Bank stopped widow from accessing matured FDs; consumer panel orders Rs 13.87 lakh payment
NEW DELHI: A Kerala district consumer commission has directed a cooperative bank to pay Rs 13.87 lakh to a depositor after it restricted her withdrawals from her savings account despite her fixed deposit hit maturity. The commission also awarded Rs 25,000 compensation and Rs 3,000 litigation costs in an order passed on September 17, 2026.Why did the depositor approach the consumer commission?According to the commission order, the woman had four fixed deposits with the Kandala Sahakarana Sangham Cooperative Bank. After the deposits matured, their proceeds were transferred to her savings account with the bank.The woman initially had Rs 7.44 lakh credited to her account after two fixed deposits were closed. However, the bank allowed her to withdraw only Rs 50,000 and did not release the remaining amount.She later sought the money for her mother’s medical treatment and also to repay arrears on a gold loan. Two more fixed deposits of Rs 4 lakh each were subsequently transferred to her savings account. The commission recorded that Rs 13.87 lakh remained in the account as on May 15, 2023.However, the bank argued that withdrawals had been restricted after an inquiry under the Kerala Cooperative Societies Act found irregularities. It said the Registrar of Cooperative Societies had directed it to disburse deposits according to a priority list prepared by a committee.Why did the commission hold the bank responsible?The bench comprising President P V Jayarajan along with members Preetha G Nair and Viju V R held that the Consumer Protection Act, 2019 provides an additional remedy and therefore the complaint could be heard despite the bank’s objection based on the Kerala Cooperative Societies Act.The commission observed that the bank had admitted the fixed deposits, their maturity and transfer of the money into the woman’s savings account. The commission said the bank’s internal inquiry could not justify delaying the payment.“The enquiry under section 65 of Kerala Co operative Societies Act against the directors and staff of the bank and the consequential departmental directions if any to the opposite party bank cannot be attributed as a justifiable reason for the delay in disbursing the amount deposited by the 2nd complainant with the opposite party bank,” the commission further observed.The commission then noted that the woman was a widow and had claimed the money in the bank was her only source of income.“The second complainant made the deposits in good faith with an expectation that the said amount will be available to her from the opposite party bank as and when any need arises to her. It is important to note that the responsibility of the opposite party bank to ensure that its consumer is satisfied with its services and the deposit is made available to her when she raised the demand for the same,” the bench added.The commission found that the bank had not produced documents supporting its claims about the Section 65 inquiry or the directions allegedly restricting withdrawals.“From the available evidence before this commission, we find that there is deficiency in service and unfair trade practice on the part of the opposite parties. It is also evident from the evidence adduced by the complainant that the complainant has suffered mental agony and financial loss due to the act of the opposite parties,” it added.The commission allowed the complaint and held the bank and its branch jointly and severally liable.It directed them to pay Rs 13,87,408 to the depositor with 9 percent annual interest from February 22, 2023, the date of filing the complaint. It also ordered Rs 25,000 compensation and Rs 3,000 towards litigation costs.The amount was directed to be paid within 30 days of receipt of the order. If the payment is delayed, the Rs 13.87 lakh amount and compensation will carry 9 percent annual interest from the date of the order until realisation.
