Kerala

Alappuzha

CC/237/2018

Sri.Arunkumar.S - Complainant(s)

Versus

The Manager. - Opp.Party(s)

23 Oct 2020

ORDER

IN THE CONSUMER DISPUTES REDRESSAL FORUM, ALAPPUZHA
Pazhaveedu P.O., Alappuzha
 
Complaint Case No. CC/237/2018
( Date of Filing : 07 Sep 2018 )
 
1. Sri.Arunkumar.S
S/o Sasikumar, Aswathy, Avlookunnu, THathampally P.O.,Alappuzha.
...........Complainant(s)
Versus
1. The Manager.
State Bank Of India,Mullackal Branch.
............Opp.Party(s)
 
BEFORE: 
 HON'BLE MR. JUSTICE S. Santhosh Kumar PRESIDENT
 HON'BLE MRS. Sholy P.R. MEMBER
 HON'BLE MRS. Lekhamma. C.K. MEMBER
 
PRESENT:
 
Dated : 23 Oct 2020
Final Order / Judgement

IN THE CONSUMER DISPUTES REDRESSAL COMMISSION, ALAPPUZHA

                         Friday the 23th day of October, 2020.

                                      Filed on 07-09-2018

  Present

  1. Sri.S.Santhosh Kumar  BSc.,LL.B  (President )
  2. Smt. Smt.C.K.Lekhamma, B.A, LLB (Member)

 

In

CC/No.237/2018

   between

  Complainant:-                                                  Opposite party:-

Sri.Arunkumar.S                                                  The Manager

S/o Sasikumar                                                     State Bank of India

Aswathy, Avalookunnu                                       Mullackal Branch

Thathampally P.O.                                               (By Adv.C.Parameswaran)  

Alappuzha

 (By Adv.K.George)                                         

          O R D E R

SRI. S.SANTHOSH KUMAR (PRESIDENT)

 

 

Complaint filed under Sec.12 of the Consumer Protection Act, 1986. 

Material averments briefly stated are as follows:-

Complainant is a NRI and he is represented by his father who is the power of attorney holder.  Complainant is holding a NRI account under SBI, Mullackal branch having No.31921915218.   On 19.06.2014 complainant received SMS that amounts were withdrawn through his debit card when he was in Saudi Arabia and at that time the card was not been activated also.  The matter was intimated to the opposite party on the same day.  The said illegal withdrawal of money is from unknown locations.  Besides that complainant demanded to the opposite party to block the account and ensure that the lost amount is to be adjusted back to his account.

On the request of the complainant opposite party had lodged a complaint with the ATM cell regarding the fraudulent transaction on 30.07.2014.  Complainant had filed a complaint before the Alappuzha North Police Station on September 2014 and FIR was registered.  Total amount of Rs.2,67,181/- was illegally withdrawn from complainant’s account without his knowledge and this amounts were withdrawn from ATMs outside India.  He did not receive related SMS which could have alerted him.  The complainant requested the opposite party to credit the amount and it was told that within 30 days the amount will be adjusted in his account.  Later on 30.07.2015 complainant sent a registered mail to the A.G.M, Thiruvananthapuram.  When the father of the complainant visited the branch manager it was advised that it will take time for resolving the complaint relating to International frauds.    On 14.03.2016 a report was sent to the complainant stating that when contacted it was informed that the file will be transferred to Cyber Cell, Thiruvananthapuram for a detailed investigation and also demanded copy of pass port which was handed over. 

Complainant had issued several messages to the opposite party regarding the subject matter and they had taken a lukewarm attitude in the matter.  Opposite party is liable to pay the amount and damages.  Hence there was deficiency of service on the part of the opposite party.  Complainant is entitled to get Rs.2,67,181/- with 12% interest per annum from 19.06.2014 till date of payment and he is also entitled for Rs.1,00,000/- as compensation.

  1. Opposite party filed a version through its branch manager mainly contenting as follows:-

There was no negligence or deficiency of service on the part of the opposite party.  Based on the complaint of the complainant opposite party had lodged a complaint to the Station House Officer, Alappuzha North about this issue and investigation is going on.  The complaint is barred by law of limitation.

