Axis Bank May Issue Legal Notices for Unsettled Negative Reward Points Balances

[Copycat]

@aaa1
I'm asking this question out of curiosity as you seem to be associated with the legal profession. Doesn't the Axis action of
a) asking for 40p per point when they themselves define the value as 20p per point AND
b) asking even those people who have not signed the 20p MITC AND
c) threatening to hit people with a legal notice if they do not pay up as per the Axis interpretation
remind you of a section 308 BNS violation?

P.S.
1) Will come back after some days to read your response; have no time to log into TF now due to work pressures
2) Didn't use the loophole; so no skin in the game. But the Axis effort just screams extortion. I would have understood if they had asked people to pay back at 20p but it seems to me Axis shot themselves in the foot by demanding 40p
3) If someone already asked this question; then sorry. I've only reached page 10 and have no time to read more
4) Isn't it also true that the letter that Axis sent to people has 0 legal value? Until they actually send someone a legal notice isn't it just hot air? I'm really curious to see just what sections such a legal notice would contain; I very much doubt Axis would send any (note to anyone reading: I'm no lawyer; so please don't treat my words as fact; consult an actual lawyer)
5) I don't support the actions of those who abused the loophole. So please don't think I'm defending them.

 

[Copycat]

There's a difference between 10 thousand and 40-50lakhs. They'll ask for proof as there'll mismatch and from where one will get proof? That I used rewards points? Fair enough. Now, how did you generate those?

by spends, right? Now, they'll ask to prove and you've to present statements from Axis to show the same. That's where I assumed the real deal will be.

If I can think like that, surely Axis can as well and they might incept the same nah? Again, I took it from my perspective if I would've been the jury. Thing is we don't have clear laws so a good judge can ruin you over a basic thing.

1) I don't see the IT violation here. You received RPs from Axis. You exchanged these for goods. This isn't taxable even if it crosses the 50K threshold. There's a whole bunch of articles on the 'Net from CAs about just when RPs are taxable
2) Again, as someone asked: Which specific section have the "looters" violated? None yet. But Axis has already committed a grievous violation by asking people to pay back double the amount at which they valued the points

 

[lucifer69]

1) I don't see the IT violation here. You received RPs from Axis. You exchanged these for goods. This isn't taxable even if it crosses the 50K threshold. There's a whole bunch of articles on the 'Net from CAs about just when RPs are taxable
2) Again, as someone asked: Which specific section have the "looters" violated? None yet. But Axis has already committed a grievous violation by asking people to pay back double the amount at which they valued the points

I was about to reply to your previous response that you are right in 20p, 40p think.

We weren't talking about taxing RP at all but Fraud and as I mentioned in responses above, the IT part was my presumption and the lawyer words were before that.

What looters violated? They commited a fraud by abusing the system, innit?

 

[Copycat]

The Income Tax Act already has a provision. Any receipt above Rs.50,000 other than from direct relatives without "adequate consideration" is treated as a "gift" and is taxed as income.

The 50K rule applies to cash, cash equivalent, property, bullion, paintings and a few other things. I don't think it applies to goods. Even a car valued at obviously several lakhs seems to come outside the definition of a "gift"

gift received as car - Tax planning - Income Tax

Hi what will be the tax implication if an individual received car as gift from another person not being an relatives of such person what will be tax treatment in both the doner and donee - Income Tax Tax planning

www.caclubindia.com

So unless your RPs were converted to cash, or you sold the goods bought with RPs and received cash; your tax liability on RPs is 0. I've read several articles that state exactly this; however as I'm not a CA either I would accept an alternate viewpoint if you could provide me with the proper arguments

 

[Tamal]

Bdw who are these 72 individual who got the axis notice mail?? Any protest publicly made by them

 

[Copycat]

I was about to reply to your previous response that you are right in 20p, 40p think.

We weren't talking about taxing RP at all but Fraud and as I mentioned in responses above, the IT part was my presumption and the lawyer words were before that.

What looters violated? They commited a fraud by abusing the system, innit?

