Consumers Commission imposes ₹50,000 fine on India Post, directs the Department to pay pending interest to PPF customer

Published - May 10, 2024 09:36 pm IST - MANGALURU

Human Rights Protection Foundation president Ravindranath Shanbhouge speaking to reporters along with complainant Venkatesh Kamath on Friday, May 10, in Udupi.

Human Rights Protection Foundation president Ravindranath Shanbhouge speaking to reporters along with complainant Venkatesh Kamath on Friday, May 10, in Udupi. | Photo Credit: UMESH S. SHETTIGAR

The Udupi District Consumer Disputes Redressal Commission imposed a ₹50,000 fine on India Post for deficiency of service and directed the Department to pay interest amount towards a public provident fund (PPF) account held by a senior citizen, which it had refused to pay citing technical grounds.

Ravindranath Shanbhogue, president, Human Rights Protection Forum, Udupi, told reporters on Friday, May 10, in Udupi, that the Commission directed the Department to pay ₹11 lakh interest on the PPF investment made by complainant Venkatesh Kamath of Sanoor in Karkala taluk.

Mr. Kamath had opened a PPF account as the head of a Hindu Undivided Family (HUF) at the Karkala Post Office for the family and his old age benefits in 2001 for 15 years. On the date of maturity in 2016, the post master advised him to continue the contribution when he went to close the account. Accordingly, he renewed the account for five years and once again for another five years in 2021.

However, a letter of June 22, 2023, by the Senior Superintendent of Post Offices, Puttur Division, asked him to immediately close the PPF account and visit the post office. He was told at the post office that India Post by its May 13, 2005, order had discontinued PPF accounts of HUF saying only individual PPF accounts could be opened. Accordingly, his PFF account should have been closed in 2016 itself, he was told. The omission was noticed when the audit was done in May 2023. The postmaster also told him that interest accrued beyond 2016 would not be paid, to which he protested.

After failing to get justice through the department, Mr. Kamath approached the foundation, which supported his case before the Consumer Commission, Dr. Shanbhouge said. He said despite clear orders by the Union government, officials at the India Post and the State Bank of India continued to periodically renew PPF accounts of HUF families, though they did not open new accounts. Whenever depositors protested over the deduction of interest amount beyond the stipulated years, they advised them to approach courts.

Dr. Shanbhogue wondered why the Union Finance Ministry did not issue a direction to pay such interests when the National Consumer Disputes Redressal Commission had clearly upheld the right to receive interest.

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