A Delhi court has directed Indian Bank to release Rs 77,000 withheld from a pensioner’s account, holding that the bank cannot deny relief to a cyber fraud victim merely by internally classifying the matter as not fraud on bank.
Court Finds Trial Order Ignored RBI Safeguards
Additional Sessions Judge Hargurvarinder Singh Jaggi was hearing a revision petition filed by Yogendra Kumar Singh, who challenged a trial court order after seeking release of funds that had been fraudulently transferred from his pension account in three transactions on May 3, 2025. Singh had immediately informed Indian Bank’s Tughlakabad branch and also lodged a complaint with the cyber police on the same day.
In an order dated May 12, the sessions court said the trial court had committed a grave error by overlooking binding RBI guidelines and documentary material showing that Rs 77,000 had already been credited as shadow credit by the bank on May 14, 2025. The court said this evidence could not be ignored while considering the petitioner’s plea for release of the amount.
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Bank Classification Cannot Override Statutory Protection
The court said Indian Bank had failed to place any clear evidence on record to show that the customer had knowingly shared OTPs or payment credentials. It further held that a unilateral internal classification by the bank could not override statutory safeguards intended to protect victims of cyber fraud.
The trial court had earlier dismissed Singh’s application after relying on a police status report that stated there was no information regarding any hold or lien amount on the National Cybercrime Reporting Portal. The sessions court, however, held that such a narrow reading had resulted in a miscarriage of justice against a vigilant citizen who had acted promptly after the fraud.
Pensioner Found Entitled to Zero Liability Protection
The sessions court observed that the petitioner had acted with utmost vigilance by reporting the fraud immediately and was therefore entitled to protection under the RBI’s zero liability policy. It also said the earlier trial court order dated September 8, 2025 suffered from patent illegality and required interference in revision.
The court directed the bank to permanently release the withheld amount of Rs 77,000 and asked the parties to appear before the trial court on May 30 for compliance. The ruling underscores that prompt reporting by customers and adherence to RBI safeguards remain central in determining relief in unauthorised electronic banking cases.
