My Days South - Episode No.11

One of the prestigious corporate accounts to be handled by us at the Corporate Cell was that of 3M India Ltd. 3M is one of the most innovative corporations worldwide. It has over 100 years of track record with more than 50,000 products. The company entered India in the year 1988 as a joint venture of the Birla Group called Birla 3M Ltd. The first unit of the company was set up in Bangalore. The name was changed to 3M India Ltd later in Dec 2002, as the partnership with Birlas came to an end.

The Birla family connection to the joint venture has an unfortunate tragic event on record. The well-known industrialist Ashok Vardhan Birla (father of Yash Birla) was coming to Bangalore on 14 February 1990 for the inauguration of the 3M unit in Bangalore. Ashok Birla was responsible for 3M’s entry into India. He was on the Indian Airlines flight IC-605 from Bombay to Bangalore along with his wife Sunanda and daughter Sujata. The flight left Mumbai at 11.58 am and approached the Bangalore HAL airport by 12.44 pm. However, while descending to 11,000 feet, the Air Bus A320 missed the airport and crashed near the Bangalore golf course killing all the 92 people on board.

The company’s connections with our Corporate Cell started in quite an unusual way. We were absolutely in dark about the company and the circumstances under which the account landed at our main branch. We came to know about the circumstances only later. We had heard that our CMD had built a palatial house in Bangalore. There were several stories about the plan, construction, luxurious furniture and interior decoration of the house. As the CMD used to stay at the prestigious Canara Bank House at Basavanagudi, it was expected that the new house would be let out on rent to a prestigious corporate house for the residence of its top executives.

We came to know that the first resident of the luxurious house was to be none other than Mr. Evans (name changed), the CEO of Birla 3M Ltd. It was the same connection, which made the company open its account with our branch. On the face of it, the account appeared to be a very prestigious catch for our bank. Being a multinational company, it was likely to contribute to our branch’s foreign exchange business substantially. It was also expected that the company may avail various credit facilities from our bank.

The first request from the company itself landed us in problem. The company asked the branch to issue a guarantee on behalf of its CEO Mr. Evans to the Customs Authority. As Mr. Evans was coming to India for regular stay, he had come with certain personal belongings.  The Customs Authority insisted for a bank guarantee before releasing the same. We were asked by the officials at HO to issue the guarantee expeditiously in view of his connections with the CMD. We would have been indeed happy to do so as it was simple question of issuing a guarantee and collecting commission. There was absolutely no chance of invoking the guarantee by the Customs Authority.

But the problem was - the company had not collected the draft of the guarantee from the Customs Authority. Besides, Mr. Evans had to execute a counter guarantee to the bank in his individual capacity as per bank rules. When the representative was told about the requirements, he simply complained to Head Office that the branch was not cooperating in the matter!

Mr. Evans himself arrived later at our branch to collect the guarantee. To be frank, it was difficult to understand what exactly he was trying to tell us in view of his very heavy American accent! But it all came down to one particular requirement. The Customs Authority wanted a guarantee to release his belongings and he could not understand why we were not obliging him! He was not convinced that he or his company was required to collect the necessary draft guarantee from the Authority. As regards the counter guarantee, he simply told us that he would not sign any document (particularly the stamped one) under any circumstances! He told us bluntly that there was no such requirement in the American banks!

The company had appointed an Indian called Othello (name changed) as Finance Manager. We thought this gentleman may help us in meeting our requirements. We wanted to somehow issue the guarantee and send Mr. Evans away happily. Otherwise, we knew that the next telephone call would come from the CMD’s Office. But Mr. Othello was more rude and blunt than his CEO.  At least in the case of Evans we were unable to make out what exactly he was telling us! But Othello’s English was very clear. It was like – “You just issue the guarantee. Don’t ask anything from us; neither are we going to sign any papers!”

It really required some ingenuity on our part to get out of this tricky situation. But we managed the situation somehow. It is not appropriate for me to explain the exact strategy followed by us. But we were more worried about the future situations in view of the fact that we were the sole bankers to the prestigious company. We were not to wait long for the next situation!

Hardly a week later, Mr. Evans arrived at the branch with his cheque book.  He wanted to draw some cash for his personal expenses. He expressed his displeasure with the Indian banks, which had not yet introduced a machine called Automated Teller Machine (ATM). He told us that there was no necessity to sign cheques in America to draw cash. He signed a cheque very reluctantly to draw Rs10,000. Our Senior Manager requested him to put his signature on the reverse of the cheque as is the practice in all the banks in India. He refused point blank. He told our SM that there was no such practice in America!

We soon came to know that the company did not require any fund-based limits. 3M being a cash surplus MNC, was hardly in need of funds. The Indian subsidiary would indent funds from the parent company periodically as per its requirements. The company required only some guarantee facilities to meet the Indian operational requirements.

But for availing the guarantee facilities, the company was expected to pass necessary board resolutions authorizing its officials to execute the necessary counter guarantees. The requirement was as per the Companies Act, 1956. Here again, the company was not convinced of our requirements. The irony was - even the Indian Finance Manager Mr. Othello was convinced that the same was not necessary!

