Orissa High Court
Allahabad Bank (Now Indian .... ... vs Surya Sponge Iron Ltd. And on 1 February, 2023
IN THE HIGH COURT OF ORISSA AT CUTTACK
RVWPET No.34 of 2022
(Through hybrid mode)
Allahabad Bank (Now Indian .... Review
Bank), Chief Manager Nayapalli Petitioners
Branch and another
-versus-
Surya Sponge Iron Ltd. and .... Opposite Parties
another
Advocates appeared in this case:
For Review petitioners: Mr. Sitansu Ku. Dey, Advocate
For Opposite Parties: Mr. Santanu Ku. Sarangi, Sr. Advocate
Mr. Mark Wright, Advocate
Mr. S.D. Ray, Advocate
CORAM: JUSTICE ARINDAM SINHA
JUDGMENT
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Date of hearing and judgment: 01.02.2023
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1. Mr. Dey, learned advocate appears on behalf of review
applicant (bank). He submits, the bank seeks modification of direction
in paragraph-4 of order dated 9th February, 2022, disposing of the writ
petition, to extent of the direction regarding 'accrued interest'. He
submits, the money was kept in a 'no lien' closed account. Such an
account is akin to current account and does not bear interest.
// 2 //
2. On query from Court he submits, there was direction upon writ
petitioner by order dated 12th March, 2013 made in WP(C) no.2797 of
2013 (writ petitioners' own case). Instead of depositing the amount
directed, petitioners deposited only Rs.1.15 crores with instructions for
it to be kept it a 'no lien' account. It was accordingly kept. By said
order dated 9th February, 2022, made in writ petitioners' subsequent
writ petition, there was direction to release the money to it along with
'accrued interest'. There was no accrual of interest and therefore,
prayer for review.
3. Mr. Dey draws attention to information disclosed in the
application regarding current accounts, by annexure-X/1. Under entry
4.4.1 it has been clearly stated that no interest is paid on current
accounts. He then refers to annexure-X/2, which is Standard Operating
Procedure (SOP) on internal office accounts for financial year, 2021-22
to submit, it is stated clearly under 'operations of internal current office
accounts' that the account is to be used, inter alia, for other receipts
such as retention money. He reiterates, there was clear instruction by
writ petitioner to keep the money in a 'no lien' account, without
mandate. Hence, as per the SOP, the money was kept in a current
account, which does not bear interest.
RVWPET no.34 of 2022
// 3 //
4. Mr. Sarangi, learned senior advocate appears on behalf of writ
petitioners. He opposes the application. He submits, under cover of
letter dated 13th April, 2013, the money was deposited. Pursuant thereto
there was transfer of the account to the assets re-construction company
on 27th September, 2013. Yet, the money continued to remain with
review applicant and not released to his clients. The bank is liable to
pay interest on the money had and received by it, to use of his client.
Mr. Ray, learned advocate appears on behalf of the asset re-
construction company. He submits, the transfer was duly made on 27th
September, 2013.
5. Mr. Dey in reply reiterates, the money was deposited under
order of Court. Unless there was further order for release of it, his
client could not have dealt with the money. He reiterates further, there
was clear instruction by writ petitioners to keep the money in 'no lien'
account, without mandate. Upon the transfer having been made
petitioners mounted challenge against it. Petitioners omitted to obtain
direction from Court upon his client to pay out the money. His client
had no purpose in keeping the money in 'no lien' account, without
mandate. It did not serve the business of his client. As soon as there
was direction to release the same by said order dated 9th February,
2022, his client complied forthwith but also applied for review on the
direction therein regarding 'accrued interest'.
RVWPET no.34 of 2022
// 4 //
6. Text of said order dated 12th March, 2013 made in W.P.(C)
no.2797 of 2013 is reproduced below.
"12.03.2013 Misc. Case No.2723 of 2013
Issue notice as above.
Accept one set of process fee.
As an interim measure, it is directed that no
coercive measure shall be taken against the petitioners
pursuant to the notice under Annexure-14 till 5th April,
2013 subject to condition that the petitioner shall deposit
a sum of Rs.1,30,00000/- (Rupees one Crore Thirty
Lakhs) in two equal installments by 15th April, 2013
before the opposite party-Bank. The 1st installment shall
be paid by 29th March, 2013 and the 2nd installment by
15th April, 2013.
Urgent certified copy of this order be granted on
proper application."
A paragraph from writ petitioners letter dated 13th April, 2013
addressed to the bank, under cover of which the money was deposited,
is extracted and reproduced below.
"To show our bonafide, we are giving a down payment of
Rs.115 lakhs in shape of DD which is aprox 10% at total
outstanding. To kept in 'No-Lien Account' with your
Branch till the final approval of our proposal for payment
of balance outstanding approved from H.O."
RVWPET no.34 of 2022
// 5 //
7. It appears, there was direction for interim measure by said
order dated 12th March, 2013 in writ petitioners' own writ petition
made earlier. Nothing has been shown regarding writ petitioners
having taken steps to thereafter obtain direction for release of the
money, upon the transfer having had been made on 27th September,
2013. Petitioners filed the subsequent writ petition, given rise to this
review application. It was presented on 17th March, 2021. On perusal
of the order sheet it is appears that the writ petition was moved before
and disposed of by this Bench on 9th February, 2022. The prayer for
release of the money was allowed. Taking that into consideration as
well as the banking norms relied upon by Mr. Dey, there is no scope
for writ petitioners to resist prayer of the bank for review. The
application is allowed. Order dated 9th February, 2022 is modified by
deleting the phrase 'accrued interest'.
8. The RVWPET is allowed and disposed of.
(Arindam Sinha)
Judge
Sks
RVWPET no.34 of 2022
