Summary of this article
Kerala HC ordered repayment of Rs 5 lakh matured FD.
Depositor to receive 12 per cent interest and compensation.
Court gave bank six months to complete the repayment.
The Kerala High Court has directed a co-operative bank to repay a depositor’s fixed deposit (FD) of Rs 5 lakh, along with 12 per cent interest and Rs 10,000 as compensation, after it failed to return the money even years after the deposit matured.
Bank Asked To Repay Matured FD
The case was filed by a depositor from Thrissur whose FD matured on June 2, 2015. According to the court records, when he approached the bank to withdraw the amount, the bank did not release the money, citing technical reasons.
The depositor then approached the District Consumer Disputes Redressal Commission, Thrissur. In December 2021, the commission directed the bank to repay the Rs 5 lakh deposit with 12 per cent interest and Rs 10,000 towards cost and compensation.
Bank Challenged Consumer Commission’s Order
The bank, however, challenged the consumer commission’s order instead of initiating the payment. It approached the Kerala High Court after a delay of 825 days and sought permission to file the appeal despite the delay.
The bank argued that the delay occurred because it was under the control of an administrator between December 2014 and May 2022. However, a single judge of the Kerala High Court rejected the request and upheld the consumer commission's order.
The bank then filed an appeal before a larger Bench of the High Court. In its statement, the bank argued that as a co-operative bank, any dispute involving it should be dealt in accordance to the Kerala Co-operative Act, 1969, and is not to be governed under the Consumer Protection Act.
Consumer Protection Law Upheld By Court
In its June 2, 2026 judgment, the Bench rejected the bank’s argument and upheld the order passed earlier.
The court said the Consumer Protection Act was enacted to protect consumers and its provisions remain available even if another law provides a separate mechanism for resolving disputes.
The Bench observed that the provisions of the Kerala Co-operative Societies Act do not prevent depositors from approaching consumer forums to recover their money. It also said that banks dealing with public funds have a responsibility to make timely payments to depositors.
The court noted that the bank had not disputed its liability to return the FD amount and said delaying payment on technical grounds was not justified.
While dismissing the bank’s appeal, the High Court accepted the bank’s request for additional time to comply with the order. It granted six months to repay the Rs 5 lakh fixed deposit along with 12 per cent interest and Rs 10,000 as compensation.
