Companies & Sectors
HDFC Bank to go offline over the weekend

Lakhs of customers of HDFC Bank across the country would not be able to do shopping, both online or offline, or any transaction using ATMs, debit cards on Saturday and Sunday as the lender wants to 'upgrade' its systems

Private sector lender HDFC Bank has decided to take a break during this weekend for upgrading its systems. This means the bank’s customers from across the country would not be able to do shopping, both online and offline, ATM transactions, phone banking, net banking and mobile banking as well as booking of term deposits through online banking.

 

In a statement, the lender said, “We are in the process of upgrading our systems to provide a wider range of products and services to valued customers such as you.”

 

Just last month, internet banking of HDFC Bank was down for a day. This affected customers who tried to use the net banking facility of HDFC Bank. In an email, the information technology (IT) team of the Bank said, “We clarify that there were no fluctuations. However, our Internet Banking was not available till 8 am on Sunday (12th May) due to hardware upgrade.”

 

While HDFC Bank denied any fluctuations in payment processing, the payment gateway had a different version. On 12th May, clients of a payment gateway received this email: “This is to inform that, due to a technical issue we are facing fluctuations in processing transactions in SBI & HDFC Net banking payment options. This will affect customers who try to avail products/services on your website and choose to use SBI or HDFC Net banking payment option… We are in communication with the bank teams and we will update you once the issue is resolved.”

 

SBI told us that “there were no fluctuations” but its internet banking was not available until Sunday for a planned upgrade. HDFC Bank took the issue more seriously and insisted that the payment gateway company must clarify the issue. So, on 13th May, it sent out an email saying, “earlier communicated fluctuations in processing payments using HDFC Net Banking payment option have been resolved. We apologize for the inconvenience caused.” So it confirms the technology issues, right? Well, think again.

 

Even more furious, HDFC Bank demanded a further clarification. So, on 14th May, there was a third clarification from the payment gateway saying that the 12th May email about fluctuations in HDFC Bank Net banking payment options “due to a technical issue, was erroneous. There was no technical issue and unavailability during that period was due to scheduled downtime. Inconvenience caused is deeply regretted.” Since Moneylife was asking the questions, we know why three emails were sent, but won’t other customers be totally flummoxed? (Read more )

 

While the bank is saying it want to ‘upgrade’ its system on 8th and 9th June, for providing a wider range of products and services, the fact is that there are issues with the IT systems of the lender. Just last month, it admitted doing the hardware upgrade. So this time the upgrade is for the software issues?

 

Remember, three years ago HDFC Bank’s website crashed and lakhs of its customers had a difficult time to access its net banking facility for over two days. on 5 September 2010, customers were greeted with this message, “Due to system maintenance, Certain account related features on Net Banking would not be available till Monday 6th September 17:00 hrs. Credit Card Enquiry, Demat, and Debit Card details would continue to be available. We regret the inconvenience caused.” Unfortunately, till 6pm on 6 September 2010, the site was down.

 

As per the latest ‘upgrade’, HDFC Bank's customers from Maharashtra would face the non-availability of all services for two days, from 2.30pm on Saturday to 6.30pm on Sunday.

 

Customers from across the country, except Maharashtra would, however are able to use debit cards at stores and do ATM transactions during the upgrading process. Here is the time and services that would be affected...

 


System / Channel

For customer accounts in (Mumbai and Rest of Maharashtra)

Other Customers

Debit Card use at stores (Point-of-Sale i.e.,POS) and online

From 2:30 pm (14:30 hours) on Saturday 8th June, 2013 to 6:30 pm (18:30 hours) on Sunday 9th June, 2013

--

ATM transactions

From 6:00 pm (18:00 hours) on Saturday 8th June, 2013 to 6:30 pm (18:30 hours) on Sunday 9th June, 2013

--

Phone Banking IVR transactions

From 6:00 pm (18:00 hours) on Saturday 8th June, 2013 to 6:30 pm (18:30 hours) on Sunday 9th June, 2013

From 8:00 am (8:00 hours) to 6:30 pm (18:30 hours) on Sunday 9th June, 2013. Some transactions such as Bill Pay will not be available.

