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StanChart fined Rs 2 lakh for cutting credit limit

Sets aside earlier order passed by consumer redressal forum and passes new deadline to hand over compensation

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The State Consumer Disputes Redressal Commission (SCDRC) in an order has directed Standard Chartered Bank (SCB) to compensate a consumer Rs 2 lakh for deficiency in services.

The order was passed by Usha S Thakare, presiding judicial member and Dr S K Kakade, member of SCDRC on the appeal (A/16/358) filed by Malad resident, Dr Vinod Kumar Bhalla. The SCDRC set aside the order passed by learned district consumer disputes redressal forum, south Mumbai while also asking the bank to pay Rs 50,000 for mental torture and agony and Rs 10,000 for litigation cost.

Bhalla had initially filed a complaint with the forum after his credit limit was reduced for his American Express Card from Rs 3.20 lakh to Rs 2.48 lakh in 2014. The credit limit was reduced due to Credit Information Bureau India Ltd (CIBIL) score was affected due to Standard Chartered had shown the amount of Rs 1.74 lakh as outstanding against the amount of Rs 5,640, which jumped due to interest application over the years since 2003. Bhalla was having Standard Chartered Bank Card since 1997.

Bhalla stated that he had paid the amount through cheque in 2003 by ICICI Bank. However, that was not reflected by the bank and it went on adding interest. As per commission order, there was default in making payment of dues by Bhalla till 2002. Appellant shifted his stay from Ahmedabad to Baroda but in January 2003, his wife visited Standard Chartered Bank located in Baroda to make the payment of outstanding amount. Interestingly, the payment was not accepted on behalf of the appellant as his credit card was blocked and advised to send cheque to Bangalore address.

However, when nothing happened, the matter was passed on to the Ombudsman of the bank. In the meantime he was denied American Express-Jet Credit Card. The Ombudsman found the complaint of Bhalla to be true. Bhalla then sent a legal notice seeking Rs 5 lakh as compensation with 18 per cent interest. When there was no response he lodged a complaint.

SERVICE FAILURE

  • Sets aside earlier order passed by consumer redressal forum and passes new deadline to hand over compensation
     
  • Besides, it also asks the bank to pay Rs 50,000 for harassment and mental torture meted out to the petitioner
     
  • The complaint was filed after the appointed Ombudsman found the petitioner’s statement to be true
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