DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION

PATIALA.

                                      Consumer Complaint No. 400 of 16.10.2017

                                      Decided on:   5.11.2020

T.N.Sharma son of Sh.R.R.Sharma, resident of 1003, S.S.T.Nagar, Patiala.

                                                                   …………...Complainant

                                      Versus

1. The Industrial Development Bank of India, Head Office IDBI Tower, Cuffe Parade,Mumbai-400 005, through its M.D.
2. The Branch Manager, IDBI Bank, Chhoti Baradari, Patiala.

                                                                   …………Opposite Parties

                                      Complaint under Section 12 of the

                                      Consumer Protection Act, 1986.

QUORUM

                                      Sh. Jasjit Singh Bhinder, President

                                      Sh.Vinod Kumar Gulati, Member    

ARGUED BY

                                      Complainant T.N.Sharma,with his counsel

                                      Sh.J.R.Mehta, Advocate,

                                      Sh.P.S.Sidhu,Advocate, counsel for OPs. 

 ORDER

                                      JASJIT SINGH BHINDER,PRESIDENT

1. This is the complaint filed by Sh.T.N.Sharma (hereinafter referred to as the complainant) against Industrial Development Bank of India and another (hereinafter referred to as the OP/s).
2. The brief facts of the case are that the complainant purchased IDBI Deep Discount Bond 1997 Flexi Bonds 2, vide folio No.FDD129650, vide distinctive No.0030180232-0030180232 for Rs.5500/- through IDBI Bank. At that time the face value of the said bond was Rs.200/- payable on Janujary,31,2020 and certificate No.1173850 dated 31.1.1997 was issued to the complainant. It is mentioned in the certificate, that the holder of the bond has option to redeem the bond on any of the dates as mentioned in the bond.
3. It is averred that the complainant received a letter dated 2.12.2013 in response to the legal notice dated 30.11.2013, intimating that the due date of the redemption of the bond is 31.5.2017 for Rs.1,00,000/-.It is averred that the complainant never opted for early redemption of the bonds nor he ever received any notice from IDBI bank in this regard.
4. It is averred that the complainant got served a legal notice dated 30.11.2013 upon the OPs who sent reply by stating false facts. The complainant also sent letter dated 7.6.2017 alongwith all the documents in original and also the bond and detail of the bank amount for remitting of the amount of Rs.1,00,000/-but the OPs failed to deposit entire amount in the account of the complainant. There is thus deficiency in service and unfair trade practice on the part of the OPs. Hence this complaint with the prayer to accept to complaint by giving directions to the OPs to pay the entire amount of the bond amounting to Rs.1,00,000/- alongwith interest @18% per annum from the date of maturity of the bond after adjusting/deducting the amount of Rs.16,912/- already deposited in the account of the complainant alongwith Rs.1,00,000/- as damages for causing mental agony and harassment to the complainant.
5. Upon notice OPs appeared through their counsel and contested the complaint by filing written reply .In reply the OPs took preliminary objections that the complaint is not maintainable against the OPs; that the complainant has not come to this Commission with clean hands; that the complainant has mislead this Forum only with the motive to get illegal relief .

It is submitted that the OPs had issued four types of unsecured bonds as IDBI Deep Discount Bonds 97 in January,1997 under IDBI Flexibonds-2 series, in terms of offer document dated 6 December,1996.

It is further submitted that as per terms and conditions, the OPs have served a call Option to redeem the Deep Discount Bonds on 30 April,2001 after expiry of 4 years 3 months. For this purpose of the redemption payment, there would be back closure from 20^th of February 2001 to 27^th of February,2001. The bond holders were requested to submit the bonds by 16^th April 2001 as per the publication notices in various vernacular daily Newspapers like the Tribune in English dated 14.2.2001, Dainik Tribune in Hindi dated 14.1.2001.The Assam Tribune in English dated 13.2.2001 and daily Lokmat in Hindi dated 13.2.2001.

