The legal principle established is that under Section 72 of the Contract Act, 1872, a person who receives payment due to a mistake is bound to refund the amount, and counter claims require supporting evidence.

VALMIKI J. MEHTA, J.

1. The challenge by means of this Regular First Appeal filed under Section 96 of the Code of Civil Procedure, 1908 (CPC) is by the appellant/plaintiff to the impugned judgment of the trial Court dated 5.6.2004 decreeing the suit of the respondent/plaintiff-bank for recovery of Rs. 1,67,900/- with interest @ 12% per annum and proportionate costs, which was filed as the appellant/defendant failed to repay the amount of a dishonoured cheque which he had withdrawn.

2. The facts of the case are that the appellant/defendant deposited a cheque of Rs. 1,50,000/- with the respondent-bank and which was presented for encashment through clearing on 3.11.1999. The account of the appellant/defendant was credited on the same date. The cheque in question was returned unpaid on 4.11.1999, however, the dishonoured cheque alongwith memo of drawee bank was lost in the transit and therefore the respondent-bank could not make a debit entry of the sum of Rs. 1,50,000/-for adjusting the credit entry of Rs. 1,50,000/- which was made assuming the cheque was cleared. The appellant withdrew the amount and took benefit thereof. When the respondent-bank received information about dishonour of the cheque, the appellant/defendant was asked to repay the amount which he failed to do and therefore the subject suit for recovery was filed.

3. The appellant/defendant claimed that the respondent-bank did not intimate the appellant till the end of the year 2001 about dishonour of cheque in question and allowed him to withdraw the amount of the cheque whereby the appellant/defendant could not pursue his remedy against the drawer of the cheque. It was pleaded that the appellant/defendant had given a loan of Rs. 1,50,000/- to one Sh. Rajiv Verma and which loan was returned by the said cheque of Sh. Rajiv Verma which was dishonoured. The appellant/defendant claimed that it was only vide letter dated 4.12.2001 that it was informed by the respondent/plaintiff to the appellant/defendant about dishonour of the cheque and the freezing of his account. A counter claim was also filed by the appellant/defendant alleging that on account of freezing of his saving bank account by the bank, he could not arrange for funds for the pilot films/documentaries and lost several contracts. It was pleaded that he could not deposit cheques which were received by him as the account was frozen, therefore, a claim of Rs. 2 lacs was made on loss of professional income which he alleged he would have earned. A sum of Rs. 1 lakh was claimed towards damages for breach of contract and another sum of Rs. 50,000/- was claimed towards unfair trade practice.

4. After completion of pleadings, the trial Court framed the following issues:-

“1. Whether the plaint has been signed and verified and suit has been instituted by duly authorised person?

2. Whether the subject matter of the suit was settled as alleged in P.O. no.2?

3. Whether the pltf is entitled to the suit amount alongwith interest @ 18% p.a.?

4. Whether the deft is entitled to Rs. 3,50,000/- towards professional loss, breach of contract and trust, deficiency in service, mental agony as claimed in counter claim?

5. Whether the deft is entitled to interest @ 24% p.a. on the amount of damages, if awarded?

6. Relief.”

5. There are two main issues urged before this Court on behalf of the appellant/defendant. The first issue is that the appellant/defendant suffered a loss because of the fact that information of dishonour of the cheque was only received on 4.12.2001 and therefore he could not sue to recover the amount of cheque from the said Sh. Rajiv Verma. The second argument is related to the first in that the appellant/defendant has wrongly been denied the counter claim which was allowable.

6. As regards the first point in question the same was subject matter of issue No.3 as to whether the respondent-bank was entitled to the suit amount, and with respect to which the trial Court has held as under:-

“12. Admittedl