Date of Filing 16.05.2023

                                                                                                       Date of Disposal: 19.10.2023

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION

THIRUVALLUR

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

THIRU.P.VINODH KUMAR, B.Sc., BL,                                           ……MEMBER-I

CC.No.49/2023

THIS THURSDAY, THE 19^th DAY OF OCTOBER 2023

Mr.M.Thuyamurthy,

No.1/1, Erpettai, ArasurSalai,

Kavaraipettai,

GummidipoondiTaluk,

Thiruvallur District 601 206......Complainant.

                          //Vs//

The Branch Manager,

State Bank of India, Ponneri,

No.60, Pudhukar Street,

Thiruvallur District -601 204.…..Opposite Party.

Counsel for the complainant: Party in Person.

Counsel for the opposite party : M/s.D.Sathish Kumar, Advocate.

This complaint coming before us on various dates and finally on 10.10.2023in the presence of complainant who appeared in person and M/s.D.Sathish Kumar, counsel for theopposite party 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

1. This complaint has been filed by the complainant/Party in Person u/s 35 of the Consumer Protection Act, 2019 alleging deficiency in service against the opposite partywith respect to the fraudulent transaction in his Bank Account along with a prayer to refund the amount of Rs.20,000/- being the amount debited from the complainant’s account along with cost of the proceedings.

Summary of facts culminating into complaint:-

2. Aggrieved by the fraudulent transaction in the complainant’s Bank Account, the present complaint has been filed by the complainant against the opposite party.

3. The complainant was having Savings Account No.11129621772 with the opposite party Bank and the complainant’spensions gets credited to the said account from his date of retirement.  While so, on 29.10.2021 he received an SMS that an amount of Rs.20,000/- was debited from his Account when he had not used his ATM card.  Immediately an email to the opposite party was sent and the Manager informed that the amount has been debited in KolkattaAsansol Hospital ATM.  Complaint was given to Ombudsman and also to the Police Station.  When enquired with the opposite party it was informed that by CCTV footage the person who fraudulently took the amount was found.  But though assured that the amount could be retrieved back the Bank did not take any steps and hence this complaint.

The crux of the defence put forth by the opposite party:-

4. Complainant was a customer of the opposite party.  On 29.10.2021 at 16.44 they received an email from the complainant that there was a theft transaction done in his account for Rs.20,000/-, for which the opposite party ensured that proper enquiry would be taken towards the issue.  On scrutiny it was observed that the complainant’s Account was debited through ATM via YONO cash mode and the complainant must have shared the OTP received to his registered mobile number and only after that the alleged transactions would have been done.  Hence it was purely the customer’s negligence which resulted in the alleged fraudulent transaction. The complainant’s claim was rejected by the Internal Banking Ombudsman andwas advised to approach Banking Ombudsman if he was not satisfied with the Bank’s decision.  Allegations that the opposite party did not take any steps or the opposite party keeping himself away from taking effective steps with false excuses towards the complaint lodged by the complainant were totally incorrect. Thus opposite party sought for the complaint to be dismissed.

5. On the side of complainant proof affidavit was filed and documentsmarked as Ex.A1 to Ex A9 were submitted. On the side ofopposite party proof affidavit was filed and documents marked as Ex.B1 to Ex.B4 were submitted.

Points for consideration:-

1) Whether the deficiency in service alleged against the opposite party Bank with respect to the fraudulent transaction happened with the complainant’s Saving Bank Account No.11129621772 on 29.10.2021has been successfully proved by the complainant with admissible evidence?

2) If so, whether the opposite party/Bank could be held liable and to what reliefs the complainant is entitled?