Complainant has put up distorted facts to suit his case. Complainant is an account holder of the opposite party and provided with an ATM card and he was frequently using the same for withdrawal.  There was complaint to the opposite party about the fraudulent use of his debit card and on verification it was found the withdrawal successful.  Therefore the opposite party is not liable to pay the money.  The complaint is bad for non joinder of parties. 

As per the process flow of ATM usage in the ATM machine the customer originally inserts the card in the machine.  Then he feeds the PIN number , type of the account and amount required.  After successfully entering the PIN the transaction request comes into the SWITCH (Central Processing Unit).  The SWITCH will in turn do pre-screening checks and the authorization process in the SWITCH will transfer the transaction request to the Bancslink (accounting system) and bancslink will thereafter respond to SWITCH and SWITCH will reply back to ATM and transaction request is honored or bounced as the case may be.  In case of withdrawal once the amount is disbursed the confirmation in this regard will be send by the ATM as per the route mentioned above within a specified time and the account of the customer would be debited.  The aforesaid transactions done by the complainant were debited in the account and the same is evidenced by the electronic journal entries kept and maintained by the opposite party in the usual and ordinary course of its business. 

The claim of the complainant that the opposite party bank is liable to return the amount of Rs.2,67,181/- to the complainant is per-se false.  The allegation that the amounts were withdrawn from outside India are false.  The opposite party bank had afforded all support including handing over of relevant datas to the investigating authorities to detect the culprit who had looted the complaint.  The circumstances of the instant case warrants that the issue is to be adjudicated by adducing voluminous evidence.   The complainant has not sustained any loss as alleged at the hands of opposite party bank.  Opposite party is not liable to pay any compensation.  The complaint is false, frivolous, vexatious and hence it may be dismissed with costs.

  1. On the above pleadings following points were raised for consideration:-
  1. Whether the complaint is barred by limitation?
  2. Whether there was deficiency of service on the part of the opposite party bank?
  3. Whether the complainant is entitled to realize an amount of Rs.2,67,181/- along with interest at the rate of 12% from 19.06.2014 as alleged?
  4. Whether the complainant is entitled to realize an amount of Rs.1,00,000/-  as compensation from the opposite party as prayed for?
  5. Reliefs and cost.
  1. Evidence in this case consists of oral evidence of PW1 and Ext.A1 to A8 from the side of the complainant and the oral evidence of RW1 and Ext.B1 to B3 from the side of the opposite party.
  2. Point No.1

In the version it was contented that the complaint is barred by limitation.  However no specific reason is pointed out.  Admittedly the alleged transactions occurred during the year 2014 and the complaint was filed during 2018.  It is noticed that the complainant came to know about the incident on 19.06.2014 by SMS.  Immediately he informed the manager of the opposite party and the manager filed a complaint before the Alappuzha North Police Station and the case was registered as crime No.35/2015 by Alappuzha North Police Station on 12.01.2015.  The E-mail communications between the complainant and opposite party bank shows that investigation is in progress.  Ext.A8 letter dated 22.07.2020 issued by the public information officer and Inspector of Police Alappuzha North Police Station shows that as per order dated 10.04.2016 of Director General of Police it was transferred to Trivandrum Cyber Crime Police Station and now the case is under investigation by the Kochi Cyber Crime Police Station.  So it can be seen that on the basis of the complaint filed by the opposite party the case is under investigation and still it has not made any headway. Complainant was running from pillar to post to redress his grievances and finally on 07.09.2018 he has filed this complaint before this commission.  As rightly pointed out by the learned counsel appearing for the complainant the relationship between the consumer and bank can be considered as a trustee.  Still complainant is maintaining an account with the opposite party and so it is a continuous process.  In such circumstances the contention taken in the version that the complaint is hit by limitation appears to be not correct.  So the point is found against the opposite party.

  1. Point No.2 to 4 

       For the sake of convenience these points are considered together.  PW1 is the power of attorney holder of the complainant in this case.  He filed an affidavit in tune with the complaint and marked Ext.A1 to A8.  

RW1 is the previous manger of the opposite party bank.  He filed an affidavit in tune with the version and marked Ext.B1 to B3. 

