consumer case - The appellant is a temple situated in the State of Tamil Nadu. It is one of the ancient temples of Lord Kartikeya and is considered prime among the six holiest shrines of the Lord. Every year, lakhs of devotees throng the temple which is situated on a hill to receive the blessings of the Lord. The temple is being administered by the Hindu Religious and Charitable Endowments Department of the Government of Tamil Nadu. The devotees make offering in cash and kind to the deity. The cash offerings are collected and invested in various forms. The income derived from such investments is utilized for charitable purposes such as prasadams, hospitals, schools and orphanages. (b) According to the appellant, it had deposited a huge sum of money totaling to Rs.1,40,64,300/- with the Post Master, Post Office, Palani from 05.05.1995 to 16.08.1995 for a period of five years under the `Post Office Time

                                                         REPORTABLE


              IN THE SUPREME COURT OF INDIA


               CIVIL APPELLATE JURISDICTION


               CIVIL APPEAL NO. 4995  OF 2006




Arulmighu Dhandayudhapaniswamy

Thirukoil, Palani, Tamil Nadu, thr.

 Its Joint Commissioner                                  .... Appellant (s)



           Versus



The Director General of Post Offices,

Department of Posts & Ors.                          .... Respondent(s)





                         J U D G M E N T


P. Sathasivam, J.


1)    This appeal is filed by the appellant-Temple through



its   Joint   Commissioner   against   the   final   order   dated



31.05.2006   passed   by   the   National   Consumer   Disputes



Redressal   Commission   (in   short   "the   National



Commission")   at   New   Delhi   in   First   Appeal   No.   411   of



1997 whereby the  Commission dismissed their appeal.





                                                                          1


2)     Brief facts:


(a)    The   appellant   is   a   temple   situated   in   the   State   of



Tamil   Nadu.     It   is   one   of   the   ancient   temples   of   Lord



Kartikeya   and   is   considered   prime   among   the   six   holiest



shrines of the Lord.   Every year, lakhs of devotees throng



the   temple   which   is   situated   on   a   hill   to   receive   the



blessings of the Lord.  The temple is being administered by



the   Hindu   Religious   and   Charitable   Endowments



Department   of   the   Government   of   Tamil   Nadu.     The



devotees make offering in cash and kind to the deity.  The



cash offerings are collected and invested in various forms.



The   income   derived   from   such   investments   is   utilized   for



charitable   purposes   such   as   prasadams,   hospitals,



schools and orphanages.



(b)    According   to   the   appellant,   it   had   deposited   a   huge



sum   of   money   totaling   to   Rs.1,40,64,300/-   with   the   Post



Master, Post Office, Palani from 05.05.1995 to 16.08.1995



for   a   period   of   five   years   under   the   `Post   Office   Time





                                                                         2


Deposit Scheme' (in short `the Scheme').   On 01.12.1995,



the   Temple   received   a   letter   from   the   Post   Master,   Post



Office,   Palani-3rd  Respondent   herein   informing   that   the



Scheme   had   been   discontinued   for   investment   by



institutions   from   01.04.1995,   and   therefore,   all   such



accounts should be closed without interest.   The amount



deposited by the Temple was refunded only on 03.01.1996



without interest.



(c)    Aggrieved   by   the   decision   of   the   Postal   Authorities,



the   appellant,   on   10.01.1996,   sent   a   legal   notice   to   the



respondents   calling   upon   them   to   pay   a   sum   of



Rs.9,13,951/-   within   a   period   of   seven   days,   being   the



interest @ 12% p.a. on the sum of Rs.1,40,64,300/- from



the   dates   of   deposit   till   the   dates   of   withdrawal.     As



nothing   was   forthcoming   from   the   respondents,   the



appellant   preferred   a   complaint   before   the   State



Consumer   Disputes   Redressal   Commission   (in   short   "the



State   Commission").     Vide   order   dated   08.08.1997,   the





                                                                        3


State Commission was divided over its opinion in the ratio



of 2:1.   The majority opinion comprising of the Chairman



and   Member   II   dismissed   the   complaint   filed   by   the



appellant.  



(d)    Aggrieved   by   the   dismissal   of   the   complaint   by   the



State   Commission,   the   appellant   preferred   an   appeal   to



the   National   Commission   which   was   also   dismissed   on



31.05.2006.  Challenging the said order, the appellant has



preferred   this   appeal   by   way   of   special   leave   before   this



Court.



