Delhi consumer commission orders bank to pay Rs 49,600 over failed Rs 10,000 ATM transaction

A Delhi consumer commission has directed Punjab and Sindh Bank to refund Rs 10,000 to a customer after finding that the amount was debited from his account during an ATM transaction but the cash was not dispensed.

The District Consumer Disputes Redressal Commission also directed the bank to pay Rs 29,600 as compensation for delayed reversal of the failed transaction, Rs 10,000 for mental agony and harassment, and Rs 10,000 towards litigation expenses.

A bench headed by commission president Divya Jyoti Jaipuriar and member Rashmi Bansal was hearing a complaint filed by Jitender Singh, who claimed that money was deducted from his account without the ATM dispensing any cash to him.

In an order dated August 27, the commission said, “The failure to reverse the amount within the prescribed period constitutes deficiency in service. The complainant was deprived of the use of his own money and was required to repeatedly approach the bank, submit written complaints and pursue the matter before this commission.”

The commission said the mere fact that the transaction was shown as “successful” in the bank’s electronic system could not conclusively establish that cash had actually been dispensed.

“The mere recording of a transaction as ‘successful’ in the electronic system cannot, by itself, conclusively establish that cash was actually dispensed to the customer,” the commission said.

The case arose from a complaint by Jitender Singh, who said he attempted to withdraw Rs 10,000 from an Axis Bank ATM in Ghaziabad on December 5, 2022. Although the transaction was processed and he received a transaction message, the ATM did not dispense any cash, while the amount was debited from his Punjab and Sindh Bank account.

Punjab and Sindh Bank told the commission that it registered the complaint and forwarded it to Axis Bank, which rejected it on the ground that the transaction was successful. The matter was subsequently referred to the ATM cell/arbitration but was again rejected.

The commission, however, noted that the bank had not produced any ATM journal, cash balancing report, electronic journal, CCTV footage, switch-level reconciliation report or other reliable technical record to establish that the cash had actually been dispensed.

“The bank itself acknowledges the registration of the complaint and the subsequent correspondence with the acquiring bank. Therefore, the grievance cannot be treated as a belated or fabricated claim,” the commission said.

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It also relied on the RBI framework for failed ATM transactions, under which an amount debited from a customer’s account without cash being dispensed is required to be reversed within T+5 calendar days. A compensation of Rs 100 per day is payable for delay beyond that period.

“The issuing bank may, in accordance with the inter-bank mechanism, recover the amount or compensation from the acquiring bank if the delay is attributable to the latter. Such inter se liability between the banks cannot be shifted upon the consumer,” the bench said.

The commission held that the failure to reverse the amount within the prescribed period amounted to deficiency in service and said an inter-bank dispute could not prejudice the customer’s right to prompt re-credit.

It directed the bank to pay the ordered amounts within 45 days, failing which the outstanding sum would carry interest at nine per cent per annum from the date of default till realisation.