10 April,2026 08:23 PM IST | Mumbai | mid-day online correspondent
Representational image. File pic
The Bombay High Court has ordered HDFC Bank to refund Rs 38 lakh to a Pune-based businessman, who lost the amount to digital fraud, observing that the account holder was not at fault.
As reported by news agency PTI, a bench of Justices Bharti Dangre and Manjusha Deshpande, while passing the order of April 6, held that account holder Subodh Korde was entitled to zero liability under guidelines issued by the Reserve Bank of India (RBI) as the online transactions transferring money from his account to beneficiaries added unauthorizedly were not initiated by him.
As per the petition filed in the Bombay High Court, Korde lost the amount through eight unauthorised online transactions executed within just 40 minutes on July 15, 2021.
The fraud was preceded by the addition of three unknown beneficiaries and a sudden increase in his transaction limit from Rs 4 lakh to Rs 40 lakh a day earlier.
Korde further claimed he had not authorised the transactions, nor had he received OTPs. However, the bank denied liability, claiming it had sent OTPs and intimation messages to the account holder.
The High Court, while passing the order, relied on a police investigation report which clearly stated that Korde had not received any messages from the bank, as per PTI.
Furthermore, the man had claimed that he was facing network issues on his SIM card at the time.
Interestingly, BSNL, the petitioner's network provider, confirmed that Korde's SIM card had been swapped fraudulently multiple times between July 12 and July 15, 2021.
Furthermore, the court also noted that it was a "clear case of SIM swapping", where fraudsters gain access to OTPs by duplicating a user's mobile number. The court further ordered, "This is precisely the methodology adopted. The petitioner did not receive any OTP as the SIM card was cloned," as per PTI.
Relying on the RBI's July 6, 2017 circular on 'Customer Protection - Limiting Liability of Customers in Unauthorised Electronic Banking Transactions'.
The Bombay High Court further said, "The burden to prove customer negligence lies on the bank. If a customer is not at fault and reports promptly, the liability is zero," as per PTI.
The court also pointed out that Korde had acted swiftly after learning about fraudulent transactions from his account.
The Bombay High Court further directed HDFC Bank to refund Rs 38.04 lakh within eight weeks with 6 per cent annual interest, which would increase to 8 per cent in case of delay.
(With inputs from PTI)
