Sunday, April 21, 2013

Bank fined For Wrong Return of Cheque

Bank bounces cheque, told to pay customer Rs 10k-Times of India
BANGALORE: The KG Road branch of Vijaya Bank was ordered to pay Rs 10,000 as compensation and Rs 1,000 as litigation cost to an SB account holder for bouncing a cheque issued by the latter to another party, despite the amount being available in his account. 

The order was passed by Bangalore IV Additional District Consumer Disputes Redressal Forum, Bangalore Urban district, on April 12, based on a complaint from a senior citizen and veterinary (wildlife) consultant, Dr NK Rai, 71, against the bank. 

The case 

In his complaint, Dr Rai said he was an SB account holder with the bank since 1961 and always maintained sufficient balance, and neither did he have any liability with the bank. Dr Rai issued a cheque for Rs 4,88,000, dated May 16, 2012, to M Venkatesh, sure that his account had enough balance. 

But when Venkatesh presented the cheque from his Canara Bank account, Basaveshwara Nagar branch, the cheque was dishonoured and returned, citing "insufficient funds". A shocked Dr Rai convinced Venkatesh his account had sufficient money and asked him to present the cheque again. The cheque was dishonoured again on June 2, 2012. 

The bank failed to reply to Dr Rai's notice accusing it of deficiency of service, causing him mental agony and bringing him disrepute. Dr Rai demanded that the bank pay him a compensation of Rs 10,00,000. After the bank failed to reply, the senior citizen filed a complaint with the consumer forum. 

The defence 

The bank's defence was that the complainant was a guarantor for a loan availed by Jyothi Shetty, proprietrix, Vigneshwara Associates, T Dasarahalli. The bank pointed out that Jyothi was Dr Rai's wife and he stood guarantee for the loan. It also alleged that Jyothi had borrowed Rs 4 lakh and failed to clear it. 

"Since he is the guarantor of the loan, the liability of the principal borrower and guarantor is joint and several. As and when the bank has informed the complainant there is an outstandingamount, he has in turn informed that his wife will clear her debts and only she is responsible for the dues, though he is the guarantor for the loan... Since the complainant and his wife failed to repay the loan, the bank has exercised its lien over the funds in the account of the complaint. However, subsequently the lien noted on his account has been withdrawn and released the lien. In the meantime, the cheque issued by the complainant got bounced," the bank said, adding "there is absolutely no deficiency of service" on its part. 

The verdict 

After examining the evidence and listening to both parties, the court observed the outstandingbalance on Jyothi Shetty's loan account was only Rs 82,840. It said the statement of account proved the balance in the complainant's account on the day the cheque bounced, was Rs 4,88,296.67. The court said the bank had kept lien on the complainant's account without informing him. 

"If at all there was the balance loan in the name of the complainant's wife, the bank should have taken legal action against her, as per banking rules and regulations," the court said. 

It said the complainant has established with convincing evidence that the bank has been negligent and there has been deficiency in service on the part of the bank.
http://timesofindia.indiatimes.com/city/bangalore/Bank-bounces-cheque-told-to-pay-customer-Rs-10k/articleshow/19670987.cms

Monday, April 15, 2013

Bank Cannot Furnish Bank Statement in court Case


Cyber law experts see it as a landmark judgement; say it will prevent misuse of bank statement of individuals

In a judgement delivered today by the Adjudicating Officer of Maharashtra, it was observed that an employer cannot get an employee or ex-employee’s bank statement and furnish it in any court case, by the Information Technology (IT) Act, 2000.

“This is a landmark judgement that will prevent misuse of an individual’s bank statement. The judgement has ruled that this amounts to Data Theft of Sensitive Personal Information under Section 43 (b) Read with Section 66 of the Information Technology (IT) Act, 2000,” said cyber law expert and advocate Prashant Mali, who argued the case.

The judgement pertained to a case where the complainant, Amit Patwardhan, was an employee of Rud India Chains and later left the company to join a rival firm, Heko Chains. Rud India claimed he took away company secrets and was getting gratification from Heko Chains to lure away customers even when he was employed by them. Rud India filed a civil suit to claim damages for this theft of trade secrets. Patwardhan came to the forum and alleged  his bank statement was filed by the company as evidence in the court case and that it was obtained by hacking into the bank system.

The bank concerned, Bank of Baroda, too said it had no knowledge about how the bank statements were obtained by the company and that the bank did not have a policy of giving out such information, without customer approval.

In response, Maharashtra Government IT secretary Rajesh Aggarwal, serving as the adjudicating officer said while the bank denied involvement, it had done nothing on its own to find how this occurred. “This speaks volumes about the apathy of the bank regarding the privacy of its customers’ sensitive data,” further pointed the adjudicating officer in the judgement delivered. However, as they are not a party to the case, the bank has not been held liable.

The Adjudicating Officer also said that here, the IT Act came into play, since the bank statement had not come from physical records of the bank, but from its electronic records. Hence, the respondents were held guilty of violating Section 43 (b) of IT Act, read with section 66. While no punishment has been imposed, the respondents have been held guilty of violating the privacy of Patwardhan.

Punishment was not imposed, as the adjudicating officer observed that perusal of the entire record before the Officer per prima facie showed the complainant was disloyal.

Petrol prices cut by Re 1 a litre

A litre of petrol in Delhi and Mumbai will cost Rs 66.09 and Rs 72.88, respectively