Consumer panel directs Axis Bank to pay Rs 3.19 cr over refusal to accept demonetised notes in 2016

The National Consumer Disputes Redressal Commission (NCDRC) has directed Axis Bank to pay Rs 3.19 crore to a Delhi‑based logistics company after holding the bank guilty of “deficiency in service” for refusing to accept demonetised currency for deposit during the 2016 demonetisation window. The ruling, delivered on March 10 by a bench comprising presiding member AVM J Rajendra and judicial member Anoop Kumar Mendiratta , reinforces consumer protection and bank accountability during extraordinary financial policy changes.

The appeal was filed by Procure Logistics Services Pvt Ltd , which alleged that Axis Bank repeatedly refused to accept demonetised notes for deposit into its own KYC‑compliant account despite multiple requests during the limited period permitted after the government’s demonetisation announcement on November 8, 2016. The company maintained that the bank’s actions deprived it of the only lawful opportunity to convert its cash holdings into valid currency before the deadline expired.

In its order, the commission underlined that nothing in the statutory framework empowered a bank to unilaterally refuse permitted transactions during the demonetisation window. If a bank had any concerns about suspicious activity, it was required to monitor and report such transactions to the authorities rather than reject them outright. The refusal, the panel observed, caused the complainant a direct and irreversible loss because the demonetised notes became worthless after the deadline. The commission said such conduct amounted to “deficiency in service” under the Consumer Protection Act, 1986 , and stressed that core services such as accepting deposits must be offered in accordance with the law, with any refusals properly justified and communicated.

The NCDRC ordered Axis Bank to pay Rs 3.19 crore with simple interest at 6 per cent per annum from December 30, 2016 until the date of payment . The bank must settle the amount within two months, failing which interest at 9 per cent per annum will apply for the delayed period.