ATM ‘debits’ Rs 10,000 but dispenses no cash, account holder wins Rs 15,000 payout

The order noted that the bank failed to return the amount debited from the complainant’s account. “The complainant deserves to be compensated adequately for the mental agony and inconvenience suffered,” it said.

The complainant maintained a savings bank account with Union Bank of India. On July 28, 2022, he visited the bank’s ATM to withdraw Rs 10,000. According to him, the ATM did not dispense any cash, but his account was debited by Rs 10,000. Despite immediately informing the bank and submitting written complaints on July 30 and August 12, 2022, the amount was not credited back.

Aggrieved by the bank’s refusal to refund the amount, the complainant approached the district consumer commission, alleging deficiency in service and seeking refund of the debited amount along with compensation.

Cash dispensed, says bank

The bank argued that the complainant was not entitled to any relief as there was no deficiency in service on its part. It admitted that the complainant held a savings account and had used his debit card to withdraw Rs 10,000 from its ATM.

The bank said its Electronic Journal (EJ) records and CCTV footage showed the transaction was successful and the cash had been dispensed. It submitted that once an ATM transaction is completed, the machine dispenses cash and debits the customer’s account. If cash is not dispensed, the system automatically reverses the debit. Since no reversal entry was generated, the transaction was successful, and the cash was dispensed.

It further stated that the complainant’s earlier complaint before the banking ombudsman had been rejected, and a subsequent complaint before the Lok Adalat had also failed.

‘Bank ignored repeated complaints’

The commission observed that although the bank claimed that the cash had been dispensed, it failed to produce the CCTV footage to conclusively establish whether the complainant had actually received the cash. It held that the EJ statement alone was not comprehensive proof that the complainant had collected the money.

The commission found that the complainant had taken all reasonable steps to recover the debited amount by approaching the bank immediately and lodging written complaints, whereas the bank failed to properly address his grievance or restore the amount.

Takeaway

This ruling underscores that banks cannot rely solely on EJ records to reject disputed ATM transactions when stronger evidence, such as CCTV footage, is available but not produced. It reinforces banks’ duty to promptly address customer complaints and affirms that failure to do so can amount to a deficiency in service under consumer law.

Consumers facing similar grievances may contact the consumer helpline in their respective states (Kerala: 1800-425-1550) or dial the National Consumer Helpline at 1915 for assistance.

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