3)     Heard   Mr.   S.   Aravindh,   learned   counsel   for   the



appellant   and   Mr.   A.S.   Chandhiok,   learned   Additional



Solicitor General for the respondents.



4)     Points   for   consideration   in   this   appeal   are   whether



there was any deficiency in service on the part of the Post



Master,   Post   Office,   Palani-3rd  Respondent   herein   and



whether the appellant-complainant is entitled to any relief



by way of interest?





                                                                         4


Discussion


5)    We have already adverted to the factual details.   It is



the case of the respondents that the Central Government



had issued a Notification being No. G & SR 118(E) 119(E)



120(E)   as   per   which   no   Time   Deposit   shall   be   made   or



accepted   on   behalf   of   any   institution   with   effect   from



01.04.1995. It is not in dispute that the appellant-Temple



had   deposited   a   huge   sum   of   money   amounting   to



Rs.1,40,64,300/- with the Post Master from 05.05.1995 to



16.08.1995.  The said deposit was for a period of five years



under   the   Scheme.     Though   the   3rd  Respondent   had



accepted the amount under the said Scheme and issued a



receipt   for  the   same,   later   it  was   found  that   the   deposits



made   on   and   from   01.04.1995   were   against   the   said



Notification  which  amounted  to  contravention  of  the  Post



Office   Savings   Bank   General   Rules,   1981   (in   short   `the



Rules').





                                                                         5


6)      In   exercise   of   the   powers   conferred   by   Section   15   of



the   Government   Savings   Banks   Act,   1873,   the   Central



Government   framed   the   above   mentioned   Rules.     The



Rules are applicable to the following accounts in the Post



Office   Savings   Bank,   namely,   a)   Savings   Account   b)



Cumulative   Time   Deposit   Account   c)   Recurring   Deposit



Account   d)   Time   Deposit   Account   and   it   came   into   force



with effect from 01.04.1982.  Among various Rules, we are



concerned with Rules 16 & 17 which read as under:-  



        "16.  Accounts   opened   incorrectly.--(1)   Where   an   account

        is   found   to   have   been   opened   incorrectly   under   a   category

        other   than   the   one   applied   for   by   the   depositor,   it   shall   be

        deemed to be an account of the category applied for if he was

        eligible to open such account on the date of his application

        and   if   he   was   not   so   eligible,   the   account   may,   if   he   so

        desires, be converted into an account of another category ab

        initio, if he was eligible to open an account of such category

        on the date of his application.

        (2)   In cases where the account cannot be so converted, the

        relevant   Head   Savings   Bank   may,   at   any   time,   cause   the

        account to be closed and the deposits made in the accounts

        refunded to the depositor with interest at the rate applicable

        from time to time to a savings account of the type for which

        the depositor is eligible.

        17.  Accounts   opened   in   contravention   of   rules.--Subject

        to   the   provisions   of   rule   16,   where   an   account   is   found   to

        have   been   opened   in   contravention   of   any   relevant   rule   for

        the time being  in force  and applicable to the accounts kept

        in  the   Post  Office   Savings  Bank,   the   relevant   Head   Savings

        Bank may, at any time, cause the account to be closed and

        the deposits made in the account refunded to the depositor

        without interest."




                                                                                               6


Since the deposits in the case on hand relate to Post Office



Time   Deposit   Account,   Rule   17   of   the   Rules   is   squarely



applicable.   The  reading  of  Rule  17  makes  it  clear  that  if



any   Account   is   found   to   have   been   opened   in



contravention   of   any   Rule,   the   relevant   Head   Savings



Bank   may,   at   any   time,   cause   the   account   to   be   closed



and   the   deposits   made   be   refunded   to   the   depositor



without interest.  Rule 16 speaks that where an account is



opened   incorrectly   under   a   category   other   than   the   one



applied   for   by   the   depositor,   it   shall   be   deemed   to   be   an



account of the category applied for if a person is eligible to



open such account and if he is not so eligible, the account



may be converted into an account of another category  ab



initio,  if   the   person   so   desires   and   if   he   is   found   to   be



eligible.   For any reason, where the account cannot be so



converted,   the   account   is   to   be   closed   and   the   deposits



made   in   the   accounts   be   refunded   to   the   depositor   with



interest   at   the   rate   applicable   from   time   to   time   to   a





                                                                             7


savings   account   of   the   type   for   which   the   depositor   is



eligible.



