JUDGMENT - (1) This is an appeal by way of a Judges Summons taken out by Madhya Pradesh State Co-operative Bank Ltd. (Hereinafter referred to as "the Co-operative Bank") against the Official Liquidator as Liquidator of the Laxmi Bank Ltd. (in Liquidation), praying that the Co-operative Bank be declared as" a preferential creditor with a trust claim of Rs. 11,031.87" against the Laxmi Bank and that the decision of the Official Liquidator disallowing the claim as a trust claim be modified.

(2) The Co-operative Bank had at all material times a Pay Office at Harda and a branch at Betulganj but no office or Branch in Bombay. The Laxmi Bank at all material times had Branches at Yeotmal, Khandwa, Chhindwara and Bombay.

(3) On the 17th May 1960 the Co-operative Banks Pay Office at Harda sent to the Laxmi Banks Branch at Yeotmal a Bill for Rs. 5,000/- for collection at Yeotmal with instructions inter alia, "to remit the proceeds by Demand Draft on Bombay". The Laxmi Banks Yeotmal Branch collected the proceeds and according to the said instructions sent its Demand Draft, dated 24th May 1960, for Rs. 5,001.23 on the Laxmi Banks Bombay Branch to the Co-operative Banks Pay Office at Harda.

(4) On

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