Bank asked to pay ₹1 lakh penalty to loanee

Land title deed, submitted as security, was not returned to loanee for seven years

A consumer forum has directed Bank Of India to pay compensation of ₹1 lakh to a Moti Nagar resident for not returning agricultural land title deeds deposited as security for a loan.

The complainant, V. Arun Jyothi (50) repaid the loan in 2011 and asked for the documents, but a bank representative had told them they were “safe, but not traceable”.

To retrieve them, Ms. Jyothi filed an RTI application. While a copy of her account statement was given to her, the title deeds remained unavailable. Contesting the claims, the bank said the documents were handed over to her and her acknowledgement recorded in a register.

After taking the statements of both parties and the documents into consideration, the Hyderabad Forum – III, which was dealing with the complaint, said it was not possible to believe the ‘version’ of the bank about the title deeds having been returned.

In addition to the compensation, the forum directed Bank of India (Mehdipatnam branch) to pay litigation costs of ₹10,000.