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A student of Ram Manohar Lohiya National Law University (RMLNLU), Lucknow has secured justice for a senior citizen in his long drawn legal battle against Unit Trust of India (UTI).
The case before the District Consumer Forum, Jaipur pertained to the premature foreclosure of UTI’s Raj Lakshmi Unit Plan (RUP) in the year 2000.
The complainant, a retired government servant, had subscribed to RUP in 1996 by purchasing 500 of its units at the rate of Rs. 10 each. This total investment of Rs 5000 was expected to yield Rs 70,000 by the year 2015.
In 2016, the complainant discovered that since the scheme was closed in the year 2000 itself, he was entitled to a meager sum of Rs 17,000. It was the complainant’s grievance that no communication with respect to the untimely foreclosure of the scheme was made to him.
On receipt of a legal notice, UTI, however, denied all responsibility on the ground that all letters to the complainant were returned undelivered.
Meanwhile, all challenges to the premature foreclosure were dismissed by various high courts on the ground that the scheme was dropped only to protect the investors’ interest.
At the time of foreclosure, the investors were given the option to either redeem the money as on the date of the closure, or convert the money into tax-free ARS Bonds. For those who failed to communicate their choices, money was by default converted into ARS Bonds.
The first set of these Bonds were issued in 2004 which were redeemable in 2007. For the ones who did not communicate their choice to redeem their investment at this stage as well, the amount was again converted into bonds by default.
Appearing for the Complainant, RMLNLU fifth year student Chanakya Sharma argued that in spite of a public notice on termination of RUP, the UTI ought to have informed the Complainant about the subsequent developments regarding the Complainant’s investment at each step.
Without going into the merits of the scheme’s termination or the conversion of the investment into ARS Bonds, Sharma argued that apart from the money that was payable to the complainant in 2009 when the the last of these ARS Bonds matured, he was also entitled to an interest on this accrued amount from 2009 till date.
The Forum found merit in this case and ordered UTI to pay approximately Rs. 40,000 to the complainant. The amount included an interest of Rs. 14,400 calculated at 9 percent per annum from December 2009.
The Forum also granted Rs 5000 as compensation for mental agony and another Rs.2500 for litigation expenses to the complainant.
Sharma, who is a certified volunteer of Legal Aid Clinic at RMLNLU, charged the complainant one rupee for arguing the case. He says,
“I will be immensely satisfied if it motivates someone, especially fellow law students, to take up any similar cause and pursue it to the advantage of the needy.”