The Kerala High Court has observed that the banking ombudsman is bound to act in a manner advancing the objectives of the banking ombudsman scheme and never in a fashion to defeat the same.
Justice S. Manu made the observation while recently setting aside an order of the banking ombudsman for Maharashtra and Goa rejecting a complaint of a marine export firm against UCO Bank.
The court observed that the ombudsman was expected to keep in mind the objectives of the scheme and consider complaints with proper application of mind and not mechanically as had been done in the case at hand. The institution of ombudsman was maintained by the Reserve Bank, bearing the entire financial burden, to provide a swift, efficacious, and inexpensive grievance redressal mechanism to the consumers of banking services.
According to the petition of the firm, money was transferred to UCO Bank for paying to the firm towards the export of frozen yellow fin tuna to an Iranian company. However, the payment was not effected by the bank to the firm. The firm had, therefore, suffered loss due to the delay in releasing the payment.
When the firm approached the banking ombudsman, Thiruvananthapuram, it suggested the petitioner to file a complaint before the banking ombudsman for Maharashtra and Goa under whose jurisdiction the bank was located .
The court also directed the ombudsman to reconsider the complaint of the petitioner firm after affording an opportunity of hearing to the parties.
