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2025 Supreme(Online)(SCDRC) 5972
STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Smt. Meena Ramanathan, I/c PRESIDENT, Sri. V.V.Seshubabu, MEMBER – (JUDICIAL)
State Bank of India – Appellant
Versus
Bochkar Mohan – Respondent
F.A.No. 484 OF 2024
For the Appellants/Opposite Parties: M/s.Ch.Goverdhan Rao
For the Respondent/Complainant: Party-in-Person
Bank liability for unauthorized transactions upheld, despite consumer reporting delays, based on consumer protection principles.
Headnote:(A) Consumer Protection Act, 2019 - Section 41(1) - Appeal against the order of the District Consumer Commission regarding unauthorized withdrawals from a bank account - Appellants directed to refund the full amount claimed by the Complainant along with interest and compensation - Issues included whether the bank's actions constituted deficiency of service and improper denial of liability under the zero liability framework. (Paras 1, 11)
(B) Essential service standards and circulars - The court held that negligence in reporting unauthorized transactions by the customer does not exempt the bank’s liability where malfeasance occurred and mandated timely communication to the bank as stipulated in the Reserve Bank of India's circular. (Paras 9, 10)
Facts of the case:
Unauthorized transactions from the complainant’s bank account were reported after the requisite period stated in bank regulations, leading to a partial reimbursement. The Complainant sought full recovery claiming bank's liability under a specific circular.
Findings of Court:
The Commission found the bank liable for full reimbursement due to incorrect application of timelines and service standard circulars.
Issues: The key issues were whether the denial of the remaining amount indicated a lack of adequate service and if the timelines communicated by the bank were justified.
Ratio Decidendi: The court reasoned that the Bank's failure to act on the complainant's claims promptly vindicated the complainant's entitlement to recover the funds and reaffirmed consumer protection principles.
Result: Appeal dismissed, affirming the previous order granting relief to the complainant.
| Table of Content |
|---|
| 1. unauthorized transactions reported after initial delays invoke bank liability. (Para 1 , 2 , 3) |
| 2. arguments on consumer negligence and bank duty to respond adequately. (Para 6 , 8) |
| 3. court upheld consumer protection law against banking negligence. (Para 9) |
| 4. bank's miscalculation of reporting timelines prompted liability. (Para 10 , 11) |
| 5. appeal dismissed, confirming consumer commission’s order. (Para 12) |
Order : PER HON’BLE SRI. V.V.SESHUBABU, MEMBER – JUDICIAL
1. The appeal is filed U/s 41 (1) of Consumer Protection Act, 2019 by the Opposite Parties No.1 & 2, aggrieved by the order dated 30.01.2024 in CC 07/2022 by the District Consumer Commission, Nizamabad, where under the opposite parties were directed to refund an amount of Rs.60,000/- with interest at 9%
per annum from the date of complaint i.e. 03.01.2022 till realization, besides compensation of Rs.5,000/- and costs of Rs.3,000/- within 45 days from the date of receipt of the order.
2. The brief averments of the complaint are that the complainant is the holder of SB account No.52085274444 with the opposite party No.1 and also having Rupay Debit Card; that during the period from 12th to 16th October 2020, unauthorized withdrawal had taken place from his account through ATM @ Rs.20,000/- per day; that the same was reported to the Bank on 16.10.2020 by blocking ATM card and account was kept on “hold”; that the complainant has even given a complaint to the Cyber Crime Police, who registered the case; that on application of the complainant, Internal Ombudsman of SBI, provided partial relief of Rs.40,000/- and rejected the balance; that aggrieved by the same, another appeal was preferred before Banking Ombudsman, Reserve Bank of India, Hyderabad on 22.06.2021 which was rejected with a direction to approach the competent Forum; that the circular in clause No.8 (1) (i) (i) of the Banking Ombudsman Scheme, 2006 shows, if any customer makes a complaint with the bank for the unauthorized transactions under “Zero Loss liability” the entire amount is to be paid; that the non-payment of Rs.60,000/- amounts to deficiency of service.
3. The brief averments of the written version of Opposite Parties are that the unauthorized withdrawals had commenced on 12th to 16th October 2020 @ Rs.20,000/- per day, but it was brought to the notice of the bank only on 16.10.2020; that the internal Ombudsman rightly reimbursed the amount of Rs.40,000/- since, the complaint is not given within 03 days, for the rest of the transactions to the tune of Rs.60,000/-; that there is no deficiency of service; that due to the negligence of the complainant only in reporting unauthorized transactions in his account, resulted in loss; that for the transactions that were taken place on 12.10.2020 and 13.10.2020, SMS was sent to the complainant on the night of 13.10.2020 at 00:20:41 hours &
00:54:56 hours respectively, for the transaction dated 12.10.2020 and 13.10.2020; that there is gap of 30 hours between the transactions dated 13.10.2023 and 14.10.2020. With this requested to dismiss the complaint.
4. Before the Commission below, complainant filed evidence affidavit as PW1 and marked Ex.A1 to A10. One Sri K.Harsha, Manager, SBI filed evidence affidavit as RW1 and got marked Ex.B1 & B2.
5. The Commission below, settled the following points for discussion viz..:
Whether any deficiency of service/unfair trade practice is there on the part of the opposite parties?
Whether the complainant is entitled for the relief claimed?
To what relief?
6. Having heard both sides, the Commission below passed the impugned order as stated supra. Aggrieved by the same, the present appeal is filed by the opposite parties with the following grounds:
The order of the Commission below is contrary to law, weight of evidence and probabilities of the case.
The Commission below failed to appreciate that the complainant not lodged the compliant with the opposite party No.1 within 03 days as per the circular but still, the Commi
