Failure To Provide SMS Alerts For Unauthorized Transactions, NCDRC Holds HDFC Bank Liable

Brief Facts:

The Complainant had a savings account with HDFC Bank (“Bank) and held an ATM cum debit card for this account. When he attempted to withdraw money from the Bank, he discovered that Rs. 35,000/- had been withdrawn by someone else. Despite the Bank's usual practice of informing account holders of transactions through SMS, the Complainant did not receive any such notification. He visited the Bank multiple times to address the issue, but the Bank ignored his concerns. Feeling aggrieved, the Complainant filed a consumer complaint in the District Consumer Disputes Redressal Commission, Nagaon, Assam (“District Commission”).

The District Commission allowed the complaint and directed the Bank to refund Rs. 35,000/-, pay Rs. 5,000/- as compensation and Rs. 5,000/- as legal costs to the Complainant. Aggrieved by the decision of the District Commission, the Bank filed an appeal before the State Consumer Disputes Redressal Commission, Assam (“State Commission”).

The Bank argued that the Complainant only produced a photocopy of the ATM card, not the original, suggesting it was not in his custody. Further, the ATM card and PIN were always with the Complainant, making unauthorized withdrawals improbable. The Bank also contended that the District Commission did not have the jurisdiction to adjudicate on a dispute involving allegations of fraud.

The State Commission dismissed the Bank's appeal and upheld the order of the District Commission. Dissatisfied by the decision, the Bank filed a revision petition before the National Consumer Disputes Redressal Commission (“NCDRC”). The Complainant did not appear before the NCDRC.

Observations of the Commission:

The NCDRC noted that Rs. 35,000/- was withdrawn in seven transactions from different locations from the Complainant's account. He discovered it only when he visited the Bank on August 12, 2013. The Complainant also lodged an FIR on August 13, 2013, and informed the Bank about the unauthorized transactions, stating that no SMS alerts were received despite having always received alerts for previous transactions. The Bank argued that the transactions were made with the Complainant's consent since the ATM card and PIN were in his possession.

The NCDRC also noted the absence of CCTV footage to disprove the Complainant's claims and upheld the findings that the Bank failed to provide due service by not ensuring SMS alerts for the disputed transactions.

The NCDRC reiterated that its revisional jurisdiction is limited and should be exercised only in cases of jurisdictional error or material irregularity. Both the District Commission and the State Commission provided well-reasoned orders, and the NCDRC found no grounds for interference. Consequently, the NCDRC upheld the orders of the State Commission and dismissed the revision petition filed by the Bank.

Case Title: HDFC Bank Ltd. vs Satish Baishya

Case No.: Revision Petition No. 57 of 2024

Advocate for the Petitioner: Ms Vasudha Arora

Advocate for the Respondent: None

Date of Order: 9th July 2024

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