Indian Bank Approves Rs 1.32 Crore Compensation for Missing Gold Jewellery in Rajkot
In a significant development, Indian Bank has approved a compensation package of Rs 1.32 crore for a couple based in Rajkot, Gujarat, after their gold ornaments, valued at Rs 1.15 crore, went missing from the bank's custody. The jewellery had been pledged against two Micro, Small, and Medium Enterprise (MSME) gold loans at the bank's Rajkot branch.
Details of the Gold Loan and Missing Jewellery
The couple, identified as Sangeeta Shah and Shyam Shah, had pledged 1,004.1 grams of 22-karat gold jewellery to secure the loans, which were renewed annually. According to the Shahs, the bank failed to inform them about the loss of the pledged gold and continued to charge interest on the loan accounts without their knowledge.
The issue came to light in October 2025 when the couple approached the bank for the renewal of their loans and were shocked to learn that the pledged gold was missing. This discovery prompted them to take legal action to seek redress for the bank's alleged negligence.
Legal Proceedings and Settlement Agreement
The Shahs subsequently filed a petition in the Gujarat High Court, where the case is currently pending. In the interim, Indian Bank initiated a settlement process to resolve the matter amicably. On March 11, the bank issued a formal letter approving the compensation of Rs 1.32 crore.
After adjusting for the outstanding principal amount of the two loan accounts, the net amount payable to the couple is Rs 89.36 lakh. Additionally, the bank has agreed to reverse all interest, penal interest, and other charges that were debited to the loan accounts after November 2025.
Bank's Commitments and Future Steps
In its settlement letter, Indian Bank outlined several key commitments to ensure a comprehensive resolution:
- Upon completion of the payment, the bank will close both gold loan accounts.
- It will remove the Non-Performing Asset (NPA) classification associated with these accounts.
- The accounts will be updated as 'closed' in the bank's official records.
- Appropriate corrections will be made with all credit bureaus to reflect the settlement accurately.
This case highlights the importance of transparency and accountability in banking operations, particularly concerning secured loans like gold loans. The settlement aims to provide financial relief to the affected couple while addressing the procedural lapses that led to the loss of their valuable assets.
