The Government of India by Ext. P4,
has already offered the writ petitioner to encash
original amount of NSC. It shall be open for the writ
petitioner to encash the NSC without any interest, if
the same has not already been encashed.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE THE AG.CHIEF JUSTICE MR.ASHOK BHUSHAN
&
THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE
THURSDAY, THE 4TH DAY OF DECEMBER 2014
WA.No. 1488 of 2014
-----------------------------
K.J.POULOSE, SECRETARY,
MULANTHURUTHY SERVICE CO-OPERATIVE BANK LTD.NO.23,
Vs
THE SENIOR SUPERINTENDENT OF POST OFFICE,
ERNAKULAM-682 011.
Citation;AIR 2015(NOC)352 kerala
These two appeals have been filed against the same
judgment dated 31st July, 2014 passed in W.P(C) No.
20131/2009.
2. The writ petition was filed by the respondent in
W.A. No. 1674/2014. The respondent, (the petitioner in the
writ petition), Secretary of the Mulanthuruthy Service Co-
operative Bank, has purchased 10 National Savings
Certificates for Rs. 10,000/- each on 25th March, 2003. The
maturity date of the certificates was 25th March, 2009.
When the petitioner presented the certificates after
maturity date, the Department declined to release the
maturity amount. The petitioner, in the circumstances, had
filed the writ petition for the following reliefs:
"i) Issue a writ of certiorari or other appropriate
writ, order or direction, call for the records leading to
Ext. P4 issued by the 2nd respondent and quash the same;
ii) Issue a writ of mandamus or other
appropriate writ, order or direction directing the 1st
respondent to permit the petitioner to encash Exts. P1 to
P1(i) certificates dated 25.3.2003 bearing Nos.
6NS/39EE 829834 to 829843 (10 numbers for Rs.
10,000/-) each and to pay the maturity value as
mentioned in the certificates along with interest from
25.3.2009 till the amount is being paid at the rate of
interest mentioned in the certificate within a
stipulated period."
3. Counter affidavit was filed in the writ
petition, wherein the Department has referred to the
National Saving Certificates (VIII) Issue Rules, 1989,
which has been produced as Ext. R1(A). The
Department's case was that the benefit of the scheme
cannot be availed by a Co-operative Society, which has
been expressly excluded under the Scheme. Hence, no
interest can be earned on the National Savings
Certificates produced by the petitioner. It is stated that
the petitioner has purchased the certificates in his
official capacity and not in his personal capacity and
the money invested was that of the Bank.
4. The learned Single Judge, after hearing the
parties, allowed the writ petition and directed payment
of maturity amount of Rs. 16,010/-. The learned Single
Judge took the view that when there is an endorsement
signed by the Sub Post Master in each certificate to the
effect that the Government of India promises to pay to
the depositor an amount of Rs. 16,010/- on or after
25.3.2009, the respondents' contention cannot be
accepted. The writ petition was allowed directing
payment. However, further interest was declined. The
Department have filed an appeal against the judgment,
whereas the writ petitioner has filed appeal against
denial of future interest.
5. We have perused the records the considered
the submissions of the parties.
6. Statutory Rules, namely, National Savings
Certificates (VIII Issue) Rules, 1989, was issued by the
Central Government in exercise of powers under
Section 12 of the Government Savings Certificates
Act, 1959 (46 of 1959). Rule 4 deals with types of
certificates and issue thereof. Rule 4(2), which is
relevant for the purpose is as quoted below:
"(2)(a) A Single Holder Type certificate may
be issued to-
(i) an adult for himself or on behalf of a minor or to
a minor;
(ii) a banking company excluding a Co-operative
bank;
(iii) a company;
(iv) a corporation;
(v) an association, institution or a body registered as
a society under any law for the time being in force
excluding co-operative society;
(vi) a firm;
(vii) a local authority;
(viii) a trust
(b) A Joint "A" Type certificate may be issued jointly
to two adults payable to both the holders jointly or to
the survivor.
(c) A Joint 'B' Type certificate may be issued jointly
to two adults payable to either of the holders or to the
survivor."
According to the above Rule, Single Holder Type
Certificate cannot be issued to a Co-operative Bank.
