The year 2025 has been marked by a judicial focus on consumer protection in digital finance and the regulation of AI-generated content (deepfakes).
1. Financial Cyber Fraud: Increasing Liability on Banks
A landmark trend has been the High Court rulings strengthening the ‘Zero Liability’ principle for victims of cyber fraud, especially in cases of banking negligence.
| Case / Ruling | Key Principle & Impact |
| Hare Ram Singh v. RBI & Ors. (Delhi High Court) | Bank Accountability & Zero Liability: The court reaffirmed the obligation of banks (like SBI in this case) to take adequate measures to secure customer accounts and respond swiftly to complaints. The ruling put the onus on financial institutions to prove that the loss was solely due to customer negligence, thereby strengthening the ‘zero liability’ rule for consumers who report unauthorized transactions promptly. |
| RBI Directives & Judicial Oversight | The Supreme Court has actively involved the RBI and directed the CBI (Central Bureau of Investigation) to lead a national probe into sophisticated rackets like ‘Digital Arrest Scams’. This highlights a top-down judicial effort to combat large-scale, organised financial cybercrime and holds institutional players (including bank officials) accountable for complicity or lax KYC/security. |
| Karnataka High Court Ruling (on Account Freezing) | The Court upheld the power of law enforcement to freeze bank accounts without prior show-cause notice in cybercrime cases. The court emphasized the concept of the “golden hour” (the critical first hour) to recover stolen funds, ruling that the need for immediate action to protect victims’ money outweighs the requirement for a pre-freeze notice. |
2. Regulation of Online Content and Deepfakes (IT Rules, 2025)
The judiciary and government have actively worked to counter the proliferation of AI-generated misinformation.
| Case / Amendment | Key Principle & Impact |
| Information Technology (Intermediary Guidelines… ) Amendment Rules, 2025 | This legislative change, often subject to judicial review, focuses on Synthetically Generated Information (SGI) / Deepfakes. It mandates that intermediaries (social media platforms) must ensure: SGI is labelled with a permanent unique metadata or identifier. Failure to remove or disable access to unlawful content (like deepfakes/misinformation) within 36 hours after receiving ‘actual knowledge’ can remove their safe harbour protection under Section 79 of the IT Act. |
| General Takedown Orders | The updated IT Rules and subsequent judicial observations ensure that any content takedown order must be Reasoned and Specific, clearly mentioning the legal basis and the exact URL, balancing free speech with the need to curb harmful content. |
3. Procedural Aspects of Cybercrime Investigation
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Bhartiya Nyaya Sanhita (BNS) Impact: The new code has renumbered many existing IPC sections used in conjunction with the IT Act (e.g., cheating, forgery). While the principles of cyber offences under the IT Act (like Section 66 for hacking, 66D for cheating by impersonation) remain, the corresponding sections of the BNS are now being applied by the courts in charge sheets.
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A. Shankar @ Savukku Shankar v. State of Tamil Nadu & Ors. (Supreme Court Order, Feb 2025): The Supreme Court passed an order concerning the transfer and consolidation of multiple FIRs related to cybercrime (defamation, harassment under IT Act Section 67) against an individual across different police stations. This signifies the apex court’s intervention to streamline investigations into related cyber offences spread across multiple jurisdictions.
💡 Key Takeaway for 2025
The legal landscape is rapidly shifting towards institutional accountability (banks, tech platforms) and adopting new technological tools (like Maharashtra’s MahaCrimeOS AI) to combat sophisticated, large-scale financial and content-based cyber frauds. Judicial pronouncements are ensuring that while technology is used, the fundamental rights of consumers and free expression are protected through clear liability rules and procedural fairness.