The National Consumer Disputes Redressal Commission (NCDRC) has ordered ICICI Bank to pay Rs 25 lakh in compensation for losing a customer's original property documents deposited as collateral for a housing loan. The bank's negligence in safeguarding these documents, which were lost in transit, led to the ruling, with the NCDRC rejecting the bank's attempt to shift responsibility to a courier company. The decision highlights the importance of responsible document management by financial institutions and underscores the consequences of service lapses.
The National Consumer Disputes Redressal Commission (NCDRC) recently issued a significant directive to ICICI Bank, compelling them to pay a substantial compensation of Rs 25 lakh. This decision stems from the bank's unfortunate loss of the original property title documents that had been deposited with them by a complainant as collateral for a housing loan.
The case, which came before Presiding Member Subhash Chandra, was filed by Manoj Madhusudhanan, represented by advocate Swetank Shantanu. Madhusudhanan had sought compensation for what he considered a clear deficiency in the services provided by ICICI Bank in this matter.
The narrative unfolds with ICICI Bank having approved a housing loan amounting to Rs 1.86 crore in Bangalore back in April 2016. Following the execution of the sale deed, the bank retained several crucial original property documents, including the registered sale deed and possession certificate. Unfortunately, the bank failed to provide scanned or true copies of these vital documents to Madhusudhanan.
In response to this lack of action on the part of the bank, Madhusudhanan lodged a complaint in June 2016. It was subsequently revealed that the documents had been lost in transit from Bangalore to the bank's central storage facility in Hyderabad, all while in the care of a courier company enlisted by the bank.
Frustrated by the lack of resolution from ICICI Bank, Madhusudhanan turned to the Banking Ombudsman for assistance. In September 2016, the Banking Ombudsman directed the bank to issue a duplicate copy of the lost documents, mandate a public notice regarding the loss, and pay Madhusudhanan a sum of Rs 25,000 as compensation for the deficiency in service.
Madhusudhanan, however, was not satisfied with this outcome. He escalated the matter to the national consumer commission, contending that ICICI Bank had displayed "extreme negligence" and emphasizing that "copies of documents cannot replace the sanctity of the original documents." He sought a significantly larger compensation amounting to Rs 5 crore, asserting that he had suffered considerable mental distress and financial loss due to this ordeal.
The NCDRC examined the evidence presented before it and concluded that Madhusudhanan's claim for compensation on the grounds of deficiency in service was indeed valid and legitimate. Furthermore, it emphasized that the core issue here was compensating the complainant for the service lapse and indemnifying him against any potential future loss.
Significantly, the commission made it clear that ICICI Bank could not evade responsibility by shifting the blame onto the courier company. In essence, it held the bank accountable for its actions, or lack thereof.
The NCDRC, having scrutinized the facts and circumstances surrounding the case, ruled in favour of Madhusudhanan against ICICI Bank. It ordered the bank to secure, at its own expense, all the reconstructed and duly certified copies of the documents that Madhusudhanan had submitted as collateral at the time of the sale deed's registration for the housing loan sanctioned by the bank.
In addition to this, the NCDRC instructed ICICI Bank to pay a substantial compensation of Rs 25 lakh to Madhusudhanan for the deficiency in services, along with an additional Rs 50,000 to cover the litigation costs incurred during this protracted legal battle.
In conclusion, this case serves as a poignant reminder of the importance of safeguarding and responsibly handling vital documents entrusted to financial institutions, emphasizing the gravity of lapses in service that can lead to severe repercussions for both parties involved.
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