TaxTMI 
TaxTMI 
2012 (7) TMI 1063
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.... The deposit was made through duly authorising his Manager Mr.Anis.A.Abid. The second respondent issued six receipts each for Rs. 95 lakhs and 7th receipt for Rs. 65 lakhs. The maturity of the fixed deposit was on 13.8.2011. As the fixed deposits were to mature on 13.8.2011, the petitioner requested through his manager to issue pay order by discharging the F.D. receipts. However, the second respondent staff directed the petitioner to contact one Mr.D.R.Naik, the erstwhile Chief Manager, who was working as Divisional Manager in third respondent bank. Though the petitioner's manager contacted the said Mr.D.R.Naik, the respondent bank did not take any step to pay the amount, compelling the petitioner to write a letter on 25.8.2011 and again on 26.8.2011. Thereafter, the petitioner issued notice dated 31.8.2011 to pay the amount. The first respondent replied on 7.9.2011. However, no step was taken by the respondent bank. Therefore, the petitioner is before this Court. 3. The second and third respondents filed counter affidavit denying the contentions made in the writ petition. 4. It is contended that even though the petitioner deposited Rs. 6.35 crores and the dat....
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....1. As the amounts were already paid, the second respondent bank did not comply with the petitioner's request for payment. Meanwhile, the respondent bank instituted a criminal complaint before the Superintendent of Police, Economic Offence Wing, Central Bureau of Investigation, Chennai and a case has been registered by CBI under RC.No.15 (E) of 2011 and investigation is in progress. Till the investigation is over, the amounts cannot be paid. 7. By giving the above version, the second and third respondent bank questioned the maintainability of the writ petition. It is contended that the writ petition is not maintainable as disputed questions of facts and triable issues are involved and the proper course is to approach the civil court for remedy and the petitioner is guilty of suppression of material facts and wanton mis-representation and he has not approached the court with clean hand and therefore, the writ petition is liable to be dismissed. 8. Mr.George Cheriyan, learned counsel for the petitioner submitted that the petitioner only made the deposits through his Manager Mr.Anis A Abid, who is authorised to transact with the respondent bank; The petitioner did....
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....ntained. Moreover, the respondent bank already lodged a criminal complaint with CBI and the investigation is in progress. Therefore, pending investigation, the amount cannot be paid. In nutshell, he submitted that equity can be worked out in proper forum and not before the Writ Court. He relied upon a constitution Bench judgement of the Hon'ble Apex Court in State of Madhyapradesh and another vs. Bhailal Bhai and others reported in AIR 1964 SC 1006 to contend that when the disputed question of fact are involved, the discretionary relief under Writ Jurisdiction cannot be granted. 10. Heard the parties and perused the records carefully. It is an admitted fact that the petitioner deposited a sum of Rs. 6 crores 35 lakhs in seven fixed deposits with the maturity date on 13.8.2011. The the FDR receipts details are as here under: No. FDR No. Deposit Amount Maturity Amount 1 0909401003525/2 95,00,000.00 1,01,84,614.00 2 0909401003525/3 95,00,000.00 1,01,84,614.00 3 0909401003525/4 95,00,000.00 1,01,84,614.00 4 0909401003525/5 95,00,000.00 1,01,84,614.00 5 0909401003525/6 95,00,000.00 1,01,84,614.00 6 ....
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....nbsp; mention of Mr.Lawrence's name and his attested signature. Therefore, the letter could not have been acted upon by the bank. The absence of material details in the above letter should have been taken note of by the officials and the authencity of the letter should have verified from the petitioner. That apart one another important aspect is that Mr.Anis.A.Abid was the original authorised agent who made the deposit whereas the subsequent letter authorised a stranger Lawrence. When such a letter is produced for encashment of FDR proceeds, that too to the tune of Rs. 3.80 crores, (Pre closure of 4 FDR receipts), it is the bounden duty of the concerned bank officials to verify the authencity of the letter either with the petitioner or with Mr.Anid A Abid. 13. The procedure for repayment of deposit before maturity is contained in clause 30.1.1, 30.2.1, 30.2.2 of the bank manual of the second respondent bank. The said clauses are extracted as follows: " 30.1.1 Term deposits are contracts whereby the depositor agrees to receive principal amount after a certain period agreed upon at the time of deposit, interest being received either periodically or at maturity. ....
