The Bombay High Court has levied a ₹50,000 fine against Yes Bank, citing an unjustified delay in opening a bank account due to the incorrect insistence on an Aadhaar card. This judicial pronouncement, favouring Microfibers Pvt Ltd, underscores the imperative for financial institutions to adhere strictly to regulatory directives and Supreme Court pronouncements. The ruling reinforces consumer protection principles, highlighting the critical role of accessible and equitable financial services in fostering a stable and just urban economy.
The dispute originated in June 2018 when Microfibers Pvt Ltd approached Yes Bank to open an account, only to be refused on the grounds of not providing an Aadhaar card. This refusal persisted despite an interim relief granted by the Supreme Court at the time, which had clarified that Aadhaar was not mandatory for opening bank accounts. The Bombay High Court bench, comprising Justices MS Sonak and Jitendra Jain, meticulously reviewed the timeline, noting that while the account was eventually opened in January 2019, the bank’s non-compliance between April and September 2018 was without justification. This period, specifically after September 26, 2018, when the Supreme Court’s definitive verdict struck down the mandatory requirement of Aadhaar for bank accounts, was deemed particularly egregious by the judiciary.
The ramifications of the bank’s delay extended beyond mere inconvenience, inflicting tangible hardship upon the petitioner. Counsel for Microfibers Pvt Ltd submitted that the absence of a functional bank account rendered the company unable to rent out its premises in Mumbai for an entire year. This inability to generate income was particularly distressing given the personal circumstances of the surviving 84-year-old widow and her unmarried daughter, who were left without alternative means of livelihood following the passing of the Founder-Director. This human element underscores the profound impact of bureaucratic hurdles and non-compliance on vulnerable individuals, highlighting the imperative for financial systems to operate with empathy and efficiency to ensure equitable access and opportunity for all citizens.
While the petitioner sought a compensation of ₹10 lakh, citing a monthly rent loss of ₹1.5 lakh, the High Court deemed this claim excessive. The bench, however, did not dismiss the need for recompense entirely. Taking into account the bank’s failure to file a reply on the issue of compensation and the petitioner’s lack of alternate income, the Court judiciously awarded ₹50,000. This decision, while a reduction from the initial claim, firmly establishes the principle of accountability for financial institutions that fail to adhere to legal directives, even in the absence of explicit contractual provisions for such penalties. The court’s decision to not relegate the petitioner to ordinary remedies further underscores the seriousness with which it viewed the bank’s conduct.
This judicial pronouncement sets a significant precedent for the banking sector, particularly concerning regulatory adherence and customer service. It serves as a potent reminder that financial institutions must stay abreast of legal and regulatory changes, especially those emanating from the nation’s apex court. Any delay or non-compliance, even if perceived as minor by the institution, can have substantial adverse effects on individuals and businesses, leading to legal repercussions. The ruling reinforces the need for robust internal compliance mechanisms and a customer-centric approach that prioritises seamless and lawful service delivery, contributing to a more trustworthy and transparent financial ecosystem.
In the broader context of fostering sustainable and equitable cities, the efficient and fair functioning of financial services is paramount. Unnecessary bureaucratic delays and non-compliance not only lead to financial losses for individuals and businesses but also create systemic inefficiencies that consume valuable resources, including time and legal costs. A well-regulated and responsive financial sector is a cornerstone of a stable economy, which in turn can support investments in eco-friendly infrastructure and social welfare programmes. This ruling, by upholding consumer rights and demanding accountability, contributes to a more just and well-functioning urban society, where access to essential financial services is guaranteed and protected for all.
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