Case Title: Standard Chartered Bank Vs. Dr. Vinod Kumar Bhalla
Case Number: R. P. No. 2388/2019
Recently, the National Consumer Disputes Redressal Commission, led by Dr. Inder Jit Singh, made a significant ruling. The Commission stated that compensation for the same deficiency in service cannot be claimed under multiple categories. Moreover, the Commission clarified that emotional distress caused by service deficiency is included in the overall compensation and cannot be compensated separately.
Now, let’s take a closer look at what happened.
The complainant, a holder of an American Express credit card from Standard Chartered Bank, had an issue with his credit limit. The bank had reduced his credit limit from Rs. 3.20,000 to Rs. 2,48,000 due to a poor CIBIL rating, which incorrectly showed an outstanding amount of Rs. 1,74,644 instead of the actual Rs. 5640. Despite clearing the dues and providing the bank with proof, the issue remained unresolved, affecting his CIBIL score.
The complainant took up the matter with the Banking Ombudsman and also filed electronic complaints against the bank. Initially, the bank denied receiving the payment, but after verification, they accepted it. The Banking Ombudsman validated the complainant’s claim and closed the complaint. However, due to the bank’s errors and their lack of response, the complainant experienced emotional stress. He filed a complaint in the District Forum, which was unfortunately dismissed. Undeterred, he appealed to the State Commission, which reversed the District Forum’s decision and directed the bank to pay Rs. 2 lakhs for deficient service and Rs. 50,000 for emotional distress. This decision led the bank to approach the National Commission with a revision petition.
The bank’s defense was that they had not received the due payment of Rs. 5347.39 towards the credit card as claimed by the complainant. This, they argued, led to the outstanding amount reflected in the complainant’s credit card, resulting in the update of his CIBIL score. Even though the complainant’s cheque of Rs. 5640.81 was cleared, his CIBIL score was still affected due to the bank’s incorrect outstanding amount of Rs. 1,77,644.
The National Commission, after reviewing the case, upheld the decision of the State Commission. They agreed that the bank had shown incorrect outstanding amounts on the complainant’s credit card account, which had a negative impact on his CIBIL score. The bank had eventually corrected the errors and settled the credit card account. However, the Commission disagreed with the State Commission’s compensation division. They referred to the Supreme Court case, DLF Homes Panchkula Pvt. Ltd. vs. D.S. Dhanda, which stated that compensation under multiple heads for the same deficiency in service is not permissible. Therefore, the Commission reduced the compensation amount to Rs. 2 lakhs for deficient service, emotional distress, and litigation costs of Rs. 10,000.
The crux of this judgment is that compensation for the same deficiency in service cannot be claimed under multiple categories. Moreover, emotional distress caused by service deficiency should be included in the overall compensation and not compensated separately. This decision provides important guidance to consumers when seeking compensation for deficient services.
