Forum directs Lakshmi Vilas Bank to pay man Rs. 10K for failed cash transaction

In November 2018, Pathiree Chandraiah, a resident of Srinivasa Nagar Colony in RC Puram, went to a Lakshmi Vilas Bank ATM to withdraw Rs. 6,000. However, the machine did not dispense the cash while his account was debited with the said amount.

Mr. Chandraiah has a Savings account in SBI's LIG Colony branch. He immediately approached his bank and SBI issued three complaint tickets but could not resolve the matter. "I approached Lakshmi Vilas Bank and expressed the same but even they did not solve the issue," said Mr. Chandraiah.

He then issued a written complaint to both the banks in January 2019 but they failed to reply. "I am an electrician working in a private company earning a meager sum of Rs. 14,637 per month. The loss of Rs. 6,000 affects my livelihood," said the complainant.

Replying to the allegations, Lakshmi Vilas Bank said Mr. Chandraiah should have waited for a few minutes after the ATM failed to dispense the cash as sometimes the machine throws the cash outside. The transaction was successful and the images relating to the said transaction are filed before the Commission, the banks said, adding the complainant was making allegations against them even though they was no default on their part.

"On the receipt of a complaint from the complainant, the opposite parties have made proper inquiry and it revealed that the transaction of withdrawal of cash was successful and a debit entry in the account of the complainant was made. Both banks have given detailed clarification in response to the complaint," said Lakshmi Vilas Bank.

After examining the documents and evidence, the commission observed, "It is a general practice that banks shall make an inquiry/investigation into the matter since the ATM occasionally malfunctions and the cash gets stuck in the machine or sometimes there may be fraud involved. In the present case, the banks simply stated that the transaction was successful without filing a single document to substantiate their contention. The ATM logbook or the ATM Journal is not filed on record."

It further added, "The banks, in fact, are fully equipped with all the information such as the denominations of notes that were inserted into the ATM and number of notes dispensed and the number that remained in the ATM at the time of placing money on the succeeding day. They failed to conduct an inquiry or having conducted one suppressed such information for the reasons best known to them. Lakshmi Vilas Bank, in order to escape its liability, simply stated that the transaction of cash withdrawal was successful without filing any proof in this regard."

The commission further stated that the complainant with a small source of income will not waste his precious time going around the court, spending his hard-earned money, and forgoing his income on each day of court adjournment unless there is truth and is bearing the brunt of the loss of money. "Hence, we are of the opinion that there is a deficiency in service and unfair trade practice on behalf of the opposite parties," said the commission.

The commission directed Lakshmi Vilas Bank to return to the complainant an amount of Rs. 6,000 that was wrongly debited from his account with an interest of 9 per cent per annum from the date of debit till the date of realization. Also, the bank was ordered to pay a sum of Rs. 10,000 as compensation for the mental agony and trauma and Rs. 3,000 towards the cost of litigation.