Judgement

SHAH, J. : This appeal is filed with certificate granted by the High Court of Punjab.

2. The Okara Grain Buyers Syndicate Ltd. -hereinafter called the Syndicate - was incorporated under the Indian Companies Act. 1913, with its registered office at Okara, District Montgomery in the undivided Punjab. In 1946 the Government of undivided Punjab devised a scheme for procurement of foodgrains and appointed the Syndicate to buy foodgrains on its behalf. For due performance of the conditions of the scheme, the Syndicate was required to make a deposit with a recognized Bank. The Syndicate deposited an amount of Rs 40,000 on March 29, 1947 with the United Commercial Bank Ltd - hereinafter called the Bank - and obtained a Fixed Deposit Receipt dated March 29, 1947. The terms of the receipt were these :

"The United Commercial Bank Limited. No Misc. 9872-4/18 Okara (Punjab) 29th March, 1947.

Received from the Okara Grains Buyers Syndicate Limited, Okara A/c District Magistrate, Montgomery Rupees Forty thousand only as a deposit at the rate of 2 per cent per annum to remain till notice of twelve months for its withdrawal by either side expires.

For the United Commercial Bank Ltd.

(Sd.) . . . ....

Accountant.

Manager.

Rs. 40,000/-.

Terms for the Deposit Receipt

This deposit receipt is issued subject to the following terms and conditions:-

1. This receipt is not transferable.

2. This deposit cannot be withdrawn before due date.

3. Interest on this deposit ceases on the due date.

4. The amount of this deposit cannot be withdrawn in part or by cheque or draft.

5. On due date this deposit receipt should be discharged by the depositors on one anna stamp if it is required to be repaid, otherwise an endorsement as to its renewal should be made in the space provided thereof.

6. Receipts will when so required, be issued in the names of two or more persons and will be made payable to any one or more of them or to the survivors."

The Syndicate served a notice of withdrawal on March 29, 1947 upon the Bank and an endorsement in that behalf was made on the receipt. The receipt was then handed over to the District Magistrate. Montgomery. On account of widespread communal riots in the month of August 1947, non-Muslim residents of the area found it unsafe to continue to reside at Okara, and the staff and Managing Director of the Syndicate migrated to India leaving all the property, goods, etc. of the Syndicate at Okara. The Syndicate set up a new place of business at Amritsar and registered itself in the State of Punjab.

3. In reply to a demand made on October, 26, 1951 by the Syndicate the Bank replied that the amount deposited will not be returned until the Syndicate obtains a discharge from the District Magistrate. Montgomery, of his lien on the fixed deposit receipt and an intimation in that behalf was given by the District Magistrate relinquishing his lien on the fixed deposit receipt. The Syndicate then filed a petition before the Debt Adjustment Tribunal, Amritsar, under, S. 13 of, the Displaced Persons (Debts Adjustment) Act 70 of 1951, for an order against the Bank for payment of Rs. 40,000 as principal and Rs. 3,200 as interest @ 2 per cent per annum upto March 3, 1952, and future interest at 6 per cent per annum till realization. To this petition, the District Magistrate, Montgomery was also impleaded as party-respondent. The Tribunal dismissed the petition holding that the amount of Rs. 40,000 deposited by the Syndicate stood forfeited by order of the District Magistrate, Montgomery, and the petition was on that account not maintainable. In appeal, the High Court of Punjab made an order in terms of the prayer in the petition, subject to the condition that the respondent shall give an indemnity for restitution of the amount in the event of the Bank having to pay the amount to the District Magistrate, Montgomery. The High Court held that the deposit was subject to conditions expressly mentioned in the receipt and no others and that the District Magistrate