Net Banking & Mobile Banking

From 5:30 pm (17:30 hours) on Saturday 8th June, 2013 to 8:30 pm (20:30 hours) on Sunday 9th June,2013

From 8:00 am (8:00 hours) to 8:30 pm (20:30 hours) on Sunday 9th June, 2013. Select Account related services will not be available

Term Deposit Booking through Net Banking / Mobile Banking

From 1:45 pm (13:45 hours) on Saturday 8th June, 2013 to 7:00 pm (19:00 hours) on Saturday 8th June, 2013

From 1:45 pm (13:45 hours) on Saturday 8th June, 2013 to 7:00 pm (19:00 hours) on Saturday 8th June, 2013

 

User

COMMENTS

Suiketu Shah

4 years ago

Their computer infrastructure is very ordinary compared to most other private banks.

Rakesh

4 years ago

Poor planning. They should upgrade their systems in parts. For eg. one week ATM, next week Debit Card, the following week Netbanking and so on.

Economy & Nation Exclusive
TDS on bank deposits: RBI’s advice to acknowledge 15-G/15-H is only half a step

Whether it is a computer or a human error, banks must refund the amount they wrongly debit. While RBI has taken the first right step by asking the banks to issue an acknowledgment, it should ask the banks to instantly refund the tax wrongly deducted


As per the present Income Tax (I-T) rules in force, depositors who are not liable to pay any tax on their income can get their interest on bank deposits without any deduction of tax if they submit Form 15-G  or 15-H, as appropriate, to the bank concerned in the beginning of every financial year.  But it has been the experience of several depositors that even when you have submitted these forms; banks continue to deduct tax at source on such deposits putting depositors into considerable inconvenience.
 

Here is a plight of a senior citizen:
 

A senior citizen who underwent a harrowing experience had this to say:  
 

“ When I asked the bank manager as to why tax has been deducted when I had filed Form 15H well in time, he said that it was a computer mistake and asked me to file my tax return and obtain a refund from the tax department. When I asked him to refund me the tax deducted, as I am not liable to pay any tax, he said that it was already remitted to the government and that he could do nothing about it now. I had to simply return home disappointed. I could not even think of changing the bank as it is close to my residence and I had authorized this bank to pay my utility bills through ECS and changing of all these will be a herculean task. So I resigned to my fate and continued with the same bank as I had neither the inclination nor energy to fight out this matter with higher authorities in the bank though such deductions do pinch me a lot.”
 

This is the real life story of a senior citizen who suffered in silence. Many times, when you bring this lapse to the notice of the bank, the bank officials very casually advice the depositors to get the refund from the I-T department by filing their tax return. It is a punishment meted out to the depositor for the blunder committed by the bank. Because, filing of a tax return just to get a small refund is so cumbersome that many people feel that it is a remedy worse than the disease.
 

RBI advises banks to issue an acknowledgement when Form 15G/15H is submitted:
 

To mitigate the inconvenience caused to the depositors, the Reserve Bank of India (RBI) had on 31 May 2013 rightly issued the following advice to banks:
“As you are aware banks are not required to deduct TDS from depositors who submit declaration in Form 15-G/15-H under Income Tax Rules, 1962. However, it has been brought to our notice that despite submission of Form 15-G/15-H by customers, banks are deducting tax at source, at times, causing inconvenience to customers resulting in a number of complaints.  Such instances arise because either the forms are misplaced or a track is not kept of forms received in the branches.
 

“The matter has been examined by us in consultation with Indian Banks’ Association (IBA). With a view to protect interest of the depositors and for rendering better customer service, banks are advised to give an acknowledgment at the time of receipt of Form 15-G/15-H. This will help in building a system of accountability and customers will not be put to inconvenience due to any omission on part of the banks.”
 