------- (To be continued)

A V Krishnamurthy

My Days South - Episode No.10

The account of XYZ Company continued to be a headache to us. As stated by me earlier, the right issue refund order account was overdrawn and the liability started mounting day by day as the refund orders continued to be presented through the clearing house. We sent a detailed report to the Circle Office highlighting the fact that the company was not furnishing the actual position of the excess subscription received and the actual amount of refund orders issued against the same. The overdrawings reached about Rs27 lakh ultimately.

Meanwhile the financial position of the company had totally deteriorated. But it continued its existence by submitting supply bills for discount occasionally for the payment of salaries and other maintenance expenses. We started seeking the permission of each transaction in the account. We used to allow drawings only with due permission from the Circle Office. We used to refer to each proposal as a part of a ‘Holding On’ operation! The DGM was obliged to give permissions in the absence of clear instructions from CMD.

Through our persistent efforts ultimately it came to light that the company had opened a current account with our A R Street, Mumbai Branch and routed some right issue subscription amount through it. It had diverted the entire proceeds somewhere and had issued the refund orders against the same on our branch. That was the reason for the overdrawings at our branch. This was nothing but a clear case of cheating by the company. We called for an explanation from the company and reported the matter in detail to the Circle Office and sought their instructions.

While we were expecting the Head Office to take some steps to discipline the company, no such thing took place. On the other hand, the MD of the company complained to the CMD that the branch was harassing the company! As a result, the name of our DM Kulkarni did not find a place in the list of promotees to the AGM cadre. In fact the DM was officially called to the Head Office and told by the CMD that his promotion was not cleared for mishandling the account of XYZ Company. That was the type of clout the company enjoyed with our CMD!

After some time Kulkarni was transferred from the branch and a gentleman called Menon was posted in his place. Menon had earlier worked in the Industrial Advances Section of our Head Office. While he knew all the nuances of handling the working capital limits, he was a master in ensuring that no accountability was fixed on him personally! He had picked up this special skill while working at the Head Office! Of course he did not mind if the same was fixed on his juniors! Our Senior Manager Kudva had also picked up this trait while working at the Circle Office. He was also a master in passing on the responsibility to the officers working under him. The two were in fact a dangerous combination for me and my other officers. This was proved in another case that I would come back later. Having worked with a gentleman like B R Nayak, who took it upon himself the protection of people working under him, this was a totally new exposure for me.

As far as the account of XYZ Company was concerned, the methodology followed by Menon was indeed quite innovative. He specifically instructed me not to use the word ‘recommend’ in any of our proposals. His argument was that since all the proposals were first discussed by the company at the Head Office and were submitted to us only later, there was no question of any recommendation from the branch. Accordingly I started mentioning in each proposal that it has already been discussed with the officials in HO and we may be permitted to allow the facility as already agreed! Quite surprisingly our Circle Office did not question the wordings of such proposals.

It was clear that the company was in no position to clear the overdrawings in the rights issue account. At the instance of our CMD, a subsidiary of our bank was asked to allow a loan facility against the security of equity shares held by the promoters. The officials of the subsidiary were obliged to sanction the facility. But the company submitted another request to our bank asking a portion of the loan to be released for its working capital needs.  Even this request was permitted by the CMD and as a result we could only get a portion of the overdrawings cleared from out of the loan sanctioned by the subsidiary.

A stage was reached when we had to run to HO for every single proposal of the company. The MD of the company used to first get an oral sanction from the CMD. We were being summoned by the General Manager in-charge of credit at the Head Office. I had to accompany our DM to meet the GM at his chambers with absolutely no idea about the proposal that would be thrust on us. Our Circle Office DGM would join us by then. Every time we had to brief the GM about the current position of the accounts of the company. It became a routine for us to tell him that there was absolutely no change in the position of irregularities in the accounts.

The GM used to invite some other GMs for discussions to get some moral support. All of them were aware that the GM in-charge of credit was helpless in the face of orders from the CMD. The seriousness of the situation was being reflected on their faces. They would ask the GM (Credit) the same question every time – “Kithle dee moon sangla”? (“How much you have been asked to sanction”?). The reply used to be – “Tha lakh moon sangla or paanch lakh moon sangla” (I was asked to sanction Rs10 lakh or Rs5 lakh). They would all then say “kassan maaraaya? (What is this - man?). The GM would then ask us to allow overdrawings of Rs5 lakh or Rs10 lakh as instructed by the CMD.

I had made it a point to ensure that all the oral/telephonic sanctions from HO/CO were duly confirmed in writing. As the Circle Office officials hated reminders from the branches in view of the hierarchy, I was listing out such pending sanctions in the fortnightly reports to CO/HO. That served the purpose of reminders and also indirectly served the purpose of putting on record that such sanctions had been given.