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....column incorporated in the reverse of FDR receipts which reads as follows: "Signature verified Supervisor/Manager" The aforesaid column would indicate the signature of the depositor needs to be verified by the supervisor/manager. In the absence of the signature of the Supervisor/Manager in the FDR issued by the bank, would certainly prove that the verification was not done by the Supervisor/Manager and it is the violation of the norms of the banks and the bank officials acted in negligent and carelessness manner deliberately with malafide motive. 15.It is the contention of the second respondent bank that as per the alleged petitioner's letter dated 19.11.2010, the petitioner informed about the loss of two original FD receipts and requested to issue duplicate FDRs in lieu of the original FDR receipts bearing No.090401003525/7 and 090401003525/8 for the value of Rs. 95 lakhs and 65 lakhs. A close scrutiny of the said letter dated 19.11.2010 would reveal that the authorised person Mr.C.H.Lawrence name is neither stated in the body of the letter nor typed in the bearer column and only the name is found to be hand written below his alleged signature. When a person ....
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....) On verification of the Deposit Receipts closed before maturity under Ultra Violet lamp, the following came to light: Bank's water mark is appearing in respect of the following 3 deposit receipts: i) KDR with printed Sl # 761023 for Rs. 95 lakhs( This Deposit receipt was issued by the branch by changing the value date of the original deposit receipt bearing Sl # 761016. The original deposit was not obtained by the branch at the time of issuing fresh deposit receipt). ii) Two Duplicate Deposit Receipts bearing Sl # 761556 and 761557 for Rs. 95 lakhs and Rs. 65 lakhs repsectively. iii) In respect of the remaining 4 Deposit receipts for Rs. 95 lakhs each closed before maturity, Bank's water mark is not appearing. Hence, the same appear to be fake." As the two duplicate receipts bearing Sl.No.761556 and 761557 were issued by the bank in the place of alleged loss of original FDRs, naturally the duplicate receipts would have water mark of the bank. The penultimate paragraph of the above complaint dated 12.10.2011 reads as follows: "Thus, it is clearly evident that there appears to be a criminal conspiracy among the perpetrators ....
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....inal agent Anis A Abid, 2) accepting the letter to issue two duplicate FD receipts without police complaint and without even verifying as to whether indemnify agreement contained all the details including the names of the indemnifiers, 3) issuance of pay orders hurriedly without following the norms, would show that the bank officials only acted fraudulently with malafide motive with the connivance of third parties and paid the amounts to strangers illegally. Therefore the second respondent bank is responsible for the fraudulent and negligent acts which cannot be disowned by the bank. Entertainment of forged documents and payments are admitted in the complaint given by the bank to CBI, which would only show that there is nothing wrong on the petitioner and the bank acted negligently and unlawfully to deprive the petitioner's legitimate dues. The bank is answerable for the fraud or negligence committed by the bank officials. Therefore this court holds that the petitioner is entitled to get the proceeds of the 7 FD receipts from the second respondent bank. 21. As per class 1.5 of RBI circular-RBI/2011-12/74 dated 01.07.2011, it is the bounden duty of the bank to rep....
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....rted in AIR 1964 SC 1066 relied upon by the learned Senior counsel appearing for the second and third respondents that power under Article 226 of the Constitution of India is discretionary one. Even in that case, the Madhyapradesh High Court issued mandamus to the State Government to pay the money collected by the tax authorities and the same was upheld by the Apex Court. The judgement of the Hon'ble Apex Court in paragraph 17, which has been categorically stated by the constitution bench as follows: "17. At the same time we cannot lose sight of the fact that the special remedy provided in Article 226 is not intended to supersede completely the modes of obtaining relief by an action in a Civil Court or to deny defences legitimately open in such actions. It has been made clear more than once that the power to give relief under Article 226 is a discretionary power. This is specially true in the case of power to issue writs in the nature of mandamus. Among the several matters which the High Courts rightly take into consideration in the exercise of that discretion is the delay made by the aggrieved party in seeking this special remedy and what excuse there is for it. Anoth....
