SC: Person who Avails any Banking Service Comes under Definition of ‘Consumer’ Under Consumer Protection Act


Shashwati Chowdhury

Published on: August 24, 2022 at 21:44 IST

According to the Supreme Court’s ruling, anyone who uses a banking service falls under the definition of “customer” in the Consumer Protection Act and is eligible to use the legal remedies it provides.

The consumer complaint in a dispute involving the bank’s premature encashment of a joint fixed deposit in violation of the terms and conditions is maintainable.

Anyone who uses any service provided by a bank will be considered a “consumer” within the meaning of the Consumer Protection Act.

The bench comprising of Justices DY Chandrachud and AS Bopanna observed that,

“A person who avails of any service from a bank will fall under the purview of the definition of a ‘consumer’ and it would be open to such a consumer to seek recourse to the remedies provided under the Consumer Protection Act.”

The complainant and his father had opened a joint FD at HDFC Bank in this case. In the complainant’s and his father’s names, 75 lakhs had been deposited over the course of 145 days. In response to a request made by the complainant’s father on May 31, 2016, the FD amount was credited to the father’s account.

The complainant claimed in his complaint to the State Consumer Disputes Redressal Commission in Lucknow that he and his father had jointly instructed the bank to renew the FD for a period of ten days upon its maturity, but that in spite of this, the money was only credited to the father’s account.

The SCDRC held that because the dispute primarily involved the complainant’s father and the amount of the FD deposit, only a civil court was competent to hear it. The appeal was dismissed as withdrawn by the NCDRC.

In a later review application, the complainant stated on affidavit that he had not given instructions to his lawyer to request the withdrawal of the appeal. The same, however, was not entertained.

The court noted that the complaint’s main claim is that there was a deficiency on the part of the respondent bank when it proceeded to credit the proceeds of a joint FD primarily to his father’s account.

As a result, the court directed the NCDRC to decide the appeal on the merits.

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