The case of the complainant is that he is having a NRI account with the opposite party bank having No.31921915218.   He is permanently residing in Saudi Arabia on account of employment.  On 19.06.2014 he received SMS showing that amounts were withdrawn through his debit card.  Total amount of Rs.2,67,181/- was withdrawn as 19 withdrawals from 09.06.2014 to 19.06.2014.  The said withdrawals were without his knowledge and authorization.  Immediately the matter was informed to the opposite party bank.  Opposite party informed the matter to Alappuzha North Police Station and a case was registered.  Though he had several communications with the opposite party bank the amount was not credited in his account.  Hence he has filed this complaint for realizing an amount of Rs.2,67,181/- along with interest at the rate of 12 % from 19.06.2014 till payment and also seeking an amount of Rs.1,00,000/- as compensation for mental agony.  Opposite party filed a version mainly contenting that to withdraw money using an ATM card a four digit PIN is required.  The PIN is initially given by the bank secretly to the ATM card holder and later the customer can change the PIN.  Hence according to them the withdrawals made were with the consent and authority of the complainant and so they are not liable to compensate.   The power of attorney holder of the complainant who is none other than his father was examined as PW1 and Ext.A1 to A8 were marked.  The then branch manager of opposite party bank was examined as RW1 and Ext.B1 to B3 were marked.

The fact that an amount of Rs.2,67,181.14 paise was withdrawn from the account of the complainant from 09.06.2014 to 19.06.2014 is not in dispute.  From Ext.B2 document produced from the opposite party bank the said amounts are seen withdrawn using ATM from several countries such as Russia, Bangkok etc and it was admitted by RW1 during cross examination.  Ext.A5 is a copy of passport of the complainant which will show that during the relevant period complainant was in Saudi Arabia.  So it is pellucid that amounts were not withdrawn by the complainant.  It was contented by the learned counsel appearing for the opposite party that the amounts can be withdrawn only using ATM/ debit card and using the PIN.  In such circumstances it was pointed out that the bank is not liable to compensate the complainant.  It was pointed out that it was the duty of the complainant to keep the ATM/ debit card under safe custody.  As stated earlier admittedly at the time of withdrawal complainant was in Saudi Arabia whereas amounts are withdrawn from Russia, Bangkok etc.  The contention of learned counsel appearing for the opposite party that the amounts can be withdrawn only using the ATM/ debit card and with the PIN appears to be not correct.  During these days there are a lot of fraudulent withdrawals from several countries outside India and within the country for which criminal cases are registered with the police.

Ext.A1 is an E-mail message dated 19.06.2014 sent by the complainant to the opposite party bank informing the withdrawal.  The last withdrawal was on 19.06.2014 and on the very same day ExtA1 message was sent to the opposite party bank.   Ext.A2 is an E-mail dated 20.06.2014 sent by the opposite party to the complainant informing that regarding the fraudulent transactions a complaint was lodged with the ATM Cell.  Ext.A4 is a copy of FIR from which it is seen that a case was registered as crime No.35/2015 by the Alappuzha North Police Station on 12.01.2015 on the basis of information given by the chief manager of opposite party bank.  The contents of the FIR will show that the fraudulent transfers were made using electronic technology equipments. It is also mentioned that the amounts were withdrawn from Bangkok and Russia.  Though the incident occurred during 2014 Ext.A8 letter dated 22.07.2020 of Alappuzha North Police Station shows that the case is under investigation by the Kochi Cyber Crime Police Station.

At the fag end of trial ie, on 01.10.2020 opposite party filed IA No.172/2020 for giving a direction to the complainant to produce the debit card.  Power of attorney holder of the complainant who was examined as PW1 filed an affidavit stating that the ATM card was already surrendered before the opposite party bank.  In support of such a contention he has produced E-mail messages between the complainant and opposite party bank.  In one of the email dated 14.08.2014 opposite party had asked the complainant to send the ATM card.  They had sent 16 forms for reporting the unauthorized withdrawal and requested to affix his signature in all the forms.  In reply to the same on 16.08.2014 complainant informed that he will sent ATM card through his father (PW1) when he visits India.  So it can be safely concluded that the ATM card was returned to the bank along with the forms which was forwarded by the bank.

