The District Consumer Disputes Redressal Commission, Palakkad (Kerala), comprising President Sri Vinay Menon V., Member Smt. Vidya A., and Member Sri Krishnankutty N.K., held Axis Bank accountable for wrongfully penalizing a customer with a cheque bounce fee due to the premature presentment of a cheque. The Commission ruled that under the Negotiable Instruments Act, the Bank was responsible for adhering to statutory requirements, including presenting cheques during banking hours.
Brief Facts:
The complainant, a loan borrower from Axis Bank, faced issues when repaying an installment. Unable to deposit funds the day before the due date due to a holiday, he deposited the amount at 7 AM on the due date, before business hours. Despite this, the Bank dishonored the cheque, which had been processed at midnight, and imposed a Rs. 400/- cheque bounce charge. Additionally, when the complainant closed his loan account, the Bank mistakenly recorded the wrong sale deed number on the list of returned security documents.
Aggrieved by these actions, the complainant approached the District Commission, alleging deficiency in service. The Bank defended itself by citing its automated system, which processed cheques automatically at midnight, and admitted to the document error but claimed it was promptly rectified.
Observations by the Commission:
- Cheque Presentment Issue:
The District Commission referred to Section 65 of the Negotiable Instruments Act, which requires cheques to be presented only during banking hours. It held that the Bank’s premature presentment violated statutory obligations and that automation cannot excuse non-compliance with the law. - Document Error:
While the Commission acknowledged the Bank’s error in recording the sale deed number, it determined that this mistake, though inconvenient, was promptly corrected and did not amount to a significant deficiency in service.
Verdict:
The Commission partially upheld the complaint, finding the Bank guilty of service deficiency for the wrongful imposition of the cheque bounce fee but exonerating it regarding the document error. The Commission directed Axis Bank to:
- Refund the Rs. 400/- bounce charge.
- Pay Rs. 25,000/- as compensation for the inconvenience caused.
- Pay Rs. 10,000/- towards legal costs.
This judgment emphasizes the responsibility of banks to comply with statutory regulations and underscores that automation cannot excuse violations of customer rights.
