Bank negligence in cheque presentment amounts to deficiency in service, while compensation must stay fair and proportionate.

A bank acting as collecting agent must present cheques with due diligence within the validity period, and failure to re-present them on available working days after an intervening strike constitutes deficiency in service under consumer law. The finding of negligence was upheld on the evidence. On compensation, consumer relief must be fair, reasonable, and proportionate to the proved loss; where the actual loss is uncertain, only moderated compensation is justified. The award was therefore reduced from the higher assessment to 6% of the cheque amount with interest at 6% per annum.

---

---

Issues: (i) Whether the bank was deficient in service in failing to re-present the cheques within the validity period; (ii) Whether the compensation awarded by the Commission was reasonable.

Issue (i): Whether the bank was deficient in service in failing to re-present the cheques within the validity period.

Analysis: The cheques were deposited within validity, but the record showed that they were not re-presented on the working days available after the strike. Under the Negotiable Instruments Act, presentment for payment must be made within a reasonable time, delay caused by circumstances beyond control is excused only until the cause ceases, and a bank receiving cheques for collection must exercise due diligence in presenting them within the prescribed validity period. Banking service falls within consumer law, and negligence in rendering that service constitutes deficiency when it causes loss or injury. The finding recorded by the Commission was based on evidence and did not suffer from patent error or perversity.

Conclusion: The bank was deficient in service, and this issue is answered against the appellant.

Issue (ii): Whether the compensation awarded by the Commission was reasonable.

Analysis: Compensation in consumer matters must be fair, reasonable, and commensurate with the proved loss or injury, and where the loss itself is uncertain, only a moderated award can be justified. Although the Commission was right in treating the loss as warranting token compensation, the assessment at 10% of the cheque value was considered on the higher side in the facts of the case, especially because a Section 138 prosecution would still have depended on further statutory requirements and the ultimate loss remained indeterminate. A reduced figure better met the standard of reasonable compensation.

Conclusion: The compensation was reduced to 6% of the total cheque amount with interest at 6% per annum, and this issue is partly in favour of the appellant.

Final Conclusion: The finding of deficiency in service was affirmed, but the compensation was scaled down, and the appeals were disposed of with modification of the monetary relief.

Ratio Decidendi: A bank acting as collecting agent must present cheques with due diligence within validity, and failure to do so amounts to deficiency in service under consumer law; however, compensation must remain fair, reasonable, and proportionate to the proven loss.

---