INDUSIND BANK LTD Vs. VIMAL MITTAL

JUDGEMENT

(1.) VIMAL Mittal, wife of Shri J.R.Mittal, filed a complaint against : (1) IndusInd Bank Ltd.; (2) National Securities Depository Ltd.; (3) Rolta India Ltd., through its Managing Director, in the State Consumer Disputes Redressal Commission, U.T., Chandigarh. It was contended that she was holding 160 share certificates of Rolta India Ltd. which she sent to the IndusInd Bank Ltd. for dematerialization, but there was unjustified delay in converting the same in dematerialised (electronic) form and hence the complaint was filed by the complainant in the State Commission claiming compensation for the loss suffered by her. It is contended that after the Depositories Act, 1996 came into force these paper shares were required to be traded in dematerialized (electronic) form and in order to convert the paper shares, the Complainant submitted the shares of the Rolta India Ltd. to the IndusInd Bank Ltd. (Opposite Party No.1) on 2.7.1999. It is contended that as per the Investor"s Guide to Depositories, the dematerialized form would normally take about 15 days time which could be extended to 30 days in the event of very large number of shares submitted for conversion into dematerialized form. It is alleged that for no fault of the Complainant, the conversion of the shares was considerably delayed for one reason or the other and it was belatedly done only on 12.4.2000. Hence, a legal notice was issued to the Opposite Parties by the Complainant, for the loss suffered, on 28th March, 2000.

(2.) IN the written version filed by the Rolta India Ltd. it was contended that as the original share certificates and the D.R.F. (Demat Request Form) (as required under the law) were not received no confirmation of dematerialization could be given and the same was rejected by the Company on 27.7.1999. Similarly, second login took place on 8.4.2000 but the same was rejected on technical grounds in conformity with the Act. Thereafter, when the Bank made login on 19.6.2000 the share certificates and the DRN were duly matched by the Company and hence the Company confirmed the demat on 23.6.2000, within four days. Rolta India Ltd., submitted that it has followed the correct procedure and there is no cause of action against the Company. It was pointed out that the grievance of the Complainant is mainly against the Bank and that is clear from the notice given by the Complainant"s Advocate on 28.3.2000, as the same was addressed Opposite Parties No. 1 and 2. The notice was not addressed to the Company, and, hence the Company is only a formal party.

(3.) THE State Commission, after considering the contentions in both the matters, by its order dated 13.9.2001, allowed both the complaints. In Complaint Case No. 43 of 2000 it awarded a compensation of Rs.50,000/- for deficiency in service rendered by the Bank as well as the NSDL; and in Complaint Case No.44 of 2000, it awarded a compensation of Rs.70,000/-. It gave a specific direction that the liability of the Opposite Party bank and the NSDL will be subject to the provisions of Section 16 of the Depositories Act, 1996. It also awarded costs of Rs.5,000/- in each case. The State Commission rejected the claim of the Complainant to award compensation on the basis of the highest value of the shares during some time taken during the dematerialization.