RBI’s advice to banks unfortunately does not solve the problem:
 

RBI’s advisory raises the following questions:

  1. RBI has advised the banks to give an acknowledgement for having received the Form 15G/H when tendered by the depositor. How is this going to help the depositors if tax is wrongly deducted by the banks?
  2. Even after the form is acknowledged by the branch, if the bank wrongly deducts the tax, what are the remedies available to the depositor?
  3. If the bank asks the depositor to claim the refund from the tax department, is it fair to the depositor?
  4. Building a system of accountability by issuing an acknowledgment may be useful only to the bank, but it is not clear as to how it will help the depositors and reduce inconvenience to them.

It is necessary to provide immediate relief to the depositors in all such cases:

As most of these customers are small depositors belonging to the middle class, who do not pay any income tax as they fall under the exempted category, it is very irksome for them to seek redressal of their grievances by writing to the head offices of the bank concerned or through the banking ombudsman, etc. So in all such cases, in all fairness, banks should provide instant relief to such depositors as under:

  1. The bank should refund and re-credit the tax wrongly deducted right away to the depositor’s account along with the interest on this amount for the period foregone by the depositor due to the mistake committed by the branch.
  2. Besides, the banks should pay a reasonable amount of compensation to the depositors for the anguish and inconvenience caused and this should also be credited to customers’ account without asking. This will also serve as a deterrent against repetition of such mistakes in future.
  3.  If in spite of pointing out the mistake committed by the bank, if the amount wrongly debited is not re-credited to the customer’s account instantly for whatever reasons, a penalty of Rs100 per day for each day’s delay should be levied on the bank, as stipulated by RBI in the case of ATM withdrawals, where cash was not dispensed with but amount debited to customers’ account.
  4. Many banks still follow a system of crediting the net amount of interest, after deducting tax, to the customers’ account, thereby camouflaging the tax deducted which is not made known to the customers at the time of deduction. RBI has to direct the banks to credit the gross amount of interest to depositors’ account and simultaneously debit on the same day the tax deducted at source, so that the tax deduction is visible to the customers when they get their pass books filled up. This will help the customers to know whether any tax has been wrongly deducted in their account and if so seek appropriate remedy quickly.

In short, the present advice of RBI to banks to simply give an acknowledgment to customers when they submit Form 15G/H is just a flash in the pan as it serves a very limited purpose but fails to deliver anything of value to the customers. Whether it is a computer mistake or a human error, banks have a bounden duty to refund the amount wrongly debited by them. While RBI has taken the first right step by asking the banks to issue an acknowledgment, which will serve as a proof for the customers to show that the form in fact has been duly submitted to the bank, RBI should go a step further and ask the banks to instantly refund the tax wrongly deducted, as it is patently a mistake committed by the bank, for which the customer should not be made to suffer.  
 

If the intention of the RBI is to mitigate the hardships faced by the innocent customers due to the casual attitude of the banks, the only solution is to provide the much-needed relief to them on the lines suggested above and thus ensure a high quality of service which all bank depositors not only deserve but also have a right to expect.                                                                                                                                                  

(The author is a banking analyst and writes for Moneylife under the pen-name of Gurpur)

User

COMMENTS

Riyaz Ahmad Khan

4 months ago

I am not a any tax payer, but bank deducted TDS on my fix deposit yearwise i.e. 2013, 2014, 2015. I submitt form 15G but baks said that bank computer or program not accept my PAN No. So please write me how I receive my deducted TDS of previous years i.e. 2013, 2014, 2015

Narendra Nath Hazra

2 years ago


To
[email protected] [email protected]
Nov 15 at 4:08 PM
Complain No-MUMT1114129405 dated 15-11-14

In one of my FD No 50300026521281 suddenly i observed that Rs. 2457/- has been deducted from the interest earned which is my only live hood at my old age of 78.

When i inquired from the Bank it was told to me that i had not submitted the 15H but on production of the receipt as given in attachment , it was told that i have not put the ward no in proper place. I live very near to bank and my mobile no as well as e-mail id is available with bank they could not even inform me the same for correction though they are supposed to check up the form before receiving the 15H.
You are aware how difficult it is to recover the amount from IT dept. I would kindly request you to kindly refund the same.