Oh, I think we all agree that the looters abused the Axis system. And most of us (I include myself) hate them for it because it screwed up the system for those who were using it fairly. But that doesn't make it a fraud. Read what constitutes a fraud here:

https://indiankanoon.org/doc/299780/

I don't see any attempt by the looters to deceive Axis about whether or not the goods were returned. Axis had all the info at their fingertips, yet they chose to take no action. They went even further and issued NOCs to some. Then they tried to extort money (by doubling the rate at which they valued the points) from those who abused the system.

 

[lucifer69]

Oh, I think we all agree that the looters abused the Axis system. And most of us (I include myself) hate them for it because it screwed up the system for those who were using it fairly. But that doesn't make it a fraud. Read what constitutes a fraud here:

https://indiankanoon.org/doc/299780/

I don't see any attempt by the looters to deceive Axis about whether or not the goods were returned. Axis had all the info at their fingertips, yet they chose to take no action. They went even further and issued NOCs to some. Then they tried to extort money (by doubling the rate at which they valued the points) from those who abused the system.

the active concealment of a fact by one having knowledge or belief of the fact; quoting your link but just to be clear fraud is a vague term. Would you like to disagree that it's how a lawyer points a statement rather than how it's written?

 

[Copycat]

the active concealment of a fact by one having knowledge or belief of the fact; quoting your link but just to be clear fraud is a vague term. Would you like to disagree that it's how a lawyer points a statement rather than how it's written?

Where was there any active concealment? Did any of the looters try to conceal the fact that they returned the goods? I don't see how one can do that especially as the amount would come right back to the card. There is no fraud here that I see which is why Axis is trying the scare tactic first rather than send an actual legal notice. How much do you think it would actually cost one of their lawyers to draft a legal notice? Or 72 legal notices? The fact that they haven't done so indicates that the Axis case is just hot air

 

[sjmajumder]

the active concealment of a fact by one having knowledge or belief of the fact; quoting your link but just to be clear fraud is a vague term. Would you like to disagree that it's how a lawyer points a statement rather than how it's written?

Where was there any active concealment? Did any of the looters try to conceal the fact that they returned the goods? I don't see how one can do that especially as the amount would come right back to the card. There is no fraud here that I see which is why Axis is trying the scare tactic first rather than send an actual legal notice. How much do you think it would actually cost one of their lawyers to draft a legal notice? Or 72 legal notices? The fact that they haven't done so indicates that the Axis case is just hot air

It is definitely not fraud. It is exploitation of a known loophole. I don't think exploitation can be termed as fraud.

 

[Copycat]

By the way, in the last 3 days, I've read a post on TF that actually constitutes an offence under several acts. But @TechnoFino hasn't even bothered to remove it. And I didn't see anyone flagging it even though a lot of people have replied

I'm out of here for now. Should have been completing work I hadn't finished and instead got sucked into this fascinating topic 🙁 Boss is going to kill me later today 🙁

 

[lucifer69]

Where was there any active concealment? Did any of the looters try to conceal the fact that they returned the goods? I don't see how one can do that especially as the amount would come right back to the card. There is no fraud here that I see which is why Axis is trying the scare tactic first rather than send an actual legal notice. How much do you think it would actually cost one of their lawyers to draft a legal notice? Or 72 legal notices? The fact that they haven't done so indicates that the Axis case is just hot air

Didn't they conceal the fact that the rewards points which were supposed to be deducted are not deducted and they are with them? Furthermore, being totally aware that it should've been reverted and didn't get reverted, they didn't just choose to use them but abused the glitch by unnecessary cancellations?

Depends upon the cost and experience but it can be as low as 1k. Bc, they are not any tom, rick and Harry but a one of the big 4 of Indian banking. We don't send legal notice directly, right? We give a stern warning and threat of notice which general public already fear and agree for settlement out of court. Only if not, we send legal notice,innit?

Lastly, Unrelated to this, considering our to and fros, I'm leaning towards an assumption that you're from legal background i.e even if you are not a lawyer, you do know shit.

 

[Copycat]

Didn't they conceal the fact that the rewards points which were supposed to be deducted are not deducted and they are with them? Furthermore, being totally aware that it should've been reverted and didn't get reverted, they didn't just choose to use them but abused the glitch by unnecessary cancellations?

