ORDER

SRI.H.R. SRINIVAS.  PRESIDENT

1.     This is the Complaint filed by the Complainant against the Opposite Party (herein referred to as OP) under section 35 of the Consumer Protection Act 2019 for the deficiency in service in not crediting the amount of Rs.12,872/-, and for crediting the same  along with interest at 12% per annum  drawn by unscrupulous unauthorized person by NEFT by hacking his account, without his knowledge and further for compensation of Rs.1,50,000/- for causing mental harassment and agony, for cost of the proceedings and other reliefs and for such other reliefs as the Hon’ble District Commission deems fit.

2.     The brief facts of the complaint are that; the complainant is an account holder with OP and has a credit card bearing No.4541982339664515. When he checked his account statement, he came to know that on 08.07.2020 and 22.07.2020 an amount of Rs.25,657/- has been charged to his credit card basing on five unauthorized fraudulent transaction without his knowledge. He was not at all provided with OTP, SMS email and the payment were made to ‘Comewel’ and ‘PPGCARD’ which the complainant is not at all aware. He raised a complaint with OP customer care and the card was blocked.  Out of the five fraudulent transactions, OP refunded the amount in respect of three transactions to his account stating that the merchant has settled the disputed transaction. However OP refused to refund Rs.7,873/- and Rs.4,999/- on the ground that the said transaction are based on OTP and hence it is a valid transactions.  OP has not produced any reasons as to how the merchant has processed the credit card in respect of three other transaction. He made a complaint to the cyber crime police who registered the complaint under FIR No.145/2020 dated 03.10.2020.

3.     Though he requested OP to charge back the amount and credit the same to his account, OP has not done so even after 4 months of lodging the complaint. Even OP has not provided with the details of the transaction, the OTP numbers, and OP has compromised the same. He had to issue a legal notice on 06.01.2020 and OP has replied on 08.01.2020 stating that they are the valid transactions and the money cannot be charged back. Since the said transactions are fraudulent, and since OP did not provide OTP, sent and received, the IP addresses from where the alleged transaction has taken place, and also proof of delivery of the products, and proof of service and hiding the true facts, amount to deficiency in service and unfair trade practice and hence the complaint.

4.     Upon the service of notice, OP remained absent and placed exparte.

5.     In order to prove the case, complainant filed his affidavit evidence and produced documents. Arguments Heard. The following points arise for our consideration:-

1) Whether the complainant has proved deficiency in service on the part of the Opposite Party?

2) Whether the complainant is entitled to the relief prayed for in the complaint?

6.     Our answers to the above points are:-

POINT NO.1 :   In the Affirmative.

POINT NO.2 :   Partly in the Affirmative.

                        For the following.

REASONS

POINT No.1:-

7.     It is not in dispute that the complainant is a holder of credit card. It is also not in dispute that out of five transactions (according to complainant unauthorized) three transactions were reverted back by OP whereas in respect of two transactions in respect of Rs.7,873.52 and in respect Rs.2,999/- which has been charged in respect of transaction with Comewell Watford and PPGCARD, the same was not charged back.

8.     It is the contention of complainant that he has not transacted the said transaction by using his credit card and it is a fraudulent transaction which he has been charged in the credit card statement. Whereas it is the specific case of the OP that as per Ex P5 which is the reply to legal notice that complainant has done the transaction and hence he has been charged.  It is also pertinent to note here that upon the intimation was received, the card  blocked on 09.07.2020 and 20.07.2020.

9.     It is also mentioned therein that 3 transaction of 754.55, 4999 and 8999 has been returned. In respect of the remaining two transaction of Rs.754.55, Rs.4,999/- has been redebited the disputed transactions and it is after the investigation made by them on the complainant independently verified by internal ombudsman of the bank and further mentioned that the OTP was generated and sent to the clients registered number.  The merchants themselves have processed the credits and there is no intervention of the bank. 

10.   The customer is only entitle for zero liability if unauthoritzed transaction has been occurred.  And the disputed part transactions were charged only after the two steps authentication was validated.  The bank is not aware with whom the complainant has intentionally or inadvertently shared the details such as login ID password, card details, CVV, expiry date etc. MPIN and the OTP lies solely with the customer and not on the bank. The dispute transaction were online secured transaction and no manual intervention or bank was required for authentication of this hence there is no liability on OP.