The retirement of the CMD and appointment of another CMD in our bank made only a marginal difference to the company. The position of irregularities continued till I left the branch on promotion as Senior Manager in June 1990. I continued submission of the fortnightly reports till I left the branch. After some more years the account became totally sticky. A special team from the Circle Office was asked to conduct an in-depth study to fix the responsibility. The fortnightly report came in handy at that time. The team concluded that the sanctioning authorities were aware of all the irregularities in the accounts of the company. There was nothing that was not known to them while allowing the limits to continue and sanctioning additional limits. The team also found that all the adhoc facilities and deviations from sanctions were having specific sanctions from the relevant authorities. It gave a clean chit to the branch and absolved the branch officials from the primary responsibility, which would have been otherwise fixed on them as a matter of routine!

------- (To be continued)

A V Krishnamurthy

Venkappaiah, the Greatest Storyteller

It is time for me to write about one great character and personality of our village, Venkappaiah of Hosalli. If one were to conduct a popular vote for the best entertaining character in our village, Venkappaiah would have won it hands down. In my opinion he was the greatest storyteller I have ever seen. He would present each incident in his life in such a fashion that the audience would be spellbound and will be on their toes to hear more. He had a never-ending treasure of stories in his basket which he would unravel to the great delight of the audience of all age group.

Venkappaiah had a 6+ feet tall giant of a personality and put his physical strength to full use in doing hard work from morning to night. He had migrated to our village from a place called Mooralli (three villages) where he was the Patel of the village. Even after shifting base, his village people did not allow him to relinquish his post. It was quite unusual for a man from a far away village to retain his post of patel in his earlier location. But that was the kind of reputation Venkappaiah had built up.

Venkappaiah had a large landholding of both arecanut plantation and paddy fields. He had taken the land on tenancy basis. But for all practical purpose, he was more than a landlord. His house in Hosalli was like a fortress. He had two sons from his first wife. The first son Thimmappa was a classmate and close friend of my eldest brother. After the death of his first wife, Venkappaiah had remarried and had children from her. His son from the second wife Srinivasa was in my age group.

Even the second marriage of Venkappaiah was a path-breaking event. He actually did a ‘seemollanghan’ in the process. What I mean here is that he had a cross-border marriage. The girl was from South Kanara district which was under the erstwhile Madras State at that time. In those times all the marriages used to be within the community without exception. Our community people were located only in Sringeri, Koppa, Kalasa, Thirthahalli and Hosanagara areas. In fact many of the brides used to be from the same village. The adage ‘variety is the spice of life’ did not hold good at all!

But Venkappaiah had the courage to break this tradition. There was another catch. It was the name of the bride. Our community owed strict allegiance to the Sringeri Mutt. The name of Sharadamba always carried great respect and reverence. The moment Venkappaiah told that the name of the bride was Sharada, everybody was quite happy. I wish to add here that both my mother and first sister-in-law also carried the same name. Years later I was also destined to follow the footsteps of Venkappaiah and married a girl from South Kanara. But then the times were different and indeed it had been accepted that variety was the spice of life!

Our village had a perfect community-living system in those days. Most of the work connected with agriculture and preparations for the rainy season were conducted through a system of sharing the labour. Each household had to fix a day in advance for the work to be done and inform all the other households. On the allotted day each household would depute one or two persons for the occasion. All the deputed persons would join the household and work for the full day to complete the job. They would be served food cooked specially for such events. The salient feature of this system was that even the richest person in the village would participate and do physical labour along with the poorest. The arrangement was reciprocal and commitments would be kept up invariably.

One main event held by each household annually was the covering of house top (roof) with the new arecanut leaves before the onset of the monsoon. Even though the houses of rich people were having tiled roofs, there would be some constructions like cowsheds covered by arecanut leaves. The work had to start early in the morning as it took a lot of time to remove the old leaves and laying the new ones. The placement of fresh leaves was an expert job known only to a few in the village. Our Venkappaiah was one such expert.

As young boys, we used to wait for the arrival of Venkappaiah anxiously. He used to wear a specially made leather chappal suited to him. As he used to walk long distances regularly the wear and tear used to be high.  We could make out his arrival from a good distance on hearing the sound of his chappals. We would shout at the top of our voice that Venkappaiah had arrived! The news would light up the spirits of one and all. It was always a familiar sight to see him arrive with two cans and two bags. One of the cans would be full of creamy milk and the other with fresh curds. One of the bags would be full with vegetables grown in his house-garden. He would hand over the cans and the vegetable-bag to us to be sent to the kitchen for that day’s use. He would sit down with the other bag and have a cup of coffee. The bag would contain old clothes to be used while doing the physical labour. He would change his clothes and move to the roof to start his job in the company of others.

Once on the roof, Venkappaiah would go full throttle on his job of covering the roof. Simultaneously he would start unfolding another event in his colourful and exciting past life. Suddenly all other conversations would come to an abrupt end. Everybody would keep their ears fully cleared to hear another incident from the never-ending treasure of Venkappaiah. Venkappaiah would work for the full day till sunset in the evening. In between he would have a lunch break; but he would continue with storytelling in view of the popular demand. As children we used to sit glued to our seats or move with Venkappaiah to hear every word of his narration.

