The main legal point established in the judgment is that a debt, such as the money in a fixed deposit, cannot be subject to a banker's lien, as it constitutes a debt in the hands of the banker and does not qualify as suitable property for a lien.

1. The Union Bank of India is the revision petitioner.

2. Fasts relevant and requisite to dispose of the issue arising for consideration lie in a narrow compass. The first respondent is the decree-holder and respondents 2 and 3 are the judgment-debtors in O.S.522/81. The first respondent had obtained an attachment before judgment of the lorry belonging to the judgment-debtors. The attachment however, was raised on one E. V. John, the brother of the judgment-debtors, giving a fixed deposit receipt for a sum of Rs.6,500/- issued by the petitioner-bank as security to the court. In execution of the decree the court, treating the bank as a garnishee, called upon the bank to deposit the amount and interest thereon, covered by the fixed deposit, in court. This order directing the bank to deposit the amount, it is submitted on behalf of the decree-holder, was passed after rejecting the bank's contention that the bank has alien' over the amount in fixed deposit. Since this order was passed without considering the above contention of the bank, according to the bank, the bank filed E. A.781/87 seeking review of the order. In this petition the bank has stated that the bank has the right to retain this money in exercise of its general power of 'lien' and appropriate the said money towards amounts due to it under the loan account.

3. The court below by the order under challenge has dismissed the review application.

4. Certain facts are admitted and they are: E. V. John had put money in fixed deposit on 14-11-1981. On the same day he had availed of an agricultural loan. On 16-11-1981 the fixed deposit receipt had been produced before the court as security; and accepting the said security, the order attaching the lorry had been vacated.

5. The learned counsel for the petitioner argues that under these circumstances, the bank can look to its 'general lien' as a protection against its loss attributable to the agricultural loan transaction which it was having with E. V. John. A reference in this connection to S.171 of the Contract Act is profitable, the counsel submits. On the other hand, it was contended on behalf of the decree-holder that at the time when the fixed deposit receipt was given as security to the court for the lifting of the attachment, there was no amount legally due from E. V. John to the bank and therefore, even assuming that the bank can avail of the 'banker's lien', the same can be exercised only subject to the charge created in favour of the court.

6. The question thus arising for consideration is: can the bank exercise the 'banker's lien' in respect of the fixed deposit? An effective answer to this question could be had only if we understand the relation of banker to the customer in regard to fixed deposit. The fixed deposit is one of the three bank deposits; the other two being saving deposits and current deposits. We should in this connection remember that money lodged with banks as fixed deposits stricto jure is a loan to the bank. The banker in connection with the 'fixed deposit', therefore is a debtor. The depositor accordingly would cease to be the owner of the money in fixed deposit. The said money becomes the money of the bank, enabling the bank to do as the bank likes, that however, with the obligation to repay the debt on maturity. (See page 411 of Paget's on Law of Banking 9th edition)

7. Money put in fixed deposit constitutes a debt in the hands of the banker and a debt cannot be a suitable subject for a lien; because a lien is a right recognised in a creditor to retain another man's property until the debt is paid (See page 412 of Paget's). Buckley J. in Halesowen Presswork and Assemblies Ltd. v. Westminster Bank Ltd. (1971 (1) Q.B. 1) has observed that 'a lien' postulates property of the debtor in the possession or under the control of the creditor'. A creditor enjoying the 'lien' as defined above however has no right to sell the thing or dispose it of. In other words he is only entitled to retain posses