DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-II
Udyog Sadan, C-22 & 23, Qutub Institutional Area
(Behind Qutub Hotel), New Delhi- 110016
Case No.259/2022
1. Mr. Shivaz Rai
S/o Mr. Rajinder Rai
R/o S-53, Panchsheel Park,
New Delhi-110017
2. Mr. Rajinder Rai
S/o. Late Sh. Gulshan Rai,
R/o S-53, Panchsheel Park,
New Delhi-110017
….Complainant
Versus
1. SBI Cards & Payments Services Limited
Having its office at:
DLF Infinity Towers, Tower C, 12th Floor,
Block 2, Building 3, DLF Cyber City,
Gurugram, Haryana – 122002
2. Encore Asset Reconstruction Company Private Limited
A company incorporated under the Companies Act, 2013
Having its office at:
5th Floor, Plot No.137,
Sector-44, Urban Estate Gurugram,
Haryana-122002
….Opposite Party
Date of Institution : 08.09.2022
Date of Order : 13.08.2024
Coram:
Ms. Monika A Srivastava, President
Ms. Kiran Kaushal, Member
Present: Adv. Priyanka Sethia for complainants
Adv. Itisha Jain, proxy counsel for Adv. Sandhya Chawla for OP
ORDER
Member: Ms. Kiran Kaushal
1. The facts as pleaded by the complainants are that complainant No.1 is the primary card holder and complainant No.2 is the secondary card holder of the credit card issued by State Bank of India, Cards and Payments Services Ltd., hereinafter referred to as OP-1.
2. It is stated that Complainants on 29.05.2020 noticed that there were certain unauthorised transactions totalling to Rs.2,07,025/- which were debited from the afore mentioned credit card on 26.05.2020. Complainants neither received any OTP nor any authorization request, despite having registered for SMS and email alerts for all electronic and other transactions. Complainants in fact, did not even receive any message intimating them about the said debit transactions.
3. It is further stated that immediately upon learning about the said fraudulent transactions complainants contacted the customer care of OP-1 and lodged a complaint. The said complaint was lodged within three days from the date of the disputed transactions.
4. It is next stated that on 01.06.2020, sum of Rs.43,610/- was credited back to the credit card account of complainants by No Broker Technologies. It is next stated that despite the said amount being credited back to the complainants OP-1 imposed late charges/interest in respect of the entire sum of Rs.2,07,025/-. Further, no remedial measures were taken by OP-1 to reverse the remaining value of the fraudulent transactions amounting to Rs.1,63,415/-.
5. It is next stated that complainant received a false and malafide Email from OP stating that the OTP for the fraudulent transactions was delivered by bank to the complainants registered mobile on 26.5.2020.
6. Frustrated by lack of action from OPs, complainants made a complaint to SHO, PS Malviya Nagar on 01.07.2020. Complainants on 04.11.2020 were informed by the concerned Police Station that two persons had fraudulently done the transactions and one of them had been taken into custody.
7. It is further stated that the complainants received demand for payment of credit card bill on 05.07.2020, 08.07.2020 and 09.07.2020, despite OP-1 informing the complainants that their complaint was being processed.
8. It is further stated on 25.11.2021 an Email was received by the complainants from Encore- ARC (OP-2) stating that the credit card portfolio of the complainants has been assigned to them by OP-1 on 31.03.2021. It is pertinent to mention that no consent of the complainants was given in this regard. It is further stated that OP-2 has been demanding exorbitant amount from the complainants by way of repeated correspondence and have been making threatening phone calls using un-parliamentary language.
9. OPs further went on to take coercive steps against complainants thereby issuing malafide demand notices and updated incorrect information about the credit score the complainants in records maintained by Trans Union CIBIL Ltd. The credit score of the complainants have been gravely impacted without any fault of theirs.
10. Alleging deficiency of service complainants pray for direction to OP to reverse Rs.1,63,415/- wrongly charged to the credit card of the complainant; to issue No Dues Certificate in respect of the credit card of the complainants; to not take any coercive steps against the complainants to recover the disputed sum of money; to provide information to Trans Union CIBIL Ltd. so that the CIBIL score of the complainants is not financially prejudiced; to restrain OP-2 from initiating any recovery proceedings, calling, messaging or visiting the house and office of the complainants; to pay Rs.5,00,000/- compensation towards mental agony, harassment as well as loss of reputation and to award the cost of litigation.
11. OP-1 filed its written version but as the same was filed beyond stipulated period reply filed by OP-1 was not taken on record and right to file reply of OP-1 was closed vide order dated 31.01.2023.
12. OP-2 resisted the complaint stating inter alia that the complaint is not maintainable qua OP-2 as no cause of action has arisen and complainant has no grievance against OP-2.