It is a pity that none of the stories of Venkappaiah were recorded by anybody and they are permanently lost to the world. As they were real-life incidents narrated in great style by Venkappaiah, there is no chance of reconstructing them in any way. He had faced tough times, great challenges and had come out every time by his sheer courage and enterprising nature. He could see them in a light hearted way as recollections from his past. There used to be tragedies, comic situations, challenges, pathos, joyous moments and what not. Only a master like him would have the guts to face them and come out successful every time. I also feel guilty that I do not recollect a single story as narrated by him. In our anxiety to hear the next incident, we simply forgot the earlier ones! But that doesn’t prevent me from writing about him. I will use this occasion to record his greatness to the future generations to come. Nobody can stop me! So let me continue!

As already mentioned by me above, we had to reciprocate and attend the similar work at Venkappaiah’s house in Hosalli. My father used to return the favour always personally. But there was one occasion on which he could not; as an alternative he deputed my elder brother and me on his behalf. We were in the age group of 16-18 at that time and had picked up sufficient expertise in doing different manual jobs. We thought it was a good opportunity to show our mettle to an expert like Venkappaiah. We told Venkappaiah that father was not well and he thought it fit to depute two of us to compensate one Venkappaiah! He was not exactly pleased; but assigned specific job to us and asked us to proceed. He was a taskmaster when it came to work. But it would be an understatement if I say that we had it tough! We had presumed AVL+AVK=V (Venkappaiah); but it was actually like AVL+AVK=V/10. What I mean here is - output of two of us together was hardly equivalent to a tenth of Venkappaiah. The only justice we did was probably to the food served to us as lunch in the noon! We toiled hard till late in the evening and felt greatly relieved when the final task was accomplished!

In our villages it was customary to recite Sanskrit slokas during lunch time on occasions like marriages, Navarathri festival, etc. There used to be some sort of competition in reciting these slokas. The practice was popularly known as reciting ‘granthas’. The granthas would invariably end with “Hara Namah Parvathi Pathaye!” or “Jai Seetha Kantha Smaran”. The audience would respond loudly shouting,”Hara Hara Mahadeva” or “Jai Jai Ram”. It was an opportunity for people of all age group to exhibit their talents. Our Venkappaiah used to recite one peculiar sloka (?), which nobody could decipher! In fact nobody ever knew in which language it was! I am reproducing it below from my memory:

Gadi Tingi Nagavaan,

Gadi Tingi Nagavaan

Sarvangi Batthise,

Sarvangi Batthise

Girje Kote Sahukar,

Bahu Dina Samsar

Gadi Tingi Nagavaan!

Gadi Tingi Nagavaan!

In my opinion this was the mother of all granthas! Simply because of the way it was rendered by the great Venkappaiah and the secrecy behind its origin. Venkappaiah neither explained its meaning nor its origin. But people continued to enjoy it and Venkappaiah remained an enigma to our villagers.

I do not remember exactly when this great man’s story telling sessions came to an end. As I moved out of our village with my professional career, I could not keep a track. Today his sons have constructed new houses in Hosalli and the fortress like old house stands dismantled. With it the memories of Venkappaiah have also disappeared. But for many of us he would remain an evergreen hero, the master storyteller, the one and the only Venkappaiah of Hosalli. May his soul rest in peace!

A V Krishnamurthy
(This story was written by me in 2008)

I Don't Know, Son! - 75

Tough Assignments for UP Police!

Son: The police Department in UP is said to be a worried lot nowadays, dad,

Father: How come? Go on, son.

Son: They say they are getting tough assignments one after another, dad.

Father: Like what? Go on, son.

Son: They first got the assignment to trace the seven missing buffaloes of senior minister Azam Khan in Rampur, dad.

Father: Go on, son.

Son: Now they were ordered by the Supreme Court to arrest the controversial Sahara Chief Subrata Roy, dad!

Father: Go on, Son.

Son: The police authorities are said to be, however, happy that they could handle both the ‘sensitive cases’ successfully, dad!

Father: I don’t know, son!

The Good and Bad News for Sons!

Son: Two pairs of father & son are in the news for good and bad reasons respectively, dad.

Father: How come? Go on, son.

Son: The good news is that the former Chief Minister of UP, ND Tiwari, has accepted 35-year old Rohit Shekhar as his son, dad.

Father: Go on, son.

Son: Rohit had dragged Tiwari to court with a paternity suit, dad.

Father: True. What is the bad news then?

Son: Now the former Chief Minister of UP, Mulayam Singh Yadav, has chided his son the present CM of UP Akhilesh Yadav, dad.

Father: Go on, son.

Son: He has asked his son to mend his ways and keep a distance from sycophants, dad.

Father: I don’t know, son!

The Script for a New Film!

Son: Well known Bollywood personalities have defended the arrested Sahara Chief Subrata Roy at a press meet in Mumbai, dad.

Father: True. Go on, son.

Son: They include director Ramesh Sippy, actor Fardeen Khan & Johny Lever, singers Nitin Mukesh, Sadhna Sargam, Sapna Mukherjee and Rahul Vaidya, dad.