The reason is obvious that National Savings Certificate
is a scheme introduced for the benefit of those
mentioned in the Rules except a Co-operative Bank.
Co-operative Banks were not supposed to invest in
National Savings Certificate or to earn any interest. It
is true that there was endorsement to the certificate to
the effect that maturity amount of Rs. 16,010/- shall be
issued after 25th March, 2009. Refusal to pay the said
amount cannot give any right to the petitioner to claim
payment of interest on the certificates, ie. the amount
of Rs. 16,010/-. It is well established that this Court, in
exercise of its writ jurisdiction, shall not issue a
direction contrary to the statutory provisions, when the
statute specifically provides that single holder
certificate cannot be issued to a Co-operative Bank. A
Co-operative Bank cannot claim any benefit on the
maturity amount.
7. The learned counsel for the Department has
placed reliance on the decision of the Apex Court in
Civil Appeal No. 4995/2006 (Arulmighu
Dhandayudhapaniswamy through its Joint
Commissioner v. The Director of General Post
Offices & Others) decided on 13th July 2011. In the
said case also, under the deposit scheme, certain
investment was made. The Postal Authorities had
declined to make payment communicating that the
scheme having been discontinued, the amount should
be closed without interest. The amount deposited was
refunded only on 3.1.1996 without interest.
Complaining deficiency in service, claim was filed
before the Consumer Disputes Reressal Forum. The
matter reached to the Apex Court. The Apex Court
examined the scheme and laid down the following in
paragraph 9:
"9. It is true that when the appellant
deposited a huge amount with the 3rd respondent
from 05.05.1995 to 16.08.1995 under the Scheme for
a period of five years, it was but proper on the part
of the Post Master to have taken a note of the correct
Scheme applicable to the deposit. It was also
possible for the Post Master to have ascertained
from the records could have applied the correct
Scheme and if the appellant being an institution, was
not eligible to avail the Scheme and advised them
properly. Though Mr. S. Aravindh, learned counsel
for the appellant requested this Court to direct the
3rd respondent to pay some reasonable amount for
his lapse, inasmuch as such direction would go
contrary to the Rules and payment of interest is
prohibited for such Scheme in terms of Rule 17, we
are not inclined to accept the same. We are
conscious of the fact that a substantial amount had
been kept with the 3rd respondent till 03.01.1996
when the said amount was refunded without interest.
In the light of the letter dated 01.12.1995 and in
view of Rule 17 of the Rules, failure to pay interest
cannot be construed as a case of deficiency in
service in terms of Section 2(1)(g) of th Consumer
Protection Act, 1986. Both the State and the
National Commission have concluded that the 3rd
respondent was ignorant of any Notification and
because of this ignorance the appellant did not get
any interest for the substantial amount. We agree
with the factual finding arrived at by the State and
the National Commission and in view of the
circumstances discussed above, the respondents
cannot be fastened for deficiency in service in terms
of law or contract and the present appeal is liable to
be dismissed."
The Apex Court, in the said case, justified non-payment
of interest as per the Rule.
8. Another judgment relied on by the learned
counsel is the judgment of a learned Single Judge of
this Court decided on 27th September, 2011 in W.P(C)
No. 21220/2011. In the said petition, a Co-operative
Bank has come up with the writ petition seeking
payment of maturity amount on the Kissan Vikas Patra
for Rs.1,00,000/-. Relying on the Apex Court judgment,
the writ petition was dismissed by the learned Single
Judge.
9. The mere fact that endorsement was made on
the National Savings Certificate cannot bind the
Department to make the payment. Endorsement made
was contrary to the Rules. The principle of estoppel
cannot be held to be applicable. No estoppel can be
pressed against the statutory rules.
10. In the light of the above, we are of the view
that the learned Single Judge has committed error in
allowing the writ petition and directing payment of
maturity amount. The Government of India by Ext. P4,
has already offered the writ petitioner to encash
original amount of NSC. It shall be open for the writ
petitioner to encash the NSC without any interest, if
the same has not already been encashed.
9. In the result, W.A. No. 1674/2014 is allowed
and W.A. N. 1488/2014 is dismissed.
Sd/-
Ashok Bhushan, Ag. Chief Justice
Sd/-
A.M. Shaffique, Judge.
Tds/
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