-15, payable amount was worked out at Rs.9,39,151/-, but despite that payment of Rs.7,64,770/- alone made. Though, closure   of the account took place on 8.10.2015, but interest accrued during period from 1.4.2015 to 8.10.2015 has not been paid or credited in the account of the complainants. So, there is deficiency in service on the part of OPs in so far as they denied accrued interest to the complainants after 1.4.2011, particularly when they allowed complainants to deposit the amounts after 1.4.2011 also. It is so because amounts of Rs.1 lac each were got deposited from the complainants on 24.3.2012, 10.1.2013, 5.8.2013 and 9.6.2014 respectively is a fact borne from the  contents   of entries of passbook Ex.C2. If these amounts were not got depositable after issue of notification or circulars placed on record as Ex.R1 or Ex.R3, then why these amounts got deposited by Ops qua that no due explanation is offered at all. So, if in view of notification Ex.R1, the PPF account in question of HUF was not liable to be extended after 31.3.2011, then action of extending the same by way of getting the huge amount deposited on the above said dates is an act of negligence on the part of OPs. There is nothing on record to suggest that the complainants were informed about contents of notification Ex.R1 or of contents of letter Ex.R2 and if that be the position, then fault lay with OPs in not abiding by the terms of      Ex.R1 and Ex.R2 each. As the contents of notification Ex.R1 was circulated amongst the heads of circles/regions through issue of letter Ex.R2 dated 13.12.2010 and as such, it was but natural for OPs and its officials to be aware about the notification Ex.R1 and bring the same to the notice of customers operating PPF of HUF accounts in violation thereof. Neither Ops themselves acted upon the contents of notification Ex.R1 or the circulated letter Ex.R2 and nor they called upon the complainants to abide by the terms of these notification/letter and as such, certainly fault lay with Ops and not with the complainants. Being so, complainants certainly entitled to the interest on the deposited amount in PPF account in question until the date of closure, in same manner as it was receivable at the time of closure of the account on 8.10.2015 in view of legal position as discussed above and hereinafter.

8.                Even after going through ratio of case titled as Post Master (SB/RD) General Post Office vs. Amit Rai Sharma and another-III(2014)CPJ-412(N.C.), it is made out that it is for the Post Master to ensure that at the time of opening of PPF account, it had been correctly opened as per rules. If the Post Master has not only allowed complainants to open the joint account, but also retained money for 15 years in PPF account, then owing to deficiency in service on the part of Postal Authorities, complaint liable to be accepted for allowing interest at the rate, at which, it is payable. In the reported case, it was also found that instruction regarding non opening of PPF account was not in the notice of the Post Master or any other senior officials and nor was brought to the knowledge during internal and external audit and that is why after allowing the continuity of PPF account, interest cannot be denied on the deposited amount. Position of initial opening of the account in violation of the rules and instructions is the same as is the position of continuity of PPF account in violation of rules and regulations and as such, also in view of ratio of above cited case, deficiency in service on the part of Ops certainly is inferable, particularly when the amounts continued to be got deposited by the Ops from the complainants even after 31.3.2011. Rather, it is held in above cited case that the authorities concerned should have a system in place to review such cases from time to time that even if any account has been opened against the rules, then immediate notice of the same should be sent to the account holder and the amounts deposited should be returned to the account holder as early as possible. Such system not shown to be evolved by Ops of this case before us and as such, in view of retention of money of the complainants for three years at least after expiry of 31.3.2011, certainly complainants cannot be denied their due.

