Skip to main content

Bank cannot freeze employee’s account on employer’s request

A bank cannot freeze the account of an employee on the request of the employer and become a judge of dispute between them, a consumer forum here has said while holding IDBI Bank Ltd guilty of deficiency for doing so.

A bench of New Delhi District Consumer Disputes Redressal Forum, presided by C K Chaturevdi, made the observation while asking IDBI Bank Ltd to pay  Rs. 20,000 to Delhi resident Om Prakash Sharma, noting that his account was freezed from December 23 to 27, 2010, on his employer’s request and without
any intimation to him.

“In our considered view, the bank cannot become a judge of dispute between the employer and employee and freeze the account of employee on the request of employer. Such a right belongs to Court or police on investigation can resort to such a request,” the forum said, adding the bank did a “negligence act” in freezing Sharma’s account.

It asked the bank to pay a compensation of Rs. 20,000 for deficiency and litigation charges while holding the bank “guilty of gross deficiency”.

Sharma had told the forum that he had some dispute with his employer and was given a cheque of Rs. 59,000 towards settlement of dues.

However, Sharma said that he came to know through RTI that his employer had written to his bank to put a debit freeze on his account, alleging that complainant had stolen the said signed cheque and filled in figures and got the money transferred in his account.

In its order, the forum also noted that the employer had not lodged any FIR with police about the theft of cheque by complainant.

Article referred: http://www.goacom.com/business/25857-bank-cannot-freeze-employee-s-account-on-employer-s-request

Comments

Most viewed this month

Partition proceedings are vitiated even if single co-sharer is not made party or is not served in accordance with law

Cause Title :  Bhagwant Singh vs  Financial Commissioner (Appeals) Punjab, Chandigarh,  CWP-2132-2018 (O&M), High Court Of Punjab & Haryana At Chandigarh Date of Judgment/Order : 31.08.2022 Corum : Hon’ble Mr. Justice Sudhir Mittal Background A large parcel of land was owned by the Nagar Panchayat. Thereafter, some of the co-sharers sold their shares to third parties including the petitioners herein. On 22.11.1995, respondents No.3 to 5 filed an application for partition of the land. The petitioners were not impleaded as parties.  On completion of proceedings, sanad was issued on 28.08.1996. Vide two separate sale deeds dated 28.05.2008 respondents No.3 and 5 sold some portion in favour of respondent No.6 and 7. These respondents sought implementation of the sanad resulting in issuance of warrants of possession dated 05.06.2008. Allegedly, it was then that the petitioners realized that joint land had been partitioned and that proceedings had been conducted behind their back. Th

NCLT - Mere admission of receipt of money does not qualify as a financial debt

Cause Title : Meghna Devang Juthani Vs Ambe Securities Private Limited, National Company Law Tribunal, Mumbai, CP (IB) No. 974/MB-VI/2020 Date of Judgment/Order : 18.12.2023 Corum : Hon’ble Shri K. R. Saji Kumar, Member (Judicial) Hon’ble Shri Sanjiv Dutt, Member (Technical) Citied:  Carnoustie Management India Pvt. Ltd. Vs. CBS International Projects Private Limited, NCLT Swiss Ribbons Pvt. Ltd. & Anr vs. Union of India & Ors. (2019) Sanjay Kewalramani vs Sunil Parmanand Kewalramani & Ors. (2018) Pawan Kumar vs. Utsav Securities Pvt Ltd 2021 Background Application was filed under section 7 of the Insolvency and Bankruptcy Code, 2016 alleging loan of Rs, 1.70 cr is due. The Applicate identified herself as the widow and heir of the lender but could not produce any documents proving financial contract between her Late husband and the CD but claimed that the CD has accepted that money was received from her husband. The applicant subsequently filed rejoinder claiming the debt t

"as is where is" defined

This is a fairly contentious issue as often sale conducted on "as is where is basis" goes into litigation due to lack of understanding or otherwise on both sides. Below are two judgments with different conclusions but helps reveal the problem 1) Gurpreet Singh Ahluwalia vs. District Magistrate Dehradun & Ors. - Uttarakhand HC Bank takes possession of borrower's property and issues auction notice for sale of properties so possessed. The successful bidder pay part of the money and request the Bank to demarcate the property so that sale deed may executed and physical possession handed over. The Bank did make several representation to the concerned authorities to demarcate the property. That did not happenand the Bank instead of pursuing the demarcation proceedings with the Revenue Authorities called upon the successful bidder to make balance payment failing which deposit amount was informed to be liable for forfeiture. The bidder due to failure of revenue authoriti