A common man deposits his life’s hard-earned money in a fixed deposit (FD) in the bank with the confidence that the money will be useful to him when needed. But what if the bank refuses to return your money even after completion of maturity? One such surprising case has come to light in Kerala. An FD of Rs 5 lakh of a Thrissur resident matured in 2015, but the bank refused to give the money citing technical glitches. Now after an 11-year long legal battle, a larger bench of the Kerala High Court has given a historic verdict on 2 June 2026. The court has ordered the bank to return the entire FD amount to the customer along with 12 percent interest and a compensation of Rs 10,000. This decision is going to strengthen the rights of crores of bank customers across the country.
11 years of struggle vs hope of justice
This entire controversy is related to Sethumadhavan living in Mullamkunnath Kavu area of Thrissur. He had made an FD of Rs 5 lakh in a co-operative bank, the maturity of which was fixed on June 2, 2015. When Sethumadhavan reached to withdraw his money on the scheduled date, the bank management shied away from returning the amount by making the excuse of technical reasons. After running from door to door for his own money, he approached the Thrissur District Consumer Disputes Redressal Commission. Looking at the evidence, the Commission gave its verdict in favor of the customer on December 31, 2021 and directed the bank to repay Rs 5 lakh along with 12 percent interest and a penalty of Rs 10,000.
Bank’s arbitrariness versus legal maneuvers
Despite the clear order of the Consumer Commission, the bank did not return the money. On the contrary, after a huge delay of 825 days, the bank approached the Kerala High Court. The bank’s argument was that from December 10, 2014 to May 7, 2022, its management was in the hands of an administrator, due to which it took so much time to appeal. The single bench of the High Court completely rejected this argument of the bank and upheld the decision of the Commission. But the bank management did not stop here. He challenged the decision and appealed to a larger bench and this time played a new legal trick.
Customers’ interests come first
Before the larger bench, the bank argued that since they are a co-operative bank, Section 69 of the Kerala Co-operative Societies Act, 1969 applies to them. The bank said that under this law, the single bench or consumer forum has no right to hear this case. However, on June 2, 2026, the larger bench of the High Court rejected all these arguments of the bank. The court clarified that the Consumer Protection Act has been enacted by the Parliament specifically to protect the interests of consumers. In such a situation, this special law will always be considered superior to the provisions of the Co-operative Societies Act.
Court’s strict comment on technical excuses
Kerala High Court said a very important thing in its decision which is related to every common citizen. The court said that it is the primary responsibility of any banking institution working with public funds to return their money to its depositors on time. Making a scathing comment, the court said that when there is no dispute regarding the maturity of FD in 2015, then withholding the customers’ money merely on the pretext of technical glitches is highly condemnable. On the appeal of the bank’s lawyer, the court gave additional time of 6 months to return the amount and rejected his petition.
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