Appropriation of provident fund
Syed Ali
(Querist) 05 November 2014
This query is : Resolved
Dear Sir,
My service in the Bank was ceased on 02.09.2011. I had availed a few Loans against the security of Provident Fund. The PF a/c was closed on 30.09.2013 and the loan a/cs were appropriated and the balance was paid to me. But the interest on the PF balance was paid only upto 02.09.2011.
Where as the interest was charged on Loan a/cs till the date of closure i.e. 30.09.2013. Thereby I lost an amount of Rs. 2.50lacs. The balance in the PF a/c was kept idle without any interest for almost 2 years. The Bank was negligent in this case by not closing the a/cs on the day of cessation of service or when the loan a/cs are charged with upto date interest the PF balance should have earned interest accordingly.
Is there any recourse for recovery of uptodate interest on PF or charging back of interest of Loan a/cs.
Pl clarify.
Rajendra K Goyal
(Expert) 06 November 2014
Bank must have taken your and the nominee undertaking to appropriate towards the loan(it may be housing or personal loan). As you did not paid your liability. Bank has evoked the undertaking from you.
Bank is at mistake in charging interest on loan account till the amount was appropriated. Represent to Bank (Manager, Regional Manager, DGM, Personal department and also to chairman through written complaint) to refund the excess amount charged and if not refunded, send legal notice and file suit.
malipeddi jaggarao
(Expert) 06 November 2014
They should have appropriated your PF to your loan accounts immediately (within a reasonable time of say one month) after your termination. Charging interest on your loan accounts beyond the date of termination is illegal. But who will heed you? Once you are discharged, nobody will bother about you in Banks, irrespective of number of representation you made to any authority. The best course is serve a legal notice and file a case in consumer forum.
T. Kalaiselvan, Advocate
(Expert) 08 November 2014
a proper legal action starting from a legal notice and followed by a suit for recovery of excess deduction or a complaint with the consumer forum may fetch you relief. Consult a lawyer and take decision as per his further advise.
ajay sethi
(Expert) 08 November 2014
agree with experts
Kumar Doab
(Expert) 10 November 2014
Exhaust the option of representation to MD, Chairman.........and trustees if the bank has its own trust to manage PF.
Thereafter you can litigate.
You seem to have a good case.