Further it is submitted that the complainant invested under IDBI Flexi-2 viz. FDD129650 vide Distinctive No.0030180232-0030180232 for Rs.5500/- and certificate No.117850 dated 31.1.1997 was issued. It is further submitted as per the terms and conditions of the Bonds, the IDBI had accordingly exercised the option at the end of 4 years 3 months vide which IDBI Deep Discount Bonds 97 will be redeemed by IDBI on 30.4.2001 as the deemed face value of Rs.10,000/- and no interest on the said bonds was payable after April,30,2001 i.e. Call Option Date. Accordingly Call Option Intimation dated 30.4.2001 was issued to all the registered bondholders informing them about the release of redemption amount as on the Call Option date by way of warrants dated 20.2.2001 to 27.2.2001. It is further submitted that the due amount i.e. Rs.16901/- has already been made to the complainant on his bank account provided by him at the time of investment in the bond. There is no deficiency in service on the part of the OPs and the complaint is liable to be dismissed.

On merits, the contents of the preliminary objections have been repeated and it has been prayed that the complaint be dismissed.

6.     In evidence the complainant tendered in evidence Ex.C1 his affidavit, Ex.C2 copy of IDBI Deep Discount Bond 1997 Flexi Bond 2, Ex.C3 copy of legal notice, Ex.C4 copy of postal receipts, Ex.C5 copy of letter written to M/s Karvy Computershare P. Ltd., Ex.C6 copy of statement of account and closed the evidence.
7. The ld. counsel for the OPs tendered in evidence Ex.OPA affidavit of Smt.Geeta Goyal, Branch Manager, IDBI Bank alongwith documents i.e. Ex.OP1 copy of issue of open bond notice, Ex.OP2 copy of IDBI Deep Discount Bond, Ex.OP3 copy of publication made in Tribune dated 14.1.2001, Ex.OP4 copy of publication notice in Dainik Tribune dated 14.1.2001, Ex.OP5 copy of publication notice in Assam Tribune dated 13.2.2001, Ex.OP6 copy of publication notice in Lokmat dated 23.2.2001, Ex.OP7 copy of call option dated 21.5.2001, Ex.OP8 copy of instructions, Ex.OP9 copy of notice send to bond holders,Ex.OP10 copy of IDBI Flexi Bond, Ex.OP11 copy of list of RCs sent to bond holders and closed the evidence.
8. The ld. counsel for the complainant has submitted written arguments in support of his case and also cited judgments of Hon’ble Supreme Court of India in the cases of Fakir Mohd.(dead) by Lrs. Vs. Sita Ram 2002(1)RCJ 89, Greater Mohali Area Development Authority & Anr. Vs. Manju Jain & Ors. 2010(4) ICC 427.
9. The ld. counsel for the complainant has further argued that complainant has purchased IDBI Deep Discount Bond 1997 Flexi Bonds 2, for Rs.5500/- through IDBI Bank, Chhoti Baradar, Patiala and the face value to the said bond is Rs.2,00,000/- payable on January 31,2022 and certificate  has been  issued. The ld. counsel further argued that holder of the bond has option to redeem the bond on 30.4.2001 for Rs.10,000/-, on 30.9.2007 for Rs.25,000/-, on 31.7.2012 for Rs.50,000/-, on 31.5.2017 for Rs.1,00,000/- and on 31.1.2022 for Rs.2,00,000/-The ld. counsel further argued that the complainant got sent legal notice dated 30.11.2013 to the OPs demanding Rs.1,00,000/- till 31.5.2017  or Rs.2lacs till 31.1.2022.  The ld. counsel further argued that intimation was given to the complainant as alleged in the letter dated 28.2.2001 but no such letter was ever received by the complainant. The ld. counsel further argued that Rs.16901/- was made on 30.7.2017 and balance amount of Rs.83099/-is still to be paid by the OPs.
10.           On the other hand, the ld. counsel for the OPs has argued that the complainant has mislead this Commission with the motive to get the illegal relief. The ld. counsel further argued that complainant was issued IDBI Deep Discount Bond 1997 Flexi Bonds-2 .The ld. counsel further argued that as per terms and conditions, OPs reserve its right to Call Option to redeem the bonds on 30.4.2001 after expiry of 4 years 3 months the amount is payable as Rs.10,000/-. The ld. counsel further argued that IDBI has decided to exercise call option falling due on 30.4.2001 at deemed face value of Rs.10,000/-per bond and no interest shall  be paid after 30.4.2001. The ld. counsel further argued that intimation was sent to all the bond holders and documents are on the file. The ld. counsel further argued that notice of Call Option was given to the bond holders in the newspapers i.e. in The Tribune dated 14.2.2001, Dainik Tribune dated 13.2.2001 and daily Lokmat in Hindi dated 13.2.2001. The ld. counsel further argued that the complainant invested under IDBI Flexi-2 for Rs.5500/- and complainant was issued certificate. The ld. counsel further argued that OPs have exercised the  Call Option at the end of 4 years 3 months whereby IDBI Deep Discount Bonds 97 redeemed by 30.4.2001 and no interest was payable after this date.The ld. counsel further argued that an amount of Rs.16901/- was paid to the complainant and now nothing is due to the complainant. The ld. counsel for the OPs has cited judgments of Hon’ble National Commission in the cases of Mahendrapal Kashiram Sharma Vs. Manager IDBI Bank and others, Revision Petition No.3107 of 2012 decided on 28.11.2016 and Chatur Behari Sharma Vs. IDBI Bank Ltd. Revision Petition No.3930 of 2013 decided on 25.11.2013, which are totally applicable to the facts of the case in hand.
11. In support of his case, the complainant has tendered his affidavit Ex.C1 and has deposed as per the version made in the complaint, Ex.C3 is the legal notice daed 30.11.2013, Ex.C4 is the postal receipt,Ex.C5 is the letter written to M/s Karvy Computershare P.Ltd.
12. On the other hand, Smt.Geeta Goyal, Branch Manager of IDBI Bank has tendered her affidavit,Ex.OP1 and has deposed as per the version made in the written statement, Ex.OP1 is a copy of public issue of Unsecured Bonds, regarding Issue Open from 2^nd January,1997 to 23^rd January,1997.In this issue on page 2, Call Option is mentioned. The date of Early Redemption Option  was mentioned , which are as follows:

