JUSTICE V.K.JAIN (ORAL)

The complainants/respondents who are husband and wife opened a joint PPF account with a post office on 6.1.1996. They continued to make deposits in the said joint account till 8.5.2008. The total deposit made by them until May, 2008 was Rs.276500/-. When they sought to deposit the contribution in May 2009, the petitioners refused to accept the same on the ground that a joint PPF account was not permitted under the rules. Being aggrieved, the complainant approached the concerned District Forum by way of a consumer complaint.

2.      The complaint was resisted by the petitioners primarily on the ground that in view of the statutory rules, a joint PPF account was not permissible. They also claimed that no interest on the deposits made by the complainants was payable since the account itself was invalid.

3.      The District Forum vide its order dated 2.4.2014 directed the petitioners to pay a sum of Rs.3 lakh as compensation to the complainants. The said amount was to increase to Rs.3,50,000/- if it was not paid within 60 days from the date on which the aforesaid order was passed. The petitioners were also directed to refund the entire amount deposited by the complainants. In case of default, they were to pay an additional amount of Rs.50,000/- to them.

4.      Being aggrieved from the order passed by the District Forum, the petitioners approached the concerned State Commission by way of an appeal. Vide impugned order dated 4.7.2017, the State Commission partly allowed the appeal and directed the petitioners to refund the amount received from the complainants along with interest thereon @ 9% p.a. from the date of each deposit till the date of payment. The compensation, however, was reduced to Rs.50,000/-. A sum of Rs.15,000/- was awarded as the cost of appeal payable to the complainants. Being aggrieved from the order passed by the petitioners are before this Commission by way of this revision petition.

5.      The learned counsel for the petitioners has drawn my attention to Rule 150 (xxiii) of the PPF rules which clearly stipulates that the PPF account cannot be opened in the joint names. Therefore, it can hardly be disputed that the joint account opened by the complainants was not permissible under the rules. However, this is also a fact that the post office personnel who are supposed to be conversant with the aforesaid rules, allowed the joint account to be opened and they kept on accepting deposits for 12 years, in violation of the statutory rules.

6.      The principal amount has already been refunded to the complainants sometime in the year 2014. However, no interest on that amount has been paid to them. The contention of the learned counsel for the petitioners is that the amount deposited by the complainants was refundable only at the end of the tenure of the PPF account opened by them. However, he has not been able to draw my attention to any statutory rule, stipulating refund only at the end of the tenure of the PPF account, even in a case where the opening of the account itself is said to be invalid. What the learned counsel for the petitioners has been able to show to me is the rule which stipulates repayment of the deposit at the end of the tenure for which the PPF account is opened. The said stipulation, however, applies to a case where the account is validly opened since interest continues to accrue on the deposits till the tenure for which the account is opened ends. However, in a case where the account is invalidly opened, the entire amount, in my opinion, should have been returned immediately on the said mistake being detected by the concerned post office.

7.      It is an admitted position that the post office had detected in May 2009 that the account had been invalidly opened since joint account in the name of the complainant and his wife was not permissible under the rules. The petitioners, therefore, should immediately thereafter have refunded the entire amount deposited by the complainants in the PPF account, to them. That, however, was not done and despite having realized their mistake, they continued to use the amount deposited by the complainants till the year 2014 when only the principal amount was refunded to them. Therefore, the petitioners, in my opinion, are required to pay appropriate interest on the deposits made by the complainants in their PPF account w.e.f. 1.5.2009 till the date on which the principal amount was actually refunded to them. In the facts and circumstances of the case, the petitioners, in my opinion, should pay simple interest @ 9% p.a.  to the complainants on the entire principal amount of Rs.276500/- w.e.f. 1.5.2009 till the date of refund of the principal amount.

8.      The petitioners, in my view, were deficient in rendering services to the complainants by allowing them to open a joint PPF account in violation of the statutory rules applicable to such accounts. As noticed earlier, the personnel posted in a post office and dealing with the opening of the PPF accounts are supposed to be conversant with the relevant rules and therefore, they ought not to have allowed the complainants to open the joint account. In fact, they are supposed to guide the persons coming to the post office for availing their services, instead of acting in violation of the statutory rules governing such deposits. Had they pointed out to the complainants that the joint account could not be opened under the rules and had they refused to open such an account, the complainants obviously would have deposited their hard earned money with some alternative instrument. Not only the post office personnel allowed the complainants to open an account in violation of the rules, they also kept on accepting deposits in the said account for 12 years without even realizing that the account itself had been opened by them in violation of the rules. The petitioners need to suitably compensate the complainants for the aforesaid deficiency in rendering services to them by not guiding  them properly opening the joint account in violation of the rules and keeping on accepting deposits for 12 years.

9.      Considering all the facts and circumstances of the case, the petitioners, in my view, should pay compensation quantified at Rs.1,00,000/-. The payment in terms of this order shall be made within eight weeks from today, failing which the petitioners will be liable to pay interest on the amount of compensation @ 10% p.a. from the date of institution  of the complaint, till the date of payment. The amount which the petitioners have deposited with the District Forum shall be refunded to it along with interest which may have accrued on that amount after the petitioners have complied with the order passed by this Commission. The revision petition stands disposed of accordingly.