The State Consumer Disputes Redressal Commission, Chennai, has directed the State Bank of India to return ₹55,91,300 along with interest of 18% a year from February 28, 2011 till the date of realisation to a businessman for deficiency in service.
The commission has asked the bank to pay a compensation of ₹5 lakh towards mental agony and cost of ₹10,000 in the case filed by V. Manickam, managing director, Manickam Engineers Pvt. Ltd.
Mr. Manickam had taken loan of ₹10.20 crore as a customer of SBI , also utilising the bank guarantee for government work contract. All the bank guarantees expired in 2007.
According to his petition, after the expiry of bank guarantees, the SBI forced him to deposit ₹55,91,300 for the expired guarantees. Later, his account was closed. However, the SBI refused to return the deposit made against the guarantees. The commission ruled that it was an unfair trade practice followed by the SBI as there was no need for the consumer to deposit the said amount towards the expired bank guarantee.
The order said the timeframe for payment was one payment from the date of order, failing which the amount shall carry interest at 12% a year, from the date of default till payment.