Early Redemption OptionAmount Payable to Inestor

          DatePeriod from date of allotment (deemed face value)

April 30,20014 years and 3 monthsRs.10,000/-

September 30,200710 years and 8 monthsRs.25,000/-

July 31,201215 years and 6 monthsRs.50,000/-

May 31,201720 years and 4 monthsRs.1,00,000/-

After that the Call Option is also mentioned which is as follows:

“IDBI also reserves the right (Call Option) to redeem the Deep Discount Bond on the dates mentioned above. In that even, the Deemed Face Value as per the table given above willbe paid to Bondholders

The full maturity value of Rs.2,00,000/- shallbe payable only if the Bondholder does not exercise the Early Redemption Option and IDBI does not exercise the Call Option to redeem the Bond. On the Bondholder receiving the amount as specified above on exercise of the Early Redemption Option/Call Option at any time, the Bond shall stand fully discharged”.

This call option was exercised and notice was given in The Tribune dated 14.2.2001,Ex.OP3, according to which IDBI Deep Discount Bond 1997 Flexi Bonds-2 willbe redeemed by 30.4.2001 with the face value of Rs.10,000/- and no interest willbe payable after 30.4.2001. This call option was also exercised in Dainik Tribue, copy of which is Ex.OP4, in The Assam Tribune, copy of which is Ex.OP5 and in the Lokmat ,copy of which is Ex.OP6. Ex.OP7 is a copy of letter written by the IDBI to the bond holders regarding Call Option with the request to surrender the bonds. Address was also given where the bonds were to be sent and instructions are Ex.OP8. Vide Ex.OP8 a notice was also sent to T.N.Sharma, complainant.

13. So it is clear that as per public notice issued vide Ex.OP1, a Call Option was exercised by the OPs and the notice was given in the  daily news papers, copies of which are on the file and it is clearly mentioned in the newspapers and the letter, Ex.OP7 sent to the bondholders that IDBI has exercised Call Option on IDBI Deep Discount Bond on 30.4.2001 with the face value of Rs.10,000/- and no interest shall be payable after this date.

Similarly the Hon’ble National Commission Delhi in the judgment Mahendrapal Kashiram Sharma Vs. Manager IDBI Bank and others, (supra) has held that Right to Call Option is correct and the revision petition was dismissed.

So due to our above discussion the amount of Rs.16901/- was paid by the OPs to the complainant when the Call Option was exercised by them and the complainant is not entitled to any other amount. The complaint is dismissed accordingly.        Parties  are to bear their own costs.

ANNOUNCED

DATED:5.11.2020       

                             Vinod Kumar Gulati             Jasjit Singh Bhinder

                                    Member                                       President