Date of Filing : 04.01.2021
Date of Disposal: 30.05.2023
DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION
THIRUVALLUR
BEFORE TMT. Dr.S.M. LATHA MAHESWARI, M.A.,M.L, Ph.D (Law) .…. PRESIDENT
THIRU.P.VINODH KUMAR, B.Sc.,B.L., .....MEMEBR-I
THIRU.P.MURUGAN,M.Com.,ICWA(Inter)., B.L., ....MEMBER-II
CC. No.20/2022
THIS TUESDAY, THE 30th DAY OF MAY 2023
Mr.S.Anand,
S/o.Shri Shanmuga Sundaram,
No.3607 Type B,
Avadi, Thiruvallur District.
Chennai – 600 054. ……Complainant.
//Vs//
1.The Manager,
Kotak Mahindra Bank Limited,
Office at Zone IV, 5th Floor,
Kotak Infinity Park,
Off. Western Express Highway,
General AK Vaidya Marg.,
Malad (E), Georegaon Mulund Link Road,
Malad (E), Mumbai 400 097.
2.The Manager,
Kotak Mahindra Bank,
Ambattur Branch,
Nosan Tower,
No.50 Naini Ammal Street,
CTH Road, Krishnapuram,
Ambattur, Chennai 600 053.
3.The Manager, Head Office of Kotak Mahindra Bank,
555 Capital Building,
Anna Salai, Opp. To Sun T.V.,
Teynampet, Chennai 600 018. ..........Opposite parties.
Counsel for the complainant : M/s.R.Meenakshi, Advocate.
Counsel for the opposite parties : M/s.N.S.Sivakumar, Advocate.
This complaint is coming before us on various dates and finally on 18.05.2023 in the presence of M/s.R.Meenakshi counsel for the complainant and M/s.N.S.Sivakumar counsel for the oppostie parties and upon perusing the documents and evidences of both sides, this Commission delivered the following:
ORDER
PRONOUNCED BY THIRU.P.VINODH KUMAR, MEMBER -I
This complaint has been filed by the complainant u/s 35 of the Consumer Protection Act, 2019 alleging deficiency in service with respect to credit card along with a prayer to direct the opposite parties to pay a sum of Rs.1,99,500/- as misused by someone from the blocked credit card N.43638915102085 of the complainant with 12% interest per month from 04.09.2020 till the date of filing this complaint and to pay a sum of Rs.5,00,000/- towards compensation for the mental agony caused to the complainant and to pay a sum of Rs.25,000/- towards cost of the proceedings to the complainant.
Summary of facts culminating into complaint:-
During the year 2017 the representative of the opposite parties approached the complainant and insisted him to avail the credit card and issued a credit card No.4363891510208510 to him. Last transaction through the said credit card was done in June 2020. The complainant asked the opposite parties to cancel the credit card on 02.09.2020 through phone. The opposite parties blocked the credit card on the same day itself. However, the opposite parties issued a new credit card No.4166 4455 0113 39066 with credit limit upto Rs.4,39,000/- and no outstanding dues without request from the complainant on 07.09.2020. On 04.09.2020 the complainant received a SMS on his mobile that the blocked credit card was used for some online transactions from Amazon. Immediately the complainant lodged a complaint through bank customer care number as well as online that the credit card was misused by someone for a sum of Rs.1,99,500/- .
He then lodged a police complaint on 04.09.2020 before the T6, Avadi Police Station vide CSR.No.911/2020 and online complaint before the cyber crime on 28.09.2020.
On receipt of credit card No.4166 4455 0113 39066on 07.09.2020, the complainant requested the opposite parties to cancel the credit card. But the opposite parties had sent another credit card No.4166 44550 120 9976 on 16.09.2020. Again the complainant informed the opposite parties to cancel the said credit card.
On 25.09.2020 the opposite parties issued a Statement asking the complainant to pay Rs.2,01,388/- towards total purchase and other charges despite the fact that the complainant stopped using the credit card in the month of June 2020 and the said credit card was blocked by the opposite parties on 28.12.2020. The opposite parties sent another SMS demanding the complainant to settle a sum of Rs.2,36,075.81/-. The opposite parties are responsible for the transactions happened in the blocked credit card and the complainant is not responsible for the same. The complainant issued a legal notice on 08.10.2020 and there is no response from the opposite parties till date. The act of the opposite parties amounts to deficiency in service and hence the complaint.
The crux of the defence put forth by the opposite parties:-
The complainant obtained the credit card on his own volition. It is denied that the complainant requested to cancel the credit card on 02.09.2020 over phone and accordingly the said credit card was blocked on the same day. It appears in the complaint that some anonymous transactions were happened on the already blocked credit card. However, the said disputed card is found to be in the possession of the complainant. Moreover all the transactions were done through secured mode by using second factor authentication, One Time Password. So it is presumed that unless the credit card number and OTP were shared to someone else by the complainant, it is impossible to transact with the credit card. The disputed transactions mentioned in the complaint and also password protected nature. The opposite parties had sent several awareness communications to all the card holders. There is no deficiency in service on the part of opposite parties and prays to dismiss the complaint.
