Punjab National Bank Held Liable for closing FD without consent of customer

The District Consumer Disputes Redressal Commission-II, U.T. Chandigarh bench, consisting of Shri Amrinder Singh Sidhu (President) and Shri B.M. Sharma (Member), recently ruled that Punjab National Bank (PNB) was responsible for the premature encashment of a Fixed Deposit Receipt (FDR) without the consent of the complainant. The bank was directed to reimburse the loss suffered by the complainant, along with 7% interest.

Background of the Case

The complainant, acting as the Karta of a Hindi Undivided Family, had invested Rs. 36,16,080/- in five Fixed Deposit Receipts (FDRs) with Punjab National Bank. One of the FDRs, with an amount of Rs. 15,95,329/- and an interest rate of 6.75%, was set to mature on July 20, 2019. Upon maturity, PNB credited Rs. 10 lakh into the complainant’s savings account and renewed the FDR for the remaining amount until July 20, 2020. Subsequently, the FDR of Rs. 7,47,531/- was renewed at an interest rate of 6.05% p.a. However, PNB broke the FDR without the complainant’s consent and credited Rs. 8,35,560/- at a lower interest rate of 5.30% per annum to the complainant’s account. Despite the complainant’s attempts to communicate with PNB, no satisfactory response was received. As a result, the complainant filed a consumer complaint with the District Consumer Disputes Redressal Commission-II, U.T. Chandigarh.

PNB’s Response and Commission’s Findings

PNB contended that the complainant had requested closure details of the FDR on December 2, 2022, expressing dissatisfaction with the interest rates. Due to an unintended entry, the amount was credited to the complainant’s account without a penalty. The complainant was then advised to reinvest the amount in another FDR, which was done on December 31, 2022. PNB argued that the initial recording of the FDR with incorrect details was a result of a system error, which was later rectified during a data cleansing exercise. Furthermore, PNB claimed that the complainant’s subsequent demands for compensation were met with an offer of Rs. 5,000/- as compensation, which was credited to the complainant’s account.

After examining the evidence, including a photocopy of the FDR issued by PNB, the District Consumer Disputes Redressal Commission-II, U.T. Chandigarh found that the premature encashment of the FDR by PNB without the complainant’s consent or prior notice constituted a deficiency in service. Additionally, the act of crediting a lower amount at a reduced interest rate into the complainant’s account was deemed a clear case of deficiency in service and unfair trade practice. As a result of PNB’s deficient services, the complainant suffered a loss of Rs. 64,125/-.

Commission’s Decision and Compensation

Consequently, the District Consumer Disputes Redressal Commission-II, U.T. Chandigarh directed PNB to compensate the complainant with Rs. 64,123/- (calculated as Rs. 8,99,683/- minus Rs. 8,35,560/-) for the premature encashment of the FDR, along with an interest rate of 7% per annum.