Professional Negligence in Indian Banking Sector

Abstract

The relationship between a banker and a customer has been laid down in section 3 of the Negotiable Instruments Act 1881 but in that the definition of “banker” as a person acting as a banker is a mere tautology. The former had no statutory meaning in India before the passing of the Indian Companies Amendment Act 1936. However, now it is well settled that banking is a business transaction between bankers and customers. Such customers are consumers within the meaning of Section 2(1) d(ii) of the Consumer Protection Act, 1986. Bank renders service to customer. Therefore the customer is a consumer.