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2006 Supreme(MP) 1004
2007(1) JLJ 175
A.M. Naik, J.
State Bank of India v. M/s. Jagdish Talkies and others
First Appeal No. 259 of 1990 and Civil Revision No. 46 of 1993
(Jabalpur); Decided on 31.8.2006.
J.P. Sanghi with Shrikant Dubey for appellant;
Virendra P. Verma for respondents.
Headnote:(1) Civil P.C., 1908 -- O.40 R.1 -- receiver -- savings account opened in his personal name -- deposited money received as receiver in Bank in order to save money and earn interest -- every thing disclosed clearly -- there is no fraud or misrepresentation by him.
(2) Contract Act, 1872 -- S.17 -- receiver opening savings bank account in his own name -- bank did not make any enquiry about source of money -- account opened to save money and earn interest -- no fraud or misrepresentation committed when everything was made clear.
Kasturchand Singhai, in the capacity of receiver, decided to keep the money so received by him in the State Bank of India, Damoh Branch. Accordingly, he opened a savings bank account in his own name and started depositing the money therein. He was assured by the bank that he will be paid the interest as per the rules of banking. This account bearing SB Nc.No.20/4918 was opened by the plaintiff on 29.4.1982 with the defendant Bank in the City Branch at Damoh. The bank used to pay the interest by crediting it in the same savings bank account. On 28.5.1986, the defendant informed the plaintiff that it would not pay interest to the plaintiff. The defendant, despite opposition by the plaintiff, debited the amount of Rs.23,785.45 ps. from the said account.
Kasturchand Singhai, the original plaintiff in the capacity of receiver instituted Civil Suit No. 7-B/88 for the recovery of Rs.23,785.45 ps. with interest pendente lite. [Paras 1 & 2
It has been contended in the written statement that M/s. Jagdish Talkies is a commercial concern and the plaintiff was holding the capacity of merely a receiver. The said savings bank account was opened with the money belonging to M/s. Jagdish Talkies, although no savings bank account could have legally been opened by it. As per the rules and instructions of the Reserve Bank of India, only current account could have been opened with the aid of the money received from the assets of M/s. Jagdish Talkies and the same could have been opened legally only as a current account in the name of M/s. Jagdish Talkies and the same would not have attracted any interest in the current account at all. [Para 3
Held: In order to constitute fraud, there should not be merely a concealment of fact but simultaneously, it should be active one. We may be guided by the provision contained in section 17 of the Contract Act which clearly lays down that mere silence as to facts likely to affect the willingness of a person to enter into a contract is not fraud, unless the circumstances of the case are such that, regard being had to them, it is the duty of the person keeping silence to speak. Even under the Banking practice, any person may open a savings bank account on allowing by the bank to do the same. There is no proof on record that any enquiry was made by the Bank with the plaintiff about the nature and/or source of money with which the savings bank account was to be opened. The banker was obviously in a position to demand such information from the plaintiff himself. This having not been done, the plaintiff cannot be said to have made active concealment of facts.
As regards the alleged misrepresentation stated to have been committed by the plaintiff, it may be observed that the principal difference between fraud and misrepresentation is that in case of fraud, the person making the suggestion does not believe it to be true whereas in the case of misrepresentation, the same is believed to be true. Again from the record, it is clear that the plaintiff, at no point of time, made the bank to believe that the money was owned by him personally. Thus, the plaintiff who opened a savings bank account is obviously entitled to the interest as per the rules and he cannot be said to have entertained any element of section 17 of Contract Act vis-a-vis the Bank. The plaintiff simply opened a savings bank account with the money which he possessed in the capacity of receiver in order to first protect it and secondly to earn interest on it. AIR 1949 PC 297 distinguished. [Paras 14 & 15
