SC upholds Rs 5 lakh fine on Citibank, State Bank of Mysore

NEW DELHI: The Supreme Court has upheld the the National Consumer Disputes Redressal Commission's judgement imposing a fine of Rs 5 lakh on Citibank N.A. and the State Bank of Mysore for 'deficiency of service'. A bench headed by Justice A K Mathur while dismissing the Citibank's and the State Bank of Mysore's petitions said, "We are of the opinion that the view taken by the National Commission cannot be faulted with... ...we are in complete agreement with the it that there was a deficiency in service by the Citibank N.A., New York, and consequently by the State Bank of Mysore also." Justifying the compensation awarded to a Bangalore-based export firm Geekay for deficiency in services on part of the banks, the court said the compensation was adequate and the State Bank of Mysore was open to recover the said compensation from the Citibank, N.A. The court also said Geekay was at liberty to move the appropriate forum for recovery of loss estimated at Rs 15 lakh. The Commission had held both the banks jointly and severally responsible for deficiency in service and had asked them to pay Rs 5 lakh compensation to Geekay for not collecting the funds from a firm in US. Besides, it had also directed Citibank N.A. to pay costs of Rs 50,000 to the firm. US-based ASK Ingredients Inc had placed a purchase order with Geekay for supply of 1,110 Kgs of Oleoresin Capsicum and 925 Kgs of red chillies seed in April 1994.

THE ECONOMIC TIMES
Apr, 2008, 2136 hrs IST, PTI