IMPORTANT POINTS
(1) Zero Liability of the Innocent Consumer – Reinforcing RBI guidelines, the Commission established that when a customer is an innocent victim of a “third-party breach” (where the fault lies elsewhere in the system and not with the customer), the consumer should not bear the burden of the loss. Since the Complainant reported the issue promptly and had not compromised his credentials through personal negligence, he was entitled to full reimbursement.
(2) Joint and Several Liability – The ruling clarifies that liability under the Consumer Protection Act can be “joint and several” when multiple service providers contribute to the chain of events leading to a loss. While the Telecom provider facilitated the access, the Bank facilitated the unauthorized outflow of funds. Both were ordered to pay the principal amount plus 9% interest and Rs.5 lakhs in compensation for mental agony.

ORDER

Dr. Inder Jit Singh, Presiding Member.—These two First Appeals (FAs) have been filed by the under section 19 of Consumer Protection Act 2019, against the order dated 09.11.2016 of the State Consumer Disputes Redressal Commission, (hereinafter referred to as the ‘State Commission’), in Consumer Complaint (CC) No. 47/2012.

2. First Appeal No. 573/2017 has been filed by the Appellant (hereinafter referred to as Axis Bank), who was Opposite Party Nos.l&2 before the State Commission and FA/1950/2017 has been filed by Appellant (hereinafter referred to as Vodafone Mobile), who were Opposite Party Nos. 3 8i 4 before the State Commission, inter alia praying for setting aside the impugned order passed by the State Commission in CC/47/2017.

3. As both the Appeals have been filed against the same order of the State Commission vide which State Commission has allowed the Complaint filed by the Complainants against all the OPs-1 to 4, jointly & severally, these are taken up together.

4. Notice was issued to the Respondent(s) in both the FAs on 18.04.2017 and 26.10.2017 respectively.

5. Brief facts of the cases, as presented by the Complainant and as emerged from the FAs, Order of the State Commission and other case records are that:

The complainant was having a Vodafone mobile connection No. 9846289101. He was also having two saving bank accounts with the OP/Axis Bank Ltd. for which, the complainant has also availed the services of ATM and net banking from the Axis Bank Ltd. On 30.03.2012, between 4 p.m. and 6 p.m., complainant’s mobile phone went dead. The Complainant contacted the Vodafone store on the very next day @ about 2.30 p.m. The complainant came to know that a duplicate SIM was replaced/issued to a third person by the OP-4. On realizing that the complainant’s mobile number was misused, OP-3 & OP-4 cancelled the SIM issued to the unknown person immediately and issued a new SIM to the complainant from the Vodafone Store, Kadavantra. On 31.03.2012, the complainant received a message on the mobile phone, that Rs.50,000/- has been credited to his account. It was an unexpected transaction, therefore, the complainant tried to check his account through online, but he was not able to access his account and it was displayed invalid username or password. On 30.03.2012 and 31.03.2012, unknown persons operated the accounts of the complainant, by using duplicate SIM, whereby amount of 9.42 lakhs was transferred from one of the complainant’s account to some other account and further Rs.1,72,500/- has been transferred to another accounts, which were as many as 20 in nos. Complainant after knowing this, through mini statement, made a complaint to the customer care of the Axis bank and got both these accounts blocked. On 01.04.2012, FIR No. 840/12 was lodged by the complainant with Central Police Station, Cochin, as regards alleged fraudulent transactions and nine persons were arrested in connection with the crime. On 09.04.2012, the Complainant issued legal notice to the bank and Vodafone, but in reply, the bank and Vodafone denied the allegations. The complainant filed complaint CC/47/2012 before the State Commission, Thiruvananthapuram alleging that the Axis Bank does not provide virtual key pad in internet banking to prevent key loggers attack, bank has also failed to comply with the provisions of Money laundering Act, 2002. In addition, the Vodafone has assisted the fraudster in the alleged illegal transaction by issuing duplicate SIM without verification of ID proof and documents. The complainant filed the complaint seeking award of 11,14,500/- with interest @ 18% p.a. w.e.f. 30.03.2012 and 75 lakhs for mental agony and cost of litigation.

6. Vide Order dated 09.11.2016, the State Commission allowed the complaint - directed the OPs to pay jointly and severally Rs.11,14,500/- with interest @ 9% p.a. w.e.f. 31.03.2012 till date of payment plus Rs.5 lakhs as compensation and Rs.10,000/- as legal costs to the complainant and directed to