SBI Ordered to Pay Rs 23,000 After ATM Dispenses Rs 10,000 Less Than Debited Amount
A consumer commission in Punjab has directed the State Bank of India (SBI) to refund Rs 10,000 to a customer after an ATM transaction debited Rs 50,000 from his account while dispensing only Rs 40,000. The bank has also been ordered to pay compensation and litigation costs.
The order was passed by the Pathankot District Consumer Disputes Redressal Commission, comprising president Kulwinder Singh Pannu and members Rachna Arora and Raj Kumar Shukla. The commission held SBI responsible for failing to provide crucial electronic records that could prove the disputed transaction was completed successfully.
The commission stated, “In view of the above, the present complaint of the complainant is allowed, and the opposite party No. 2 (SBI Bank) is directed to refund the disputed amount of Rs 10,000/- along with interest @ 6% per annum from the date of debit till its realisation. The opposite party No. 2 is further directed to pay Rs 10,000/- as compensation for deficiency in service and mental harassment & agony and also pay Rs 3,000/- as litigation expenses.”
How the Dispute Began
The complaint was filed by Shakti Singh Malhotra, an IndusInd Bank customer. According to the complaint, on August 6, 2022, he carried out five withdrawal attempts at an SBI ATM. While four transactions successfully dispensed cash amounting to Rs 40,000, the fifth transaction reportedly failed to dispense any money.
However, Malhotra later received an alert showing that Rs 50,000 had been deducted from his account. He claimed that despite repeatedly approaching the banks and lodging complaints, the issue remained unresolved.
The complainant argued that the incident caused financial loss, inconvenience, and significant mental stress as he continued to pursue the matter for months.
Commission Finds SBI Liable
During the proceedings, the commission observed that SBI failed to submit key evidence such as CCTV footage, ATM journal records, or other primary electronic documents that could verify the transaction. It also noted that SBI did not appear before the commission despite being served notice.
As a result, the consumer body concluded that SBI could not establish that the disputed cash had actually been dispensed.
The commission ordered SBI to refund the disputed Rs 10,000 with 6% annual interest from the date of debit until payment. In addition, the bank must pay Rs 10,000 as compensation for deficiency in service and mental harassment, along with Rs 3,000 towards litigation expenses. The payment has to be made within 30 days.
IndusInd Bank Gets Relief
IndusInd Bank argued that the disputed transaction occurred at an SBI ATM and that it had already pursued the matter with SBI through the chargeback process. The bank maintained that it had conducted its own investigation based on records received from SBI and had informed the customer accordingly.
Accepting this argument, the commission held that IndusInd Bank could not be held responsible for the disputed withdrawal since the transaction took place at a third-party ATM operated by SBI.
Why the Order Matters
The ruling reinforces the responsibility of banks operating ATMs to maintain and produce transaction records when disputes arise. Simply claiming that a transaction was successful may not be enough. If a bank cannot provide evidence showing that cash was actually dispensed, it can be held liable for deficiency in service and may be required to compensate affected customers.
Consumers facing similar banking disputes can seek assistance through the National Consumer Helpline by calling 1915 or 1800-11-4000.
The order was passed by the Pathankot District Consumer Disputes Redressal Commission, comprising president Kulwinder Singh Pannu and members Rachna Arora and Raj Kumar Shukla. The commission held SBI responsible for failing to provide crucial electronic records that could prove the disputed transaction was completed successfully.
The commission stated, “In view of the above, the present complaint of the complainant is allowed, and the opposite party No. 2 (SBI Bank) is directed to refund the disputed amount of Rs 10,000/- along with interest @ 6% per annum from the date of debit till its realisation. The opposite party No. 2 is further directed to pay Rs 10,000/- as compensation for deficiency in service and mental harassment & agony and also pay Rs 3,000/- as litigation expenses.”
How the Dispute Began
The complaint was filed by Shakti Singh Malhotra, an IndusInd Bank customer. According to the complaint, on August 6, 2022, he carried out five withdrawal attempts at an SBI ATM. While four transactions successfully dispensed cash amounting to Rs 40,000, the fifth transaction reportedly failed to dispense any money. However, Malhotra later received an alert showing that Rs 50,000 had been deducted from his account. He claimed that despite repeatedly approaching the banks and lodging complaints, the issue remained unresolved.
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The complainant argued that the incident caused financial loss, inconvenience, and significant mental stress as he continued to pursue the matter for months.
Commission Finds SBI Liable
During the proceedings, the commission observed that SBI failed to submit key evidence such as CCTV footage, ATM journal records, or other primary electronic documents that could verify the transaction. It also noted that SBI did not appear before the commission despite being served notice. As a result, the consumer body concluded that SBI could not establish that the disputed cash had actually been dispensed.
The commission ordered SBI to refund the disputed Rs 10,000 with 6% annual interest from the date of debit until payment. In addition, the bank must pay Rs 10,000 as compensation for deficiency in service and mental harassment, along with Rs 3,000 towards litigation expenses. The payment has to be made within 30 days.
IndusInd Bank Gets Relief
IndusInd Bank argued that the disputed transaction occurred at an SBI ATM and that it had already pursued the matter with SBI through the chargeback process. The bank maintained that it had conducted its own investigation based on records received from SBI and had informed the customer accordingly. Accepting this argument, the commission held that IndusInd Bank could not be held responsible for the disputed withdrawal since the transaction took place at a third-party ATM operated by SBI.
Why the Order Matters
The ruling reinforces the responsibility of banks operating ATMs to maintain and produce transaction records when disputes arise. Simply claiming that a transaction was successful may not be enough. If a bank cannot provide evidence showing that cash was actually dispensed, it can be held liable for deficiency in service and may be required to compensate affected customers. Consumers facing similar banking disputes can seek assistance through the National Consumer Helpline by calling 1915 or 1800-11-4000.
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