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Banking

(Querist) 18 July 2016 This query is : Resolved 
How does one calculate the quantum of compensation to be awarded to a victim of fraud BY a bank which did not release the money lying in the victim's Savings Bank account for 26 long years ? (Pls note no one can be compelled to keep, and no one keeps money in a Savings Bank account for 26 ;ong years, especially when the amount runs into crores). Pls share your ideas/opinions/suggestions. Thanks
R.K Nanda (Expert) 19 July 2016
Contact local lawyer.
Guest (Expert) 19 July 2016
Mr. Mohan Shandilya,

Only a banker or the judge of the case can tell.

About your instruction to "note no one can be compelled to keep, and no one keeps money in a Savings Bank account for 26 long years, especially when the amount runs into crores" that is duly noted.

But, you may also please note, without description of details of the case history solutions are not possible to be provided to the academic type of queries.

You may also please note that no one keeps crores of rupees in a savings bank account. Any one would prefer to earn more interest through FD or by investing in other beneficial and safe modes than to keep crores of rupees in an SB account.


P. Venu (Expert) 19 July 2016
Please state the material facts.
Rajendra K Goyal (Expert) 19 July 2016
bankers does not have / may not have fixed foot-rule to calculate compensation in such case.

You have to move for court orders.
Kumar Doab (Expert) 19 July 2016
The banks have been advised to frame and advertise the 'Compensation Policy' you may not be satisfied with it.



Better to engage a very able counsel.
Mohan Shandilya (Querist) 21 July 2016
The money was parked in a Saving Bank account for a very short term, since bank charges money for FD premature foreclosure, for investment purpose in real estate. But the bank fraudulently siphoned away the money fraudulently with a month. In criminal case, bank's CMD was sacked and the manager was jailed where he committed suicide, The Bank's unofficial stand is why did the depositor got their CMD sacked and their manager jailed. So, they are dragging the matter in civil court for the past 26 long years using senior advocates at the cost of taxpayers only. Thank you Experts, I hope now you have the required information to help me. pls advise.
Mohan Shandilya (Querist) 21 July 2016
Thank you Experts, pls advise.
Mohan Shandilya (Querist) 21 July 2016
This Query is OPEN, please.
Guest (Expert) 21 July 2016
Mr. Mohan Shandilya,

I wonder, if it is not exxageration of the facts that "the depositor got their CMD sacked!"

I wonder, if a CMD gets sacked on sohoning of money by some individual executive of the bank branch in some account and nobody below the manager and out of heirarchy between the Manager and CMD remain untouched for that offence!

Further, now you have added that bank charges money for FD premature foreclosure, whereas you did not talk about the FD in your original query.

I also wonder that the depositor was not ready to bear merely about 1% short of the due FD interest on pemature closure of FD, but could prefer to dump his huge money in an SB account, which yields a very low interest rate, may be even half of the FD rate!

So, it would be better, if you please narrate the complete story with full facts of the case than revealing in bits and pieces here and there.
Kumar Doab (Expert) 21 July 2016
Post full facts in chronological order.
Mohan Shandilya (Querist) 23 July 2016
Mr PS Dhingra, pls stop 'wondering'. Start researching. So far, CMDs of three banks have been sacked: Dada and Shetty of Vijaya Bank: R C Suneja of New Bank of India (merged with PNB); Gopalakrishnan of Indian Bank. Mr Shetty of Vijaya Bank committed suicide in jail. I am a serious and responsible Advocate aged abt 64 years, and do not indulge in 'exaggerations' as alleged by you. Penalty @1% on Rs 2 Crores amounts to Rs 2 Lakhs, while S/B account interest tax free is @ 4% which comes to Rs 8 lakhs. So, does it make sense now? The info I have above is more than sufficient to answer my Query. How does one calculate the quantum of compensation to be awarded to a victim of fraud BY a bank which did not release the money lying in the victim's Savings Bank account for 26 long years?
rajeev sharma (Expert) 23 July 2016
Mr Mohan as you are your self a man of law hence i may safely presume that this query is posted after due research. Sec 34 CPC provides for interest of lis pendence period but no rate for compensation is fixed. Compensation is a matter on the discretion of the court.one thing i understad from your query is that it has been proved that the amount was fraudulently withdrawn from the aggrieved account then how the bank has not restored that amount in the account of that person ? the matter of compensation may be settled separately and subsequently
Guest (Expert) 23 July 2016
Mr. Mohan,

It seems, my questions have pinched you to some extent.

