Woman Fails to Receive Funds After Fixed Deposit (FD) Matures—Despite 12% Interest Promise.

In Karnataka, a woman opened a Fixed Deposit (FD), but the funds were not returned even after the deposit matured. Additionally, the funds of an elderly individual were also left stranded with the same society. In total, Rs 17.63 lakh belonging to these two individuals remained stuck.

Given rising inflation and the need for financial security during emergencies, people increasingly prioritize savings. Common avenues for saving include Fixed Deposits (FDs), post office schemes, and various other financial instruments. Imagine, however, that you have invested your savings in an FD—expecting both security and interest—only to find that, upon maturity, the bank or credit society refuses to return your money. Such a situation would naturally cause significant distress.

A case of this nature has emerged in Karnataka, where a woman did not receive her funds after her FD matured. Furthermore, it has come to light that the funds of a senior citizen are also trapped. Both matters have since reached the Consumer Commission. This raises a critical question: why were the funds not released even after the maturity date?

Woman Held Two FDs

The woman had opened two separate FDs: one for Rs 5 lakh and another for Rs 4.5 lakh. The Rs 4.5 lakh FD was set to earn an annual interest rate of 12%, while the Rs 5 lakh FD carried an annual interest rate of 10.80%.

Funds of a Senior Citizen Also Trapped

In addition to the woman’s case, a 73-year-old senior citizen also had funds stranded with the society. Notably, both individuals held not only FDs but also savings accounts and recurring deposits with the institution. In total, Rs 17,63,274 belonging to these two customers remained unreturned. It is essential to identify the specific society involved in this matter.

Which society is involved in this case?

According to the information, this case pertains to the 'Kittur Rani Chennamma Urban Credit Souharda Sahakari Limited' in Karnataka. It is here that the funds belonging to a woman and an elderly person were left stranded.

Multiple requests for the return of funds

Significantly, both customers requested the return of their funds from the society on several occasions. When the money was not returned, they sent a legal notice to the society. Upon receiving no response to this notice, the matter was escalated to the Consumer Commission.

Court proceedings

During the hearings, the Gadag District Consumer Disputes Redressal Commission conducted a thorough examination. The Commission reviewed the customers' Fixed Deposit (FD) receipts, passbooks, and documents related to the legal notice. It was also essential to consider the society's stance on the matter.

What was the society's response?

In its defense, the society argued that since proceedings regarding this matter were already underway under a specific Karnataka state law, the Consumer Commission should not hear the case.

What did the Commission rule?

The Commission rejected the society's argument. It clearly stated that the failure to return the customers' deposits constitutes a 'deficiency in service.' Consequently, the Commission ordered the society to return the funds along with the applicable interest.

What amount had to be returned?

The Commission ordered the society to return Rs 17,63,274, along with the interest accrued on the respective accounts.
Additionally, the society was ordered to pay Rs 25,000 as compensation for mental distress and legal expenses.

Exercise caution when opening an FD

If you are planning to open a Fixed Deposit (FD), keep the following points in mind:

First, conduct a thorough background check on the bank or society.
Ensure you are well-informed about the interest rates offered.
Understand the tenure (duration) of the FD.
Verify the maturity date.
Familiarize yourself with the rules and procedures for withdrawing your funds. Keep the receipts related to your FD safe.