State Bank Of India And Ors vs Permanent Lok Adalat And Ors

By way of this writ petition, the petitioner-Bank assails the award dated 28/09/2018 passed by the Permanent Lok Adalat, Udaipur whereby it directed the petitioner-Bank to reimburse an amount of Rs.40,000/- which was defrauded from the ATM of the petitioner-Bank alongwith interest at the rate of 10% per-annum. Further, an amount of Rs.10,000/- has also been directed to be paid as compensation.

Learned counsel for the petitioner-Bank submits that after filing of the writ petition, Rs.40,000/- has been paid by the petitioner-Bank and so far as the direction of paying interest and the compensation is concerned, the same is too excessive. The petitioner-Bank cannot be said to be at fault as it was apparently a fraud committed by a third party at the ATM where on account of negligence of the respondent no.2, certain persons were able to get the amount transferred from the account of respondent no.2 to another account and thereby defrauded not only the respondent no.2 but the Bank too. It is his submission that the Bank cannot be said to be not providing proper services if such an incident has taken place. Learned counsel further submits that the Permanent Lok Adalat ought not have dealt with the matter as did not have the jurisdiction to do so.

Per-contra, learned counsel appearing for respondent no.2 submits that the respondent no.2 had attempted to withdraw a sum of Rs.40,000/- lying in his account from the ATM on 11/11/2017. As there were two ATM machines in one cabin, there were some other persons in the same cabin handing other ATM machine, who, after unsuccessful attempt of the respondent no.2 and after leaving cabin by the respondent no.2, manipulated and hacked his account resultantly the respondent no.2 suffered a loss to the tune of Rs.40,000/-. He immediately complained to the Bank authorities and also informed about the concerned account of the said miscreants which was also in the same Bank. The Bank authorities did not make any complaint to the Police authorities with regard to the incident. It is his submission that the petitioner-Bank, on the other hand, conducted in-house enquiry and held the respondent no.2 himself responsible and also held wrongfully that there was no fraud committed with the respondent no.2 and denied repayment of the amount even though there was a specific circular issued by the Reserve Bank of India dated 06/07/2017 providing for the method and manner in which the liability of the customer is to be relieved and the circumstances therein. Learned counsel for the respondent no.2 further submits that the respondent no.2 has already raised a complaint before the OMBUDSMAN and thereafter filed application before the Permanent Lok Adalat who had tried to get the matter reconciled but the Bank authorities were not even ready for reconciliation and thereafter the Permanent Lok Adalat has passed the final award. He submits that no inference is required to be made to such an order.

Heard learned counsel for the parties

This Court in the case of Royal Living Homes Pvt. Ltd. Vs. Aseem Kumar Sharma and others (SB Civil Writ Petition No.16279/2018), decided on 11/09/2018 at Jaipur Bench, held that the Permanent Lok Adalat will have power under Section 22(c) of the Legal Services Authority Act, 1987 to adjudicate the matter after having attempted for reconciliation. A perusal of the order dated 28/09/2018 passed by the Permanent Lok Adalat, this Court finds that the Permanent Lok Adalat has first attempted to get the matter reconciled but the Bank authorities have not accepted and in the circumstances, it has proceeded to pass the award.

The submission of learned counsel for the petitioner-Bank that the Bank has not committed any fault cannot be accepted, it was required as per the circular issued by the Reserve Bank of India to repay the amount of Rs.40,000/- immediately on having come to know about the fraud having been committed on one of its customers and the Bank was also required to lodge an FIR expeditiously but the same has not been done. It is noticed that the respondent has lodged FIR mentioning all the facts. It is also noticed that the respondent no.2 has also made an complaint to the OMBUDSMAN but the amount has not been paid to him. In the circumstances, the Permanent Lok Adalat, after examining the facts and circumstances, has reached to the conclusion that the amount has to be refunded alongwith interest at the rate of 10% and a sum of Rs.10,000/- has also been directed to be paid at a compensatory amount.

The writ jurisdiction of this Court in relation to the award is limited. The only aspect which this Court would examine is whether there is any perversity in any award and would not substitute is opinion to the opinion arrived at by a legal authority.

Having said so, this Court finds that no interference is called for in the present case and the award passed by the Permanent Lok Adalat dated 28/09/2018 is upheld. The petitioner-Bank is directed to make the payments as directed by the Permanent Lok Adalat within a period of two months henceforth.

The writ petition is accordingly dismissed.