Raj Kumar Hem Singh vs Union Of India & Ors
2013 Latest Caselaw 3501 Del

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*      IN THE HIGH COURT OF DELHI AT NEW DELHI

+      W.P.(C) 5001/2013 & CM APPL. 11291/2013

       RAJ KUMAR HEM SINGH               ..... Petitioner
                   Through               Ms. Shweta Bharti with
                                         Mr. Shantanu, Mr. Neelesh Sinha,
                                         Mr. Vikram Hazarika and Ms. Risha
                                         Mittal, Advocates
                          versus

       UNION OF INDIA & ORS              ..... Respondents
                     Through             Mr. Jayant Tripathi, CGSC and
                                         Mr. Satyajit Sarna, Advocate for R-1.
                                         Mr. Rajiv Kapur with Ms. Vatsala
                                         Rai, Advocates for R-2/SBI.
                                         Mr. K.S. Panikar, Advocate for RBI.

%                                  Date of Decision: 07th August, 2013

CORAM:
HON'BLE MR. JUSTICE MANMOHAN

                             JUDGMENT

MANMOHAN, J: (Oral)

1. Present writ petition has been filed under Article 226 read with Article 227 of the Constitution of India seeking a direction to the respondent no. 1 to release the funds of the petitioner from an appropriate bank and for quashing of the letter/order dated 17th June, 2013 passed by Banking Ombudsman.

2. Briefly stated the facts of the present case are that petitioner seeks reimbursement of two Fixed Deposit Receipts dated 6th February, 1924 and 8th August, 1935 belonging to his great grandmother, Her Highness Rani Jaswali Dharamdei of Chamba, for which the petitioner had obtained a succession certificate in October, 2011.

3. The respondent no.2-SBI with whom the aforesaid fixed deposit receipts were lodged has refused to encash them vide its letter dated 27th February, 2013. The relevant portion of SBI's letter dated 27th February, 2013 giving reasons for refusal of encashment is reproduced hereinbelow:-

"2. In this regard, we have to advise that the branch of Imperial Bank of India, Lahore was functioning as State Bank of India, Lahore till 1965, whereafter in the wake of Indo-Pak war, the assets of the Lahore branch were taken over by the Government of Pakistan. Hence the records relating to the deposits are not available with the Bank.

3. In this regard, we would also like to draw your attention to para 3 page 346 (copy enclosed) in the book "THE RESERVE BANK OF INDIA 1951- 1967" which is available on the RBI website, wherein it is mentioned that the Indian Banks were permitted to operate their branches in Pakistan till 1965. With the outbreak of hostilities between the two countries in 1965, the assets of the State Bank of India in Pakistan were taken over by the Pakistan Government, custodian of Enemy property. As such the assets/liabilities of State Bank of India, Lahore branch were reported to be taken over in 1965 by Pakistan."

4. Petitioner's complaint was dismissed by the Banking Ombudsman vide order dated 17th June, 2013. The relevant portion of the order reads as under:-

"3. As per clause 1(4), of BOS-2006 the provisions of the Banking Ombudsman Scheme, are applicable to the business of banks in India only. The text of the schedule is available at our website: www.bankingombudsman.rbi.org.in

4. In view of the above, we express our inability to intervene in the matter and close your complaint under Clause 13 (a) of BOS-2006, i.e. not on the grounds of complaint as mentioned in the Clause 8 of BOS-2006."

5. In the opinion of this Court, present petition is barred by delay and laches inasmuch as the cause of action to seek encashment of aforesaid two FDRs arose in favour of the great grandmother of the petitioner much prior to the Partition. Further, the assets of State Bank of India in Pakistan were taken over by the Pakistan Government in 1965 whereas the present petition has been filed in 2013. The issuance of succession certificate does not provide a fresh cause of action to file the present petition.

6. In any event, with the outbreak of hostilities between the two countries and the takeover of assets of State Bank of India in Pakistan by the Pakistan Government, the contract stood frustrated by virtue of Section 56 of the Indian Contract Act, 1872 which reads as under:-

"56. Agreement to do impossible act.--An agreement to do an act impossible in itself is void.

Contract to do act afterwards becoming impossible or unlawful.--A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful.

xxxx xxxx xxxx

(d) A contracts to take in cargo for B at a foreign port. A's Government afterwards declares war against the country in which the port is situated. The contract becomes void when war is declared."

7. Consequently, in the opinion of this Court since the assets of State Bank of India Lahore, Pakistan were taken over by the Pakistan Government in 1965, the petitioner cannot today seek encashment of the said FDRs as the same became an agreement to do an impossible act under Section 56 of the Indian Contract Act, 1872. This Court is of the opinion that in view of the subsequent war with Pakistan as well as takeover of assets of State Bank of India, Lahore, Pakistan by the Pakistan Government there was an intervening event so fundamental that it struck at the root of the agreement and was entirely beyond the contemplation of the parties when they entered into the agreement. Accordingly, the doctrine of frustration is also clearly applicable to the facts and circumstances of the present case.

8. In view of aforesaid, present writ petition and application are dismissed.

MANMOHAN, J AUGUST 07, 2013 rn