Admittedly the petitioner made the following deposits against Special Notice Deposit Receipts
(SNDR) with respondent:-- 40258113.6.1998Rs, 4,00,000/- 40258215.6.1998Rs, 4,50,000/- 4025912.9.1998Rs, 4,00,000/- It is also admitted that these receipts are non-cumulative and nontransferable and can be encashed only upon presentation. Another admitted facts that the petitioner is still holding original receipts with him. Now according to the petitioner upon receipt of statement of accounts he found some wrong entries therein and when respondent was confronted he was informed that the total amount of the said Receipts i,e, Rs, 12,50,000/- has been adjusted by way of set off against over- draft payment. Then there is reference to a criminal case registered against the concerned bank official under Sections 409, 467, 468, 469, 471, 420, 477-A and 109 PPC read with Section 5(2)
Prevention of Corruption Act, 1947, which is under trial before the competent Court. According to the petitioner he is holding the said Receipts and has never presented the same and had never issued notice to the bank for withdrawal. The relief prayer is that since the said 'act of the Respondent withholding the amount of the said Receipts is without lawful authority, it be directed to encash the same in accordance with law. In its written statement the position taken by the respondent bank is that the petitioner is maintaining account with the respondent bank individually. Then there is a business account in the name of M/s. Fine Petroleum Services and M/s. Top Filling Station being maintained by the brother of the petitioner, namely, Waseem Iqbal Ansari. The petitioner issued and sent two bearer cheques for Rs, 250,000/- and Rs, 706,156/- through, his brother, namely, Waseem Iqbal Ansari, who is also account holder of respondent bank. Waseem Iqbal Ansari obtained pay order of Rs, 706, 156/- in favour of Shell Pakistan Limited for purchase of petrol for their said business. Waseem Iqbal Ansari also received cash of Rs, 2,50,000/- from the respondent bank. In the same breath it is stated that no amount was present in the account of the petitioner but respondent extended an overdrawn facility to him. Later he failed to pay the amount and while exercising right of set off the amount of Special Notice Receipts was appropriated towards over- drawn amount and remaining amount was credited to the account of the petitioner. It is then stated that the Manager of the concerned Branch Abdul Rauf had closed relations with Waseem Iqbal Ansari and due to some differences case FIR No, 511 dated 20.11.1998 was registered at Police Station Sadiqabad under Section 364 PPC against the said Manager.
2. Learned counsel for the petitioner contends that in view of the admitted facts that deposit was made by the petitioner and original receipts are being held by his client and further that no notice for withdrawal was issued by the petitioner, the respondent bank cannot withhold the payment. He further states that no cheque stands issued from the cheque book issued to the petitioner by the respondent bank against the said account. Learned counsel for the respondent, on the other hand, refers to the case of Chettinad Mercantile Bank Ltd. v. PL.A. Pichammai Achi and another (AIR 1945 Madras 447) to urge that respondent was fully authorised to adjust the said amount as set off against the said amount of over-draft.
3. I have gone through the said pleadings and documents placed by both the parties on record. I called upon the learned counsel for the respondent bank as to whether he can demonstrate any debit entry prior to the one being relied by him at any time, the answer is in the negative. Now statement of accounts available at page 7 of the paper book shows the credit entries of Rs, 4,42,100/- entered on 14.11.1998 and credit balance of Rs, 4,43,012/-. On the same date there is debit entry of Rs, 4,42,000/- against loose Cheque No, 550467. Then on 19.11.1998 there is another debt entry of Rs, 7,06,264/- with reference to a loose cheque No, 550468. On the same date there is another debit entry of Rs, 2,50,000/- to Cheque No, 879403. On 20.11.1998 there is credit entry by transfer of Rs, 12,50,000/, leaving credit balance of Rs, 2,94,748.12. Now the respondent has not mentioned in the reply, the date of the pay order of Rs, 6,06,156/- issued by it to Waseem Iqbal Ansari in favour of Shell Pakistan Limited. Copies of four pay orders, however, have been appended with the written statement. On these pay orders the date has been cut and written as 17.11.1998. Now according to the document R/1 appended with the written statement which is a letter addressed by the Shell Pakistan Ltd., the said company informed the respondent that four pay orders bearing date 14.11.1998 were received in the afternoon and were lodged on 16.11.1998 to A.N.Z. Grindlays Bank Limited. Rawalpindi. Supply date is also mentioned as 14.11.1998. It will thus be seen that there was no question of pay order carrying the date 17.11.1998, as for copies produced by the respondent itself, being lodged with said A.N.Z. Grindlays Bank Ltd. on 16.11.1998 and further making of supplies on 14:11.1998. Now the said loose cheques allegedly issued by the petitioner bear the date 16.1.1998.
The withdrawal in the statement of accounts are shown to have been made on 19.11.1998. I am conscious that these are Constitutional proceedings but the said documents on the face of them be speak the manipulation of the records done by the respondent bank. Be that as it may, suffice it to say that it is stated case of the respondent that pay orders as well as the cash amount were handed over to Waseem Iqbal Ansari, who of course has nothing to do with the said individual account of the petitioner. It is an admitted position on record that all this cooking was done without any notice to the petitioner.
4. Notwithstanding the said position emerging on the face of documents produced by the respondent bank itself, fact remains that receipts were issued against amount deposited by the petitioner against the same. Now the said judgment in the case of "Chettinad Mercantil Bank Ltd" being relied upon by the learned counsel Madras High Court, observed with reference to the Hats's Law of Banking, 4th Edition, Vol. II, Chapter 6 that the Banker lien is right of retaining things delivered into his possession as a banker if and so long as the customer to whom 'they belonged or who had the power of disposing of them when so delivered is indebted to the banker on the balance of the account between them provided the circumstances in which the banker obtained possession do not imply that he has agreed that this right shall be excluded. It was further observed that in all the cases where question of banker's lien came up, there were securities or other properties of the customer in the hands of the bank and the bank sought to exercise the right of retaining those securities or documents until the whole amount due to it was paid. It was further observed by the said learned Court that in the case of money of the customer paid into the bank into his current account or deposit account, the amount ceases to be the property of the customer and becomes the property of the banger and the banker is thereafter under a contractual obligation to repay or give credit to the customer for the amount.
5. To my mind; subject to the right of the respondent bank to be established in a properly constituted suit that the said over-draft was valid given, the respondent is under obligation to honour the said SNDR subject to terms thereof.
6. The writ petition is accordingly allowed and the respondent directed to encase said SNDRS upon notice of the petitioner in accordance with terms thereof. No order as to costs.