Hyderabad consumer forum orders Paytm to pay Rs 3,000 compensation for service deficiency

HYDERABAD: The District Consumer Redressal Commission has ordered Paytm to pay Rs 3,000 in compensation for causing mental agony with deficiency in service to a consumer.

Mavarpu Parmesh, 41, of Dilsuknagar, transferred Rs 12,000 to his friend B Srinivas on September 15, 2022. He made the money transfer via the Paytm app and from his account that was linked to his SBI Bank account.

The money was immediately debited from Parmesh's bank account following the transaction on he app. However it was not transferred to the recipient B Srinivas, who also has an account with SBI. On being informed by Srinivas that the money was not credited to his account, Parmesh double-checked his account and Paytm transactions and found that the money was deducted from his bank account and the same was confirmed by the Paytm App.

However, the transaction was not processed even after several hours, following which, Parmesh reached out to Paytm customer service.

Parmesh was assured by the Paytm customer service representatives that if the payment failed, the money would be refunded and credited back to the same account. Parmesh even received a message that the money would be reimbursed within a few days but there was no trace of the money in his account.

He was informed that the attempt had failed and that the refund would be initiated again. He waited for a long time but received no refund. Parmesh felt betrayed when he received no response after contacting the customer service again.

He also contacted his bank as well as the bank of the recipient and obtained statements for both accounts. The statements display just a single transaction, a debit of Rs.12,000 from the complainant's account with no credit entry in the account of the recipient B Srinivas and no refund of Rs 12,000 to the complainant's bank account.

Parmesh, dissatisfied with the Paytm authorities' lack of response, approached the consumer forum, alleging that the app team did not show concern to address his issue, which amounts to an unfair trade practice and deficiency of services as defined by the Consumer Protection Act, 2019.

The court pointed out that Paytm authorities failed to appear before the Commission to make representations and provide written responses within the stipulated term of 45 days either to refute or dispute the complainant's allegations.

The court noted that Paytm authorities were liable for their inadequate services and that he was entitled to reasonable compensation from Paytm in addition to a refund of the amount debited from his account. The court also ruled that Paytm caused Parmesh great mental anguish and harassed him by failing to provide services as promised, and that it violated the complainant's terms and conditions of service and expectations.

The court noted that the Paytm authorities failed to reimburse the amount paid despite the complainant's repeated follow-up. Parmesh filed a memo on June 5, 2023 saying that Paytm reimbursed Rs 12,000 into his account on March 2, 2023 with a six-month delay, proving the lack of service. Hence, the court determined that Parmesh was entitled to compensation.

The court directed Paytm to pay Rs 2,000 as compensation for creating mental anguish due to the abnormal delay in crediting the transacted amount and Rs 1,000 as costs of the litigation within 45 days of the ruling.