The West Bengal State Consumer Disputes Redressal Commission has clarified that consumer forums must not dismiss complaints at the admission stage merely because they involve allegations of cyber fraud. The ruling reinforces the protective intent of the Consumer Protection Act, 2019, and mandates that allegations of bank negligence in failing to act on prior notice be adjudicated on merits, not rejected prematurely.
Background & Facts
The Dispute
The appellants, Sri Baidya Nath Sinha Roy and Smt. Bharati Sinha Roy, are joint account holders of a savings bank account (No. 10021600089) with the State Bank of India. On 29.12.2022, they received a fraudulent phone call from an impersonator posing as the Chief Branch Manager of the bank, who extracted sensitive account details including the account number and IFSC code. The next day, on 30.12.2022, the appellants discovered that Rs. 10,00,000 had been fraudulently transferred from their account in two transactions of Rs. 5,00,000 each.
Key Facts
- The appellants’ account balance as of 23.12.2022 was Rs. 12,14,695.01
- On 30.12.2022, the appellants immediately visited the bank branch at 10:00 A.M. to report the fraud and submitted a letter of caution requesting immediate blocking of transactions
- The bank officials refused to accept the letter, instructing the appellants to first lodge an FIR with the police
- The appellants lodged an FIR with the local police station on 30.12.2022
- The bank finally acknowledged receipt of the caution letter on 04.01.2023, four days after it was submitted
- The appellants allege that had the bank accepted the letter on 30.12.2022, the fraudulent transfer could have been prevented
- The appellants filed a complaint before the District Consumer Disputes Redressal Commission (DCDRC) seeking compensation of Rs. 10,00,000 for loss, litigation costs, and damages for deficiency in service
Procedural History
- 29.12.2022: Fraudulent phone call received by Appellant No. 1
- 30.12.2022: Rs. 10,00,000 fraudulently debited from account; appellants visit bank at 10:00 A.M. to submit caution letter; bank refuses to accept it
- 30.12.2022: FIR lodged with local police station
- 04.01.2023: Bank acknowledges receipt of caution letter
- 15.01.2023: Complaint Case No. CC/161/2023 filed before Ld. Additional DCDRC, Rajarhat (New Town)
- 24.05.2023: Ld. Additional DCDRC dismisses complaint at admission stage, holding it requires "detailed specialised investigation" beyond its jurisdiction, relying on Axis Bank Ltd. v. Thomas Ninan
- 21.07.2023: First Appeal No. SC/19/A/224/2023 filed before State Consumer Commission
- 21.04.2026: State Commission delivers judgment
The Parties' Positions
For the Appellants
The appellants contended that the bank’s refusal to accept the caution letter on 30.12.2022 constituted a clear deficiency in service under the Consumer Protection Act, 2019. They argued that the bank, as a nationalised financial institution, had a statutory and contractual duty to act promptly on customer alerts, especially under RBI’s notification dated 06.07.2017. They emphasized that unlike Axis Bank v. Thomas Ninan, there was no involvement of SIM deactivation or third-party telecom negligence - only the bank’s failure to act on direct notice.
For the Respondent
The bank denied any deficiency in service, arguing that the appellants’ version of events was inconsistent with the FIR and that the fraudulent transaction was the result of sophisticated cybercrime beyond the bank’s control. It contended that the matter required forensic investigation into digital transactions, which consumer forums are not equipped to handle.
Relief Sought
The appellants sought compensation of Rs. 10,00,000 to be paid or credited to their joint account, along with litigation costs and interest, for the bank’s gross negligence in failing to act on timely notice.
The Legal Issue
The central question was whether a consumer forum may dismiss a complaint at the admission stage on the ground that it involves allegations of cyber fraud requiring "detailed specialised investigation," when the core allegation is the bank’s failure to accept a customer’s caution notice and take preventive action.
