Delhi consumer court orders post office to pay ₹15k penalty for failure to maintain bank customer's KYC details

A District Consumer Dispute Redressal Commission (DCDRC), Delhi recently ordered the Post Office at Mayur Vihar to pay ₹15,000 to a banking customer for failing to properly maintain his Know Your Customer (KYC) details on their system [Kamaljit Chibber v Post Master]..The issue came to light after a cheque issued by the customer to transfer some money from his bank account was dishonoured citing the absence of the customer's signature details on the bank's database. .The coram comprising of President SS Malhotra and members Rashmi Bansal and Ravi Kumar noted that the information was provided years ago by the customer when he opened the bank account. As such, the consumer forum concluded that the bank was guilty of negligence as they were expected to ensure their KYC database was maintained properly once the details are handed over by customer. Therefore, it asked the consumer court to pay a compensation of ₹10,000 and ₹5,000 as litigation costs to the customer, with 6 percent (per annum) interest from November 5, 2019 when the cheque was dishonoured. ."OP (post office) is under legal duty and obligation to update the signature of the complainant right then the time of opening of the account ... It is also no excuse on the part of OP that no transaction has taken place in the accounts for almost 2 years and 4 months. This does not give any right to OP to not properly maintain the account opened with it and not to update the KYC of the account holders," the DCDRC order stated. .By way of background, the customer had two accounts with the post office and intended to transfer funds from one of them.To facilitate the transfer, he issued a cheque of ₹1 lakh. However, the cheque was dishonored by the bank (post office) on the grounds that the customer's signature was not present in their database.In response, the bank requested the customer to provide his signature details again.Instead of complying with bank's request, the customer filed a complaint, alleging negligence or raising concerns of potentially fraudulent activity.He contended that he had provided his signature during the KYC process years ago and suspected that another signature might have been uploaded to the bank's database.The complainant has also reported the matter to to the Ministry of Communication, alleging mischief, corruption, and criminal activity by the bank.He raised concerns that there may be a conspiracy to seize his funds and that another signature might have been uploaded on the bank's database, leaving open the possibility of his money being withdrawn by someone else..The post office countered that the complainant was unnecessarily raising hue and cry just to extort money and that he did not appear interested in actually resolving the matter despite requests to provide details of his signature after the issue arose. The post office added that they shifted offices in 2018 due to renovation work and that the customer's details may have been inadvertently misplaced in the process. .The consumer court, however, was not convinced by the post office's submissions. Rather, it concluded that there was negligence on the post office's part.The complainant/ customer has suffered inconvenience, harassment, mental agony because of the deficient service of the post office and he cannot be forced to accept a deficient service, the consumer commission added. .Therefore, the commission decided to award the complainant exemplary compensation considering the extent of the negligence committed by the bank.."Therefore, the ends of justice would meet if the complainant is compensated to the extent of Rs. 10,000/- for his sufferings, Rs.5,000/- towards litigation cost along with interest at the rate of 6% p.a. from the date of dishonouring of the cheque i.e. 05.11.2019 to be paid by OP to the complainant within 30 days from the date of passing of the order failing which the OP shall be liable to pay interest at the rate of 9% per annum from 05.11.2019 till the final realisation by the complainant," the November 2 order stated. .The DCDRC added that the post office should also pay the the customer the money deducted from his account (₹296) when the cheque was dishonoured. .[Read Order]