Date of Filing      : 19.01.2021

                                                                                                                 Date of Disposal: 14.11.2022

 

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION

THIRUVALLUR

 

 BEFORE  TMT. Dr.S.M. LATHA MAHESWARI, M.A.,M.L, Ph.D (Law)                  .…. PRESIDENT

                  THIRU.J.JAYASHANKAR, B.A,B.L.,                                                              .....MEMBER-I

                 THIRU.P.MURUGAN,.MCom., ICWA(Inter)., B.L.,                                    ....MEMBER-II

  

CC. No.17/2021

THIS MONDAY, THE 14th DAY OF NOVEMBER 2022

 

Mr.G.Elangovan, S/o.R.Gopalakrishnan,

Plot No.1183, T.N.H.B,

Avadi, Chennai 600 054.                                                                .........Complainant. 

                                                                          //Vs//

1.The Branch Manager,

   Axis Bank, Avadi Branch,  Avadi, Chennai 600 054.

 

2.The Authorised Signatory,

   Axis Bank Credit Card Division,

   Old No.38, New No.165,

   Plot No.65, Arcot Road,

   United India Colony, Kodambakkam – 600 024.                     ...Opposite parties.

 

Counsel for the complainant                  :   M/s.L.Ravichandran, Advocate.

Counsel for the opposite parties           :   M/s.R.Palani Kumar Ramesh, Advocate

                         

This complaint is coming before us on various dates and finally on 18.10.2022 in the presence of M/s.L.Ravichandran, Advocate  counsel for the complainant, M/s.R.Palani Kumar Ramesh, Advocate counsel for the opposite parties and upon perusing the documents and evidences of both sides, this Commission delivered the following: 

ORDER

PRONOUNCED BY TMT. Dr.S.M. LATHA MAHESWARI,   PRESIDENT.

 

This complaint has been filed by the complainant u/s 35 of the Consumer Protection Act, 2019 alleging deficiency in service on the part of the opposite parties with regard to the fraudulent transactions that occurred in the credit card account of the complainant along with a prayer to direct the opposite parties  to repay the illegally debited amount of Rs.11,600/- , to restrain the opposite parties from claiming of EMI, overdue for the fake transactions, to restrain the opposite parties from making all sort of threatening and coercion and to pay a compensation of Rs.5,00,000/- for the mental agony, stress  to the complainant. 

Summary of facts culminating into complaint:-

 

It is the case of the complainant who is a retired Senior Citizen, operating Savings Account bearing No.0140101003009677.  Fraudulent transaction has occurred for his Credit Card No.5305620220976944.  On 06.07.2019 the complainant got a phone call from Mumbai Axis Bank Credit Card Division with regard to a fake transaction of Rs.55,000/- requesting the complainant to pay the over dues.  On 12.07.2019 the complainant lodged a complaint with the 1st opposite party for which the they replied that a fake company by name Moviwik System Private of Jamaika had purchased goods worth Rs.55,000/-.  There was no possibility to the complainant to go and visit Jamaika and to purchase the goods. At such circumstances, the complainant was having the credit card in his hand at the time of transactions in India and had not received any SMS and OTP for the fraudulent transactions.  A police complaint was filed with CSR.No.1199/2019 on 13.07.2019.  In spite of the same the opposite parties debited Rs.11,600/- from the complainant’s account towards  the fake transactions. The complainant also wrote a letter about the fraudulent transaction to the Ombudsman and also to the RBI.  As there was no fruitful efforts taken by the opposite parties aggrieved by the same the complainant after issuance of legal notice dated 05.08.2020 had filed the present complaint for the reliefs mentioned below;

To direct the opposite parties  to repay the illegally debited amount of Rs.11,600/- ;

 To direct the opposite party restraining from their illegal claiming of EMI, overdue through the fake transaction;

 To restrain the opposite parties from all sort of threatening and coercion of the complainant;

 To pay a compensation of Rs.5,00,000/- towards compensation for the mental agony, stress  to the complainant. 

