2006 (10) TMI 518 - Commission - Indian Laws

Summary

Issues Involved:
1. Deficiency in service and negligence by the bank.
2. Quantum of compensation payable to the complainants.

Detailed Analysis:

Issue 1: Deficiency in service and negligence by the bank

This case highlights the extent of negligence or fraud that bank officers can commit. The complainants had been allotted a bank locker in 1979, which was broken open in 1997 by a previous allottee, with the connivance of bank officers, resulting in the theft of valuable items. The complainants filed a complaint alleging deficiency in service by the bank.

The complainants had been regularly paying the rental charges for the locker and last operated it in April 1997. When they attempted to access the locker in March 1998, they discovered it had been broken open by a previous allottee, Mr. Ramender Singh, who had removed all the contents. The bank admitted to a mistake/negligence by their staff in a reply to a legal notice sent by the complainants.

Mr. Ramender Singh was arrested and admitted to the fraud, returning some cash and melted gold to the bank, which was handed over to the complainants. The complainants provided a detailed list of the stolen items and their valuation, supported by a government-approved valuer's report.

The bank argued that the locker was originally allotted to Mr. Ramender Singh and that his surrender of the locker was not properly recorded. When Mr. Singh requested the locker be broken open, the bank allowed it without verifying the records or preparing an inventory of the contents. The bank contended that the relationship with the complainants was that of a landlord and tenant, not a bailer or bailee, and hence they were not responsible for the contents.

The commission found gross negligence and deficiency in service by the bank. The bank's failure to maintain proper records and follow procedures laid down by the Reserve Bank of India contributed to the fraud. The commission rejected the bank's argument that they were not responsible for the contents of the locker and held them liable for the loss.

Issue 2: Quantum of compensation payable to the complainants

The complainants claimed a total loss of Rs. 18 lakhs and an additional Rs. 5 lakhs for mental shock and harassment. They provided affidavits and photographs to support their claim of the stolen items, which included valuable jewelry given to their daughter-in-law at her wedding. The valuation report by a government-approved valuer corroborated the complainants' claims.

The commission accepted the complainants' evidence and found no reason to doubt the accuracy of the FIR and the valuation report. The commission determined that the complainants had lost golden ornaments and jewelry valued at Rs. 17,51,489/-.

Conclusion:

The commission concluded that there was clear deficiency in service and gross negligence on the part of the bank. The bank was directed to pay Rs. 17,51,489/- with interest at the rate of 9% per annum from the date of filing the complaint until the date of payment. Additionally, the bank was ordered to pay Rs. 25,000/- to compensate for the costs, mental agony, and harassment caused to the complainants. The complaint was allowed accordingly.