New Delhi: The National Consumer Disputes Redressal Commission (NCDRC) has found Axis Bank guilty of “deficiency in service” for refusing to accept demonetized currency notes from a Delhi-based logistics company during the 2016 demonetization window. In a significant ruling, the commission directed the bank to pay ₹3.19 crore to Procure Logistics Services Pvt Ltd, compensating for the irreversible loss the firm suffered when its cash holdings became worthless.
The bench, comprising presiding member AVM J Rajendra and judicial member Anoop Kumar Mendiratta, issued the order on March 10 after hearing an appeal filed by the logistics firm. The commission noted that the bank repeatedly disallowed the complainant from depositing notified cash into its own KYC-compliant account despite multiple requests made before the government-mandated deadline expired. The NCDRC emphasized that the statutory framework did not empower a bank to unilaterally refuse deposits in a legitimate account during the permitted window.
The commission clarified that if the bank found any transaction suspicious, its legal obligation was to monitor and report the matter to the competent authorities, rather than blocking the deposit entirely. By denying the company the only lawful opportunity to deposit the specified bank notes, the bank deprived the firm of its assets. The ruling stated that accepting deposits in duly maintained accounts is an “undisputed core banking service,” and any refusal must be supported by cogent reasons and regulatory norms.
As a result of this deficiency, Axis Bank has been ordered to pay the ₹3.19 crore sum with a simple interest of 6\% per annum, calculated from December 30, 2016, until the date of payment. The bank must settle the amount within two months; otherwise, the interest rate will escalate to 9\% per annum for the delayed period. This judgment reinforces the accountability of financial institutions in adhering to regulatory timelines and protecting consumer rights during major policy shifts.