Crux of the defence put forth by the opposite parties:-

The opposite parties jointly filed written version disputing that the fraudulent transactions pertains to the credit card bearing No.5245080007224815 and not 5305620220976944 as mentioned in the complaint. It was submitted that the complainant was a chronic defaulter in payment of dues and to avoid payment of over dues he had filed the present complaint.  On 06.07.2019 the opposite parties Credit Card Division informed the complainant about certain transactions through his credit card No.5245080007224815 and requested to make payment and during the said call the complainant did not deny nor requested the opposite parties to block his card. Subsequently on 12.07.2019 the complainant lodged a complaint to the 1st opposite party informing about such transactions that they were fraudulent transactions to the tune of Rs.55,000/- by using his credit card No.5245080007224815.  On receipt of complaint dated 12.07.2019, the opposite parties verified the disputed transaction and found that the disputed transactions were done through ‘Verified by Master Card Secure Code’ which are secured transaction which could not be done unless the person is in possession of the card and all the details which are confidential in nature known only to the cardholder and unless the card holder divulges the same to a third party the transaction could not be completed.  It was submitted that in the present case the complainant has informed about card details to somebody else for the transactions to be successful. When the transaction have taken place using the confidential credentials that are known only to the account holder, the opposite party Bank cannot be made liable for such transactions.  The opposite parties Bank did not seek any information such as personal information, account details or information on user ID and password of complainant’s internet banking facility.  Though the complainant was known about the transaction on 06.07.2019 he made complaint only on 12.07.2019 and as per the RBI circular 2017, the deficiency would not fall on the bank.  Further with regard to the credit card No. 5305620220976944 there was no written request towards debiting the amount.  Further the opposite parties bank debited Rs.11,600/- from the complainant’s account towards the credit card dues and hence the same is not illegal.  The transaction ought to have occurred either due to the negligence on the part of the complainant in sharing the payment credentials to any third party or with the knowledge of the complainant.  All the e-commerce transactions were done by entering user ID and password available with the complainant alone and authenticated under 2 factor authorisations. In such circumstances the bank cannot be made liable for such negligence on the part of the complainant.  Thus contending that the alleged transaction has taken place only with the knowledge of the complainant and there is no negligence or deficiency in service on their side the opposite parties sought for the dismissal of the complaint. 

The complainant has filed proof affidavit and documents Ex.A1 to Ex.11 were marked on their side.  On the side of opposite parties proof affidavit was filed and documents Ex.B1 & Ex.B2were filed by them.  

Point for consideration:-

Whether the allegation as to deficiency in service against the opposite parties with respect to the alleged fraudulent transactions has been successfully proved by the complainant by admissible evidence?

If so to what relief the complainant is entitled?

Point:1

On the side of the complainant the following documents were filed in support of the complaint allegations;

Representation letter to the opposite party by the complainant dated 12.07.2019 was marked as Ex.A1;

CSR Copy  No.1199/2019, T-6, Avadi Police Station against the complaint  dated 13.07.2019 was marked as Ex.A2;

E-commerce transaction and report by the 1st opposite party dated 03.08.2019 was marked as Ex.A3;

Representation to banking Ombudsman by the complainant dated 21.01.2020 was marked as Ex.A4;

Legal notice sent by the complainant to the opposite parties dated 05.08.2019 was marked as Ex.A5;

Reply from the opposite parties to the complainant dated 26.08.2020 was marked as Ex.A6;

 

Letter from complainant to the 1st opposite party dated 07.08.2019 was marked as Ex.A7;

Arbitration notice to the complainant dated 25.01.2021 was marked as Ex.A8;

Reply from the complainant to the Arbitration counsel dated 04.02.2021 was marked as Ex.A9;

Opposite parties credit card statement dated 09.07.2019 was marked as Ex.A10;

Opposite parties credit card statement dated 29.03.2022 was marked as Ex.A11;

On the side of opposite parties 1 & 2 the following documents were filed in support of their defence;

RBI Circular bearing No.DBR.No.leg.BC.78/09.07.005/2017-18 dated 06.07.2017 was marked as Ex.B1;

Policy information copy was marked as Ex.B2;

 The crux of the oral arguments adduced by the counsel for the complainant is that the alleged transactions amounting to Rs.55,000/- were fraudulent transactions and online fraud committed without the knowledge of the complainant as he did not receive any OTP.  Further the complainant’s any written consent and when the complaint filed by him was pending, opposite parties debited Rs.11,600/- from his Saving Bank Account for the overdue balances of the  credit card.  The opposite parties without taking measures to find out the real culprits was threatening the complainant to pay the dues towards the credit card.  He argued that the transactions were shown to be done in Jamaika but in their statement it was seen that it is in Gurgoen, New Delhi and hence it is only the opposite party’s officials who involved in the said fraud and now unethically claiming overdue towards the credit cards.  Thus contending the act of the opposite parties amounted to deficiency in service the complaint and sought for the complaint to be allowed.

On the other hand the counsel for the opposite parties submitted that the credit card subjected to dispute transaction was only 5245080007224815 and not as found in the complaint.  It was submitted that the transactions were done through secure mode and were genuine transactions using Password and login ID and hence could not be termed as fraudulent transactions.  He also argued that OTP was sent to mobile number as per the statement and the complaint was made belatedly and also submitted that as per the RBI guidelines they were not responsible for the alleged transactions and hence sought for the dismissal of the complaint.