On the side of complainant proof affidavit was filed and documents Ex.A1 to Ex.13 were marked on their side. On the side of opposite parties proof affidavit was filed and documents Ex.B1 to Ex.B5 were marked on their side.
Points for consideration:-
Whether there is any deficiency in service on the part of the opposite parties?
If so to what reliefs the complainant is entitled?
Point No.1:-
It is the case of the complainant that some fraudulent transactions for a sum of Rs.1,99,500/- were happened using his blocked credit card. Inspite of repeated demands from complainant the opposite parties had not taken any action till date. The opposite parties have not chosen to conduct any enquiry with respect to the fraudulent transaction. Even after receipt of legal notice the opposite parties had not given any proper response to the complainant and hence the complaint.
To prove the case the complainant deposed proof affidavit with 13 documents which were marked as Ex.A1 to Ex.A13. Ex.A1 is the copy of credit card No.43638915102085 issued to the complainant. Ex.A2 is the SMS regarding One Time Password for transaction at Amazon from Kotak Mahindra Bank, Ex.A3 is the complaint given by the complainant to the Banker in prescribed form, Ex.A4 is the Copy of CSR issued by the Avadi Police Station, Ex.A5 is the letter of the banker for issue of credit card No.4166445501139066, Ex.A6 is teh letter of the banker for issue of credit card No.4166445501209976, Ex.A7 is the monthly Statement issued by the banker for the month of Sep.2020 for credit card No.4363891510208510, Ex.A8 is the receipt of the complaint lodged by the complainant with the Cyber Crime on online, Ex.A9 is the photocopy of the fresh credit cards, Ex.A10 is the legal notice isued by the complainant to the banker, Ex.A11 is the monthly Statement issued by the banker for the month of Oct 2020 for credit card No. 4363891510208510, Ex.A12 is the reminder letter issued by the banker to the complainant and Ex.A13 is the Monthly Statement issued by the banker for the month of Nov 2020 for credit card No. 4363891510208510.
Per contra, the opposite parties interalia contended that there is no deficiency in service on the part of the opposite parties. It is the duty of the complainant to prove that the credit card was blocked on 02.09.2020. The said transactions were done through secured mode i.e. by using second factor authentication, One Time Password. It is presumed that unless the credit card details and OTP is shared to someone else by the complainant, it is impossible to transact on the credit card. Hence the opposite parties pray to dismiss the complaint.
To refute the claim of the complainant the opposite parties deposed proof affidavit with 5 documents which were marked as Ex.B1 to Ex.B5. Ex.B1 is the authorization letter, Ex.B2 is the Application of credit card, Ex.B3 is the email correspondences, Ex.B4 is the Statement of Accounts and Ex.B5 is the service request of the complainant.
It is noted from the complaint that the complainant lodged complaints through dispute form to the opposite parties on 04.09.2020 vide Ex.A3. Ex.A4 is the CSR issued by the T6, Avadi Police Station in respect of the complaint lodged by the complainant about alleged transactions. Ex.A8 is the acknowledgement of online complaint lodged by the complainant with the Cyber Crime Police.
The Reserve Bank of India circular bearing Reference number RBI 2017-18/15, DBR No.Leg BC 78/09.07.2015/2017-2018 dated July 6, 2017 and page Nos.5 table 2 which states that the Bank customer has zero liability if the incident is reported to the Bank within 3 working days and the transactions value of the amount if reported in this 4 to 7 working days and beyond 7 days as per Bank’s approved board policy.
As per the RBI circular of 2017, CUSTOMER PROTECTION- LIMITING LIABILITY of customers for UNAUTHORIZED ELECTRONIC BANKING TRANSACTIONS relevent Rules as follows;
Rule 12: Burden of Proof: The burden of proof of providing customer liability in case of unauthorised electronic banking transactions shall lie on the bank.
Rule 9:Reveral timeline of Zero liability/Limited Liability of customers: on being notified by the customer the bank shall credited (Shadow reversal) the amount involved in the unauthorized electronic transactions to the customer account within 10 working days for the date of such notification by the customer (without waiting for settlement of insurance claim if any). Banks may also at their discredion decide to waive off any customer liabilty in case of unauthorized electronic banking transactions even in case of customer negligence. The credit shall be valued datedt to be as of the date of the unauthorized transactions.
Rule 10, Further banks shall ensure that:
A complaint is resolved and liability of the customer, if any established with such time, as may be specified in the bank’s board approved policy, but not exceeding 90 days from the date of receipt of the complaint, and the customer is compensated as provision of paragraphs 6 to 9 above;
Where it is unable to resolve the complaint or determine the customer liability, if any, within 90 days, the compensation as prescribed in paragraphs 6 to 9 above is paid to the customer; and
In case of debit card/bank account, the customer does not suffer any loss of interest, and in case of credit card, the customer does not bear any additional of interest.
