The court established that banks must act to reverse unauthorized transactions promptly when notified by customers, per RBI guidelines, even amidst ongoing investigations.

JUDGMENT

Dated this the 16th day of October, 2025 The writ petition has been filed being aggrieved by the inaction on the part of the 3^rd respondent Bank in initiating steps to release an amount of ₹3,82,000/– to the petitioner.

2. It is the case of the petitioner that, in response to an advertisement published on OLX by one Mini Paul and Satheesh Patter for the sale of their Innova car bearing Registration No.KL-32-F-1899, the petitioner transferred a sum of ₹3,82,000/– as an advance towards the total sale consideration of ₹8,00,000/–. The said amount was remitted as evident from Ext. P1. Thereafter, on realising that it was a fake advertisement, the petitioner preferred Ext. P2 complaint before the Station House Officer, Perumbavoor.

3. In response to the enquiry made by the police, it is revealed that the petitioner had transferred an amount of ₹3,82,000/– through an account maintained by him with the 2^nd respondent, Punjab National Bank, Perumbavur. Upon further enquiry, it was found that the advertisement published on OLX was a fake one. In this regard, the Manager, State Bank of India, Lake Gardens Branch, Kolkata, addressed a communication to the Station House Officer, Perumbavoor, stating that an amount of ₹3,82,000/– had been received from the petitioner in response to the said fake advertisement for the sale of an Innova car, and that the amount was credited to the account of one Indrashaw maintained at the Punjab National Bank, Perumbavoor Branch. Upon further verification, it was confirmed that the OLX advertisement was fraudulent, and the State Bank of India was requested to initiate steps to return the said amount to the petitioner’s account maintained with the Punjab National Bank, Perumbavoor Branch.

4. A letter of similar nature was issued by the second respondent to the third respondent in relation to the question of transferring the said amount in the name of the customer, namely, the petitioner herein. The petitioner also preferred Ext.P5 complaint before the Reserve Bank of India. A similar complaint was filed before the Ombudsman for Banking Institutions, as evident from Ext.P7. However, the petitioner’s request was declined, directing him to approach the Banking Ombudsman at Kolkata. Even in Ext.P8 communication, the Reserve Bank of India expressed its inability to intervene in the matter, treating it as sub judice.

5. In this connection, the third respondent Bank has filed a statement admitting that it had received similar complaints from the Palghar (Maharashtra) Police Station regarding recovery of an amount of ₹1,00,000/- from Account No. 20310772657. As on 25.03.2018, the balance amount in the said account was ₹3,82,000/-. Likewise, a sum of ₹9,99,999/- was subjected to a second hold in the same account. However, on 26.03.2018, the 3^rd respondent, in compliance with a court order, released an amount of ₹1,00,000/-, leaving a balance of ₹3,82,000/- and ₹9,99,999/-. Upon subsequent verification, the available balance in the said account was only ₹3,39,720.50.

6. It is further stated that the amount claimed by the petitioner could not be released or returned because he had failed to obtain a favourable order directing the return of the money, and the matter was under police investigation. As per the prevailing banking laws, the 3^rd respondent Bank is not in a position to release the amount without the express consent of the account holder, unless the petitioner obtains a favourable order from the court.

7. In this regard, the learned counsel for the petitioner referred to the concept of limited liability of a customer as provided under a notification - RBI/2017–18/15 dated 06.07.2017 issued by the Reserve Bank of In