Bank wrongly marks customer ‘deceased’, ordered to pay Rs 50,000 compensation

4 min readNew DelhiJul 3, 2026 03:30 PM IST

SBI admitted that the complainant's Customer Information File (CIF) had been wrongly marked ‘deceased’ due to a technical error. (AI-generated image)

A district consumer commission in Tamil Nadu has directed the State Bank of India (SBI) to restore a customer’s internet banking services, issue fresh banking documents and pay Rs 50,000 after finding that the bank wrongly marked his Customer Information File (CIF) as “deceased” and failed to rectify the error for over a year.

President P Ganeshram and members R Ramola and N Lakshmanan found the bank guilty of deficiency in service and directed to pay compensation to the complainant.

“It is evident that due to the negligence of the opposite party, the complainant’s CIF number was not only updated incorrectly but the issue has also not been rectified by opposite party till date. The complainant has proved the deficiency of service committed by the opposite party with sufficient material evidence,” the order dated July 2 read.

The complainant had a joint savings account with his grandfather and an individual savings account with SBI. After his grandfather died in January 2023, he approached the bank in February 2024 to convert the joint account into an individual account. Instead, the bank erroneously marked the complainant’s Customer Information File (CIF) as “deceased”.

As a result, the complainant said he lost access to internet and mobile banking facilities and faced difficulties in carrying out banking transactions. He claimed that despite repeated visits to the branch, a complaint lodged with SBI’s customer care in May 2025, and a legal notice sent in January 2026, the issue remained unresolved.

SBI admitted that the complainant’s CIF had been wrongly marked as “deceased” due to a technical error between the joint account CIF and the complainant’s individual CIF. However, it said the mistake was a clerical oversight rather than negligence, but reversing a “deceased” status required multiple levels of authorisation under its security protocols.

The bank argued that the complainant continued to access his funds through UPI, ATM withdrawals, branch transactions and cheque clearances, and that only internet banking services were affected. It also allegedly offered to open a new account as a solution while the backend issue was being resolved.

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Deficiency of service: Consumer forum

The commission observed that not resolving the issue till date and not returning the complainant’s passbook and cheque book amounts to deficiency of service.

The complainant proved the deficiency of service committed by the bank with sufficient material evidence.

The situation would have caused mental agony to the complainant, which needs to be compensated.

Rs 50k payout

The commission directed the bank to activate the complainant’s online mobile and internet banking facilities, issue a new passbook and cheque book for one account and a new passbook for the other account within two months. It ordered the bank to pay Rs 25,000 as compensation for deficiency in service, Rs 20,000 for the mental agony caused to the complainant and Rs 5,000 towards litigation costs.

Takeaway

The ruling underscores that banks are responsible not only for maintaining accurate customer records but also for promptly correcting errors that disrupt access to essential banking services. The decision also highlights that technical or procedural hurdles cannot excuse prolonged failure to restore banking facilities.

Consumers facing similar grievances may contact the consumer helpline in their respective states (Tamil Nadu: 044-28592828) or dial the National Consumer Helpline at 1915 for assistance.

Ashish Shaji is a Senior Sub-Editor at The Indian Express, where he specializes in legal journalism. Combining a formal education in law with years of editorial experience, Ashish provides authoritative coverage and nuanced analysis of court developments and landmark judicial decisions for a national audience.

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consumer court

State Bank India

Tamil Nadu