Bank Cannot Disclaim Liability for Locker Theft Due to Security Lapses: NCDRC Slams PNB, Awards ₹1 Lakh Each to 28 Locker Holders

“Banks cannot contract out of their duty of care in locker services” –  In a major decision reinforcing the duty of care banks owe to locker holders, the National Consumer Disputes Redressal Commission (NCDRC) held Punjab National Bank liable for gross negligence and deficiency in service following the theft of valuables from 15 lockers at its Modi Nagar Branch. The Commission, however, declined to quantify the actual loss, directing complainants to approach the Civil Court for full compensation, while awarding each of the 28 complainants ₹1 lakh for litigation costs and negligence.

The Bench comprising Justice Sudip Ahluwalia (Presiding Member) and Justice Anoop Kumar Mendiratta (Member) found serious security violations, including non-functional alarms, outdated locker systems, a dangerously weak vault wall, and absence of night guards, which enabled burglars to steal valuables in the intervening night of 11–12 June 2017.

“5-Inch Brick Wall for Strong Room Violates 2003 Safety Norms” – Gross Lapses Exposed

The Commission noted that the strong room wall was only 5 inches thick, made of brick without reinforced concrete or tin sheeting, as mandated by the Indian Standard – Code of Practice for Construction of Vaults (2003). The strong room was constructed in 1971 and had not been upgraded in line with modern security standards. Alarm systems and CCTV were either non-functional or bypassed, and no guards were present during night hours when the theft occurred.

The Commission cited the Investigating Officer's report, noting:

“The backside of the wall of the strong room was not too strong to be made as per the norms prescribed… The thickness of the wall was found to be of 5 inches… Most of the CCTV installed in the bank were found to be non-functional, which also reflects the irresponsible and callous conduct on the part of the Bank.” [Para 17]

These findings confirmed that the Bank had not complied with RBI standards or its own internal security protocols.

“Relationship Not That of Landlord–Tenant – Bank Cannot Evade Duty of Care”

Punjab National Bank had attempted to disclaim liability by relying on clauses in its locker agreement, claiming the relationship was merely of landlord and tenant, with no responsibility for contents.

The Commission dismissed this defence as untenable, holding:

“The leasing of a locker in the custody and control of the Bank… does not and cannot create the relationship of landlord and tenant… It appears to be a tour de force on the part of the appellant to seek release from its obligations under the locker agreement.” [Para 14]

The Commission reaffirmed that banks, as custodians, cannot evade their statutory and contractual obligations by mere nomenclature.

“Summary Jurisdiction Not Suited to Determine Actual Value of Locker Contents”

While each complainant submitted affidavits detailing their individual losses, totalling several crores, the Commission declined to assess specific monetary compensation, following the Supreme Court’s decision in Amitabha Dasgupta v. United Bank of India.

Quoting extensively from the Supreme Court, the Commission noted:

“Valuation of stolen locker contents requires detailed and precise evidence, which cannot be undertaken in summary consumer proceedings. A separate civil suit is the appropriate remedy for proving the actual value.” [Paras 27–28]

The Court held that even though affidavits went unchallenged due to lack of cross-examination, such unchallenged testimony alone was insufficient in a complex case involving large and disputed monetary claims.

Separate Duty of Care Independent of Bailment Principles

The Commission observed that even if bailment was not established, the bank had a separate duty of care as a service provider, particularly in maintaining locker infrastructure and securing public property.

“Banks as service providers… owe a separate duty of care to exercise due diligence in maintaining and operating their locker or safety deposit systems… irrespective of the application of the laws of bailment.” [Para 27, quoting SC in Amitabha Dasgupta]

Thus, even absent knowledge of locker contents, the Bank's failure to prevent unauthorized access, maintain secure infrastructure, and ensure functioning safety mechanisms amounted to deficiency in service.

Complaint Dismissed on Valuation, But Costs of ₹1 Lakh Each Awarded

Despite rejecting the prayer for compensation based on claimed valuations of gold, cash, and documents (running into several crores), the NCDRC observed that the Bank’s negligence was clear and egregious.

Accordingly, the Commission:

“Dismissed the complaint with liberty to file civil suits… However, costs of ₹1.00 lakh to each of the Complainants are awarded for the palpable negligence in the matter on the part of the Bank Authorities.” [Para 30]

Key Takeaways from the Judgment:

1. Bank locker agreements cannot shield banks from liability by invoking a landlord–tenant relationship; banks retain active control and responsibility.
2. Gross security failures — including non-compliance with Indian Standard codes, absent guards, and dysfunctional safety systems — constitute deficiency in service.
3. Consumer Commissions cannot adjudicate complex valuation of locker contents; such claims must be pursued via civil suits.
4. Affidavits, even if unchallenged, are insufficient where detailed evidence is needed to assess the extent of damages.
5. However, where negligence is established, litigation costs and punitive damages may still be awarded to consumers.

This NCDRC ruling sets a strong precedent on the scope of bank liability in locker theft cases, reinforcing that contractual disclaimers do not override legal duties. While complainants must now approach civil courts for full recovery, the decision underlines that banks cannot absolve themselves through archaic clauses or outdated infrastructure.

Date of Decision: 16 January 2026