P. S. Shanmuga Sundaram vs Director Treasuries and Accounts Department II Floor, Panagal Building Saidapet, Chennai

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2021 Supreme(Mad) 3454

IN THE HIGH COURT OF JUDICATURE AT MADRAS
S.M.SUBRAMANIAM, J.
P.S.Shanmuga Sundaram - Petitioner
Vs
The Director Treasuries and Accounts Department II Floor, Panagal Building Saidapet, Chennai - Respondents
W.P.Nos. 34347, 24076 & 34348 of 2016 and W.M.P. Nos. 20601, 29609 & 29610 of 2016
Decided On : 29-10-2021

Advocates:
Advocate Appeared:
For the Petitioner: Mr. M.R.Uma Vijayan
For the Respondents:Mr. C.Kathiravan Government Advocate, Mr. P.Ilayaraj Kumar, M/s. Ramalingam & Associates

Headnote:
Constitution of India, 1950 – Article 226 - Illegally Demanding Bundle of Currency - Petitioners are in the business of vending stamp papers since 1988 and holding valid licenses - Grievance of Writ Petitioners is that since January, 2015, the Second and Third Respondents are illegally demanding Petitioners to deposit Rs.15/- for every bundle of currency, i.e., bundle containing 100 notes by remitting in name of account as “Commission Account”, for which no receipts or payment challans are issued – As the stamp vendors are remitting cash to purchase Stamps from Treasuries by remitting money into State Government Accounts and not for inidividual current /savings Bank Accounts, it is requested that this cash handling charges should be waived off for this remittance. (Para 9).
Finding of the Court: Court is that the respondents 2 and 3 argued that they need not respond to the letter sent by the Commissioner of Treasuries and Accounts, Government of Tamil Nadu - No doubt, the Commissioner of Treasuries and Accounts may not have administrative control over the State Bank of India, but he is an officer of the State performing solemn functions and, whenever such letters are communicated by the Governmental authorities, the State Bank of India, is bound to respond in an appropriate manner and in the event of any doubt in respect of such information given by the Commissioner of Treasuries and Accounts, they are at liberty to approach the Government for further clarification, so also the Reserve Bank of India - Contrarily, they are not expected to neglect such letters or to proceed under the pretext that they need not respond to such letters - This nature of conduct is also to be construed as irresponsible on the part of the State Bank of India authorities - Any such letters from any responsible authorities of the State, who all are performing solemn functions of the State must be responded in the manner known to law and due courtesy is to be extended to such officials, while they are performing their administrative/public duties The respondents 2 and 3 are expected to initiate appropriate action in this regard to sensitize the Bank officials.
Result: Writ Petitions allowed.

ORDER :

The writs on hand have been instituted for direction to direct the Second and Third Respondents to waive off fully cash handling charges collected from the stamp vendors, pursuant to the Official Letter in R.C. No.12849/2016/L2 dated 28.03.2016 issued by the First Respondent and consequently, forbear the Third Respondent from collecting any cash handling charges forthwith from the Petitioners for purchase of stamp papers.

2. The Petitioners are in the business of vending stamp papers since 1988 and holding valid licenses. The grievance of the Writ Petitioners is that since January, 2015, the Second and Third Respondents are illegally demanding the Petitioners to deposit Rs.15/- for every bundle of currency, i.e., bundle containing 100 notes by remitting in the name of account as “Commission Account”, for which no receipts or payment challans are issued. The First Respondent viz., the Director, Treasuries and Accounts Department, Chennai vide letter dated 28.03.2016 addressed the Second Respondent viz., the General Manager, State Bank of India, Local Head Office, College Road, Nungambakkam, Chennai to waive off the cash handling charges collected from the stamp vendors, as the Government is paying separately to the banks. The Petitioners are forced to pay Rs. 150 /- to Rs. 200/- as cash handling charges, which have severe financial impact on the meager commission earned every day.

3. Learned Counsel appearing on behalf of the Petitioners/ Stamp Vendors submits that the Second and Third Respondents /State Bank of India, by misinterpreting the Master Circular issued by the Reserve Bank of India, collecting cash handling charges from the Petitioners, who all are depositing money through Treasury Challans into the Government account.

4. It is contended that the stamp vendors are depositing money through Treasury Challans in the Government account, more specifically, on behalf of the Government. Thus, the transaction cannot be treated as 'private transaction' and the money is being deposited in Government accounts through Treasury Challans for the purpose of purchase of stamps.

5. This being the nature of transaction, there is no valid reason whatsoever for the purpose of collecting cash handing charges from the stamp vendors, as they are unconnected with the Government accounts and, the deposit is made on behalf of the Government. This being the illegality noticed by the Petitioners, due to the act of the State Bank of India, the Petitioners are constrained to move the present Writ Petitions.

6. Learned Counsel appearing on behalf of the Second and Third Respondents /State Bank of India objected the contentions by stating that cash handling charges are collected based on the Master Circular issued by the Reserve Bank of India. Such cash handling charges are being collected for every such transaction and therefore, there is no irregularity as such in respect of such collections made pursuant to the direction of the Reserve Bank of India.

7. Learned Counsel appearing on behalf of the Second and Third Respondents contended that the Master Circulars dated 01.07.2014 and 01.04.2021 permit the State Bank of India to collect cash handling charges and whenever the cash is deposited, the authorities of the State Bank of India are empowered to collect those cash handling charges.

8. Learned counsel appearing for the Second and Third Respondents clarified by saying that the Master Circulars dated 01.07.2014 and 01.04.2021 are permitting to collect agency commission and cash handling charges. Thus, there is no infirmity in respect of such collection of cash handling charges by the Second and Third Respondents /State Bank of India.

9. It is pertinent to note that the complaint submitted by the Petitioners to the Director /Commissioner of Treasuries and Accounts was considered by the Commissioner, who in turn sent a letter dated 28.03.2016 to the General Manager, State Bank of India, Local Head Office, Nungambakkam, Chennai, which reads as follow

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