HSBC fined Rs30,000 for shoddy service

The Hongkong and Shanghai Banking Corporation (HSBC) will have to pay advocate Mohammed Rafiq Chauhan Rs30,000 for not recovering the instalment amount and then demanding interest on it.

The district consumer forum ordered the bank to pay within four weeks or else the delay would attract an interest of 9% on the outstanding amount.

Chauhan’s complaint said he had taken a personal loan of Rs1 lakh from the bank and the payment, which was to be done in 36 monthly instalments, was to be debited each month from his personal bank account with the ICICI Bank.

However, the HSBC did not debit the last instalment and only after Chauhan made inquiries for return of his agreement and security cheques that the bank demanded an extra interest of Rs442.

Chauhan moved the consumer court, alleging failure in provide service and demanded a compensation of Rs4.75 lakh.
The bank stated that due to technical problems, the last instalment demand was not made. When it reflected in their accounts in a letter dated December 30, 2008, the bank requested Chauhan to make the payment. He paid after 10 days and the delay attracted an interest amount which needed to be paid.

The bank also said the complainant had failed to pay a previous instalment for which the interest amount was charged. Thus, it had not erred in providing service.

The forum concluded that the bank had erred in providing service and so it was liable to pay the compensation amount of Rs25,000. However, since the complainant was an advocate and he had argued his case, he needs to be paid only for the expenses incurred by him.