The Chandigarh State Consumer Disputes Redressal Commission has ruled that Canara Bank must pay a retired army commander ₹96,000 in fines for ignoring his auto loan account. This is a shocking example of financial mismanagement. The case calls into question how financial institutions treat veterans and exposes grave flaws in banking procedures.
Background of the Case:
Lt Col (Retd) Vipin Bakshi, the complainant, obtained a ₹4.5 lakh auto loan from Canara Bank with a 48-month repayment period. The first installment was due on December 21, 2018, and the loan demanded monthly payments of ₹11,209. Pankaj Chandgothia, Bakshi’s lawyer, contended that the bank had acquired Bakshi’s signature on an Electronic Clearing Service (ECS) mandate meant to generate automated monthly EMI withdrawals. Canara Bank, however, did not correctly apply these ECS guidelines.
The bank processed ad hoc payments inconsistently and without clear explanation or notification, in violation of the ECS obligation. Due to this carelessness, Bakshi received false letters requesting payment for arrears that shouldn’t have been there if the ECS had been properly completed. Bakshi had excessive stress and financial difficulty as a result of these mistakes, which also had a negative impact on his credit score.
Commission’s Findings:
The Chandigarh Consumer Commission reviewed the issue and determined that Canara Bank had engaged in unfair trade practices and serious service shortcomings. Bakshi submitted the ECS mandate on November 21, 2018, but the bank did not process it until July 21, 2019, according to the commission. This was a disproportionate delay that resulted in needless fines and annoyance for the complainant.
The commission stressed that Bakshi should not be held responsible for fines resulting from the bank’s tardiness in setting up the ECS system. According to the committee, it is unfair and upsetting to involve a seasoned officer in these kinds of financial conflicts. It instructed Canara Bank to issue a No Dues Certificate and treat Bakshi’s loan account as closed.
Compensation and Legal Costs:
The commission mandated that Canara Bank rectify Bakshi’s credit report by reversing all incorrect entries relating to his loan account, in addition to canceling the loan account without penalty. Additionally, the bank was directed to return any checks that had been handled incorrectly.
Additionally, Canara Bank was ordered to reimburse Bakshi for ₹21,000 in legal fees and ₹75,000 in compensation for the grief this caused. The commission’s decision shows that financial institutions are increasingly realizing how important it is to be accountable for how they treat their clients.
Conclusion:
This case emphasizes the significance of responsibility in financial services and acts as an alarming indication of the possible dangers in banking procedures. It emphasizes how important it is that banks follow all procedures when handling consumer accounts, particularly those of people who have served their nation.
Financial institutions must put a high priority on customer service and transparency as they develop further in an increasingly digital environment. In addition to giving Lt Col Bakshi justice, the Chandigarh Consumer Commission’s ruling establishes a standard for how banks ought to respond to incidents of this nature going forward. Future banking regulations must prioritize treating all consumers fairly, especially veterans like Bakshi who have dedicated their lives to defending the country.