Delhi High Court Says Bank Cannot Unjustifiably Cut Interest on Court-Ordered Fixed Deposit

The Delhi High Court held that a bank cannot unilaterally and unjustifiably reduce interest on a fixed deposit maintained pursuant to court orders.

Background and legal issue

NatWest had reduced the rate on a ₹5.89 crore deposit from about eight per cent to 3.5 per cent during an arbitration-related dispute The Division Bench found no material showing comparable fixed deposits had received the same reduction or that the parties were properly informed about maturity and renewal consequences It therefore upheld the direction requiring higher interest

Reasoning and significance

The ruling does not freeze bank deposit rates generally; it requires transparent, non-discriminatory treatment where funds remain deposited under judicial arrangements and parties rely on them.

The legal effect is confined to the ruling or procedural development reported here. Allegations and submissions are not treated as established facts unless expressly adjudicated.