Heard oral arguments made by both the parties and perused the pleadings and documents produced by them.  It was the case of the complainant that only on 06.07.2019 after receipt of the call from the Mumbai Axis Bank Credit Card Division he came to know about the fraudulent transactions.  However, it is seen that he made complaint only on 12.07.2019 to the opposite parties and on 13.07.2019 to the Police.  As per Ex.A10 his own document we could see that on 29.06.2019 two transactions and on 30.06.2019 three transactions for a total value of Rs.50,000/- has been made which are alleged as fraudulent transactions by the complainant.  When the complainant received the call on 06.07.2019 from Mumbai Axis Bank Credit Card Division with regard to alleged transactions there were only five transactions. If he had acted promptly and informed the opposite parties, further transactions could have been thwarted.  However, as he had not made any complaints still more three transactions on 09.07.2019 for a total sum of Rs.25,000/- has happened.  In such circumstances we could presume that the complainant had not acted prudently.  It was also submitted by the opposite parties that as per RBI guidelines wherein the Customer’s Liability has been discussed and under clause (H) with regard to loss/Theft/Misuse of Cards it has been mentioned as the Bank must be immediately notified if the card is misused without the permission of the card holders and also a police complaint must be lodged immediately with the nearest police station and a copy of FIR must be submitted to the Bank.  It has been mentioned that in case of misuse, the Bank’s liability will be limited to the amount covered under lost card liability, subject to fulfilment of policy’s terms and conditions.  The card holder will be solely liable for any misuse of card for ATM or PIN/Password/OTP/mPIN/CVV based transactions. Further as per the RBI circular dated 06.07.2017 it has been clearly mentioned that if the delay in reporting is beyond 7 working days, the customer liability shall be determined as per the bank’s Board approved policy.  Though it has been given under clause (12) that the burden of proving customer liability in case of unauthorised electronic banking transaction shall lie on the bank, in the present case the bank has vide letter dated 03.08.2019 has clarified that the alleged transactions were not fraudulent transactions but all the disputed transaction were successful e-commerce transactions done by entering user ID and password available only with the complainant in their words as follows,

“With regard to the letter dated 12.07.2019 and SR raised subsequently 18.07.2019 after getting the FIR copy from the Police department, all the transaction are successful e-commerce transaction done by entering user ID and password available only with the cardholder and authenticated under two factor authorization.  The transaction has been successfully claimed by the merchant bank.  Since these transaction has been environment with UCAF value 212 and there are no disputes rights.”

It is also the clear version of the opposite parties that the said transactions were successfully claimed by the merchant bank and done in a secured environment and there is no possibility for any fraud to be committed.  The complainant being the cardholder was the only person who knows the PIN number and hence the transactions had taken place using the confidential credentials known only to him, as no third person nor the bank has the opportunity to know the PIN number and the OTP number.  Therefore, as per the RBI circular bearing No.DBR.Leg.BC.78/09/09.07.005/2017-18 dated 6th July 2017, issued to all commercial banks, as per which, “the customers shall be liable for the loss occurring due to unauthorised transactions in cases where the loss is due to negligence by a customer, such as where he has shared the payment credentials, the customer will bear the entire loss until he reports the unauthorised transaction to the bank.” In such scenario we have to hold that the complainant had failed to prove that the transactions alleged by him were fraudulent transactions and that the recovery of Rs.11,600/- from his Saving Bank account towards credit card payment is illegal and thus the act of the opposite parties amounts to deficiency in service.  Without the complainant using the credit card for himself or divulges the details of credit card to a third party such transactions could not have occurred.  Thus we answer the point accordingly holding that the complaint allegations with respect to fraudulent transactions were not proved by the complainant and hence no deficiency in service was proved against the opposite parties.

 

Point No.2:

As we have held above that no deficiency in service was proved against the opposite parties, the complainant is not entitled to any reliefs. Thus we answer the point accordingly. 

In the result the complaint is dismissed.  No order as to cost. 

Dictated by the President to the steno-typist, transcribed and computerized by him, corrected by the President and pronounced by us in the open Commission on this the 14th day of November 2022.

 

Sd/-                                                    Sd/-                                                         Sd/- 

MEMBER-II                                  MEMBER-I                                               PRESIDENT

 

 

List of document filed by the complainant:-

 

Ex.A1 12.07.2019 Representation letter to the opposite party by the complainant. Xerox

Ex.A2 13.07.2019 CSR Copy  No.1199/2019, T-6, Avadi Police Station against the complaint. Xerox

Ex.A3 03.08.2019 E-commerce transaction and report by the 1st opposite party. Xerox

Ex.A4 21.01.2020 Representation to banking Ombudsman by the complainant. Xerox

Ex.A5 05.08.2020 Legal notice sent by the complainant to the opposite parties. Xerox

Ex.A6 26.08.2020 Reply from the opposite parties to the complainant. Xerox

Ex.A7 07.08.2019 Letter from complainant to the 1st opposite party. Xerox

Ex.A8 25.01.2021 Arbitration notice to the complainant. Xerox

Ex.A9 04.02.2021 Reply from the complainant to the Arbitration counsel. Xerox

Ex.A10 09.07.2019 Opposite parties credit card statement. Xerox

Ex.A11 29.03.2022 Opposite parties credit card statement. Xerox

 

 

List of documents filed by the opposite parties:-

 

Ex.B1 06.07.2017 RBI Circular bearing No.DBR.No.leg.BC.78/09.07.005/2017-18.

Ex.B2 ............... Policy information copy.

 

 

Sd/-                                                  Sd/-                                                             Sd/-

MEMBER-II                                  MEMBER-I                                               PRESIDENT