Arguments Presented
For the Appellant
The appellants relied on the protective intent of the Consumer Protection Act, 2019, arguing that consumer forums are not required to conduct forensic investigations at the admission stage. They distinguished Axis Bank Ltd. v. Thomas Ninan on factual grounds, noting that case involved SIM deactivation and telecom negligence, whereas here, the issue was purely the bank’s refusal to accept a complaint. They cited Section 36(2) and (3) of the Act, which permits deemed admission if admissibility is not decided within 21 days, indicating legislative intent to avoid premature dismissal. They further invoked Section 100, which clarifies that the Act is in addition to, and not in derogation of, other laws.
For the Respondent
The bank argued that fraudulent online transfers inherently involve complex digital evidence, including IP logs, transaction trails, and third-party involvement, which consumer forums lack the technical capacity to verify. It contended that the Axis Bank precedent was directly applicable and that allowing such complaints to proceed would overload consumer forums with cases requiring cyber forensics.
The Court's Analysis
The State Commission conducted a rigorous analysis of the statutory framework under the Consumer Protection Act, 2019, and the procedural posture of the case. It emphasized that dismissal at the admission stage is permissible only if the complaint is patently barred by law, lacks jurisdiction, or is frivolous - not because the allegations are complex.
"At the time of admission hearing, there is no need to go very deep into merit or fate of the case. For admission of a case some preliminary points are to be considered viz, whether in the case there is any consumer-service provider/vendor relationship, the limitation period for filing the case and whether the case is barred by or excluded by any other special laws in force and also to consider the jurisdiction of the Ld. Commission."
The Commission noted that the consumer-service provider relationship between the appellants and the bank was undisputed. The core allegation - that the bank refused to accept a caution letter on the day of the fraud, thereby delaying preventive action - is a straightforward claim of deficiency in service. The Commission held that the Axis Bank judgment was distinguishable because it dealt with a multi-party scenario involving telecom providers and SIM deactivation, whereas here, the bank alone was alleged to have failed in its duty.
The Commission further observed that Section 100 of the Act explicitly preserves the jurisdiction of consumer forums even when other laws (such as the IT Act or IPC) may also apply. The fact that criminal proceedings or cyber investigations may be underway does not oust the consumer forum’s jurisdiction to examine service deficiency.
"The Consumer Protection Act has not been made totally toothless. Some powers have been conferred upon the Commission for bringing necessary information/evidences on records."
The Commission rejected the notion that the mere possibility of complex evidence renders a complaint non-maintainable at admission. It held that the District Commission’s reliance on Axis Bank was misplaced and that the dismissal was a mechanical application of precedent without considering factual distinctions.
The Verdict
The appeal is allowed. The impugned order dated 24.05.2023 dismissing the complaint as not maintainable is set aside. Complaint Case No. CC/161/2023 is admitted and remanded to the Ld. Additional DCDRC, Rajarhat, for disposal on merits. The Ld. Commission is directed to proceed without being influenced by the observations in this judgment. The complainants are directed to appear before the Ld. Commission on 21.05.2026. Copies of this order are to be supplied to the parties free of cost.
What This Means For Similar Cases
Admission Stage Cannot Be Used to Dismiss Complex Allegations
- Practitioners must now argue that consumer forums are not required to resolve forensic or technical disputes at the admission stage
- A complaint alleging bank negligence in responding to customer alerts cannot be dismissed merely because cyber fraud is involved
- The burden is on the forum to determine if the complaint discloses a prima facie case of deficiency in service - not whether the claim will ultimately succeed
Banks Cannot Shift Responsibility to Police as a Precondition for Action
- Banks cannot refuse to accept customer complaints on the ground that an FIR must be filed first
- RBI’s 06.07.2017 notification imposes a duty on banks to act promptly on customer alerts, regardless of criminal proceedings
- Failure to act on timely notice may constitute deficiency in service under Section 2(1)(g) of the Consumer Protection Act, 2019
Jurisdiction Is Not Ousted by Parallel Criminal Proceedings
- Consumer forums retain jurisdiction even when criminal investigations are ongoing
- The existence of overlapping remedies under the IT Act or IPC does not bar a consumer complaint
- Section 100 of the Act ensures that consumer rights are not subordinated to other legal frameworks