11.   The copy of the acknowledgment issued by Police regarding receipt of the complaint in respect of the fraudulent transaction of his card is produced along with the complaint and Ex P3 is the copy of the legal notice issued to OP and the same has been replied as per Ex P5 reply to the legal notice

12.   When the stand taken by the OP is taken in to consideration, what factor resisted the OP to file a detailed version before this commission when an opportunity for appearance and filing version was given to OP has not been explained. Further it is the duty of the OP to participate in the proceedings and to take proper defence when notice of the complaint has been duly received by OP. In this case, though OP received notice it remained absent and the proceeding took exparte.  Ex P6 is the a circular issued by Reserve Bank of India.

13.   Though OP has taken the contention in the reply to the legal notice that the complainant has done online transaction for which OTP is generated and transferred to his registered mobile, in this case the bank has not filed the details of the OTP number generated and shared the same with the complainants registered mobile. The bank has failed to produce those details. What prevented the OP to provide all these evidence to strengthen its stand taken in the reply to the legal notice has not been explained. Under the circumstances, we have to hold that the transaction of the credit card from the account of the complainant is not either by complainant or by act of OP whereas it is the defect lying in the banking system of internet and digital banking service. As per the limited liability of the customer liability in case of unauthorized electronic payment transaction through PPI contributory fraud/negligence/deficiency on the part of PPI including PPI-MTS issuer irrespective of whether or not the transaction is the quoted by the customer the liability of the customer is zero. If the 3^rd party breach where the deficiency lies neither with the PPI issuer nor with the customer, but lies elsewhere in the system and the customer the PPI issuer regarding unauthorized payment transaction. The per transaction customer liability is such on the number of days lapsed between the receipt of transaction communication by the customer from the PPI issuer of reporting unauthorized transaction by the customer to the PPI issuer within 3 days of the liability of the customer is zero.

14.   When this directions and guidelines are applied to the facts and circumstances it is to be noted here that on 09.07.2020 and 27.07.2020  the complainant came to know the unauthorized transaction of  his credit  card to the extent of Rs.12,872/- and informed the OP who blocked the card which is within three days from the date of knowledge of the fraudulent transaction which attracts zero liability on the part of the complainant. Hence not charging back the amount to the account of the complainant within the time stipulated by the RBI guidelines i.e. within 10 days/ 90 days from the date of receipt of the complaint, and not adhering to the reversal time line for zero liability/limited liability of a customer under clause 7 and 8, amounts to deficiency in service. Hence we answer POINT NO.1 IN THE AFFIRMATIVE.

POINT NO.2:

15.   In the result OP is liable to charge back the charges levied in respect of the said two transactions i.e. for Rs.7,873/- and Rs.4,999/- dated 21.07.2020 and 09.07.2020 in respect of PPGCARD  and Comewell. Further since complainant was made to suffer mentally, physically due to the inaction of the OP in charging back the transaction made the complainant to approach this commission by filing this complaint by spending time money and energy. Hence we are of the opining that if a sum of Rs.5,000/- towards damages as compensation and Rs.5,000/- towards cost of the litigations if OP is ordered to pay to the complainant would meet the ends of justice. Hence we answer POINT NO.2 PARTLY IN THE AFFIRMATIVE and pass the following:

ORDER

1. The complaint is allowed in part with cost.

2. OP i.e. Standard Chartered Bank represented by its Branch Manager/Authorized signatory is hereby directed to charge back Rs.12,872/- without levying late payment charges, penalty or interest.

3. OP further pay a sum of Rs.5,000/- towards damages as compensation and Rs.5,000/- towards cost of the litigation expenses.

4. OP is hereby directed to comply the above order within 30 days from the date of receipt of this order and submit the compliance report to this commission within 15 days thereafter.

5. Send a copy of this order to both parties free of cost.

Note: You are hereby directed to take back the extra copies of the Complaints/version, documents and records filed by you within one month from the date of receipt of this order.

(Dictated to the Stenographer over the computer, typed by him, corrected and then pronounced by us in the Open commission on this day the 12^th day of November  2021)

MEMBER                                PRESIDENT

ANNEXURES

1. Witness examined on behalf of the Complainant/s by way of affidavit:

Copies of Documents produced on behalf of Complainant/s:

Ex P1: Copy of the Financial Statement

Ex P2: Copy of the FIR

Ex. P3: Copy of the Legal notice.

Ex P4: Postal acknowledgement.

Ex P5: Email correspondences

Ex P6: Copy of the RBI guidelines.

2. Witness examined on behalf of the Opposite party/s by way of affidavit:

RW-1: - nil -

Copies of Documents produced on behalf of Opposite Party/s

• Nil -

MEMBER                        PRESIDENT

RAK*