6. Point No.1:-

The following documents were filed on the side of complainant in supportof his contentions;

1. Copy of email of the complainant dated 29.10.2021 was marked as Ex.A1;
2. Reminder email of the complainant dated 30.10.2021 was marked as Ex.A2;
3. Letter issued by the opposite party to the complainant dated 01.11.2021 was marked as Ex.A3;
4. Copy of WhatsApp message dated14.11.2021 was marked as Ex.A4;
5. Complaint regarding cloned debited card dated 24.11.2021 was marked as Ex.A5;
6. SBI, Ponneri regarding rejection of claim dated 25.03.2022 was marked as Ex.A6;
7. Appeal to Banking Ombudsman dated 06.06.2022 was marked as Ex.A7;
8. Banking Ombudsman letter dated 27.09.2022 was marked as Ex.A8;
9. Banking Ombudsman advised to go to other Forum for rejection of claim dated 12.10.2022 was marked as Ex.A9;

On the side ofopposite party the following documents were filed in proof of their defence;

10. Transaction log was marked as Ex.B1;
11. Rejection letter to complaint dated 25.03.2022 was marked as Ex.B2;
12. Intimation of internal Ombudsman decision for unauthorised transaction dated 05.03.2022 was marked as Ex.B3;
13. Message log of the complainant’s mobile number was marked as Ex.B4;

            7. Heard both.

8. The Party in Person/Complainant argued that though immediately the opposite party was informed about the fraudulent transaction the opposite party Bank did not take any steps to retrieve the amount thus he sought for the complaint to be allowed as prayed for.

9. On the other hand, the opposite party argued that the complainant had used YONO App for the disputed transaction and hence there was no fraudulent transaction occurred to the complainant’s Account and that no deficiency in service committed by them.  Further it is their argument that the complainant did not deny the sharing of OTP by him.  Thus he sought for the complaint to be dismissed.

10. We perused thepleadings and evidences produced by both parties. The complainant’s main grievance was that an amount of Rs.20,000/- was debited without his knowledge.  However, the opposite party contended that the amount got debited only due to the negligence on the side of the complainant.  It is their case that complainant used the YONO App and that the transaction happened only after sharing OTP by the complainant.  However, complainant replied for the said arguments that the transaction had taken place at an earlier hours at 03.06am on 29.10.2021 while he was sleeping and that there was no occasion for him to share the OTP to anyone.  It is his strong case that he never received any OTP and he did not use any Yono app for his Bank Account

11. On the other hand the opposite party filed an additional document stating that the complainant’s cell phone having BSNL network had received the OTP for the alleged transaction. However, the complainant stoutly objected for the same stating that he never used BSNL network for his cell phone and that the document produced did not contain any particulars about him and the admissibility of the said document was strongly objected.  We arealso of the view that the document (Ex.B4) could not be relied upon by this Commission as it contains no authenticated particulars about the complainant and hence we rejected the said document.

12.  Further the opposite party also did not provide any evidence to show that the complainant had used YONO App when it is strongly denied by thecomplainant stating that he had not possess the YONO App and had never used.  It is well within the domain of the opposite party that they can produce evidence to show that the complainant had used YONO App.

13. The opposite party’s defence that the alleged transaction happened only because of the negligence of the complainant and that they could not be held liable for the allege fraud and that the only remedy for the complainant is to approach the Cyber Crime Branch could not be accepted as an valid defence. It has been held in catena of decisions that when the fraudulent transaction occurs without the involvement of the complainant, the Bank should be held responsible and that when the fraudulent transaction has been immediately intimated to the opposite party Bank the customer has ‘Zero’ liability.  In the present case it is made clear and well established that the complainant had not contributed anything towards the fraudulent transaction and has immediately informed the Bank about the disputed debit of money.  Thus in the facts and circumstances we hold that the opposite party Bank should be held liable and committed deficiency in service with respect to the fraudulent transaction as they failed to retrieve the amount of Rs.20,000/-.