9.                In case of Union of India and others vs. Navnit N.Desai (Dr.)-2016(1)CLT-331(N.C.), it was held that if notification issued by Reserve Bank of India regarding non allowing of continuation of PPF account is not within the knowledge of Postal Authorities and the complainants, then case be treated as        a case of contributory negligence. Rather, it is held in the above cited case that if such notifications to be issued by Reserve Bank of India, then they must be advertised before hand in newspapers, TVs and other means of communication. In               the reported case, it was found that such notifications are made abruptly without the knowledge of the subject and they causes unlawful enrichment of the State, which amounts to unfair trade practice. Even in the case before us, there is nothing on record to suggest that contents of notification Ex.R1 or of letter Ex.R2 were circulated or advertised through newspapers or through TVs or other means of communication and as such, denial of due interest on the amount deposited is an act of unfair trade practice on the part of Ops of this case also. Therefore, Ops must pay accrued interest at least up to the date of disbursement of the amount on 8.10.2015. So, by taking it as a case of contributory negligence, interest after 8.10.2015 alone is denied to the complainant.

10.              Directions in case of M/s Bhagwati Vanaspati Traders vs. Senior Superintendent of Post Office, Meerut-2014(4)CLT-228 by the Hon’ble Supreme Court of India, New Delhi were issued in exercise of jurisdiction of Article 142 of the Constitution of India in view of the facts of that case and as such, benefit of that case cannot be availed by the complainants because jurisdiction of Hon’ble Apex Court of the country is extraordinary.

11.              In case of State Bank of India vs. Yash Pall Gupta-II(2016)CPJ-88(N.C.), it was held that if deposits got renewed from time to time, then Bank was supposed to pay interest upto the date of renewal because fault cannot be found with the depositor owing to non giving of any information to him due to change in the terms and conditions of the scheme. In case amounts continued to be got deposited in a scheme from the depositor, then he always remains under impression that it is a continuing scheme and that is why amounts of interest even continued to be credited to his account. Keeping in view the ratio of above cited case and the fact that amounts continued to be got deposited from the complainants until 8.10.2015 and the interest even continued to be  credited to their account,      it has to be held that it is a case of negligence on the part of Ops alone, due to which, the complainants entitled to interest until the date of closure of the account, in the same manner as it was receivable by them upto the date of closure. If the account opened or continued to be run in violation of the rules and regulations, then on equitable considerations and principle of unjust enrichment,    complainants will be entitled to interest on the deposits is also the proposition of law laid down in case Kishan Sahkari Chini Mills Limited vs. Post Master General Bareilly Division and others-II(2011)CPJ-162(N.C.). Likewise, in case, Kisan Vikas Patras irregularly and wrongly issued to Karta of HUF in contravention of rules, then issue of direction for payment of interest @9% per annum on the matured amount held to be proper in case titled as Union of India and others vs. Dr.Satinder Nath Verma (HUF)-I(2005)CPJ-76(N.C.). Ratio of this case is also fully applicable to the facts of the case in hand and as such, certainly submission advanced by counsel for the complainants has force that the complainants are entitled to interest in the same manner as it was receivable at the time of closure of the account in question on 8.10.2015. However, for avoiding unjust enrichment of the complainants and on equitable consideration, further interest on the less paid amount not allowed because the amounts continued to be deposited in violation of rules and regulations after 31.3.2011. For the mental harassment caused to the complainants, they are entitled to compensation of Rs.5000/-, but litigation expenses of Rs.5000/- more. Liability of Ops held            as joint and several.

12.              As a sequel of the above discussion, complaint allowed in terms that the complainant will be entitled to the interest on the deposited amounts in PPF account in question until the date of closure in the same manner as it was receivable at the time of closure of the account on 08.10.2015. Difference of the amount already paid and amount calculated as per directions issued through this order  be  paid to the complainant within 30 days from the date of receipt of copy of this order. Compensation for mental harassment of Rs.5,000/- (Rupees Five Thousand only) and litigation expenses of Rs.5,000/- (Rupees Five Thousand only) more allowed in favour of complainant and against Ops. Liability of Ops held as joint and several. Payment of above referred amounts be made within 30 days from the date of receipt of copy of order. Copies of order be supplied to parties free of costs as per rules.

13.                        File be indexed and consigned to record room.

         

                   (Param Jit Singh Bewli)                                        (G.K. Dhir)

                                                Member                                                President

Announced in Open Forum                                                              Dated:22.03.2017

Gurpreet Sharma.