NCDRC Holds ICICI Bank Liable For Loss Of Original Documents, Awards 25 Lakh Compensation

Recently, the National Consumer Disputes Redressal Commission (NCDRC) presided by Hon’ble Mr. Subhash Chandra as the presiding member, partly allowed a consumer complaint and directed the ICICI Bank (Opposite Party no. 1) to pay compensation worth Rs. 25 Lakh for losing the original property documents of a complainant. The case revolves around one Manoj Madhusudhanan (complainant), who had taken a housing loan of Rs. 1.86 Crore from ICICI Bank, to buy a property in Bangalore. To secure the loan, the he had submitted his original property documents, which eventually got lost while being sent to a storage facility by a courier company Bluedart (Opposite Party no. 2). While observing that the bank was primarily responsible for the loss of documents and could not shift the responsibility to its courier agent, the NCDRC upheld the consumer claim and found the bank liable for deficiency in services. Brief Facts In April 2016, the bank approved Manoj's housing loan of Rs. 1.86 Crore. To secure the loan, Manoj gave the bank his original property documents. However, he noticed that he did not receive any scanned or true copies of his original documents. After which he took action and filed a complaint. He was then informed that the documents had gone missing during their transport from Bangalore to the bank's storage facility in Hyderabad, supposedly because of an error by the courier company called "Bluedart”. As per the complainant, he also approached the Banking Ombudsman in order to resolve the issue, who directed the bank to provide a duplicate copy of the lost documents, publish a public notice regarding the loss and pay Rs. 25,000/- for their deficiency in services. After all this, when Manoj sent a legal notice to the bank in September 2016, the bank denied accepting any mistake on their part. Aggrieved by this, Manoj then moved the NCDRC alleging that "the bank was extremely negligent with regard to the original papers pertaining to his property which is valued at Rs 5,00,00,000/- and that copies of documents cannot replace the sanctity of the original documents". Arguments of ICICI Bank and Bluedart In response the Bank argued that the complaint was not maintainable, as the loss of documents was due to the fault of the courier company. They contended that the complainant did not provide any proof or documents to justify the actual value of the lost papers. They also claimed that the case was already resolved by the Banking Ombudsman. The courier company on the other hand also argued that the complaint was not maintainable, but on the ground that there was no “privity of contract” between the complainant (Manoj) and them (Bluedart). While pointing out their agreement with the bank, which limits their liability for document loss during transit, they argued that they were just a service provider for the bank and therefore not directly responsible for the loss. They also emphasized that the complainant was not considered a 'consumer' under the Consumer Protection Act in relation to them. Observations of the Commission The NCDRC observed that the bank was responsible for the custody and security of the original title documents, and it could not shift its liability to the courier company. While acknowledging that the complainant’s legal title to the property was compromised due to the loss of the original documents, the Commission found that a "deficiency in service" had been established. Consequently, the commission ruled in favour of the complainant, holding the bank responsible for the loss of the documents and directed them to obtain reconstructed and duly certified copies of the documents, issue an indemnity bond, and pay compensation of Rs. 25 Lakh along with an additional Rs. 50,000/- (Rupees Fifty Thousand) as reimbursement for litigation expenses. It directed that the decision be complied with within eight weeks from the receipt of its official copy; failure of which would result in ICICI Bank being obligated to pay the specified amounts along with 12% annual interest. Case Title: Manoj Madhusudhanan vs. ICICI Bank & Anr. Counsel for Complainant: Mr. Swtank Shantanu, Advocate Counsel for Opposite Party: Mr. Anand Shankar Jha and Mr. Sumit Goel, Advocates Click Here To Read/Download Order

NCDRC Holds ICICI Bank Liable For Loss Of Original Documents, Awards 25 Lakh Compensation

Apoorva Pandita

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