Lack Of CCTV Footage In ATMs And Failure To Investigate Unauthorized Transactions, Southwest Delhi District Commission Holds PNB Liable

Brief Facts:

The Complainant stated that there were unauthorized withdrawals from his bank account with the Punjab National Bank (“PNB”). Withdrawals totalling Rs. 1,00,000/- were made from his account on 20.09.2012, 23.09.2012, and 26.09.2012. Particularly, the transaction dated 23.09.2012 for Rs. 25,000/- was purportedly made from two separate ATMs located at SR International School, Najafgarh, which he contended he did not authorize or execute. Despite complaints lodged with the PNB on 16.10.2012 and 31.12.2012, as well as to the local police station and Banking Ombudsman, the Complainant didn't receive any satisfactory response. Feeling aggrieved, the Complainant approached the District Consumer Disputes Redressal Commission-VII, Southwest Delhi (“District Commission”) and filed a consumer complaint against PNB.

In response, PNB contended that the Complainant himself or someone with access to his ATM card and PIN executed the withdrawals. It argued that withdrawals totalling Rs. 25,000/- each were made from two different ATMs, one at Shri Ram International School, Najafgarh, and another on Thana Road Najafgarh, during the early hours of 23.09.2012. It maintained that the withdrawal pattern indicated a sequence consistent with the Complainant's usual transactions, asserting that withdrawals were made at intervals of Rs. 10,000/- and Rs. 15,000/-, indicating deliberate and planned transactions by someone with access to the complainant's ATM card.

Observations by the District Commission:

The District Commission held that the transactions on 23.09.2012, involving four withdrawals from different ATMs during nighttime, raised doubts regarding the Complainant's involvement. It noted that it was improbable that the Complainant would make multiple withdrawals from various ATMs in such a manner, suggesting that the withdrawals may not have been authorized by him.

The District Commission noted that there was an absence of CCTV footage or video evidence from the ATMs. Such evidence could have provided clarity regarding the identity of the individual conducting the transactions. However, it held that PNB's failure to produce this crucial evidence raised questions about its handling of the case and its commitment to transparently resolving the matter. Furthermore, the lack of timely action by the PNB in response to the Complainant's grievances was held unacceptable by the District Commission, as it hindered the preservation of potentially vital evidence.

Additionally, the District Commission noted that PNB did not provide any explanation for the absence of SMS alerts on the Complainant's registered mobile number, which could have alerted him to the unauthorized transactions.

While acknowledging the generally secure nature of ATM operating systems, the District Commission recognized the possibility of irregularities occurring. Moreover, it emphasized that even if a third party were responsible for the unauthorized withdrawals, the bank would still bear responsibility for the security of the Complainant's account.

Therefore, the District Commission held that the failure to adequately investigate the matter and preserve crucial evidence constituted a deficiency in service on PNB's part. Consequently, it ruled in favour of the Complainant, directing PNB to refund the disputed amount of Rs. 1,00,000/- along with 7% interest from the date of filing the complaint. Additionally, PNB was directed to pay Rs. 15,000/- as compensation for mental agony and harassment to the Complainant.

Case Title: Jai Narain vs Punjab National Bank

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