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2025 Supreme(Online)(SCDRC) 1012
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
JUSTICE SUNITA YADAV, DR. MONIKA MALIK, JJ
STATE BANK OF INDIA – Appellant
Versus
KUBERCHAND JAIN – Respondent
FIRST APPEAL NO. SC/23/A/22/262 | FIRST APPEAL NO. 262 OF 2022
For the Appellants/Petitioners: Shri Vijay Shahani
For the Respondents: Shri Rajneesh Jain, Shri Vishnu Tiwari
The burden of proof for unauthorized transactions lies with the complainant, and banks are not liable under the Zero Liability Policy if the customer fails to report fraudulent activity promptly.
Headnote:(A) Consumer Protection Act, 2019 - Sections 2(1)(g) and 12 - Deficiency in service - Appeal against the District Commission's order allowing a complaint for unauthorized withdrawals - Bank's liability under the Zero Liability Policy and customer responsibility for safeguarding ATM PIN discussed. (Paras 7, 12, 20)
(B) Fraudulent Transactions - The burden of proof lies on the complainant to establish unauthorized transactions, and issues of fraud require detailed evidence beyond the Consumer Commission's jurisdiction. (Paras 18, 19)
Facts of the case:
The complainant alleged unauthorized withdrawals totaling Rs.4,80,000/- from his bank account via ATM transactions, claiming the bank was responsible for the fraud. The bank contended that the complainant failed to protect his ATM PIN and did not inform them of the withdrawals in a timely manner.
Findings of Court:
The District Commission found the bank liable for unauthorized withdrawals, but the appellate court found this determination erroneous based on RBI guidelines and the complainant's admission of negligence.
Issues: The primary issues included whether the bank was liable for unauthorized withdrawals and the adequacy of evidence presented to support claims of fraud.
Ratio Decidendi: The court held that the complainant's failure to report unauthorized transactions promptly and the bank's adherence to the Zero Liability Policy absolved it of responsibility. The case also emphasized that allegations of fraud require comprehensive evidence, unsuitable for summary proceedings.
Result: Appeal allowed; the impugned order set aside.
| Table of Content |
|---|
| 1. unauthorized withdrawal from bank account. (Para 2 , 3 , 4) |
| 2. bank's defense regarding atm card usage. (Para 5 , 6) |
| 3. district commission's order on compensation. (Para 7) |
| 4. arguments for and against the district commission's decision. (Para 8 , 9) |
| 5. court's analysis of atm transactions. (Para 11 , 12) |
| 6. principle on cardholder's responsibility. (Para 13) |
| 7. errors in district commission's findings. (Para 14 , 15 , 16) |
| 8. complexity of fraud cases and jurisdiction. (Para 17 , 18) |
| 9. commission's conclusion on district commission's error. (Para 19) |
| 10. appeal allowed; complaint dismissed. (Para 20) |
ORDER
(Passed On 13.06.2025)
Per Say Justice Sunita Yadav, President The opposite party/appellant has filed this appeal against the order dated 19.01.2022 passed by the District Consumer Disputes Redressal Commission, Chhindwara (for short ‘District Commission’) in C.C.No.157/2018 whereby the complaint filed by the complainant/respondent has been allowed.
2. Facts of the case in short are that the complainant and his wife are having a joint savings bank account no.10545036760 with the opposite party bank with ATM card facility. His ATM Card number is 4591150105276729 by which he used to withdrawal of funds from his bank account. It is submitted by the complainant that on 14.04.2018, a sum of Rs.40,000/- was withdrawn in two installments of Rs.20,000/- each from ATM situated Kokar Shiv Mandir. Further a cash sum of Rs.40,000/- was withdrawn from SBI ATM situated at Ranchi. Further submitted that on 14.04.2018, a sum of Rs.40,000/- was transferred in bank account number 459115000751852 & 00000035444200041 belonging to one Guddi Devi. In this way a sum of Rs.1,20,000/- was unauthorizedly withdrawn from the bank account of the complainant.
3. It is further submitted that on 15.04.2018, Rs.20,000/- twice were withdrawn from ATM situated at East Jail Road, Kanpur. On the same day on 15.04.2018, Rs.40,000/- were transferred in aforesaid account of Guddi Devi. Similarly on 15.04.2018, Rs.80,000/- was withdrawn from his account. On 16.04.2018, Rs.40,000/- was withdrawn from his account from ATM situated at Kanpur and Rs.40,000/- was transferred to bank account of Guddi Devi. On 17.04.2018, sum of Rs.40,000/- was transferred in bank account number 4592000135957757 & 000010545083664 belonging to one Nawal Singh Choudhary. On the same day i.e. 17.04.2018, a sum of Rs.40,000/- was withdrawn from ATM situated at Kuleti. On 18.04.2018, a sum of Rs.40,000/- in cash was withdrawn from ATM situated at Dhanbad, Jharkhand. On 19.04.2018, a sum of Rs.20,000/- was withdrawn twice from ATM situated at Kodarma. On 19.04.2018, a sum of Rs.40,000/- was transferred to the aforesaid account of Nawal Singh Choudhary. In this way a total sum of Rs.4,80,000/- were unauthorizedly withdrawn from the bank account of the complainant.
4. It is further submitted by the complainant that on 20.04.2018, the complainant had approached the opposite party/appellant-bank and got his ATM Card blocked. He further made a police complaint in Police Station Kotwali wherein the complainant made allegations upon the opposite party's branch manager of his involvement with the fraudsters in the alleged withdrawals made from his bank account. The complainant further submitted that another ATM card bearing number 459200013597757 was used for the withdrawals of said amount in dispute however, said ATM Card was never allotted to the complainant. The complainant therefore alleging deficiency in service against the bank filed a complaint before the District Commission seeking Rs.4,80,000/- with interest and compensation.
5. The opposite party/appellant-bank in its reply before the District Commission admitted issuance of ATM card bearing number 4591150105276729 against his savings bank account number 10545036760 to the complainant. However, the bank denied of usage of alleged ATM card bearing number 459200013597757 in the act of withdrawal of funds fro 14.04.2018 to 19.04.2018 from t