But, if you make a review of your own posts, you would not have asked me to stop wondering.

So, as of your own review, would you please like to make it clear whether anywhere in your query you tried to introduce yourself as a lawyer and also that how you were related with the case? Yours was merely a question, as if posted by a law student, who could have desired to solve his academic excercise somehow or the other.

So, not for me only, but still it is a chance for others also to wonder that being a very experienced, serious and responsible Advocate aged abt 64 years, how you preferred to merely post an academic type of a query without any background, case history and status of the case, like the following:

"How does one calculate the quantum of compensation to be awarded to a victim of fraud BY a bank which did not release the money lying in the victim's Savings Bank account for 26 long years? (Pls note no one can be compelled to keep, and no one keeps money in a Savings Bank account for 26 ;ong years, especially when the amount runs into crores). Pls share your ideas/opinions/suggestions."

When I mentioned, "Only a banker or the judge of the case can tell," and that "without description of details of the case history solutions are not possible to be provided to the academic type of queries," still you did not state anything about you, your case history. and also how you were related with the case. You simply stated, as follows:

"The money was parked in a Saving Bank account for a very short term, since bank charges money for FD premature foreclosure, for investment purpose in real estate. But the bank fraudulently siphoned away the money fraudulently with a month. In criminal case, bank's CMD was sacked and the manager was jailed where he committed suicide, The Bank's unofficial stand is why did the depositor got their CMD sacked and their manager jailed. So, they are dragging the matter in civil court for the past 26 long years using senior advocates at the cost of taxpayers only."

So, can you state, what was the reason for not revealing your real identity in any of the previous to posts description of the complete background history with the present status of the petition or the revision or the appeal, whatsoever be, if in court, as well as the fact how you are connected with the case? Moreover, had you anywhere stated, being a very experienced and serious advocate, why along with the advocates of the case, you could experience such type of difficulty in calculating the compensation? A further question arises, whether the court was unable to decide the quantum of compensation, or the court asked the lawyers, including yourself to suggest how to calculate the compensation?

I HOPE YOU CAN WELL APPRECIATE THAT ALL SUCH FACTORS WERE NOT THE MATTER OF ASSUMPTIONS OR PRESUMPTIONS TO BE MADE BY THE MEMBERS FROM WHOM YOU DESIRED THEIR IDEAS/OPINIONS/SUGGESTIONS, WHEN THE CASE HAD BEEN LINGERING FOR THE PAST 26 YEARS.

Naturally, deposit of than one crore in a savings bank for 26 years long seemed to be a hypothetical proposal.