Father: Go on, son.

Son: However, Ram Gopal Verma, the well known director could not attend the press meet, dad.

Father: Go on, son.

Son: When asked for the reasons for his absence, sources revealed that Verma was right now busy with a script for his upcoming film, dad.

Father: Go on, son.

Son: They told in confidence that the script will be based on the real-life story of a famous industry personality who is right now in jail as per Supreme Court orders, dad!

Father: Go on, son.

Son: When pressed further, they revealed that the person owned an airline and an IPL cricket team previously, dad!

Father: I don’t know, son!

Government’s Generosity for Small Savers!

Son: The Government has announced a ‘substantial’ hike in interest rates on small savings schemes in post offices, dad.

Father: True. Go on, son.

Son: The hike in rates vary from 0.1% to 0.2%, dad!

Father: Go on, son.

Son: However, the government has left the interest rates on schemes for Senior Citizens untouched, dad.

Father: Go on, son.

Son: When asked for reasons for keeping this section out of the benefit of hike, the spokesperson was said to be quite outspoken, dad!

Father: Go on, son.

Son: He told that this particular section is always fishy and touchy, dad!

Father: What does he mean? Go on, son.

Son: He appears to have told that the elderly persons would definitely attribute this largesse by the government as an election stunt, dad!

Father: I don’t know, son!

A V Krishnamurthy

5^th March 2014

The Story of Choma

That morning Sudheer had an unusual guest at home. It was Choma, the cowherd. It was after a long time that Choma was visiting the house. There was a time when he would visit the house daily to collect the cows and buffaloes for grazing. But two things had changed the life of Choma. The first one was that he had become a landlord. The land cultivated by him as tenant now vested with him as per the tenancy act passed by the Government. Secondly the system of cow grazing was no more in existence. Earlier each household would have a number of animals to be sent for daily grazing. But presently all the houses had only one or two cross breed cows, which would be reared in the cowsheds only. Thus the profession of a cowherd had become redundant.

After the usual offer of a cup of coffee, Sudheer asked Choma the reasons for his sudden visit. Choma told him that he had come to him to avail his service as an advocate! He had heard that Sudheer was practicing as an advocate. He was also aware that he had a very good practice, but was very considerate to his clients-particularly to the under-privileged. Choma had never thought that one day he may require his services. But now he had landed himself with a case for which he was least responsible. He started telling Sudheer how he was obliged to his father right from childhood. Sudheer asked him to come to the point directly without any formalities.  Choma was happy to see the humility of Sudheer.

But when Choma came to the point directly, Sudheer was quite amused. Choma wanted Sudheer to file a suit against Indicate bank! Sudheer suddenly got a doubt whether Choma had a ‘drink’ right in the morning. But to his surprise he found Choma quite conscious and very clear about what he was telling. As per him he was cheated by the bank; he wanted Sudheer to file a suit to recover his deposit amount and also teach a suitable lesson to the bank. Sudheer asked him to explain to him clearly what went wrong between him and the bank.

Choma’s case went like this. He was not new to the Indicate Bank. As per him, he had a very bad experience with the bank even earlier.  One year back, he had approached it for a housing loan. But he found the bank turning down his request on a flimsy ground. While the Manager dismissed his proposal off hand, Choma had overheard him telling the Accountant, “Ayeg Erme kattyara apuji” (he cannot rare a buffalo!). Choma could not really make out the connection between his housing loan proposal and his incapacity to rear a buffalo! In fact he tried to tell the Manager that he was a cowherd by birth and knew exactly how to rear a buffalo! But the manager was in no mood to hear him and just sent him away.

Choma was actually in need of a loan of Rs25,000/ at that time to finish the construction of his small house. After the rejection of his proposal by the bank he came to know that the Government was extending subsidy to weaker section people like him for house construction. He submitted his application and got a subsidy sanctioned for Rs25,000/=. By the time the amount was received, Choma had already finished the construction of his house from his own funds.

Choma went to deposit the subsidy cheque in the same Indicate Bank.  He was asked to open a bank account.  When the Manager asked him if he knew how to sign, Choma proudly told him that he could. Actually he was a total illiterate and could neither read nor write. But he had attended a Sakshratha (literacy) campaign week held by the social welfare department where he was taught how to put his signature in Kannada. He found the bank very reluctant to open his account. The Manager asked him to bring a suitable introduction.

Choma was loitering in the bank with the cheque in his hand, when a bank peon, by name Monappa, saw him. Monappa asked Choma what was his problem. Choma showed him the cheque and requested him to help out. Monappa appeared to be a very kind and helpful soul. He filled up all the forms and asked Choma to sign them. Choma signed all of them by writing his name in Kannada, as taught to him, with great difficulty. It took a long time for him to put each signature. Ultimately Monappa managed to get Choma’s account opened by obtaining introduction of one of the customers known to him. Choma had to submit a copy of his ration card and two photographs for the purpose. Choma deposited the cheque and was asked to come after two days to draw the amount.

