NCDRC Directs HSBC Bank To Pay Rs. 15 Lakhs Compensation For Negligence And Deficient ServiceNCDRC Directs HSBC Bank To Pay Rs. 15 Lakhs Compensation For Negligence And Deficient Service

NCDRC’s Verdict: HSBC Bank to Pay ₹15 Lakh Compensation for Harassment Over Dishonoured Cheques: In a significant ruling, the National Consumer Disputes Redressal Commission (NCDRC) has directed HSBC Bank to provide a compensation of ₹15 lakh to a couple for the harassment and mental agony they endured. The couple’s cheques were dishonoured by the bank, despite having sufficient funds in their account. The NCDRC deemed HSBC Bank’s actions as unjustifiable and ruled in favor of the complainants.

HSBC Bank’s Troubling Actions: NCDRC Awards ₹15 Lakh Compensation to Couple Over Cheque Dishonour

The case of Anil Milkhiram Goyel and Anr v. HSBC Limited shed light on the couple’s distressing experience. The bank had frozen their account, alleging non-payment of an outstanding loan amount of approximately ₹1,80,000, and claimed that their Know Your Customer (KYC) details were not updated.

Presiding over the case, Dr Inder Jit Singh of the NCDRC thoroughly examined the evidence and found no basis for the bank’s classification of the complainants as high-risk customers requiring frequent KYC updates every two years, as per Reserve Bank of India (RBI) guidelines. Furthermore, the Commission discovered that the loan accounts in question had already been settled and closed in 2009 and 2010.

Account Freeze Backfires: HSBC Bank Forced to Pay ₹15 Lakh Compensation for Unjust Treatment

According to Anil and Neelam Goyel, they encountered an alarming situation in November 2015 when they attempted to withdraw money from an ATM. Their transaction was declined, and upon contacting the bank, they were informed that it failed due to their KYC details not being updated.

Despite having updated their KYC in May 2015, they were instructed by the bank’s branch in Fort, Mumbai, to repeat the process. To their surprise, they were then informed of an outstanding loan amount associated with their savings account, despite the loans having been settled previously.

Frustrated by the bank’s actions, the complainants approached the NCDRC in 2016, alleging deficiency in service and seeking compensation of ₹3.55 crores for the distress caused to them.

HSBC Bank admitted that the loan accounts had been settled but justified freezing the account by claiming that Neelam had failed to provide updated KYC documents.

HSBC Bank’s Negligence Costs Them: NCDRC Orders ₹15 Lakh Compensation for Cheque Dishonour

After careful examination of the facts, the NCDRC concluded that HSBC Bank’s decision to freeze the couple’s joint savings account was unwarranted and had caused significant adverse effects on the complainants. The Commission determined that the bank’s actions amounted to a deficiency in service, resulting in unwarranted humiliation, embarrassment, and damage to their reputation.

While acknowledging the complainants’ entitlement to compensation, the NCDRC did not award the full claimed amount of ₹3.55 crores. The reason cited was the absence of sufficient evidence demonstrating the exact extent of the couple’s losses.

Cheque Dishonour Debacle: HSBC Bank Slapped with ₹15 Lakh Compensation by NCDRC

Consequently, the NCDRC ordered HSBC Bank to pay ₹15 lakh as compensation and ₹1 lakh to cover litigation expenses. Additionally, the bank was instructed to unfreeze the couple’s account and refrain from demanding any further amount related to the settled loan accounts.

Advocates Pulkit Deora, Vidit Gupta, and Prachi Gupta effectively represented the complainants, while Advocates Devmani Bansal and Shresth Sethi represented HSBC Bank in the case.

Account Freeze Backfires: HSBC Bank Forced to Pay ₹15 Lakh Compensation for Unjust Treatment

This ruling by the NCDRC serves as a significant precedent, emphasizing the importance of fair treatment and customer satisfaction in the banking sector. It reinforces the notion that customers should not face undue harassment and mental agony due to the unjust actions of financial institutions, thereby promoting accountability and justice in consumer disputes.

Case: Anil Milkhiram Goyel & Anr v. HSBC Limited

Counsel for Complainants: Mr. Pulkit Deora, Mr. Vdit Gupta, and Mr. Prachi Gupta

Counsel for Respondents: Mr. Devmani Bansal with Mr. Shresth Sethi