13. It is stated that the credit card facility in question, was assigned to OP-2 vide assignment agreement dated 31.03.2021. OP-2 is an asset reconstruction company duly registered with RBI and as OP-2 had acquired the said credit card, OP-2 was entitled to exercise all rights, liabilities and titles of OP-1 under the card holder agreement including recovery/realization of the outstanding dues pertaining to the said credit card. It is next stated that after availing the credit card facility complainants have used the said credit card for purchasing, making payments etc. hence OP-2 is entitled to recover the dues from the complainants.
14. It is further stated that the transactions in dispute were all prior to assigning of the loan account to OP-2 hence OP-2 is not privy to the disputed transactions and holds no responsibility of the same. It is stated that vide email dated 30.12.2021 complainant was duly informed that the transactions in dispute were 3D secured transactions and the said factum was informed by OP-1. Despite the repeated requests and reminders of OP-1 complainant has failed to pay the dues.
15. In light of the facts and circumstances above it is prayed that the complaint be dismissed qua OP-2 with exemplary costs.
16. Complainants have filed rejoinder denying the objections raised by OP-2 and reiterating the averments made in the complaint. Complainant in the rejoinder states that complainants have no contractual liability to make payments towards unauthorized transactions specifically disputed by the complainants, in terms of the RBI guidelines. It is further stated that the disputed transactions are not towards the purchasing made by the complainants on the said credit card.
17. Evidence and written submissions have been filed on behalf of the complainants and OP-2. Submissions made on behalf of the parties are heard. Material placed on record is perused.
18. It is complainants’ case that complainants while checking their credit card account statement on 29.05.2020 noticed that certain unauthorized transactions totaling to Rs.2,07,025/- got charged/debited from their credit card on 26.05.2020. Complainants neither received any OTP nor any authorization request either on their mobile numbers by way of SMS or on their email IDs to authenticate the debit transactions.
19. Complainants at Page no.123 of the complaint has appended Progress Report regarding investigation of their case by Cyber Cell, Saket, New Delhi which affirms the fact that complainant had not received any OTP or debit messages on his mobile number of transactions in dispute. The said report also states that the alleged crime might have been committed by the fraudsters conspiring with the Swami Service Stations employee . Per contra OP-2 has not filed any cogent evidence to prove that any OTP or any debit messages pertaining to the disputed transactions were received by the complainants . Bald averments have no value in the eyes of law.
20. As right to file reply of OP-1 was closed averments made in the complaint and evidence led by the complainants has remained uncontroverted and unrebutted qua OP-1.
21. In light of the facts stated above this Commission is of the view that there is no contributory negligence on part of the complainants rather OPs are found to be deficient in service for neither securing the transactions nor resolving the grievance of the complainants which was to be resolved within a timeframe. It is noticed that the complainants immediately upon learning about the fraudulent transactions on 26.05.2020 lodged a complaint with OP-1 on 29.05.2020 i.e within a period of three days. OPs are also found to be deficient as no report regarding any investigation conducted by them has been filed.
22. RBI vide various circulars have placed limited liability of the customer in cases of unauthorized transactions. For ready reference RBI Circular dated 06.07.2017 is reproduced as under:-
Limited Liability of a Customer
- Zero Liability of a Customer
6. A Customer’s entitlement to zero liability shall arise where the unauthorised transaction occurs in the following events:
(i) Contributory fraud/negligence/deficiency on the part of the bank (irrespective of whether or not the transaction is reported by the customer).
(ii) Third party breach where the deficiency lies neither with the bank nor with the customer but lies elsewhere in the system, and the customer notifies the bank within three working days of receiving the communication from the bank regarding the unauthorized transaction.
- Limited Liability of a Customer
7. A customer shall be liable for the loss occurring due to unauthorized transactions in the following cases:
i) 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 unauthroised transaction shall be borne by the bank.
(ii) In cases where the responsibility for the unauthorized electronic banking transaction lies neither with the bank nor with the customer, but lies elsewhere in the system and when there is a delay (of four to seven working days after receiving the communication from the bank) on the part of the customer in notifying the bank of such a transaction, the per transaction liability of customer shall be limited to the transaction value or the amount mentioned in Table 1, whichever is lower.
23. There is no denying the fact that complainants are liable to pay the charges due on the authorized transactions made by them but not on the unauthorized transactions. OP-2 having stated that after acquiring the credit card account from OP-1 all the rights, liabilities, obligations etc. qua the said credit card stood vested with them therefore OP-2 cannot now escape the liability by stating that OP-2 was not privy to the transactions
24. In light of the discussion above, OP-2 is directed to reverse Rs.1,63,415/- to the complainants within three months from the order failing which OP-2 shall be liable to pay the above stated amount with interest @ 6% per annum till realization. OP-2 is further directed to issue No Dues Certificate and also to provide information to Trans Union CIBIL Ltd. so that the CIBIL score of the complainants is not financially prejudiced.
- Additionally, OP-2 is directed to pay Rs.10,000/- towards mental agony and cost of litigation.
Parties be provided copy of the judgment as per rules. File be consigned to the record room. Order be uploaded on the website