Depends upon the cost and experience but it can be as low as 1k. Bc, they are not any tom, rick and Harry but a one of the big 4 of Indian banking. We don't send legal notice directly, right? We give a stern warning and threat of notice which general public already fear and agree for settlement out of court. Only if not, we send legal notice,innit?

Lastly, Unrelated to this, considering our to and fros, I'm leaning towards an assumption that you're from legal background i.e even if you are not a lawyer, you do know shit.

Ok last reply 🙂
The "exploiter" could say I ordered a lot of stuff when I was thought I could pay for it. "But then my circumstances changed so I cancelled the order" OR "My wife forced me to see the reality that we couldn't really afford it so I cancelled the order" OR "I suffer from compulsive shopping disorder but my family knows about it so I'm forced to sit down and review every purchase and cancel if not necessary". Think Axis can argue with that? It's certainly not a crime to cancel an order. Nor is it the shoppers responsibility to tell Axis to deduct points. Also, I'm pretty certain that I've read in one version of the T&C that Axis has said that AEP would not be taken back once 3 months had passed. So there are conditions under which Axis does not take back points. And if a lot of time has passed and if an NOC has been issued, I think the "exploiter" would be justified in assuming that the points would not be taken back

 

[lucifer69]

Ok last reply 🙂
The "exploiter" could say I ordered a lot of stuff when I was thought I could pay for it. "But then my circumstances changed so I cancelled the order" OR "My wife forced me to see the reality that we couldn't really afford it so I cancelled the order" OR "I suffer from compulsive shopping disorder but my family knows about it so I'm forced to sit down and review every purchase and cancel if not necessary". Think Axis can argue with that? It's certainly not a crime to cancel an order. Nor is it the shoppers responsibility to tell Axis to deduct points. Also, I'm pretty certain that I've read in one version of the T&C that Axis has said that AEP would not be taken back once 3 months had passed. So there are conditions under which Axis does not take back points. And if a lot of time has passed and if an NOC has been issued, I think the "exploiter" would be justified in assuming that the points would not be taken back

How would explain cancelling orders of 2-3 crore over such a short time? One definitely needs to first have that income at hand. It raises eyebrows,innit? Next thing axis can do is put the data of cancellation before the bug, during the bug, after the bug same for purchases.
Now, they can pull his average spending and make comparison thesis to present a case on how the customer exponentially changed pattern in that time. Abuse of a systemic failure, right? That condition you mentioned is not something I'm aware of, I haven't even used an axis card for maybe an year or so except that 2rs transaction.

Regarding last point, if its proven fraud, noc doesn't matter and any MITC, agreement, timeline doesn't matter [ if proven fraud ]

 

[theXfactor]

 

[aaa1]

@aaa1
I'm asking this question out of curiosity as you seem to be associated with the legal profession. Doesn't the Axis action of
a) asking for 40p per point when they themselves define the value as 20p per point AND
b) asking even those people who have not signed the 20p MITC AND
c) threatening to hit people with a legal notice if they do not pay up as per the Axis interpretation
remind you of a section 308 BNS violation?

P.S.
1) Will come back after some days to read your response; have no time to log into TF now due to work pressures
2) Didn't use the loophole; so no skin in the game. But the Axis effort just screams extortion. I would have understood if they had asked people to pay back at 20p but it seems to me Axis shot themselves in the foot by demanding 40p
3) If someone already asked this question; then sorry. I've only reached page 10 and have no time to read more
4) Isn't it also true that the letter that Axis sent to people has 0 legal value? Until they actually send someone a legal notice isn't it just hot air? I'm really curious to see just what sections such a legal notice would contain; I very much doubt Axis would send any (note to anyone reading: I'm no lawyer; so please don't treat my words as fact; consult an actual lawyer)
5) I don't support the actions of those who abused the loophole. So please don't think I'm defending them.

All the questions you have raised I have already answered and even others above have explained. What these 72 people did was fraud. If proven fraud, the MITC and NOC are irrelevant. But I will change 1 of my answer. I had said 40p will most likey not stand but if Axis proves that it costs them that much to purchase the points and MITC doesn't mention any value of points, then purely by showing the purchase price they can establish that value of point and then ask to pay up on the basis of that. But their later MITC states value as 20p so the court might go with it. It would be debatable.

