Salim PM v M/s State Bank of India

Case Number: C.C. No. 413/ 2019.

A Kerala consumer court ruled that a bank is accountable for any losses incurred by a client as a result of unapproved withdrawals from their account.

The District Consumer Disputes Redressal Commission in Ernakulam noted this while ordering the State Bank of India (SBI) to reimburse a client for an illegal withdrawal of funds from his bank account.

Additionally, the Court dismissed SBI’s argument that, since Salim, the client, had received SMS notifications informing him of the withdrawal, there was no unfair trade practice or service defect on the bank’s part.

“In the instant case the complainant is not duty bound to read all the messages and some among them have been received in the odd hours of the night by the complainant,” said the judgement.

Additionally, the RBI has launched the Ombudsman Scheme for Digital Transactions, 2019, which is specifically designed to address grievances about digital transactions that customers have completed through system participants. According to the scheme’s definition, system participants are organisations or platforms—aside from banks—that facilitate transactions using credit and debit cards, money transfers, and other comparable activities. With effect from January 31, 2019, the programme was implemented per Section 18 of the Payment and Settlement Systems Act, 2007.

Case Summary:

A complaint filed in the aforementioned case by Salim PM, who lost ₹ 1.6 lakh as a result of fraudulent money withdrawals from his bank account in 2019, was being heard by the court. 

An earlier order from the banking ombudsman required the State Bank of India to reimburse Salim for his loss in the sum of ₹80,000. His account was also credited with an additional ₹10,000.

Salim therefore goes before the consumer court to get the remaining ₹70,000 that he lost paid to him.

A bench comprising V Ramachandran, Sreevidhia TN, President of the District Consumer Forum DB Binu, and members granted the claim up to ₹ 85,000 (₹70,000 for the loss, ₹10,000 as compensation, and ₹5,000 for litigation costs).

The Court found in its orders that the bank owed it to the customer to take reasonable precautions to protect their interests because it was offering a service. This involves having an obligation to take action to stop unlawful withdrawals from clients’ bank accounts.

Salim said in the lawsuit that he lost ₹1.6 lakh as a result of three separate illegal withdrawals from his bank account.

Salim also stated that he was startled to discover that there was just ₹ 3,011 left in the ATM when he attempted to take out money. He stated that his bank account had ₹ 1.6 lakhs stolen from it.

On July 29, the consumer forum issued its decision in the matter, directing SBI to pay an additional ₹85,000 to the ₹90,000 that had been paid following the previous banking ombudsman finding.

Leave a Reply

Your email address will not be published. Required fields are marked *

This field is required.

This field is required.


The following disclaimer governs the use of this website (“Website”) and the services provided by the Law offices of Kr. Vivek Tanwar Advocate & Associates in accordance with the laws of India. By accessing or using this Website, you acknowledge and agree to the terms and conditions stated in this disclaimer.

The information provided on this Website is for general informational purposes only and should not be considered as legal advice or relied upon as such. The content of this Website is not intended to create, and receipt of it does not constitute, an attorney-client relationship between you and the Law Firm. Any reliance on the information provided on this Website is done at your own risk.

The Law Firm makes no representations or warranties of any kind, express or implied, regarding the accuracy, completeness, reliability, or suitability of the information contained on this Website.

The Law Firm disclaims all liability for any errors or omissions in the content of this Website or for any actions taken in reliance on the information provided herein. The information contained in this website, should not be construed as an act of solicitation of work or advertisement in any manner.