Had you stated the facts at the very initial stage of posting your query, there would not have been any chance for me to wonder, and every member here would also have volunteered to help you find out solution to your problem, as far as possible.
Mohan Shandilya (Querist) 24 July 2016
Mr Rajeev Sharma, thanks for your reply. You are correct in saying: "Compensation is a matter on the discretion of the court.one thing i understad from your query is that it has been proved that the amount was fraudulently withdrawn from the aggrieved account then how the bank has not restored that amount in the account of that person ? the matter of compensation may be settled separately and subsequently."
Yes, the rogue bank has been able to drag the matter for 26 long years in court with the help of legal legerdemain, and hiding behind "matter is sub-judice".
Yes, the matter of damages and compensation will be taken up subsequently. That's why my Query as to what is the formula for calculation of comensation or damages in such a case.
It is not an academic exercise, like Mr P S Dhingra wrongly assumes. It is a real case, and the facts I stated above are sufficient for an Expert to answer. As you correctly understood that the fact of fraudulent appropriation stands proved, then, the bank is liable to pay a sum over and above the interest as compensation to the depositor. Whether it is my case or somebody else's doesn't matter.
Mohan Shandilya (Querist) 24 July 2016
Dear Mr P S Dhingra, 1. my Query is not Academic, it is a real case.
2. How does it matter to an Expert to answer the query whether I am a lawyer or not?
3.The details provided in the Query are sufficient and succinct enough for an Expert to answer.
4. I asked this with the sole sincere intention to gain from Experts' knowledge and experience for I strongly believe that 1 + 1 = 11 ... and not just 2.
5. If I were you, I would have answered as follows: No one keeps money in crores in a savings bank account for long. Therefore, since the Bank has forced the depositor's money to remain in the savings bank account for 26 years, the quantum of compensation should be based on the current market value of the property in which the sum of the deposit would have been invested 26 years ago. As an example, if the amount of the deposit were say Rs 1 Crore, and invested in 1990 in a property, which is worth Rs 100 Crores at prevailing market value today in 2016, then the Bank should pay 100 times the amount deposited in 1990.
6. Hope you now see that the facts stated by me in the Query are enough for any Expert to answer.
7. Thanks a lot for your valuable time.
8. Best regards.
P. Venu (Expert) 24 July 2016
Compensation in the given facts is a question of law and facts which, in my considered opinion, a Competent Court alone can decide.
Guest (Expert) 24 July 2016
Dear Mohan Shandilya,

If seems, my simple reply, "Only a banker or the judge of the case can tell," could not be understood by you earlier. Now Ld. Rajeev Sharma and P Venu have also confirmed that only competent court can decide about compensation. But still you insist to seek formula from members here, while you are also a serious and experienced lawyer. My assumption was not wrong about your query as a type of academic query, when even being a lawyer you did not try to show head or tail of the problem. Even a layman tries to give description of the background facts before asking a query

In deed, every one can assume that the query was hypothetical when you state a very rarte phenomena, "money lying in the victim's Savings Bank account for 26 long years' and talk for compensation instead of interest that too without giving any background of the case. It is a matter of commensense that none can expect such a question without head and tail from a serious lawyer.

Even still you have not stated why you want to know formula, but without giving present status of the case, if it is under trial and also without replying my question, "whether the court was unable to decide the quantum of compensation, or the court asked the lawyers, including yourself to suggest how to calculate the compensation?"

About your 2md point, "how does it matter to an Expert to answer the query whether I am a lawyer or not", I hope you can well undertant that experts try to give their opinion to a layman in a layman's language, while a lawyer's question can be discussed legally and strategically.

About your 3rd point, I would like to ask you only, would you prepare a case of your client, if he gives you only cuts & pieces of the information without any background facts, like that you given in your query? Sacking of CMD and suicide of the Manager cannot be taken as the background or fact for asking compensation to an SB account holder.

If you think that the details provided in the Query are sufficient and succinct enough for an Expert to answer, you are extremely mistaken. So, on that my brief answer, "Only a banker or the judge of the case can tell," was quite sufficient for your brief and fact less question. BY THE WAY, where was the need to tell the experts about sacking of CMD and the suicide of the manager and linking that to ask for compensation to an SB account holder, when the sacking/suicide of CMD/ Manager did not have even a remote link with the compensation case to a depositor? Was there any relevance for the experts to know what happened to the CMD and the Manager in that case? Also what was the relevance of showing their fate just to know a formula of compensation?

About your point 4, I never questioned your sincere intention to gain from Experts' knowledge and experience. Had I done that, I would not have suggested you that Only a banker or the judge of the case can tell, as I do not prefer to respond to an academic query.

Also, it is not necessary that every one should follow your so called strong belief that 1 + 1 = 11 ... and not just 2. Axioms and sayings are meant only to encourage or guide a discouraged person, but the truth can mever be denied that 1+1 gains strength of only 2, not 11 in any case. If your strong belief is 1+1=11, not 2, do you believe that 100 persons would be reduced to strength of only 1+0+0=1 ? Would not that become a strange formula in the case of 100, 1000, 10000, etc.