7)       Before   considering   Rule   17,   it   is   useful   to   refer   the



communication   dated   01.12.1995   of   the   Post   Master-3rd



Respondent herein which reads as under:



                          "DEPARTMENT OF POSTS, INDIA



                                                          From

                                                                              Post Master

                                                                          Palani 624 601

                                                           To

                                                            The Joint Commissioner/

                                                                       Executive Officer

                                                    A/M. Dhandayuthapani Swamy

                                                                        Thirukoil, Palani



No. DPM/SB/Dlg.                                           Dated at Palani 01.12.1995



Sub:   Investment   by   Institution   in   the   Post   Office   Time   Deposits,   K.V.

Patras, NSC VIII Issue-reg.



Sir,



         I am to inform you that with effect from 01.04.1995 investments by

Institution   in   the   P.O.   T.D.   V.P.+N.S.C.   VIII   issue   is   discontinued.     As

Devasthanam   is   also   an   Institution,   I   request   you   to   close   all   the   TD

accounts immediately without interest and also if any kind of above said

patras and certificates purchased by the Devasthanam after 01.04.1995.



The   following   TD   accounts   have   been   opened   at   Palani   H.O.   after

01.04.1995.  Please close the accounts immediately.



1)   5   year   TD   2010417   dt.   05.05.1995,   (2)   2010418   dt.   20.05.1995,   (3)

2010419   dt.   31.05.1995,   (4)   2010421   dt.   14.06.1995,   (5)   2010422   dt.

21.06.1995, (6) 2010423 dt. 03.07.1995, (7) 2010424 dt. 03.07.1995, (8)

2010425   dt.   11.07.1995   (9)   2010426   dt.   13.07.1995,   (10)   2010428   dt.

29.07.1995, (11) 2010429 dt. 01.08.1995, (12) 2010430 dt. 07.08.1995,

(13) 2010431 dt. 07.08.1985 and (14) 2010435 dt. 16.08.1995.




                                                                                          8


                                                    Yours faithfully



                                                    (Sd/-)............

                                                      Post Master

                                                      Palani 624 601"

 



It is clear from the above communication that with effect



from   01.04.1995   i.e.   even   prior   to   the   deposits   made   by



the   appellant-Temple,   investment   by   institutions   under



the Scheme was not permissible and in fact discontinued



from   that   date.     It   is   not   in   dispute   that   the   appellant-



Temple is also an institution administered and under the



control   of   the   Hindu   Religious   and   Charitable



Endowments   Department   of   the   State.     Vide   the   above



said communication, the Post Master, Palani informed the



appellant   to   close   all   those   accounts   since   the   same   was



not   permissible.     The   communication   dated   01.12.1995



also   shows   that   all   such   accounts   should   be   closed   and



the   amounts   so   deposited   are   to   be   refunded   without



interest.     In   our   case,   the   deposit   accounts   have   been



caused to be closed and the amounts deposited have been





                                                                           9


returned   to   the   depositors   without   interest.     Though   the



appellant   claimed   interest   and   insisted   for   the   same   on



the ground of deficiency in service on the part of the Post



Master,   Palani,   in   view   of   Rule   17,   the   respondents   are



justified   in   declining   to   pay   interest   for   the   deposited



amount since the same was not permissible.     In the light



of Rule 17 of the Rules, as rightly concluded by the State



and the National Commission, it cannot be held that there



was   deficiency   in   service   on   the   part   of   the   respondents,



3rd respondent in particular.



8)     The State Commission while rejecting the claim of the



appellant   relied   on   a   decision   of   this   Court   reported   in


Postmaster   Dargamitta,   H.P.O.,   Nellore                  vs.     Raja


Prameeelamma (Ms.) (1998) 9 SCC 706.  In that case, the


complainant   therein   issued   six   National   Savings



Certificates for Rs. 10,000/- each on 28.04.1987 from the



Post   Office.     According   to   the   Notification   issued   by   the



Government   of   India,   the   rate   of   interest   payable   with





                                                                         10


effect   from   01.04.1987   was   11   per   cent.       But   due   to



inadvertence   on   the   part   of   the   clerical   staff   of   the   Post



Office,   the   old   rate   of   interest   and   the   maturity   value



which   was   printed   on   the   certificates   could   not   be



corrected.     The   question   that   arose   in   that   case   was



whether   the   higher   rate   of   interest   printed   in   the



Certificate   shall   be   paid   or   only   the   rate   of   interest



mentioned   in   the   Notification   is   applicable.     This   Court



held that even though the Certificates contained the terms



of   contract   between   the   Government   of   India   and   the



holders   of   the   National   Savings   Certificate,   the   terms   in



the   contract   were   contrary   to   the   Notification   and



therefore   the   terms   of   contract   being   unlawful   and   void



were not binding on the Government of India and as such



the   Government   refusing   to   pay   interest   at   the   rate



mentioned in the Certificate is not a case of deficiency in



service   either   in   terms   of   law   or   in   terms   of   contract   as



defined   under   Section   2(1)(g)   of   the   Consumer   Protection





                                                                            11


Act, 1986.   The above said decision is squarely applicable



to the case on hand.