Thanking you,

Yours faithfully ,

Narendra Nath Hazra

arun adalja

3 years ago

rbi s circular does not help depositors it helps only to bank officers who forgot to enter in the system and so ultimate loss to investors.why rbi is not increasing limit ?

arun adalja

3 years ago

rbi s circular does not help depositors it helps only to bank officers who forgot to enter in the system and so ultimate loss to investors.why rbi is not increasing limit ?

mahesh

3 years ago

I am a sr. citizen whose only source of income is from int. on bank F.D.'s. In the begining of the F.Year 2013 my estimated interest income on F.D. was less than 2.5 lacs. However some F.D's matured & reinvested in the same bank at slightly higher rate of interest.
Total interest income exceeded 2.5 lacs in Feb. 14.Inspite of the submissin of 15H in the begining of the Year, bank deducted TDS on the full interest income.

Should they not deduct TDS on int. amount exceding Rs. 2.5 lacs? I have also invested some amount in NSC in the F.year.
Therefor there is no tax liabilty. Now for claiming this refund I shall have to file returns & wait for one Year to get back the money.
What is the remedy? Why can't I.Tax dept. make a rule that in case of Sr. Citizens TDS shall be deducted only on int. income exceding 2.5 lacs . !!

Priya

3 years ago

I once had a cummulative deposit on which they deducted taxes and did not even send me the TDS certificate. TDS certificate was with the bank's dispatch section after 3 years. I lost 2 years of TDS deducted as both these years the assessments were completed.

REPLY

Dayananda Kamath k

In Reply to Priya 3 years ago

on cumulative deposits there is no tds many banks are advertising to open cumulative deposits that is rd dangling this provision. your bank has wrongly deducted tds on cd you can claim it back from the bank

CA PRADEEP AGARWAL

3 years ago

I Feel Banks do not bother about small depositors, they worry only for Large/Corporate Depositors, whereas there income arises mainly from the SMALL DEPOSITORS, whereas large depositors give deposits, based on Auction unless otherwise interested.

Mun Mohan Kale

3 years ago

Govt rules are idiotic. Senior citizens should be exempted from TDS on deposits. I have also suffered from this TDS. Bank could have rang me up & asked for form 15G/ 15H. I am 83 years & I am a super senior citizen. Afterall the amount is negligible but I had to pay auditor 500 rupees for filing the return. These politicians do not have the knowledge of the travails of IT payers. Why cab't the FM do away with TDS for senior citizens & pensioners.

PATTABHI

3 years ago

The problem is more acute in the case of Reinvested deposits, for which Forms 15G/H have already been submitted. He calculates and pays the Advance Tax before 15th March on the assumption that TDS is not deducted by the Bank by virtue of his submitting Form 15G/H and gets an unpleasant surprise when he gets the Form 16A by next May/June after close of the Financial Year; often this is not reflected in Form 26AS also due to the Bank quoting a wrong PAN NO or nor quoting PAN NO at all.

REPLY

CA PRADEEP AGARWAL

In Reply to PATTABHI 3 years ago

It is a suggestion if Banks do not have PAN then deduction of TDS is at higher rates (so no excuses here), so in the absence of PAN or 15G/H, the deduction should only be made with the consent

CA PRADEEP AGARWAL

3 years ago

WHAT AS A PROFESSIONAL I FEEL IS the Bank Manager and concerned staff should personally compensate for wrong deductions, then only in future these errors will not be repeated.

Anil Kishore

4 years ago

You have covered the real points. Actually, The Income Tax department should refund such deducted amount to the Banks. This may resolve the problem of all the customers easily. Once amount is remitted by the Bank even erroneously it becomes difficult for anyone as how to return the money. If there is provision of refund of TDS to Banks then this problem will be solved to some extent.