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....stion for consideration in that case was whether the writ petition is maintainable seeking mandamus to re-credit the amount which were un-authorisedly transferred from one account to another. Though the respondent bank therein raised the plea that the disputed question of fact were involved, it could be determined only by the civil court., The Hon'ble Supreme Court held basic facts regarding unauthorised transfer of the disputed amount from the account, as well as bank liability was admitted and there was no justification for the bank to file suit on the ground of disputed questions of fact. It is further observed that such functioning of a nationalised bank is detrimental to public interest and it follows the practice of transferring money of its customer to some other person account on oral authority, people will loose faith in the credibility of the bank. The facts of the case is similar to the case in hand. In that case the amount was transferred on oral instruction. Whereas in this case, the amount was paid to strangers based on the alleged petitioner's authorisation letter which was not verified with the petitioner and bogus FDRs which is admitted by the bank itself. ....
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....e coming under the statute within the meaning of Article 226 of the Constitution of India and the writ petition is maintainable. Recently in Zonal Manager, Central Bank of India vs. Devi Ispat Limited and others reported in 2010 11 SCC 186 it has been held that Where public Sector banks discharging public functions are having status of "State". Despite clearance of its outstanding dues in entirety by the borrower, the Appellant bank therein failed to return latter's title deeds. Therefore, writ of writ of mandamus issued by the High Court for returning title deeds was upheld by the Hon'ble Supreme Court, rejecting the contention of the bank that the proper forum is Civil Court and further held that writ petition is maintainable in contractual matter. The above said position of law settled by the Hon'ble Supreme Court would make it clear that the writ petition is maintainable against the respondent bank. 27. The second respondent bank contended that adjudication of the disputed questions of facts cannot be made by the Writ Court. It has been held by the Hon'ble Supreme Court in ABL International Limited vs. Export Credit Guarantee Corporation of India Limite....
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....ad Bank and others reported in (2010) 6 SCC 193 held that the doctrine of FULL FAITH & CREDIT applies to the act done by the officials. In that case, the Hon'ble Supreme Court held that the concept of public accountability and the performance is applicable to the instrumentality of the State like bank and thus all administrative norms and principles of fair performance are applicable to them with equal force. Paragraphs 79 of the above judgement is usefully extracted as follows: "79. Inaction, arbitrary action or irresponsible action would normally result in dual hardship. Firstly, it jeopardises the interest of the Bank and public funds are wasted and secondly, it even affects the borrower's interest adversely provided such person was acting bona fide. Both these adverse consequences can easily be avoided by the authorities concerned by timely and coordinated action. The authorities are required to have a more practical and pragmatic approach to provide solution to such matters. The concept of public accountability and performance of functions takes in its ambit proper and timely action in accordance with law. Public duty and public obligation both are essentials ....
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....o legal section information and doing the needful. Till such time, the second respondent did not care even to give reply. Only after this Court ordered noticed on 28.9.2011, the second respondent woke up and lodged a complaint before the CBI (Economic Offences Wing) on 12.10.2011. This would only exhibit carelessness calculated silence kept by second respondent bank in this matter. 31. The second and third respondents neither pleaded the facts properly in the counter affidavit nor filed all the required documents before this Court. On the contrary deliberate falsehood, by suppressing material facts, has been pleaded in their counter to gain advantage and to deny the dues to the petitioner unlawfully. Though the second respondent in paragraph 27 of the counter affidavit stated that the criminal complaint has been filed before the CBI, copy of the complaint was not filed as a document by the respondents. The petitioner only filed the FIR before this Court on 11.11.2011. Mere reference about CBI complaint in the counter is not enough and the pleadings should be in consonance with the facts stated therein without twisting the facts to its convenience. Though the compliant was filed ....