About your point 5, Rest assured, a non-believer of truth of 1+1=2 cannot be like me. Question arises, if you wanted to assume yourself to be myself, and were capable to answer on my behalf, you could not have felt the need to post your query to fetch answers from experts, as you would have been capable to answer on behalf of all experts, who responded to your question. Unless hypothetical types looking stories are made clear with real facts nobody can assume or presume, what could have been my answer. The question arises, how anyone could believe that the depositor was compelled to keep crores of money in to his savings bank, unless supported by the basic necessary facts and background of the case?

About point 6, your hope can be dashed to know that the facts stated by you in the Query are NOT yet enough for any Expert to answer. You are still far away from the facts, when you have not stated the present status of the trial, why you want to know the formula when only court can decide, and how you are related with the case, etc., as I asked in my previous post.

Any how, I won't compel you to answer my queries, but my first reply won't change to any extent. However, I still maintain that your original query was not that of the type that could be expected to have been posted by a serious and experienced lawyer.
Mohan Shandilya (Querist) 24 July 2016
Dear Mr P S Dhingra, my Query is "How does one calculate ... " ... and NOT "Who to calculate - banker or court".
A lawyer or a litigant will be on the path to victory in Court if she/he is well prepared. There is no need to first get a direction from a court and then start preparation. At least, there is no harm. Knowledge and information do not harm any person. Thank you very much for your valuable time. Regards.
Mohan Shandilya (Querist) 24 July 2016
Mr P Venu, I agree with you totally when you say:"Compensation in the given facts is a question of law and facts which, in my considered opinion, a Competent Court alone can decide."
My Query is to seek suggestions/answers/advice from you Experts so as to be well prepared to build a strong case seeking compensation/damages from the rogue bank and, then, present the solid case to the competent court for a favourable decision. Thanks again and regards.
Mohan Shandilya (Querist) 24 July 2016
Dear Experts, the other formula that comes to my mind is:-
The average rate of growth be calculated based on the audited accounts of the relevant three years prior to the year of the Deposit, and then, apply that average Rate of Growth to the amount of the Deposit. The erring Bank can then be directed to pay to the victim-depositor the said sum as compensation/damages. Kindly share your views/suggestions/advice. Thanks and best regards. This can apply to a depositor irrespective of whether she/he is an individual, or a partnership firm, or a pvt ltd company or a limited company.
Guest (Expert) 24 July 2016
Your query, "How does ONE calculate" is quite different from the querym "WHO to calculate - banker or court." ONE can be any one, not only court or bank.

In your initial query, you did not ask "Who to calculate - banker or court."

However, my reply served answer to both of your past & present query, i.e., any one of the two, the bank or the court.
Kumar Doab (Expert) 24 July 2016
The banker committed fraud and has been awarded with punishment.


The RBI guided to frame compensation policy, which is, if looked into to offer peanuts.


Obviously bank has offered any compensation, since which banker shall own it.



Obviously NO banker has come forward to apply his/her mind to try to offer suitable compensation.


So the aggrieved has no option but to approach court and court shall deliver the justice and just compensation.


Mohan Shandilya (Querist) 25 July 2016
Oh My God, Dear Mr P S Dhingra, kindly go to the top and you will see my original query. It is "How does one calculate the quantum of compensation ... " ........ and NOT "who to calculate - Bank or Court.
Please read carefully.
I never asked: "Who to calculate - Bank or Court ?
You have not answered my Query so far: "How does one calculate the quantum of compensation ...". I gave you two examples also, but no comments by you.
Still, I thank you for your valuable time.
Guest (Expert) 25 July 2016
How to calculate has no relevance, if you have not been assigned the duty to calculate.

Even if you would have been assigned the duty, even then my answer, "Only a banker or the judge of the case can tell," was valid for your original query.
Mohan Shandilya (Querist) 26 July 2016
It is Open to all but not to Mr P S Dhingra
Guest (Expert) 26 July 2016
Your last post, "It is Open to all but not to Mr P S Dhingra" is not clear, what is Open to all, but not to P S Dhingra?


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