14. The decision rendered by NCDRC in Hdfc Bank Limited vsJesna Jose rendered on 21 December, 2020  in REVISION PETITION No. 3333 OF 2013 squarely applies to the present case wherein it has been held,

11.    Furthermore, the Petitioner-Bank cannot rely on arbitrary terms and conditions to wriggle out of its liability towards customers and any such terms and conditions must be in conformity with the directions issued by the RBI which is responsible for safekeeping of the Banking Systems and maintaining checks and balances in the same. As per the RBI circular, zero liability will rest with the customer, where the deficiency lies in the banking system. The first unauthorized transaction took place on the 15.12.2008. Admittedly, the said transactions were observed by the Bank on 15.12.2008 itself. The Complainant's father was contacted only on 18.12.2008. Thereafter, on 20.12.2008, within three days of receiving information form the Bank the Complainant's father notified the Bank that the transactions were unauthorized. In such circumstances, therefore, even if the deficiency was not with the Bank, but elsewhere in the system, the Bank will be held liable for all the 29 unauthorized transactions which were effected from 15.12.2008 till the card was hotlisted, i.e. till 20.12.2008. The aforesaid RBI circular as well decision of this Commission in Punjab National Bank and Anr. V Leader Valves II (2020) CPJ 92 (NC), are both squarely applicable in the present matter. In Punjab National Bank and Anr. V Leader Valves II (2020) CPJ 92 (NC), this Commission while addressing the question of liability of a Bank in case of unauthorized and fraudulent electronic banking transactions, has observed as under:

"11. The first fundamental question that arises is whether the Bank is responsible for an unauthorized transfer occasioned by an act of malfeasance on the part of functionaries of the Bank or by an act of malfeasance by any other person (except the Complainant/account-holder). The answer, straightaway, is in the affirmative. If an account is maintained by the Bank, the Bank itself is responsible for its safety and security. Any systemic failure, whether by malfeasance on the part of its functionaries or by any other person (except the consumer/account-holder), is its responsibility, and not of the consumer."

Reference is also drawn to circular bearing No. DBR.No.Leg.BC.78/09.07.005/2017-18 dated 6th July 2017, issued by the Reserve Bank of India to all commercial banks, wherein it is stated as under: -

"6. A customer's entitlement to zero liability shall arise where the unauthorised transaction occurs in the following events:

Contributory fraud/ negligence/ deficiency on the part of the bank (irrespective of whether or not the transaction is reported by the customer).

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 unauthorised transaction."

Both the Fora below have rightly held the Bank liable for the unauthorized transactions.

Thus this point is answered accordingly in favour of the complainant and as against the opposite party.

Point No.2:-

15. We have held above that the opposite party Bank had committed deficiency in service with respect to the fraudulent transaction alleged on the side of complainant.  The complainant had prayed for the said amount to be paid with interest along with cost of the complaint.  Thus we direct the opposite party to pay the amount of Rs.20,000/- with 9% interest from the date of alleged fraudulent transaction i.e. 29.10.2021.  Further for the mental agony and hardship caused to the complainant we award a compensation of Rs.10,000/- along with cost Rs.5,000/- towards the proceedings of the complainant. 

In the result, the complaint ispartly allowed against the opposite party directing them

a) To refund the amount Rs.20,000/- (Rupees twenty thousand only) with 9% interest from 29.10.2021 till the date of realization to the complainant being the amount debited from the complainant’s Bank Account within six weeks from the date of receipt of copy of this order;

b) To pay a sum of Rs.10,000/- (Rupees ten thousand only) towards compensation for the mental agony and hardship caused to the complainant;

c) To pay a sum of Rs.5,000/- (Rupees five thousand only) towards litigation expenses to the complainant.

c)Amount in clause (a) if not paid by the opposite party within six weeks from the date of receipt of copy of this order, enhanced interest at the rate of 12% will be levied on the said amount from the date of alleged fraudulent transaction i.e. 29.10.2021 till realization.

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 19 day of October 2023

      Sd/-                                                                                                      Sd/-

MEMBER-I                                                                                            PRESIDENT

List of document filed by the complainant:-

List of documents filed by the opposite party:-

     Sd/-                                                                                                Sd/-

MEMBER-I                                                                                     PRESIDENT