Banks can be held liable for fraudulent withdrawals made through ATM cards issued in the name of third parties if they fail to verify the account details provided in the application form for the card.

JUDGMENT/ORDER :

R. K. Agrawal, President - The delay in filing the Appeal, if any, is condoned.

2. Mr. R. Sreenivasa Rao, learned counsel has filed Vakalatnama on behalf of the legal heirs of the Respondent and has also filed an affidavit bringing on record that the Respondent had expired on 12-06-2016 leaving behind the legal heirs mentioned in the affidavit. The learned counsel submitted that the Respondent has died and is represented by the heirs mentioned in the affidavit.

3. Heard the learned counsel for the parties and perused the order dated 27-09-2012 passed by Andhra Pradesh State Consumer Disputes Redressal Commission (hereinafter referred to as the State Commission) whereby the State Commission has allowed the Complaint in part and directed the Opposite Party (Appellant herein) to pay a sum of Rs.23, 13, 653/- to the Complainant/Respondent herein with interest @9% p.a. from 02-06-2010 (when the General Power of Attorney (GPA) holder came to know of the fraudulent withdrawal from the account of the Complainant) till the date of realization and a sum of Rs.25, 000/- towards compensation for mental agony and a sum of Rs.2, 000/- towards costs.

4. Briefly stated, the facts giving rise to the Appeal are that the Complainant/Respondent is a Non Resident Indian residing in USA. He has residential property at Hyderabad and is maintaining with the Appellant Bank a Savings Bank Account No.1404155000018690 in which he had given his local address only. He was having an amount of Rs.23, 13, 653/- in his Account out of the rent of his residential houses. He did not visit Hyderabad for more than eight years and did not withdraw any amount from his Account except by cheques. However, the Complainant/Respondent had appointed his sister, Ms. Furyal Fathima as GPA holder to maintain his property. On 02-06-2010, the GPA holder obtained the account statement from the Appellant Bank and to her utter surprise found that the Account carries a credit balance of Rs.52/- only. The rest of the amount had been withdrawn by one Mr. Naimathullah Hussaini, the nephew of the complainant, by using ATM card issued by the Appellant Bank. It may be mentioned here that Mr. Naimathullah Hussaini had obtained the ATM card in his name by mentioning the Account Number of the Complainant/Respondent. Admittedly, the Appellant Bank did not check the Account Number mentioned by Mr. Naimathullah Hussaini in his application for issuance of the ATM card and mechanically issued the ATM card vis-a-vis the Account Number of the Complainant/Respondent. Mr. Naimathullah Hussaini had withdrawn huge amount of Rs.21, 88, 653/- from the said Account by using the ATM card on numerous occasions. On an application filed by the Appellant Bank a criminal case has been lodged against Mr. Naimathullah Hussaini and the matter is still pending (CC No.612/2012, before the II ACMM, Nampally, Hyderabad). We may mention here that a sum of Rs.1, 25, 000/- has been withdrawn by the GPA holder by four cheques from the Account of the Complainant in respect of which there cannot be any dispute. The State Commission by the impugned order after analyzing the entire evidence and material on record came to the conclusion that the Appellant Bank is responsible for the deficiency in service as it had not checked the Account Number in the application form filed by Mr. Naimathullah Hussaini while issuing the ATM card and, therefore, is liable to pay the amount withdrawn by Mr. Naimathullah Hussaini by using the ATM card.

5. The learned counsel for the Appellant submitted that the Statement of Accounts were being sent periodically to the Account Holder and for a considerable period of time the Account Holder (the Complainant/Respondent or the GPA holder) neither raised any objection nor pointed out the alleged withdrawal through ATM card by Mr. Naimathullah Hussaini and, therefore, there is a contributory negligence on the part of the Complainant/Respondent though his GPA and the Appellant Bank cannot b