Delhi High Court
Syndicate Bank vs Bank Of Baroda & Anr. on 21 December, 2010
Author: Valmiki J. Mehta
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ RFA No.42/1996
% 21st December, 2010
SYNDICATE BANK ...... Appellant
Through: Mr. Ajant Kumar,
Advocate
VERSUS
BANK OF BARODA & ANR. .... Respondents
Through: Mr. Arun Aggarwal,
Advocate for the
respondent no.1.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA
1. Whether the Reporters of local papers may be
allowed to see the judgment?
2. To be referred to the Reporter or not?
3. Whether the judgment should be reported in the Digest?
VALMIKI J. MEHTA, J (ORAL)
1. The challenge by means of the present appeal under Section 96
of the Code of Civil Procedure, 1908 (CPC) is by one of the defendants,
namely M/s Syndicate Bank, which has been held jointly and severely
liable with the defendant no.1/Bank of Baroda/respondent no.1 under
the money decree to the respondent no.2/plaintiff.
2. The facts of the case are that respondent no.2/plaintiff filed a
suit for recovery of Rs.32,865.30 along with interest at 12% per annum
on the ground that there have been fraudulent withdrawals from his
saving bank account by four entries, of which two were major, being
through encashment of cheques of Rs.9,000/- and 15,000/-, both dated
6.10.1978 and the other two entries of Rs.4000/- and Rs.1000/- being
through self cheques dated 7.10.1978 and 9.10.1978. The respondent
no.2/plaintiff contended that all his transactions in the saving bank
account prior to the disputed entries were through withdrawal slips and
he never asked for or got issued any cheque book with respect to the
saving bank account.
3. By the impugned judgment, the trial court by a detailed
judgment running into as many as 65 pages has very exhaustively and
thoroughly examined the testimonies of all the witnesses including that
of the handwriting experts, the circumstances of the case, the legal
position and has arrived at a finding that the withdrawals were
fraudulently made from the saving bank account of the respondent
no.2 and the respondent no.1 bank/defendant no.1 and the respondent
No.2/defendant nos.2 respectively were guilty of negligence and
collusion in allowing the fraudulent encashment of the cheques in
clearing as also through self cheques.
4. The defendant no.1/Bank of Baroda, with whom the respondent
no.2 had a saving bank account, has not challenged the judgment and
decree. The judgment and decree is therefore final so far as the Bank
of Baroda/respondent no.1/defendant no.1 is concerned. The challenge
is laid only by defendant no.2 which was the banker which opened the
account and through which account the cheques were collected by it
on behalf of its customer one Sh. Satpal.
5. As regards, the liability of the appellant/defendant no.2 is
concerned, the trial court has dealt with the same from paras 71 to 78
of the judgment. In these paras, it has been found, inter alia, that the
account of Mr. Satpal was opened only with the deposit of Rs.20/- and
soon thereafter, two cheques were encashed in the said account
totaling to Rs.24,000/- which itself should have aroused suspicion with
the officers of the appellant bank at least after the first encashment. It
is trite and could not be disputed by the learned counsel for the
appellant that various circulars have been issued by the Reserve Bank
of India (RBI) with respect to operation of the accounts opened with
miniscule amounts, in which huge amounts are thereafter credited
and withdrawn. The present case clearly shows negligence of the
officers of the appellant bank with respect to the operation of the
account. In fact, there is negligence also with respect to opening of the
account because though the appellant bank claimed that the account
was validly opened with introduction of one Mr. Mangla however, the
said Mr. Mangla was not even brought into the witness box. In fact
no steps were taken thereafter to contact and seek recovery from Mr.
Satpal or Mr. Mangla.
6. Learned counsel for the appellant sought to place reliance upon
State Bank of India Vs. United Commercial Bank Ltd. AIR 2003
Delhi 284 (DB), however, the said case does not deal with the
situation as to whan a collecting banker can be exempt from liability
although negligence and collusion of its officers and staff is found as a
matter of fact on the record. In the facts of the present case, in view
of the detailed findings and conclusions of the trial court, with regard
to the negligence of the appellant bank, this judgment would therefore
not be applicable.
7. This court sitting as an Appellate Court would not be entitled to
interfere with the detailed findings of facts and conclusions of the trial
court merely because another view is possible, though of course in the
facts of the present case only one view was possible and which has
been taken by the court below in its detailed and thorough judgment.
There are no ground for interference by this court sitting in appeal.
The appeal is therefore dismissed, leaving the parties to bear their own
costs.
Trial court record be sent back.
DECEMBER 21, 2010 VALMIKI J. MEHTA,J
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