Choma went to the bank again after a week. Monappa gave him the passbook. Choma wanted to draw Rs.10,000/. He was issued a withdrawal slip. With the help of Monappa he got the same filled up and put his signature. He collected the cash from the cashier. He was given back the passbook showing the balance as Rs15,100/. He kept the pass book safely in his possession at home. As he was not in need of money he did not turn up at the bank for nearly a year. He thought his money was lying safe in the Indicate bank.

One fine morning Choma was in need of money for purchase of fertilizers for his paddy crop. He took out his passbook and went to the bank. He could not find Monappa at the bank. Choma was told that he had been promoted as a clerk and transferred. Choma found himself helpless. With the help of a customer at the counter he got a withdrawal slip filled up for Rs5.000/ and tendered it at the counter along with the passbook.

Choma got a shock of his life when he was told by the clerk that the balance in his account was only Rs100/. He asked the clerk as to what happened to his Rs15,000/. He was told that he had already withdrawn it. Choma informed him that he had never come to the bank after withdrawing Rs10,000/. But the clerk just repeated that the amount had already been withdrawn by him about two months back. Choma was virtually in tears. He went to the bank Manager with his passbook. But he was of little help. He merely sent him away by stating that since the withdrawal slip had his signature it was presumed that he had withdrawn the money.

Choma ended the story here and requested Sudheer to help him out. He not only wanted his money back but wanted Sudheer to file a cheating case against the bank to teach them a suitable lesson. Sudheer could make out now that Choma was telling the truth and had a clear cut case against the bank. He collected the passbook and the withdrawal slip (for Rs5,000/ which was denied payment by the bank) from Choma.  He wrote a letter to the bank Manager in Choma’s name to issue a Xerox copy of the withdrawal slip against which the bank had paid Rs15,000/.  He asked Choma to visit the bank and collect the Xerox. He also told him to meet him at his office in the evening with the Xerox copy.

Choma promptly met Sudheer at his office on the next day. He gave him the Xerox copy of the slip he had collected from the bank. He once again requested Sudheer to teach the bank a proper lesson. Sudheer discussed his case with an official of another bank, who was with him as a client at that time. The Official was amused by Choma’s vociferous attitude towards the bank officials. Sudheer told him that the indicate Bank had earlier rejected Choma’s housing loan proposal with the flimsy reason that he did not know how to rear a buffalo. The colleague could not first understand what exactly Choma had been told by the Manager. But when Choma repeated his version he could not stop laughing. He explained to Sudheer that the Manager was only telling his Accountant that Choma could not pay the ‘EMI’ for the loan if sanctioned (“Ayeg EMI kattyara apuji”)! Choma had heard EMI as Erme!

Sudheer drafted a legal notice to the bank and told Choma to come after two weeks as he had to first receive reply from the bank for the notice. Once Choma left, he compared the signature in the Xerox copy given by the bank and the original withdrawal slip for Rs5,000/ signed by Choma himself. He could make out from his naked eyes that the signature of Choma had been forged.  The difference was too apparent to escape the notice of the bank.

Sudheer then went through the passbook entries. He discovered one major discrepancy. He found that the withdrawal slip carried the date 3rd April 2007 while the passbook showed the withdrawal date as 10^th September 2007. He could conclude that it was some ‘insider job’ at the bank. He decided to wait for the reply from the bank.

The bank was very prompt in replying the notice. It had merely stated that Choma had withdrawn the amount on 3^rd April 2007 and his signature tallied with the specimen signature lodged with the bank. It had rejected the request of Choma to reimburse the amount as sought in the notice. Sudheer prepared a plaint immediately and sent a message to Choma to call on him. In due course a suit was filed in the civil court.

The case would have taken its own time to come up for hearing. But Sudheer could convince the Judge that the plaintiff belonged to the weaker section and he had been cheated by the bank. Hence the case came up for hearing fast.

o--------------o-------------------o-------------------o---------o-----------

On the day of hearing at the Civil Judge Court, Puttur:

The Scene

(The Judge arrives and the court comes to the order. The clerk calls the case-Mr.choma v/s Indicate Bank, Puttur. The bank is represented by Mr. Pai, the Manager and Mr. Bhat, bank’s advocate. Choma was present with his advocate Sudheer. The judge asks Sudheer to proceed with the case. He calls Choma to the witness box. The proceedings start :)

  

Sudheer (Speaks in Kannada): Choma, please take the oath. You have filed this case against the bank. Have you been explained the contents of the plaint in Kannada and have you signed it after understanding it in full? Do you say that whatever stated therein is true to the best of your knowledge?

Choma (Speaks partly in Kannada and partly in Tulu): Yes. I have been explained and I have understood fully the contents of the plaint. They are true to the best of my knowledge.

Sudhir: Are you a literate? Do you know reading and writing in Kannada or any other language?

Choma: I am an illiterate. I only know how to put my signature in Kannada, which was taught to me during a Sakshratha campaign of the Government.

Sudheer (exhibits a Xerox copy of the withdrawal slip for Rs15,000/: given by the bank): Is this your signature? Do you remember having visited the bank either on 3rd April or 10^th September 2007?