REPLY

MOHAN SIROYA

In Reply to Anil Kishore 4 years ago

To get the rightful due of the customer, the liability to pay back is of the institution who did the wrong. Once the money goes in the Government treasury ,it is supposed to be deposited by the Institution as "legal" dues. As per the Finance Act, only the concerned deptt. i.e the Income Tax is supposed to adjust ,refund such amount ,if found 'Not due" after the tax payer's IT return is assessed.
If by faulty IT system, the TDS amount gets cut and deposited, the Institution viz; the bank is solely liable to make good to the customer. If such an error was caused by the negligence of an employee in the bank, it is up to the bank how and what action for such 'Loss Causing act' can be taken against the employee so that he or others will feel deterred not to commit such errors due to negligence. But in no case the customer's Right to get it back in account can be undermined.
The Consumer Complaints Cell had taken up a few such instances in the past and the bank had credited back the wrongfully deducted TDS amount even after the same was deposited in the Govt. Treasury. How they did it, we are not aware.
Mohan Siroya

Ubaldo C DSouza

4 years ago

I understand that forms 15G/15H can only be issued when the person is not taxable AT ALL and not if he becomes non-taxable after statutory/prescribed deductions. Is this not an aberration and avoidable hassle, specially to the seniors. I am always eligible for refund but cannot file the mentioned forms, I am told. Please correct me if I am wrong.

REPLY

MOHAN SIROYA

In Reply to Ubaldo C DSouza 4 years ago

Mr. DSouza

There is no such condition for getting the form ( It is available for download even on website) which is printed and available on demand. U R taxable or not is a declaration given by you and not by bank.
What latest guideline for TDS deductions for banks are that those A/c holders whose 'Taxable Income' from all sources in the year will be of less than the taxable starting amount after all allowable deductions, they only should file these forms so that merely to claim back the 'TDS' they need not file a RETURN.

Vaibhav Dhoka

4 years ago

Our bankers are poor at accepting the mistake,they are poor in tax knowledge and for their own mistake they pass buck on customer.A customer is orphan entity in India.

MOHAN SIROYA

4 years ago

Kudos to Mr. Gurupur for this well analysed article/update.

I have given my detailed comments on what DY.Governor RBI had said in "Open House"on 3 rd June which was published in "Moneylife update". Same comments will be applicable here.

drsharmilaraopn

4 years ago

How does an individual ascertain that this is followed.

JLR’s US retail volumes up 11% in May 2013

Jaguar Land Rover’s May 2013 retail sales volume in the US came in at 4,989 units, up 11% y-o-y while other luxury OEMs have reported volume growth in the range of 8%-15%.  However, Nomura doesn’t expect the Tata Motors stock to react significantly to this data

Jaguar Land Rover’s (JLR) May 2013 retail sales volume in the US came in at 4,989 units, up 11% y-o-y. Other luxury OEMs have reported volume growth in the range of 8%-15%, according to Nomura Equity Research in its Quick Note.

 

Jaguar volumes have increased by 33% y-o-y, helped by the launch of the new Jaguar F-Type and strong growth of the XF model. Land Rover volumes increased by around 3% y-o-y; volume growth of Range Rover was strong (33%), however Range Rover Sport volumes declined by 8% y-o-y, possibly due to the impending launch of a new model in 4QCY13.
 


Overall, Nomura believes that the numbers are largely in line with its expectations. The brokerage expects around 8% volume growth for JLR in US in FY14F, and it doesn’t see any changes to its estimates based on these numbers.

 

According to Nomura, the weighted average marketing and promotional spend for JLR increased by 22% month-on-month (up 3% y-o-y), led partly by a higher Jaguar mix. Incentives increased by 16% m-o-m at Jaguar and by 7% m-o-m at Land Rover.
 


“We don't expect the Tata Motors stock to react significantly to this data,” said Nomura in its concluding remarks.

User

COMMENTS

jeevan

4 years ago

Retail investors have lost heavily
in ' IPO's. Companies/ promoters
vanished immediately after IPO'S.
What SEBI / Govt is doing ? What is the solutions for retail investors now ? Can they get money ? What actions is taken by SEBI / Govt on the such companies / promoters ? This is big scam, fraud, cheating by the companies.
What action is taken on promoters, merchant Bankers, managers to issue ?

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