The State Bank of India has been told to pay Rs. 11 lakh by the Delhi consumer commission for disregarding an order from an Italian company of dishonoring cheques from a lost chequebook.
The charge was levied on SBI by Delhi State Consumer Disputes Redressal Commission president Barkat Ali Zaidi and member M.L. Sahni. The commission said, “When a banking institution is guilty of negligence, it cannot shirk its liability to make good the loss suffered by a consumer due to a deficiency in service. In the present case, the admitted facts constitute deficiency in service on the part of the bank, which, therefore, is held liable to indemnify the loss suffered by the complainant”.
The SBI has been told to pay Rs. 11 lakh to the company for releasing the payments. Another Rs. 10,000 has been levied as legal expenses.
The bank defended its stand saying that it had honored only those cheques for which no instruction had been given by the company to stop payment.
The case dates back to 2003. The Italian company had told the bank that as it had lost a chequebook it must ensure no payment is released for the lost unused cheques. The details of the used cheques were given to the bank.
But SBI ignored the instruction and released cheques valued Rs. 11 lakh from the lost ones. This made the company go to the consumer court for compensation.
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