Choma: It is not my signature. I had not visited the bank on both the dates.

Sudheer: You can go now. (Turning to the judge) May I now examine the Bank Manager?

Judge: You may proceed.

(Mr. Pai, the Manager comes to the witness box and takes oath)

Sudheer: Mr.Pai, do you know the plaintiff Choma?

Manager: Yes, I know him.

Sudheer: Did you know that he was an illiterate and only could put his signature?

Manager: Yes.

Sudheer: The banks are expected to follow certain special guidelines in respect of illiterate accounts. Can you tell me what those guidelines are?

Manager: We will not issue cheque books. The depositor has to personally visit the bank and withdrawals are allowed only through withdrawal slips accompanied by passbook. Thumb impressions are to be affixed in front of the bank officer only. The officer has to verify the photograph each time and then only authorize payments.

Sudheer: Did your bank follow these guidelines in the present case? If not, why?

Manager: We had not issued the cheque book. Other guidelines were not made applicable as the depositor was treated as literate as he could put his signature.

Sudheer: You knew that Choma could only sign with great difficulty as he was an illiterate. Such accounts are naturally susceptible for fraud. It would have been prudent on your part to treat the account as an illiterate account and exercise caution. Do you agree?

Manager: I have nothing to say.

Sudheer: The withdrawal slip is dated 3^rd April 2007, but the pass book shows the withdrawal date as 10^th September 2007. What do you have to say on this discrepancy?

Manager: I am not able to say anything on this matter right now.

Sudheer: Do you agree that the plaintiff has a valid case against the bank as the signatures do not tally and the bank had not exercised necessary caution?

Manager: I disagree.

Sudheer: (Turning towards the judge). May I sum up the case now?

Judge: you may proceed.

Sudheer: The honorable court may note that the plaintiff is an illiterate person belonging to the weaker section. He only knew how to put his signature. Such accounts are susceptible for fraud. The bank was aware of this. But they have not exercised caution and followed the guidelines prescribed for an illiterate account. The signature in the withdrawal slip does not tally with the plaintiff’s signature. The date on the withdrawal slip and the date of withdrawal in the pass book do not agree. All this prove that the bank has not exercised sufficient care. This has resulted in fraudulent withdrawal from the account. The court may kindly order the bank to reimburse the full amount with interest and cost. That is all, my Lord.

Judge: Does the bank’s advocate have anything to say in the matter?

Bhat: The bank may be provided some time to clarify the points raised by the plaintiff’s advocate.

Judge: The case stands adjourned.

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]

Mr. Pai, the Manager of Indicate bank was a busy man that week. He reported Choma’s case as a fraud case to the Zonal Office. An Officer arrived from Zonal Office and conducted a detailed investigation. It was found that the payment of Choma’s cheque had been made on 3rd April 2007 only. The Bank was implementing core banking and due to technical problems the cheques could not be posted to the accounts on

3rd and 4th April. After posting the cheques later there was a difference in the accounts. The same was traced to the cheque of Choma only on 10 September. The cheque was posted to the account only on that date. The forged cheque had been encashed in the confusion prevailing on 3rd April. The cheque had been paid by the cashier without authorization. On enquiry by the investigating Officer, the cashier admitted his crime. He had used the illiterate Choma’s account to draw money fraudulently.

o--------------o-------------------o-------------------o---------o-----------

The Head Office of Indicate Bank issued a circular asking all the branches to treat the accounts as illiterate accounts if the depositor knew only to sign. The bank credited the money to Choma’s account with interest. It also informed the court through the advocate that it had settled the payment. The court dismissed the case awarding cost to the plaintiff Choma.

That morning Choma called on Sudheer. He left the place after having his coffee and breakfast and thanking him profusely. Another case of Sudheer had come to a happy end.

A V Krishnamurthy

(This story based on real-life incident was written on 5^th December 2008)

My Days South - Episode No.9

As I have mentioned earlier, working in a bank branch where its Head Office is also situated has its own perils. While your achievements may not reach the top administration, you can be sure that any complaint against you will reach them - even up to the CMD level within no time. Once it reaches the level of CMD, you don’t know what sort of fate awaits you! Another fall out of this situation is that your bosses expect you to do certain things against your conscience. You may be forced to do them knowing very well that the same is against the rules and ordinary prudence!

Our bank had floated a subsidiary for undertaking merchant banking activities. The persons posted there were generally high-fliers. They believed that they were a privileged class and the branch officials were supposed to meet their needs – no matter whether the same went against the established procedures and systems.

One day I was called by my Senior Manager Kudva to his cabin. He introduced me to a young officer who was working at the said subsidiary. He had an inter branch advice with him for a few crores issued by a major branch of our bank in Mumbai. The amount represented the proceeds of a call money placement by a Mumbai Corporate with the subsidiary. I was asked to credit the proceeds to any of our corporate accounts by reducing the drawing power (limit) to the same extent. As and when the Mumbai Corporate wanted the funds back, I was supposed to debit our client’s account and remit the money back to our subsidiary along with interest till date. The client was supposed to pay one percent less on this amount than what was being charged by us.