Now the only question to be considered is whether the bank is liable to compensate the complainant.  As discussed earlier as per Ext.B2 document bank had admitted that an amount of Rs.2,67,181.14/- paise was withdrawn from the account of complainant from 09.06.2014 to 19.06.2014 through ATM from several countries outside India.  Admittedly from Ext.A5 copy of passport it can be seen that during the relevant period complainant was in Kingdom of Saudi Arabia.  During cross examination of PW1 an attempt was made to show that PW1 is not aware of the matters.  As discussed earlier since complainant is working in KSA his father gave evidence as PW1 on the strength of power of attorney.  Here the transactions are admitted by the opposite party bank by Ext.B2 account statement.  Since the matter is proved through documents the oral evidence of PW1 is not that much important.  During cross examination itself PW1 had stated that the debit card was surrendered with the bank.  It was contented by RW1 that as per Ext.B1 and B2 the withdrawals are successful and so they are not liable to compensate the complainant. 

The learned counsel appearing for the complainant relied upon a ruling of the

Hon’ble High Court reported in 2019 (1) KLT 505 (SBI Vs. George ) and pointed out that the bank is liable to the customer for the loss occurred due to unauthorized transactions.  It was held by the Hon’ble High Court,  The relationship between a bank and its customers arises out of the contracts entered into between them.  Such contracts consist of general terms applicable to all transactions and also special terms applicable to the special services, if any, provided by the bank to its customers.  The relationship between a bank and its customer, in so far as it relates to the money deposited in the account of a customer, is that of debtor and creditor.  The contractual relationship exists between a bank and its customers are founded on customs and usages.  Many of these customs and usages have been recognized by courts and it is now an accepted principle that to the extent that they have been so recognized, they are implied terms of the contracts between banks and their customers.  Duties of care is an accepted implied term in the contractual relationship that exists between a bank and to its customer.  It is impossible to define exhaustively the duties of care owed by a bank and its customer.  It depends on the nature of services extended by the bank to its customers.  But one thing is certain that where a bank is providing service to its customer, it owes a duty to exercise reasonable care to protect the interests of the customer.  Needless to say that a bank owes a duty to its customers to take necessary steps to prevent unauthorized withdrawals from their accounts.  As a corollary, there is no difficulty in holding that if a customer suffers loss on account of the transactions not authorized by him, the bank is liable to the customer for the said loss.

Per contra the learned counsel appearing for the opposite party relied upon a decision of the National Consumer Disputes Redressal Commission reported in II (2011)CPJ106(NC) ( State Bank of India Vs. K.K. Bhalla) and pointed out that the bank is not liable for fraudulent withdrawals for using ATM card.  On a reading of the ruling it is seen that the complainant in the said case was a resident of Delhi  and he was holding an account with the SBI, Janakpuri branch, New Delhi.  An amount of Rs.77,629/- was withdrawn from his account using ATM. In the complaint it was stated that the account was fraudulently manipulated with the connivance of someone in the petitioner bank.  The District Forum asked to produce CCTV footage which was not produced and so the District Forum directed the bank to compensate which was upheld by the State Commission.  However the National Commission revised the decision. 

       The Reserve Bank of India had issued a circular No.RBI/2017- 18/15 dated 06.07.2017 which reads as follows.  If  a customer suffers loss in connection with the transactions made without his junction by fraudster        it has to be presumed that it is on account of the failure on the part of the bank to put in place a system which prevents such withdrawal, and the banks are, therefore, liable for the loss caused their customers.  It is noticed that since the decision of the National Commission is dated 07.04.2011 it was before the circular of the RBI.  As per the circular referred above the RBI has made clear that the banks are liable for the loss caused to their customers.

In the decision reported in 2019 (1) KLT 505 the circular of RBI is refereed.  In the circumstances it can be seen that the decision of the National Consumer Disputes Redressal Commision is not applicable in this case since the facts are different.  On the contrary the decision referred by learned counsel appearing for the complainant (2019 (1) KLT 505) is squarely applicable in this case. 

