UPI Transaction Court Case - PhonePe to Pay Compensation & Refund Amount

UPI Transaction Court Case - PhonePe to Pay Compensation and Refund Amount:

In a recent ruling, the 111 Additional Bangalore Urban District Consumer Disputes Redressal Commission handed down a judgment in favor of two complainants in a case against PhonePe Private Limited (OPPOSITE PARTY No. 1), a leading online payment platform, and two banks, Canara Bank (OPPOSITE PARTY No. 2) and Karnataka Bank (OPPOSITE PARTY No. 3). The case, Consumer Complaint No: 1503/2019, highlights the significance of consumer protection laws in India.

Background

The dispute, dating back to October 11, 2017, arose when the first complainant, N.D. Vinaya Kumar, transferred Rs. 10,000 to his friend, Unnikrishna B (Complainant No. 2), via PhonePe’s platform. However, despite receiving a successful transaction message from PhonePe, the money was not credited to Unnikrishna B’s bank account maintained with Canara Bank.

The complainants’ attempts to resolve the issue with PhonePe and the respective banks proved unsuccessful, leading them to file a complaint under the Consumer Protection Act, of 1986. Their grievance alleged both a deficiency of service and unfair trade practice on the part of the opposite parties.

The Ruling

In a comprehensive judgment delivered by the commission of Sri. Shivarama. K, PresidentSri and Chandrashekar.S.Noola & Smt. Rekha Sayannavar, Member, the following key points were outlined:

1. Deficiency of Service: The commission found PhonePe (OPPOSITE PARTY No. 1) liable for the transaction issue. As an intermediary facilitating online payments, PhonePe was deemed responsible for ensuring diligence in every transaction on its platform. In the words of Smt. Rekha Sayannavar, the commission member, “We hold that opposite party No. 1 is liable for it and also the act of not refunding the claimed amount of Rs. 10,000/- to the account of either complainants despite many requests raised by both the complainant. It amounts to deficiency of service as enumerated U/s. 2 (g) and unfair trade practice as enumerated U/s as enumerated U/s. 2 (r) of C.P Act, 1986.
2. Compensation Awarded: The commission ordered PhonePe (OPPOSITE PARTY No. 1) to refund the Rs. 10,000 with interest at a rate of 9% per annum from the date of the alleged transaction. Additionally, both complainants were awarded compensation of Rs. 3,000 each for the mental agony and financial hardships they endured during the ordeal.
3. Litigation Costs: The costs of litigation, amounting to Rs. 5,000, were imposed on PhonePe (OPPOSITE PARTY No. 1) and Karnataka Bank (OPPOSITE PARTY No. 3).
4. Compliance Deadline: PhonePe (OPPOSITE PARTY No. 1) was given 45 days to comply with the order. Failure to do so would result in the awarded amount accruing interest at a rate of 9% per annum from the date of the order until payment.

Case Name: N.D. Vinaya Kumar Vs Phonepe Private Limited

Case No.: CONSUMER COMPLAINT NO: 1503/2019

Bench: Sri. Shivarama. K, PresidentSri and Chandrashekar.S.Noola & Smt. Rekha Sayannavar, Member

Order dated: 11.08.2023

Source: https://www.livelaw.in/pdf_upload/case-89-nd-vi...