The Bombay High Court recently directed Yes Bank to pay ₹50,000 in compensation to a Mumbai-based company for refusing to open a bank account without an Aadhaar card despite a Supreme Court ruling [Microfibres Pvt Ltd. v Yes Bank and Ors].
A Bench of Justices M S Sonak and Jitendra Jain noted that the company had been unable to rent out its property in Mumbai for several months because it lacked a functioning bank account.
"The Hon’ble Supreme Court struck down the requirement of providing an Aadhar Card for opening a Bank account. Therefore, from 26th September 2018 onwards, there was no impediment to the Respondent-Bank opening the Bank account without insisting on the Aadhaar Card...we agree with the learned counsel for the Petitioner that there was no justification for not opening the Bank account after 26th September 2018,” the Court observed, referring to the date on which the Supreme Court struck down the mandatory Aadhaar requirement.
The dispute began in January 2018, when the company approached Yes Bank to open a current account but was told that an Aadhaar card was mandatory. The bank reiterated this position in a written communication issued in April 2018. Despite pointing out interim Supreme Court orders that allowed opening accounts without Aadhaar, Yes Bank refused to open an account.
The petitioner’s counsel argued that due to the absence of a bank account, the company was unable to lease its commercial premises in Mumbai for the entire year. He pointed out that the founder-director had passed away and the property was intended to generate financial support for his widow and unmarried daughter. The petition sought a compensation of ₹10 lakh, citing monthly rental loss of approximately ₹1.5 lakh.
The Court noted that while the compensation claim was “exaggerated,” the company was entitled to some relief. It pointed out that the bank failed to respond to the compensation claim even after being given an opportunity in 2018.
“In a matter of this nature, we would have ordinarily relegated the petitioner to the alternate remedy...Considering these peculiar circumstances, we do not relegate the petitioner to the ordinary remedies,” the bench observed, awarding ₹50,000 in compensation to be paid within eight weeks.
Advocate Niyam Bhasin for the petitioner.
[Read order]