TaxTMI 
TaxTMI 
2016 (6) TMI 865
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....use carrying on the business of exports under licence granted by the Government of India. The Plaintiff held a current account with the Defendant bank in connection with its exports business. The Commissioner of Customs (Preventive), R. & I. Division, by his letter dated 4 November 1996, informed the Defendant that the Plaintiff's exports in connection with a particular L/C were under investigation and that preliminary investigations had revealed that as against purported exports of Rs. 8 Crores, no physical exports had been made, but only paper transactions had been carried out. The Commissioner of Customs, in the premises, called upon the Defendant bank to withhold any operations of the subject L/C and not to release any payment to any party thereunder without prior clearance of the Customs. Simultaneously, a summons was issued under Section 108 of the Customs Act, 1962, requiring the Defendant to supply information and documents. The Defendant, accordingly, proceeded to freeze the Plaintiff's current account with the bank. During the period the account was frozen, export remittance in the sum of Rs. 65,66,200/on account of export of goods to Russia under the subjec....
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....rest; and that no interest is payable by the Defendant to the Plaintiff on the amount. Apart from a contest on merits, the Defendant pleads the bar of limitation, and also contests the jurisdiction of this Court to entertain the suit. 4 Based on the pleadings, the following issues were framed by this Court : : I S S U E S : 1. Whether this Court has jurisdiction to receive, try and dispose of this suit ? 2. Whether the suit is filed within limitation ? 3. Whether the suit is bad for nonjoinder of necessary parties ? 4. Whether the Defendant proves that the amount in question could not have been placed in fixed deposits as requested by the Plaintiff ? 5. Whether the Plaintiff proves that they are entitled to a decree in the sum of Rs. 1,21,91,105/along with further interest at 18% p.a. from the date of filing of the suit until payment/realization ? 6. What decree ? What order ? 5 Both parties produced documentary and oral evidence, and made submissions through Counsel. 6 The ground of want of jurisdiction is urged by the Defendant on the basis that the cause of action arises at the branch in which the Plaintiff held its current account, and not at the C....
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...., futile to refer to another legislation such as the CPC (which is not applicable) to determine the jurisdiction of the Chartered High Court. Under Clause 12 of the Letters Patent, if and to the extent the defendant carries on business within the local limits of the jurisdiction of this Court, this Court has jurisdiction to entertain a suit against the defendant. Issue No.1 is, accordingly, answered in favour of the Plaintiff and against the Defendant. 7 As for the ground of limitation, it is important to note that the amount lying in deposit with the Defendant Bank became payable to the Plaintiff only after this Court passed an order directing the Defendant to defreeze the account and pay the amount lying to the credit of the account of the Plaintiff. The liability to pay the interest, accordingly, arises only upon the passing of that order. If that date is reckoned as the starting point of limitation, the suit filed for interest on the amount due to the Plaintiff is within time. Issue No.2 is also, accordingly, answered in favour of the Plaintiff and against the Defendant. 8 Neither State Bank of India nor Customs Department can be said to be a necessary party to the presen....
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....ess is contested by the opponent. The genuineness of a document, its receipt by the addressee when it is addressed to someone and the truth of its contents are all matters of trial. In the present case, the document is produced by the Plaintiff through PW1. PW1 has deposed both to its contents and also its receipt by the Defendant. There are two important things to be noticed here. Firstly, after such formal proof was tendered, the Defendant did not appear to have objected to the marking of the document. Secondly, there is absolutely no cross-examination of PW1 on this point. In the premises, the only inescapable conclusion to be drawn is that the existence, receipt and contents of the document are duly proved by the Plaintiff. I hold accordingly. 11 The more important point, however, is, whether the Defendant was bound to act on the letter of 7 July 1998 and keep the amount lying to the credit of the current account of the Plaintiff in a Fixed Deposit. In the first place, there is admittedly (i) no cheque issued by the Plaintiff drawn on the current account to pay any monies to the Defendant bank towards a fixed deposit, (ii) no standing instruction from the Plaintiff to the....