NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
C. Viswanath, Presiding Member
HDFC Bank Limited and Anr. – Petitioners
versus
Jesna Jose – Respondent
Revision Petition No.3333 of 2013
(Against the Order dated 09/04/2013 in Appeal No.99/2011 of the State Commission Maharashtra)
Decided on 21.12.2020

IMPORTANT POINT
Bank held liable for unauthorized transactions from FOREX Debit Card.

Headnote:

Consumer Protection Act, 1986 – Section 21(6) : [Consumer Protection Act, 2019 – Section 58] – E-Banking – Forex card – Unauthorised transactions – Liability for – Complainant purchased a Pre-paid Forex Plus Debit Card having a limit of US $ 10,000/- A large volume of transactions of US $ 6000/- taken place on complainants forex card – However the complainant denied having transacted on the card at all – District Forum directed the petitioner to give US $ 6110/- State Commission upheld the same – Hence this revision petition – Credit card was in possession of complainant when the disputed transactions had taken place – Transaction had taken place several miles away from the actual location of complainant – Thus, reason for fraudulent transactions must be forgery or some other technical lapses in e-Banking system – No evidence that credit card was stolen – Bank rightly held liable for unauthorized transactions – Interference with concurrent findings of both the fora below, declined.

Held: Heard the Learned Counsels for all the Parties and carefully perused the record. The brief facts of the case are that in the year 2007, the Complainant purchased a Pre-paid Forex Plus Debit Card bearing no. 4123310000407245 having a limit of US$ 10,000/-, from Opposite Party No. 2. The card account was opened on 11.08.2007. Soon thereafter it was observed that there were large volume of transactions on the Complainant’s Forex Card. On failing to contact the Complainant, her father was informed of the same. The Complainant’s father verified the same with the Complainant, who denied having transacted on the card at all. Thereafter, he contacted the Opposite Party and requested for a statement of the transactions. On 20.12.2008, the executives of Opposite Party informed the Complainant’s father via telephonic conversation that transactions to the tune of US$ 6,000/- had taken place on the aforesaid Forex Card in the past few days. On 24.12.2008, the Complainant registered a Criminal Case at Burbank Police Station, Los Angeles. On 04.03.2009, the Complainant received charge slips for the disputed transactions, however, the said charge slips were in respect of 27 out of 29 transactions. Complainant noticed that the signatures on the charge slips did not match with her signature. The Complainant, thereafter, made several representations to the Opposite Party requesting them to address her grievances and take appropriate action.

The Counsel for the Petitioner stated that the Respondent had willfully not opted for SMS alert facility and in view of this the computer generated auto responses could not be sent to the Complainant. He stated that in case of suspicious or fraudulent activity, the Bank is not liable to intimate card-holders. It was further stated that the responsibility of tallying the signatures on the transaction slips with the specimen available with the Bank does not rest with the Bank since the chargeslips are not required to be furnished to the Bank as the entire process is automated without any human intervention. The Fora below erred in not considering the terms and conditions governing the issuance and use of the Forex card before arriving at their decisions. Condition 36 of the said terms and conditions stated that “transactions are deemed authorized and complete once EDC terminal generates a sales slip”. As per the Counsel for the Petitioner, the production of 27 chargeslips in itself is evidence that the transactions were authorized. He also relied on Condition 22 of the said terms and conditions which read as follows: “The cardholder shall at all time ensure that the card is kept at a safe place. The cardholder shall under no circumstances whatsoever allow the card to be used by the other individual”.

The Counsel for the Respondent, however, contended that as per the letter sent along with the charge slips, the Opposite Party was aware of the fraudulent transactions on 14.12.2008 itself, in spite of which no action was taken by the Opposite Party.

In Shankar Finance and Investments vs. State of Andhra Pradesh and Ors. Criminal Appeal No. 1449 of 2003 the Hon’ble Supreme Court has held, in the context of the Negotiable Instruments Act, 1938, that a Complaint may be filed by the Power of Attorney Holder and in doing so the Power of Attorney Holder is acting not in a personal capacity but as an agent on whose behalf the Power of Attorney has been executed. I am, therefore, of the considered view that a Complaint filed by the power of attorney holder is maintainable.

The Bank has merely stated that the Credit Card must have been stolen and that it is due to the Card Holder’s negligence that she lost safe custody of her card. The Petitioner, however, has produced no evidence to substantiate its averment that the credit card was stolen or that the Complainant has resorted to any fraud/forgery. In today’s digital age, the possibility that the credit card was hacked or forged cannot be ruled out. In the absence of any evidence that the credit card was stolen, I hold the Bank liable for the unauthorized transactions.

The Petitioner-Bank cannot rely on arbitrary terms and conditions to wriggle out of its liability towards customers and any such terms and conditions must be in conformity with the directions issued by the RBI which is responsible for safekeeping of the Banking Systems and maintaining checks and balances in the same. As per the RBI circular, zero liability will rest with the customer, where the deficiency lies in the banking system. The first unauthorized transaction took place on the 15.12.2008. Admittedly, the said transactions were observed by the Bank on 15.12.2008 itself. The Complainant’s father was contacted only on 18.12.2008. Thereafter, on 20.12.2008, within three days of receiving information form the Bank the Complainant’s father notified the Bank that the transactions were unauthorized. In such circumstances, therefore, even if the deficiency was not with the Bank, but elsewhere in the system, the Bank will be held liable for all the 29 unauthorized transactions which were effected from 15.12.2008 till the card was hotlisted, i.e. till 20.12.2008. The aforesaid RBI circular as well decision of this Commission in Punjab National Bank and Anr. v. Leader Valves II (2020) CPJ 92 (NC), are both squarely applicable in the present matter. In Punjab National Bank and Anr. v. Leader Valves II (2020) CPJ 92 (NC).

Reference is also drawn to circular bearing No. DBR.No.Leg.BC.78/09.07.005/2017-18 dated 6th July 2017, issued by the Reserve Bank of India.

Both the Fora below have rightly held the Bank liable for the unauthorized transactions.

Jurisdiction of this Commission under Section 21 (b) is very limited. This Commission is not required to re-appreciate and reassess the evidences and reach to its own conclusion. The Court can intervene only when the petitioner succeeds in showing that the Fora below has wrongly exercised its jurisdiction or there is a miscarriage of justice. It was so held by the Hon’ble Supreme Court in the case of Mrs. Rubi (Chandra) Dutta Vs. M/s United India Insurance Co. Ltd. (2011) 11 SCC 269.

Same principle has been reiterated by Hon’ble Supreme Court in the case of Lourdes Society Snehanjali Girls Hostel and Ors. Vs. H & R Johnson (India) Ltd. and Ors. (2016 8 SCC 286).

There is no infirmity or illegality in the impugned order, warranting interference under Section 21 (b) of the Consumer Protection Act, 1986. Revision Petition is dismissed with no order as to costs. (Paras 6 to 16)

Result: Petition dismissed.