As held by Hon’ble Supreme Court in 2007 (4) KLT short note 33 (case No.34) (Sumti bai Vs. Paras finance company ) Precedents – A decision is only an authority for what it actually decides- A little difference in facts or additional facts may make a lot of difference in precedential value of a decision.

       To sum up complainant through PW1 has proved that the fraudulent transfers occurred from different countries like Russia, Bangkok etc. while he was in Kingdom of Saudi Arabia.  On 19.06.2014 that is on the last day of transaction he received a SMS and immediately he informed the matter to the manager of opposite party bank.  In turn the manager lodged a complaint before the Alappuzha North Police Station and the case is now being investigated by the Cyber Crime Police Station, Kochi.  The communications produced by PW1 shows that the complainant was running from pillar to post claiming his lost money.  Though the opposite party bank informed that it is under investigation they have not compensated till date.  It shows that there was deficiency of service from the part of the bank.  The contention of the opposite party bank that without the consent and knowledge of the complainant the amount cannot be withdrawn appears to be not correct.  From the complaint it is seen that some of the withdrawals were made even before the activation of the card.  So it is crystal clear that it was without the knowledge or consent of the complainant and the contra allegations are baseless.  Hence applying the principles laid down by the Hon’ble High Court in 2019 (1) KLT 505 opposite party bank is liable to compensate the complainant.

       Complainant is claiming an amount of Rs.1,00,000/- as compensation for mental agony and loss of valuable time.  As discussed earlier immediately on getting  the SMS on 19.06.2014 complainant informed the matter to the opposite party bank.  Between the complainant and opposite party bank there were several communications regarding the transaction.  The amount was not credited in to the account of complainant on a contention that investigation is going on by the Cyber Crime Police Station.  It is to be noted that the case was registered as per Ext.A4 FIR on 12.01.2015 and even now also investigation has not made any headway.  In such circumstances complainant is entitled for compensation and considering the entire circumstances and the amount involved in this case we are limiting the same to Rs.50,000/-.  These points are found accordingly.

  1. Point No.5

In the result complaint is allowed in part.

  1. Opposite party bank is directed to pay an amount of Rs.2,67,181/- along with interest @9% per annum from 19.06.2014 till payment.  The amount will be credited to the account of the complainant.
  2. Complainant is allowed to realize an amount of Rs.50,000/- as compensation from the opposite party.
  3. Complainant is allowed to realize an amount of Rs.5,000/- as cost.

The said order shall be complied within one month from the date of the receipt of copy of this order. 

Dictated to the Confidential Assistant, transcribed by her corrected by me and pronounced in open Forum on this the 23th day of October, 2020.

Sd/-Sri.S.Santhosh Kumar (President)

         Sd/-Smt.C.K Lekhamma (Member)

 

Appendix:-

Evidence of the complainant:-

PW1                    -        Sasikumar (Witness)

Ext.A1                -        Copy of E-mail dtd 19.06.2014

Ext.A2                -        Copy of E-mail dtd 20.06.2014

Ext.A3                -        Letter dtd 30.07.2015

Ext.A4                -        Copy of FIR

Ext.A5                -        Copy of passport

Ext.A6                -        Copy of passbook issued by SBI, Mullackal

Ext.A7                -        Copy of E-mail dtd 27.06.2020

Ext.A8                -        Reply notice dtd 22.07.2020

       

 

Evidence of the opposite parties:- 

RW1                             -        Shajimon Joseph (Witness)

Ext.B1                 -        Copy of e-journal entry  

Ext.B2                 -        Certified copy of statement of account

Ext.B3                 -        Copy of terms and conditions

 

// True Copy //

To

        Complainant/Oppo. party/S.F.

                                                                           By Order

 

 

                                                                       Senior Superintendent

Typed by:- Sa/-

Compared by:-

 

 

 

 

 

        

 
 
[HON'BLE MR. JUSTICE S. Santhosh Kumar]
PRESIDENT
 
 
[HON'BLE MRS. Sholy P.R.]
MEMBER
 
 
[HON'BLE MRS. Lekhamma. C.K.]
MEMBER
 

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