BANKING

A. Balu misplaced his State Bank of India (SBI) passbook. On realizing the loss, he wrote to the Thattanchavady Branch of the SBI where he held the account. During discussions with the bank, he learnt that Rs. 20,000 had been fraudulently withdrawn from his account. Balu informed the bank about the transaction and also lodged a police complaint. When the Branch Manager and the accountant verified the signature on the withdrawal slip with his original signature, they found them different. The bank’s negligence in verifying the signatures became evident.

After prolonged discussions, the bank credited the amount to Balu’s account as a 46-day term deposit but Balu was not entitled to the amount till the matter was resolved. On completion of 46 days, the bank refused to pay him the deposit amount and interest. It informed him that the deposit would be renewed for a further period of 46-days and the receipt would be kept in its custody till the police solved the matter.

After waiting patiently for four and a half years, Balu approached CERS. CERS took up the matter with the SBI. The bank finally agreed to pay Rs. 32,467 (Rs. 20,000 with 10 per cent interest per annum).