PSU banks not liable for losses from safe deposit vaults: RTI disclosure

Public sector banks will not be liable for any loss of valuables from safe deposit boxes rented out to customers as per the locker hiring agreement, says an RTI disclosure.

This was revealed in an RTI response to an RTI query of a lawyer by the Reserve Bank of India (RBI) and 19 PSU banks.

The lawyer, Kush Kalra, who had sought information under the transparency law has now moved the Competition Commission of India (CCI) alleging "cartelisation" and "anti-competitive practices" by the banks in respect of the locker service.

He has informed the CCI that the RTI response from the RBI has said it has not issued any specific direction in this regard or prescribed any parameters to assess the loss suffered by a customer.

He further alleged that all these banks, also including State Bank of India, Indian Overseas Bank, Syndicate Bank, Allahabad Bank and others, have formed a "cartel" to indulge in such "anti-competitive" practices.

Under the RTI response all public sectors banks have washed their hands of any responsibility.

According to the information availed by the lawyer, the unanimous reason given by the 19 banks, including Bank of India, Oriental Bank of Commerce, Punjab National Bank, UCO and Canara, among others, is that "the relationship they have with customers with regard to lockers is that of lessee (landlord) and lessor (tenant)".

The banks have contended that in such a relationship, the lessor is responsible for his or her valuables kept in the locker which is owned by the bank.

Some banks have, in fact, specifically stated in their locker hiring agreements that any item stored in the locker is at the customer's own risk and he or she may, in their own interest, insure the valuables.

The lawyer also raised questions of banks collecting rent without taking any responsibility for the valuables they keep.

If the banks are not responsible, why not people keep valuables at home after insuring them, instead of paying rent to the bank for a locker'' the lawyer asks.

"As per safe deposit memorandum of hiring locker, the bank will not be responsible for any loss or damage of the contents kept in the safe deposit vault as a result of any act of war or civil disorder or theft or burglary and the contents will be kept by the hirer at his or her sole risk and responsibility.

"While the bank will exercise all such normal precautions, it does not accept any liability or responsibility for any loss or damage whatsoever sustained to items deposited with it. Accordingly, hirers are advised in their own interest to insure any item of value deposited in a safe deposit locker in the bank," according to the hiring agreements.