Lol, fraud recovery never ever falls under threatening to extort. That would be ridiculous.

Again, the main issue is people think Axis is doing wrong and they are taking back points. But they are taking back points they said they will never give. They never mentioned anywhere that refunded transactions will give points or card replacement will give points. There was fraud going on and it took them time to identify the extent of it. That is why we have a statute of limitations. Which would be 3 years in this case, they identified the fraud within 3 years and are asking recovery for it. Well within their legal timelines.

 

[Copycat]

All the questions you have raised I have already answered and even others above have explained. What these 72 people did was fraud. If proven fraud, the MITC and NOC are irrelevant. But I will change 1 of my answer. I had said 40p will most likey not stand but if Axis proves that it costs them that much to purchase the points and MITC doesn't mention any value of points, then purely by showing the purchase price they can establish that value of point and then ask to pay up on the basis of that. But their later MITC states value as 20p so the court might go with it. It would be debatable.

Lol, fraud recovery never ever falls under threatening to extort. That would be ridiculous.

Again, the main issue is people think Axis is doing wrong and they are taking back points. But they are taking back points they said they will never give. They never mentioned anywhere that refunded transactions will give points or card replacement will give points. There was fraud going on and it took them time to identify the extent of it. That is why we have a statute of limitations. Which would be 3 years in this case, they identified the fraud within 3 years and are asking recovery for it. Well within their legal timelines.

Sorry, I disagree. You keep repeating the same, again and again, that what they did was a fraud. You keep failing to show how it is a fraud. Just because you think it is a fraud doesn't make it a fraud in the eyes of the law
1) They are well within their rights to cancel orders. the quantum of orders or cancellations doesn't matter. Also their past and future (as in after the cancellations) ordering behaviour doesn't matter for reasons I pointed out earlier
2) They are under no obligation to inform Axis to take back the points
3) They have not attempted to conceal any facts. The very act of cancelling the order would have resulted in a credit to the CC account, which Axis could very well see

Axis has exhibited utter negligence in not reclaiming the points in the first place. Axis made its error worse by issuing NOCs. It then dug itself into a bigger hole by attempting to recover points at the rate of 40p when its own terms and conditions state the monetary value of an ER point as 20p

Please point out which specific act of the exploiters constitutes a fraud, in the legal sense of the term "fraud". Or if you have already answered it please point out where. If you are unaware of what a fraud is, in a legal sense, please refer to this https://indiankanoon.org/doc/299780/ & this https://www.lawyersclubindia.com/articles/criminal-fraud-vs-civil-fraud-14863.asp

Axis very well knows that it has not much of a case. Because of point 3 above, i.e. it was evident to Axis that the transaction was cancelled, the case would be thrown out of court. Which is why it is trying the bluff & bully route. If Axis had the faintest hope of winning, it would already have sent legal notices for recovery. Legal notices don't cost anything when you have lawyers on the roll. And merely sending a legal notice does not place any burden on the sender of the notice.

 

[Tamal]

long story short. Axis gave money in form of Edge points to "X" no. of cardholders by mistake. Now axis is taking back the money in form of Edge points from "X" no. of active cardholders and few (72 closed cardholders) as direct Cash.

Now value of Edge points extracted in form of goods/services is very well known to both Axis and the closed 72 cardholders (who got the payment notice) and its available in the redemption record also. so let them decide via court if they don't agree the point to cash conversion metrics.

ultimately the closed cardholders have to pay via cash and axis bank cant let them get away otherwise it will destroy the depositors trust in the bank.
And also the staff who failed to stop the mess quickly must also be penalized.

