The Delhi State Consumer Disputes Redressal Commission has upheld an order directing the State Bank of India (SBI) to refund ₹1.30 lakh to a customer whose bank account was allegedly drained through unauthorised ATM withdrawals and account transfers. The Commission found serious lapses on the part of SBI, particularly its failure to produce CCTV footage, transaction records and other evidence that could establish how the disputed transactions were authorised.
The order, dated 10 August 2026, reinforces the responsibility of banks to investigate complaints concerning unauthorised electronic banking transactions and preserve relevant transaction records.
₹80,000 Withdrawn Through ATM Without Authorisation
The dispute arose from a series of transactions in October 2018. On 12 October 2018, four ATM withdrawals of ₹20,000 each were made from the customer’s SBI account, resulting in a total debit of ₹80,000.
Ten days later, on 22 October 2018, two further transactions amounting to ₹50,000 were made from the account. These included transfers of ₹40,000 and ₹10,000 to a person identified as Sonu.
The account holder maintained that he had not authorised any of the six transactions. He also stated that his debit card had never been lost, stolen or handed over to another person.
Importantly, the customer approached SBI on 22 October 2018 itself, disputing the transactions and requesting the bank to investigate the ATM withdrawals and provide the relevant CCTV footage. A second written complaint was submitted on 6 March 2019. According to the Commission, SBI failed to take meaningful action on either complaint.
SBI Failed to Produce CCTV and Transaction Records
A key issue before the consumer fora was whether SBI could establish that the disputed ATM transactions were genuinely authorised.
The State Commission observed that SBI was the custodian of the relevant electronic records and was therefore in the best position to explain how the transactions were processed. However, the bank failed to produce CCTV footage from the concerned ATM.
The Commission also referred to an NPCI circular dated 26 March 2013, which requires banks to make CCTV recordings relating to disputed ATM transactions available when sought by customers.
Apart from CCTV footage, SBI did not produce ATM journals, switch records or authentication details that could establish the circumstances in which the four ₹20,000 withdrawals were completed.
The Commission also questioned how four withdrawals totalling ₹80,000 were permitted if the applicable daily ATM withdrawal limit was lower than that amount. SBI did not provide a satisfactory explanation.
Bank Failed to Establish Authorisation of ₹50,000 Transfers
The Commission separately examined the two transfers of ₹40,000 and ₹10,000.
Once the customer specifically disputed these transactions, SBI was expected to produce documentary evidence demonstrating that the transfers had been authorised by him. Such evidence could have included debit slips, transfer vouchers or other authentication records.
However, no such material was placed before the Commission.
The absence of documentary evidence significantly weakened SBI’s defence and supported the customer’s claim that the transactions were unauthorised.
SBI’s Defence Based on RBI Customer Liability Rules Rejected
SBI challenged the District Commission’s order, including its ex-parte decision dated 1 November 2022.
The bank argued that it had not been given a proper opportunity to contest the consumer complaint. It also relied on RBI guidelines concerning customer liability for unauthorised electronic banking transactions, contending that the customer had not reported the transactions within the prescribed period.
The State Commission rejected these arguments.
It found that SBI had received notice of the complaint on 24 February 2022, but failed to appear or file its written statement. According to the Commission, the bank’s failure to participate in the proceedings could not subsequently be used to justify reopening the matter.
The Commission also noted that SBI had failed to place the necessary material on record to substantiate its defence based on the RBI customer-liability framework.
Consumer Commission Finds Deficiency in Banking Service
The State Commission ultimately upheld the finding that SBI was guilty of deficiency in service.
The Commission identified several cumulative failures, including:
- Failure to preserve and produce CCTV footage concerning the disputed ATM transactions;
- Failure to explain how the ATM withdrawals were processed;
- Failure to establish that the ₹50,000 account transfers were authorised;
- Failure to properly act upon the customer’s written complaints regarding unauthorised transactions.
Accordingly, the State Commission dismissed SBI’s appeal and found no reason to interfere with the District Commission’s order.
SBI Directed to Pay ₹1.30 Lakh With Interest
SBI has been directed to refund ₹1.30 lakh to the customer, together with 6% annual interest from 12 October 2018.
In addition, the bank must pay:
- ₹5,000 towards mental agony, and
- ₹5,000 towards litigation expenses.
The Commission further directed that if the amount is not paid within 30 days from receipt of the order, the interest rate on the entire amount would increase to 8% per annum from 12 October 2018 until full payment.
Key Takeaway for Bank Customers
The decision highlights that banks cannot simply rely on the existence of a debit card or electronic transaction to shift responsibility onto customers. Where a customer specifically disputes an ATM withdrawal or electronic transfer, the bank must be able to produce appropriate records demonstrating the authenticity and authorisation of the transaction.
The ruling also underscores the importance of preserving CCTV footage, transaction logs, authentication records and other electronic evidence when a customer reports suspected banking fraud.
For customers facing unauthorised withdrawals or transfers, the case demonstrates the importance of immediately notifying the bank in writing, preserving copies of complaints and seeking documentary details concerning the disputed transactions.
The decision therefore serves as a significant reminder that banking institutions have a duty to investigate disputed electronic transactions and maintain evidence capable of establishing whether those transactions were genuinely authorised.