In Brief
DAV Public School's bank accounts at Indian Bank suffered fraudulent withdrawals through unauthorized transactions. The bank had failed to implement net banking security measures. While a police chargesheet identified two fraudsters and absolved the school's Principal of complicity, the school delayed filing a formal complaint after detecting the first misappropriation. The Supreme Court held the bank liable for deficiency of service but limited compensation to the first day's losses only, since the second day's siphoning resulted partly from the school's delayed reporting. The school and Principal were not held vicariously liable for the fraud."
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