The exercise went like this. Our subsidiary was getting the funds from the Mumbai corporates at about 8% per annum. Our clients were being charged at about 16% on an average by our bank. They would be charged 15% (one percent less) for the period the funds were in their account. Our subsidiary would pocket cool money of 7% on the amount for the period of the deposit.

While the intention of the subsidiary to make money was understandable, it had no business to use our branch as a vehicle for the purpose. It was also not clear whether it was licensed to conduct such money market operations. As a Manager I had no authority to debit and credit a company’s account without specific instructions – no matter even if I was offering a 1% rebate in interest. But the Senior Manager told me that the subsidiary may complain to the CMD, if we refused to toe its line. The subsidiary was a brainchild of our CMD and antagonizing the officials amounted to rubbing the CMD on the wrong side!

I was forced to do this adjustment against my conscience. I had to get it done through an officer under my signature. Even though I was acting as per the instructions of the Senior Manager, I knew that only the officer and I would be held responsible for the transactions later. There was nothing to prove that I was acting under his orders. The officer from the subsidiary would suddenly turn up one day and ask us to reverse the transaction. This became a nuisance for us. Besides some of the clients started questioning our action and asked us not to ‘play in their accounts’ as such unauthorized transactions attracted adverse comments from their auditors. They said they were not interested in this 1% benefit scheme!

One day our Senior Manager received a phone call from the CMD’s office that he was not happy with the treatment given to the officers from the subsidiary. The officer had complained to him that we were reluctant to handle the ‘adjustment business’. By that time our bank had floated a mutual fund venture. The officers from the Fund also started approaching us for similar adjustments. In fact the officer who used to call on us was said to be a close relative of the then ED of our bank. We were naturally expected not to rub him on the wrong side!

We carried on with this adjustment under duress. I was aware that the adjustments were against the bank rules. I thought it prudent to bring the same to the notice of the Head Office. One day I drafted a letter addressed to the Credit Wing at Head Office requesting them to confirm that the branch was in order in doing such transactions at the oral request of our subsidiaries. The Credit Wing was then headed by a person who was my DGM at the Kolkata Circle for some time. This gentleman knew that the transaction was not in order. But he did not want to antagonize the CMD. He did the best thing to safeguard his skin. He telephoned our Senior Manager and told him not to address such letters to the Credit Wing in future! He said he was destroying the letter at his end!

I left the branch in the year 1990. The Harshad Mehta Scam took place in the year 1992. Both the officers mentioned by me above (one from the subsidiary and the other from the Mutual Fund) were arrested by the CBI. One of the allegations against them was routing the money of one corporate in the account of other corporate (including brokers’ accounts)!

------- (To be continued)

A V Krishnamurthy

I Don’t Know, Son! – 74

The Bitcoin Facing a Bit of Problem!

Son: Mt. Gox, the world’s biggest bitcoin exchange has disappeared suddenly with its website down, dad.

Father: Go on, son.

Son: Angry investors were left wondering whether exchange was still solvent, dad.

Father: Go on, son.

Son: According to sources, the exchange is in a bit of problem, dad!

Father: Go on, son.

Son: However, they failed to explain the real position as it was difficult for them to coin suitable words, dad!

Father: I don’t know, son!

Old Bank Licence!

Son: The committee headed by former RBI Governor Bimal Jalan has submitted its recommendations on new bank licences to the Reserve Bank of India, dad.

Father: True. Go on son.

Son: A RBI spokesperson is said to have refused to reveal as to when RBI would announce the names of the applicants successful in securing the licences, dad.

Father: Go on, son.

Son: However, he is said to have confidentially revealed that right now one old bank licence is up for grabs, dad!

Father: How come? Which is the bank? Go on, son.

Son: Apparently it appears that he was referring to United Bank of India (UBI), which is in the news for all the wrong reasons, dad!

Father: I don’t know, son!

UBI CMD Resigns for ‘Health’ Reasons!

Son: The CMD of United Bank of India Archana Bhargava has resigned and has opted for voluntary retirement citing health reasons, dad.

Father: True. Go on, son.

Son: While the CMD has not revealed the nature of her sickness, it is reported that the bank is finding it difficult to handle a number of large ‘Sick’ accounts left behind by her, dad!

Father: I don’t know, son!

Blue-eyed Boy to Scapegoat!

Son: The posting of a Bank official as CMD of a PSU bank is treated as a Blue-eyed boy posting all these days, dad.

Father: True. Go on, son.

Son:  Now that the CMD of United Bank of India has resigned, the vacancy is up for grabs, dad.

Father: True. Go on, son.

Son: But it appears none of the Executive Directors of the PSU banks are interested in the once coveted post, dad!

Father: Go on, Son.

Son: Apparently, the post looks like a ‘scapegoat’ posting than a Blue-eyed boy posting, dad!

Father: I don’t know, son!

A V Krishnamurthy

26^th February 2014