 

[aaa1]

Sorry, I disagree. You keep repeating the same, again and again, that what they did was a fraud. You keep failing to show how it is a fraud. Just because you think it is a fraud doesn't make it a fraud in the eyes of the law
1) They are well within their rights to cancel orders. the quantum of orders or cancellations doesn't matter. Also their past and future (as in after the cancellations) ordering behaviour doesn't matter for reasons I pointed out earlier
2) They are under no obligation to inform Axis to take back the points
3) They have not attempted to conceal any facts. The very act of cancelling the order would have resulted in a credit to the CC account, which Axis could very well see

Axis has exhibited utter negligence in not reclaiming the points in the first place. Axis made its error worse by issuing NOCs. It then dug itself into a bigger hole by attempting to recover points at the rate of 40p when its own terms and conditions state the monetary value of an ER point as 20p

Please point out which specific act of the exploiters constitutes a fraud, in the legal sense of the term "fraud". Or if you have already answered it please point out where. If you are unaware of what a fraud is, in a legal sense, please refer to this https://indiankanoon.org/doc/299780/ & this https://www.lawyersclubindia.com/articles/criminal-fraud-vs-civil-fraud-14863.asp

Axis very well knows that it has not much of a case. Because of point 3 above, i.e. it was evident to Axis that the transaction was cancelled, the case would be thrown out of court. Which is why it is trying the bluff & bully route. If Axis had the faintest hope of winning, it would already have sent legal notices for recovery. Legal notices don't cost anything when you have lawyers on the roll. And merely sending a legal notice does not place any burden on the sender of the notice.

Sure, I'll stop repeating myself. Its not fraud. Those 72 people just randomly decided to order and cancel crores of orders and at the same time the loophole was open. Just a crazy coincidence.

They closed the account with NOC after the loop was patched because again no intention to conceal anything.

It shouldn't have given points if it wanted them back. 200% their fault. Mistakes don't ever happen in this world. And there is no legal recourse for mistakes. Nothing called statute of limitations or mistake of facts or unilateral mistakes.

Yeah, Axis big bad idiot bully. Definitely avoid it. Everyone should close their Atlas and Olympus and Magnus Burgundy and Burgundy Private. 100% or Axis will come to bully you.

Yeah, Axis is bluffing cause it can send legal notice but didn't. You can't wake up someone who's pretending to be asleep.

Axis will learn soon. The d**do of consequences rarely arrives lubed.

You win.

 

[Copycat]

Sure, I'll stop repeating myself. Its not fraud. Those 72 people just randomly decided to order and cancel crores of orders and at the same time the loophole was open. Just a crazy coincidence.

They closed the account with NOC after the loop was patched because again no intention to conceal anything.

It shouldn't have given points if it wanted them back. 200% their fault. Mistakes don't ever happen in this world. And there is no legal recourse for mistakes. Nothing called statute of limitations or mistake of facts or unilateral mistakes.

Yeah, Axis big bad idiot bully. Definitely avoid it. Everyone should close their Atlas and Olympus and Magnus Burgundy and Burgundy Private. 100% or Axis will come to bully you.

Yeah, Axis is bluffing cause it can send legal notice but didn't. You can't wake up someone who's pretending to be asleep.

Axis will learn soon. The d**do of consequences rarely arrives lubed.

You win.

How about just answering what I asked instead of being sarcastic? Or is that too much to ask for in a civil discussion?
I asked you just one question: To answer or to give me the link in case you've already answered about how their actions constitute a fraud in the legal sense

 

[Zacobite]

You are right but for tge wrong reasons.

For the sake of argument imagine you take out 10L from your credit card and deposit it into your bank account. You can explain the 10L in your bank account as a short term debt end of discussion. Now imagine you got 10L in your account or you made a 10L purchase and it didn't come from debt, or income or salary or business txn or gift. In USA income from theft/fraud/scam is taxable and this law is very famous too as it helps small business owners/individuals/enterprises in recovery.

However, In india the entire Income Tax dept is a joke and I don't think there is a clear law. That's why I said, if it goes to court we will get a landmark judgement to set a precedent for future cases.

IT doesn't send demand upfront.. It will send a query and ask for an explanation.. This can happen for any transaction of any value.. with new algos any mismatch can be questioned.. After explanation is provided and if rejected then they will review the entire case, ask for supporting etc.. and recompute overall tax for all income.. then demand will come up..I know someone whose review was triggered by a small transaction that showed up on the SFT and was not reported