Case Summary- The Supreme Court has upheld the State Bank of India’s (SBI) liability for fraudulent and unauthorized transactions reported by a customer, emphasizing the duty of banks to safeguard their customers' accounts. The Bench of Justice JB Pardiwala and Justice R Mahadevan dismissed SBI's appeal against the Gauhati High Court’s decision, which directed the bank to refund Rs. 94,204.80 to the customer who fell victim to fraud.
The Court also urged account holders to remain vigilant and ensure OTPs and sensitive information are not shared with third parties. "We expect the customers, i.e., the account holders also to remain extremely vigilant and see to it that the O.T.Ps. generated are not shared with any third party. In a given situation and in the facts and circumstances of some case, it is the customer also who could be held responsible for being negligent in some way or the other. Given the above, we see no good reason to disturb the impugned order passed by the High Court. The Special Leave Petition is, accordingly, dismissed," the Court ordered.AOR Sanjay Kapur appeared for the SBI, and AOR Anil Shrivastav appeared for the respondent. Upon following instructions from a fraudster posing as customer care, the customer had attempted to return an online purchase and downloaded a mobile app that facilitated unauthorized transactions from his account.
Cause Title: State Bank of India v. Pallabh Bhowmik and Ors. [Special Leave to Appeal (C) No. 30677/2024]
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