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RAJASTHAN STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, JAIPUR
Hon’ble Mr. Justice M.A.A. Khan,
President & Mr. Ratan Prakash, Member
PUNJAB NATIONAL BANK—Appellant
versus
YOGESH KUMAR—Respondent
Appeal No. 1675 of 2003—Decided on 4.12.2003
Important Points
Subject
Banking Law - Cheque Encashment and Stop Payment Instructions
Act Referred
Headnote
Stop Payment - Banking Services - The court held that the appellant bank was bound to honor the stop payment instructions issued by the respondent, and therefore, the bank's encashment of the cheques despite the instructions constituted gross deficient services.
Fact of the Case:
The respondent issued cheques to pay off a liability, later directed the bank to stop payment, but the bank encashed the cheques regardless. The forum directed the bank to pay the respondent a sum with interest and additional amounts for mental agony and litigation costs.
Finding of the Court:
The court rejected the appellant's argument that it was legally justified to encash the cheques due to the absence of mentioned amounts and expiration of the stop payment instructions. The court upheld the forum's decision, stating that the stop payment was with regard to the cheques and the bank was bound to honor the instructions.
Issues: Dispute over the bank's encashment of cheques despite stop payment instructions, and the respondent's claim for deficient services.
Ratio Decidendi: The bank was obligated to honor the stop payment instructions issued by the respondent, and its failure to do so constituted gross deficient services.
Final Decision: The appeal was dismissed, and the bank was ordered to pay the respondent's claimed sum with interest, along with additional amounts for mental agony and litigation costs.
Counsels for the Parties :
For the Appellant :Mr. Bhagchand Jain, Advocate.
For the Respondent:Mr. Rajesh Mootha, Advocate.
Mr. Justice M.A.A. Khan, President—Heard.
The respondent was admittedly the consumer of the services of the appellant Bank for consideration in respect of his account No. 729. In order to pay off his liability to Texla Enterprises, Delhi, the respondent issued cheque Nos. 11748 and 11749. Thereafter dispute appears to have arisen between the respondent and the aforementioned Texla Enterprises, Delhi. Therefore, on 5.5.2000 the respondent directed the appellant Bank to stop payment of the aforementioned cheque Nos. 11748 and 11749. The appellant Bank duly charged a sum of Rs. 100/- from the respondent for rendering such specific services to him. However, the appellant encashed both the cheques on 11.11.2000 when those were presented before it. The Forum has held that the Bank had rendered gross deficient services to the respondent in making payment of the amounts of the aforementioned two cheques, despite instructions from him to stop the payment of the said cheques. The Forum, therefore, directed the appellant Bank to pay a sum of Rs. 16,042.27 to the respondent with interest @ 9% p.a. and Rs. 500/- for mental agony and Rs. 200/- as cost of litigation. Aggrieved by such order of the Forum dated 6.8.2003 in Complaint No. 101/2001 the appellant has preferred this appeal.
2. It was vehemently urged on behalf of the appellant that since the respondent had mentioned the amounts of the two cheques and such amount was not found to have been entered into the said two cheques when those were presented for encashment before it and period of six months had also expired to the instructions of the respondent issued to the appellant, the appellant was legally justified to encash the aforementioned two cheques. This argument has been rejected by the Forum and to our minds rightly.
3. It was the stop-payment of the amount as was mentioned in the aforementioned two cheques. The stop payment was with regard to the cheques and not with regard to any person or the particular amount. Once the respondent had issued instructions to the appellant Bank not to make payment of cheque Nos. 11748 and 11749, the appellant was bound to honour its commitment to the respondent. In our opinion, therefore, the Forum has rightly decided the issue in this matter.
The appeal is dismissed with cost on parties.
Appeal dismissed.
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