HDFC Bank fined by consumer forum for mentally harassing customer over alleged unpaid credit card dues

The bank said Guha had a credit card since 2006 and she had crossed the credit limit several times till April-May 2016. Representation pic

HDFC BANK has been directed by the District Consumer Dispute Redressal Forum to pay Rs 25,000 for mental harassment caused to one of its customers over alleged unpaid credit card dues. The forum ruled that deducting money from a customer's account and freezing the account is an unfair trade practice.

According to the complainant, a senior citizen from Mira Road, Rs 65,254 had been deducted by the HDFC Bank in September 2016 and her account was frozen on the pretext of outstanding dues on the credit card. The complainant claimed no bill was generated by the bank and there were no transactions made from her card.

The consumer forum has directed the bank to return the money with 12 per cent interest from the date of deduction, and unfreeze the account. It has also penalised the bank to the tune of Rs 25,000 as cost to the complainant and for mental harassment.

The case

Mira Road resident Neera Guha had reached out to the District Consumer Dispute Redressal Forum, Thane, in September 2018 complaining that HDFC Bank had blocked her account in August 2016 and within a fortnight had deducted Rs 65,254 from her account without any notice. After enquiring with the bank, she was told that the money was deducted towards her outstanding credit card bill amount. Guha added that she needed the amount for her medical expenses.

Filing a reply to the complaint, HDFC Bank said Guha had a credit card since 2006 and she had crossed the credit limit several times till April-May 2016. Her outstanding bill amount reached Rs 76,170 and the bank had no option but to deduct the money as she did not repay it even after several reminders.

The arguments

Advocate Suraj Singh appearing for Guha told the commission, "Even if the consumer had an outstanding amount from 2006, what steps had the bank taken within 10 years to recover the amount. Also, according to the law of limitations, the bank can't recover the money which was outstanding for more than five years. This represents unfair trade practices as well as a deficiency in service." Advocate Shamli Hajila, appearing for HDFC Bank, pointed out that the outstanding amount is categorised as ‘Bankers Lien' which is similar to a ‘General Lien' and legally banks can freeze the account and deduct money to recover the outstanding amount.

When the District Consumer Dispute Redressal Forum asked the bank what steps were taken to recover the outstanding amount, how many times the credit limit was crossed and what was the evidence for the same, the bank did not submit any response. Hence, President Milind Sonawane and Member Poonam Maharshi passed an order in favour of Guha. HDFC Bank officials didn't respond to the correspondent even after several attempts.