Bombay High Court Orders Bank of Baroda to Refund Rs 18.79 Lakh to Cyber Fraud Victims
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MUMBAI (April 23, 2026) — The Bombay High Court on Wednesday directed the Bank of Baroda to refund Rs 18.79 lakh to a 75-year-old woman and her daughter-in-law after finding the bank liable for unauthorized internet banking transactions. The ruling, delivered by a single-judge bench, emphasized the bank's failure to adhere to the Reserve Bank of India's 'zero liability' provision for customers who report fraud promptly.
The court held that the account holders were not negligent in the incident, which involved the unauthorized transfer of funds from their accounts. The judgment marks a significant enforcement of consumer protection norms in digital banking, placing the onus on financial institutions to secure customer accounts and reverse fraudulent charges when no customer fault is established.
The case arose after the senior citizen and her daughter-in-law discovered missing funds and reported the cyber fraud to the bank. Despite the prompt complaint, the Bank of Baroda initially refused to reverse the transactions, leading the victims to seek judicial intervention. The High Court bench noted that the bank had not demonstrated any negligence on the part of the account holders, such as sharing passwords or engaging in suspicious activities that would compromise security.
Under the Reserve Bank of India's guidelines, customers are entitled to a 'zero liability' status if they report unauthorized transactions within a specified timeframe and have not been negligent. The court found that the bank's refusal to refund the money violated these regulations. The judgment ordered the bank to process the refund immediately and warned against similar dismissals of legitimate claims in the future.
The ruling is expected to strengthen the legal framework protecting senior citizens and other vulnerable demographics from cyber fraud. It also reinforces the responsibility of banks to implement robust security measures and honor their obligations under central bank directives. Legal experts suggest the decision may encourage other victims of digital fraud to pursue similar legal recourse.
Bank of Baroda has not yet issued a public statement regarding the judgment. The bank is now required to comply with the court's order and refund the specified amount to the affected individuals. The case highlights the growing challenges in securing digital banking platforms and the increasing role of the judiciary in safeguarding consumer rights in the financial sector.
As of Wednesday, the status of the refund remains pending, with the bank expected to initiate the process within the timeframe mandated by the court. The outcome of this case may set a precedent for future disputes involving unauthorized transactions and the application of zero liability provisions across India's banking system.