The National Consumer Disputes Redressal Commission (NCDRC) has directed Axis Bank to pay ₹3.19 crore to a Delhi-based logistics firm after holding the bank guilty of “deficiency in service” for refusing to accept demonetised currency during the 2016 demonetisation window.
The commission was hearing an appeal filed by Procure Logistics Services Pvt Ltd, which alleged that the bank repeatedly refused to accept its demonetised notes for deposit despite the account being fully KYC-compliant.
In its order dated March 10, the bench comprising presiding member AVM J Rajendra and judicial member Anoop Kumar Mendiratta observed that the bank failed to allow the company to deposit the notified cash within the limited time frame provided after the government announced the 2016 Indian demonetisation on November 8, 2016.
The commission noted that the bank had no legal basis to deny the deposit. If the transactions appeared suspicious, the bank should have accepted the money and reported the matter to the appropriate authorities instead of refusing the deposit altogether.
According to the panel, the refusal effectively deprived the company of its only lawful opportunity to deposit the demonetised notes before the deadline expired. As a result, the currency held by the firm became worthless after the permitted window closed, causing significant financial loss.
The commission ruled that such denial clearly falls under “deficiency in service” as defined under Section 2(1)(g) of the Consumer Protection Act, 1986. It also emphasised that accepting deposits in valid bank accounts is a core banking service, and banks must act within the regulatory framework when handling such transactions.
The NCDRC ordered Axis Bank to pay ₹3.19 crore along with simple interest at 6% per annum from December 30, 2016, until the date of payment.
The commission further directed that the payment must be made within two months, failing which the bank will be required to pay 9% annual interest for the delayed period.
