Coop. bank told to unfreeze SB Account of retired bank employee

The Udupi District Consumer Disputes Redressal Commission has directed the General Manager of the Teachers’ Cooperative Bank’s branch in Udupi to unblock the SB Account of a retired employee of the bank and allow the latter to transact in the account.

The District Commission headed by Sunil T. Masaraddi has directed the bank to pay 10% per annum interest on ₹8.64 lakh in the SB account since blocking the account on February 26, 2020. It has also asked the bank to pay ₹1 lakh towards mental agony and ₹10,000 towards cost of litigation.

In the complaint, 62-year-old complainant K. Jayarama Somayaji from Vaderahobli in Kundapura of Udupi district said he retired as the in-charge manager of the bank’s branch in Belthangady of Dakshina Kannada on August 31, 2019. A retirement benefit of ₹6.54 lakh and gratuity of ₹2.09 lakh was credited to his SB account maintained by the bank.

The bank has unauthorisedly, illegally and against banking norms blocked his account and thus disabled him from using the money in his SB account, he alleged.

In reply, General Manager of the bank said the District Commission is barred from entertaining the complaint as per Section 70 (1)(c) of the Karnataka Cooperative Societies Act. He said the complainant was facing charges of misusing his power as the in-charge branch manager and sanctioning loan to non-teachers. As this loan amount was not recoverable, the SB account of Mr. Somayaji has been blocked. The bank was forseeing disciplinary proceedings against him, the official said.

Turning down the contention of the bank in its order dated September 27, the Commission comprising of Mr. Masaraddi and members Sujatha B. Koralli and E. Prema said being an SB account holder Mr. Somayaji was the consumer of the bank and the act of blocking the account was bank’s deficiency of service.

The provisions of the Consumer Protection Act was in addition to and not in derogation of any other provisions of law. The complainant may elect or opt for any one of the remedies for redressal of his/her grievance.

Noting that the bank till date has not initiated any legal action for alleged misuse of power for sanctioning loan to non teachers, the Commission said, “Hence bank is not permitted to block the SB Account for indefinite period and that too unspecified amount.”