9)    It   is   true   that   when   the   appellant   deposited   a   huge



amount   with   the   3rd  Respondent   from   05.05.1995   to



16.08.1995 under the Scheme for a period of five years, it



was   but   proper   on   the   part   of   the   Post   Master   to   have



taken   a   note   of   the   correct   Scheme   applicable   to   the



deposit.   It  was also  possible  for  the  Post  Master  to  have



ascertained   from   the   records,   could   have   applied   the



correct Scheme and if the appellant, being an institution,



was   not   eligible   to   avail   the   Scheme   and   advised   them



properly.  Though Mr. S. Aravindh, learned counsel for the



appellant   requested   this   Court   to   direct   the   3rd



Respondent to pay some reasonable amount for his lapse,



inasmuch   as   such   direction   would   go   contrary   to   the



Rules   and   payment   of   interest   is   prohibited   for   such



Scheme in terms of Rule 17, we are not inclined to accept



the same.  We are conscious of the fact that a substantial




                                                                         12


amount   had   been   kept   with   the   3rd  Respondent   till



03.01.1996   when   the   said   amount   was   refunded   without



interest.   In the light of the letter dated 01.12.1995 and in



view of Rule 17 of the Rules, failure to pay interest cannot



be construed as a case of deficiency in service in terms of



Section   2(1)(g)   of   the   Consumer   Protection   Act,   1986.



Both   the   State   and   the   National   Commission   have



concluded   that   the   3rd  Respondent   was   ignorant   of   any



Notification   and   because   of   this   ignorance   the   appellant



did   not   get   any   interest   for   the   substantial   amount.     We



agree with the factual finding arrived at by the State and



the National Commission and in view of the circumstances



discussed   above,   the   respondents   cannot   be   fastened   for



deficiency   in   service   in   terms   of   law   or   contract   and   the



present appeal is liable to be dismissed.              





                                                                          13


10)    Before parting with this appeal, we intend to make the



following   suggestions   to   the   Post   Offices   dealing   with



various accounts of deposits:



       i)     Whether it is metropolitan or rural area, persons



       dealing with public money or those who are in-charge



       of   accepting   deposits   to   be   conversant   with   all   the



       details   relating   to   types   of   deposits,   period,   rate   of



       interest,   eligibility   criteria   etc.   for   availing   benefits



       under different schemes.



       ii)    It   is   desirable   to   exhibit   all   these   details   in



       vernacular   language   in   a   conspicuous   place   to



       facilitate   the   persons   who   intend   to   invest/deposit



       money.





                                                                          14


       iii)    That   if   the   Central   Govt.   issues   any



       notification/instructions   regarding   change   in   the



       interest   rate   or   any   other   aspect   with   regard   to



       deposits,   the   decision   taken   shall   be   immediately



       passed   on   to   all   the   authorities   concerned   by   using



       latest   technology   methods   i.e.   by   fax,   e-mail   or   any



       other   form   of   communication   so   that   they   are   kept



       updated of the latest developments.



iv)    If there is any change in different types of schemes, it



       must   be   brought   to   the   notice   of   the   sub-ordinate



       staff of the post offices dealing with deposits in order



       to   ensure   that   correct   procedures   are   followed   and



       correct information is given to the public.



11)    We are constrained to make these observations since



in the case on hand because of the lack of knowledge on



the part of the Post Master who accepted the deposit and



the   appellant,   one   of   the   ancient   temples   in   Tamil   Nadu



lost a substantial amount towards interest.





                                                                        15


12)    With   the   above   observations,   we   dismiss   the   appeal



with no order as to costs.  




                                     ..........................................J.

                                         (P. SATHASIVAM)



                                    ..........................................J.

                                       (A.K. PATNAIK)


NEW DELHI;

JULY 13, 2011.  





                                                                     16