In a recent case highlighting the plight of innocent victims of cyber fraud, the Bombay High Court on Thursday directed the Bank of Baroda to return Rs 76 lakh to a company that had fallen prey to online fraud. The court's decision was based on a July 2017 RBI circular.
The division bench of Justices Girish Kulkarni and F. P. Pooniwalla ruled that according to both the RBI circular and the bank's policy, customers have zero liability for fraudulent online transactions if they report them within three working days.
According to a report of TOI, "When the unauthorised transactions occur due to a third-party breach where the deficiency lies neither with the bank nor with the customer but elsewhere in the system and the customer notifies the bank regarding the unauthorised transactions within a certain time frame," HC said.
The Bombay High Court noted that the petitioners' liability would be zero, as three cyber cell reports indicated that the deficiency lay neither with the Bank of Baroda nor with the account holders. Consequently, the petitioners are entitled to a refund.