Therefore it is clear from the above that as per the circular lay down by the controlling body of the opposite parties namely the Reserve Bank of India envisages an early disposal of the dispute in these kind of electronic unauthorized transactions within a period of 90 days.
However, in the present case the complainant lodged his complaint about the alleged transactions to the opposite parties on the same day itself. Even after receipt of detailed dispute form from the complainant the opposite parties had not taken necessary steps to trace out the merchant and beneficiary of the transaction and their addresses and simply sitback by taking the transactions as genuine without going into truth and defaulted in rendering due service by proper investigation. More over the opposite parties had not filed a single document to show that they have taken necessary steps to trace out the persons who were involved in the alleged transactions.
The opposite parties without taking necessary action with respect to alleged transactions, they have demanded the complainant to make the payment. Further Rule 10(11) clearly states that where the dispute is not resolved after 90 days, it is not the police but the bank who should reimburses the complainant’s loss. Therefore the defence of the opposite parties stating that the Police investigation is pending towards the alleged transactions has also been stuck down by Rule 10(11).
We have carefully perused all the documents and arguments advanced by both the counsels. The act of not taking necessary action with respect to alleged transaction by the opposite parties, even after receipt of complaint from the complainant on the same day itself amounts to deficiency in service. This point is answered accordingly.
Point No.2:-
Since we have come to the conclusion that the opposite parties had committed deficiency in service for not taking necessary action on the complaint lodged by the complainant, the complainant is definitely entitled to waive off the demand of Rs.1,99,500/- and the compensation for the mental agony due to deficiency in service of the opposite parties. We have inclined to award Rs.20,000/- towards compensation and Rs.5,000/- as cost in addition to waving off the demand of Rs.1,99,500/- made by the opposite parties with respect to alleged transactions.
In the result, the complaint is partly allowed against the opposite parties 1 to 3 directing them
a) To waive off the demand of Rs.1,99,500/- (Rupees one lakh ninety nine thousand five hundred only) towards the unauthorized transactions in credit card No.436389150208510;
b) To pay a sum of Rs.20,000/- (Rupees twenty thousand only) towards compensation for the mental agony caused to the complainant;
c) To pay a sum of Rs.5,000/- (Rupees five thousand only) towards litigation expenses to the complainant.
d) The above order shall be complied within six weeks from the date of receipt of this copy of the order, failing which, this said compensation amount shall carry interest at the rate of 9% per annum till the date of payment.
Dictated by the Member -I to the steno-typist, transcribed and computerized by him, corrected by the Member -I and pronounced by us in the open Commission on this the 30th day of May 2023.
Sd/- Sd/- Sd/-
MEMBER-II MEMBER -I PRESIDENT
List of document filed by the complainant:-
Ex.A1 ............ Credit card No.4363891510208510 issued to the complainant by the Banker. Photo copy
Ex.A2 04.09.2020 SMS regarding One Time Password for transactions at Amazon from Kotak Mahindra Bank. Photo copy
Ex.A3 04.09.2020 Complaint given to the Banker by the complainant in prescribed form. Photo copy
Ex.A4 08.09.2020 CSR issued by the T6, Avadi Police Station. Photo copy
Ex.A5 Sep.2020 Letter of the banker for issue of credit card No.4166445501139066. Photo copy
Ex.A6 16.09.2020 Letter of the banker for issue of credit card No.4166445501139066. Photo copy
Ex.A7 25.09.2020 Monthly Statement issued by the banker for the month of Sep.2020 for credit card No. 4363891510208510. Photo copy
Ex.A8 28.09.2020 Receipt of the complaint lodged by the complainant with the Cyber Crime on online. Photo copy
Ex.A9 ............... Photocopy of the credit cards. Photo copy
Ex.A10 08.10.2020 Legal notice issued to the banker by the complainant. Photo copy
Ex.A11 25.10.2020 Monthly Statement issued by the banker for the month of Oct.2020 for credit card No. 4363891510208510. Photo copy
Ex.A12 26.10.2020 Reminder letter issued to the complainant by the banker. Photo copy
Ex.A13 25.11.2020 Monthly Statement issued by the banker for the month of Nov.2020 for credit card No. 4363891510208510. Photo copy
List of document filed by the opposite parties:-
Ex.B1 01.04.2022 Authorization letter. Photo copies
Ex.B2 12.05.2017 Credit Card Application signed by the complainant. Photo copies
Ex.B3 04.08.2022 Email correspondences between Risk Control Unit and the Banking Officials. Photo copies
Ex.B4 ……………. Statement of Accounts. Photo copies
Ex.B5 ……………. Book-I with SR nature-confirming the request raised by the complainant. Photo copies
Sd/- Sd/- Sd/-
MEMBER-II MEMBER-I PRESIDENT
