NCDRC in its order told banks to pay for delay in cheque clearance

The National Consumer Disputes Redressal Commission (NCDRC) in its July 14 judgment has asked banks to credit local cheques to accountholders account the same day or at the most the next day. The commission in its order said the outstation cheques should be encashed between seven and 14 days, depending upon the distance from the place where the cheque is issued.

The commission in its order said you can claim interest from a bank for delayed encashment of your outstation cheques. “If there is any delay in collection of the said (outstation) cheques beyond the period… interest at fixed deposit rate, or at a specified rate as per the respective policy of the banks, is to be paid to the payee of the cheques.”

The judgment has come on the petition filed by an advocate Atul Nanda. As per the order of the commission the banks will have to pay interest to customers for delayed encashment of local cheques as well. Usually it takes up to three days to be encashed. While Nanda in his consumer litigation has said the delay in crediting the cheques to the consumers’ account was leading to “undue enrichment” of banks, which were earning crores in interest on the customers’ money for the delayed period.

The commission chairman Justice M. B. Shah directed the banks to abide by the order within two weeks. He asked the banks to write in bold letters in every branch’s notice board the salient features of their policies on collection period of outstation cheques and interest payable in case of delay. Justice Shah has asked the RBI to monitor the order.