Law & Justice
Kerala Consumer Forum Fines Bank of India Rs 15,000 Over Delay in Releasing Deceased Woman's Savings
A district consumer disputes redressal commission in Kerala has ordered Bank of India to pay Rs 10,000 as compensation and Rs 5,000 towards litigation costs to an elderly man, after ruling that the bank had delayed the release of his deceased wife's savings and engaged in unfair trade practice. The order was issued on August 31, 2026. The case arose after the complainant's wife died on September 2, 2022, leaving behind Rs 62,541 in a savings account at Bank of India's Kuruppampady branch. Since the couple's son, who was the nominee on the account, had also died, the complainant approached the bank with a relationship certificate and death certificates to claim the funds. The bank asked him to submit a legal-heirs certificate, which he obtained on August 5, 2023. He alleged that even after submitting this document, the bank continued to delay payment, citing the need for legal opinion. Frustrated, he wrote to the bank's zonal office on August 18, 2023. The branch then asked him to complete additional paperwork on August 25, and the money was finally credited to his account on September 4, 2023. The complainant said he was forced to make multiple visits to the bank and suffered both financial hardship and mental distress as a result. He sought Rs 10,000 in compensation along with other relief. In its defense, the bank denied any wrongdoing, claiming the complainant had first submitted an unsigned application without the required legal-heirship certificate or Certificate of Administration. It stated that the Certificate of Administration was submitted on August 16, 2023, and that all required documents were completed by September 1, following which Rs 62,682 was transferred to his account that same day. The bank further argued that the complainant did not qualify as a "consumer" under the Consumer Protection Act, since settling a deceased depositor's account involves statutory verification of succession and legal heirs. The commission, comprising president D.B. Binu and members V. Ramachandran and Sreevidhia T.N., acknowledged that the bank was justified in verifying the rightful claimant given the nominee's death. However, it stressed that such verification should not become excessively burdensome. "Legitimate verification cannot become a justification for an opaque, undocumented or unnecessarily burdensome procedure. A bank dealing with the legal heirs of a deceased customer has a corresponding obligation to communicate the requirements clearly, furnish the prescribed forms, identify deficiencies promptly and facilitate completion of the claim within a reasonable period," the bench stated. The commission pointed out that the bank's central defense rested on the claim that the complainant had submitted an unsigned application in May 2023, but the bank failed to produce this application, any acknowledgment, an inward register entry, or written communication asking him to sign it. As a result, the bench concluded the bank had not proven that this alleged unsigned application caused the delay. "A pleading is not evidence merely because it contains a factual assertion. Where a party relies upon the existence and contents of a particular document, and that document is naturally within its possession, its unexplained non-production assumes evidentiary significance," the commission observed. The bench also took into account the complainant's advanced age and limited understanding of English, noting that banks are obligated to ensure meaningful access to services and to explain procedural requirements in a language customers can understand. Citing Reserve Bank of India guidelines on simplified procedures for settling deceased depositors' claims, the commission noted that the bank could not demonstrate what documents and formalities were explained to the complainant during his initial visit. It further found that although the complainant had escalated his complaint to the zonal office, the bank could not produce any evidence of an effective response. "Such failure to address the grievance or even communicate a response amounts to a clear deficiency in service on the part of the second opposite party and forms an integral part of the unfair trade practice established against the opposite parties," the commission stated. Ultimately, the bench concluded that the bank's handling of the matter caused avoidable inconvenience, hardship, and mental agony to the complainant, despite the eventual release of the principal amount. The complaint was partly allowed, with the bank directed to pay Rs 10,000 in compensation and Rs 5,000 in litigation costs. The commission also instructed the bank to ensure that claim forms, checklists, and procedural requirements for deceased-depositor claims are provided and clearly explained in the relevant regional language wherever applicable. The bank has been given 45 days from receipt of the order to make the payments, failing which the amount will accrue 9 percent annual interest from the date the complaint was filed.