(3) Civil P.C., 1908 -- S.96 -- no discrepancy pointed out in the impugned judgment with regard to appreciation of material on record as well as law -- interference cannot be made. (2000)5 SCC 652, (2004)2 SCC 177 and 1971 JLJ 505 distinguished. [Para 17
(4) Civil P.C., 1908 -- O.6 R.4 -- fraud or misreprestantion -- not pleaded with exactness as required -- plaintiff did not commit fraud or misrepresetation. [Para 19
(5) Contract Act, 1872 -- S.17 -- plaintiff opening savings bank account -- not under obligation to disclose source of money -- no fraud committed n he is also entitled to interest. [Para 20
(6) Contract Act, 1872 -- S.72 -- refund is required to be made if payment has been made under mistake n savings bank account opened n interest also paid -- it is not payment by mistake. [Para 21
(7) Bank -- instructions of Reserve Bank of India -- are binding on every bank -- account of any customer opened against such instruction -- money of customer cannot be retained. [Para 22
(8) Interest -- bank allowing opening of savings bank account of customer -- customer cannot be deprived of interest. [Para 22
(9) Court-fees Act, 1870 -- Sch.1 Art.1 and S.13 -- interest pendentelite -- not to be included in valuation of appeal for the purpose of Art. 1 of Sch.1 -- court-fees paid by mistake -- has to be returned. AIR 1964 SC 457 followed. AIR 2002 Delhi 305 relied on. [Para 24
¼1½ flfoy çfØ;k lafgrk] 1908& &fjlhoj& &mlds O;fDrxr uke ls cpr [kkrk [kksyk x;k& &/ku dh cpr rFkk C;kt ds miktZu ds fy, fjlhoj ds :i esa çkIr /ku cSad esa fu{ksfir& &lc dqN Li"Vr% çdV fd;k x;k& &mlds }kjk dksbZ diV vFkok nqO;Zins‘ku ughaA
¼2½ lafonk vf/kfu;e] 1872& &/kkjk 17& &fjlhoj }kjk Lo;a ds uke ij cpr cSad [kkrk [kksyk x;k& &cSad }kjk /ku ds L=ksr dh dksbZ tk¡p ugha dh xbZ& &[kkrk /ku dh cpr rFkk C;kt ds miktZu ds fy, [kksyk x;k& &dksbZ diV ;k nqO;Zins‘ku ugha tc lc dqN Li"V fd;k x;kA
dLrwjpan fla?kbZ us] fjlhoj dh gSfl;r ls] mlds }kjk çkIr /ku dks LVsV cSad vkQ bafM;k] neksg ‘kk[kk esa j[kus dk fu‘p; fd;kA rnuqlkj] mlus Lo;a ds uke ls cpr cSad [kkrk [kksyk rFkk mlesa /ku fu{ksi djuk çkjaHk fd;kA mls cSad }kjk vk‘oklu fn;k x;k fd cSad ds fu;ekuqlkj mls C;kt lanÙk fd;k tk,xkA cpr cSad [kkrk Ø-20@4918 oknh }kjk 29-4-1982 dks çfroknh cSad] uxj ‘kk[kk neksg esa [kksyk x;kA cSad }kjk mlh cpr cSad [kkrs esa tek djrs gq, C;kt lanÙk fd;k tkrk jgkA 28-5-1986 dks çfroknh us oknh dks lwpuk nh fd og oknh dks C;kt dk lank; ugha djsxkA çfroknh us oknh }kjk fojks/k ds ckotwn # 23]785-45 iSls dh jde dfFkr [kkrs ls fodfyr dj yhA
fjlhoj dh gSfl;r ls ewy oknh dLrwjpan fla?kbZ us] okndkyhu C;kt ds lkFk # 23]785-45 iSls dh olwyh ds fy, flfoy okn Ø-7&ch@88 lafLFkr fd;kA ¼iSjk 1 ,oa 2½
fyf[kr dFku esa ladFku fd;k x;k gS fd esllZ txnh‘k Vkdht okf.kfT;d leqRFkku gS rFkk oknh ek= fjlhoj dh gSfl;r dk /kkjd gSA mDr cpr cSad [kkrk esllZ txnh‘k Vkdht ds /ku ls [kksyk x;k Fkk] ;|fi mlds }kjk dksbZ cpr cSad [kkrk oS/k :i ls ugha [kksyk tk ldrk FkkA Hkkjrh; fjtoZ cSad ds fu;e rFkk vuqns‘k ds vuqlkj] esllZ txnh‘k Vkdht dh vfLr;ksa ls çkIr /ku dh lgk;rk ls ek= pkyw [kkrk [kksyk tk ldrk Fkk rFkk og esllZ txnh‘k Vkdht ds uke ls oS/k :i ls dsoy pkyw [kkrs ds :i esa [kksyk tk ldrk Fkk rFkk mls pkyw [kkrs esa dksbZ C;kt ugha feyrkA ¼iSjk 3½
vfHkfu/kkZfjr % diV xfBr gksus ds fy,] ek= fdlh rF; dk fNikuk gh ugah gksuk pkfg, vfirq lkFk&lkFk] og lfØ; gksuk pkfg,A lafonk vf/kfu;e dh /kkjk 17 gesa ekxZn‘kZu çkIr djuk pkfg, ftlesa Li"Vr% vf/kdfFkr gS fd fdlh O;fDr dh lafonk djus dh jtkeanh dks çHkkfor djus okys laHko rF;ksa ij ek= ekSu jguk diV ugha gS] tc rd fd ekeys dh ifjfLFkfr;k¡ ,slh gSa fd mUgsa /;ku esa j[krs gq,] ekSu jgus okys O;fDr dk drZO; gS fd og cksysA cSad çFkk esa Hkh] dksbZ Hkh O;fDr cSad }kjk vuqKk nsus ij cpr cSad [kkrk [kksy ldrk gSA vfHkys[kxr ,slk dksbZ lcwr ugha gS fd cpr cSad [kkrk ftl /ku ls [kksyk tkuk Fkk mlds Lo:i rFkk@vFkok L=ksr ds laca/k esa oknh ls dksbZ tk¡p cSad }kjk dh xbZA Li"Vr% cSad Lo;a oknh ls ,slh tkudkjh dh ek¡x djus dh fLFkfr esa FkkA ;g ugha fd, tkus ij] oknh }kjk rF;ksa dks lfØ; :i ls fNikuk ugha dgk tk ldrkA
oknh }kjk fd, x, gksuk vfHkdfFkr nqO;Zins‘ku ds laca/k esa] ;g leqfDr dh tkuk gksxh dh diV rFkk nqO;Zins‘ku ds chp eq[; Hksn ;g gS fd diV ds ekeys esa] dFku djus okyk O;fDr mlds lR; gksus ij fo‘okl ugha djrk tcfd nqO;Zins‘ku ds ekeys esa] mlds lR; gksus ij fo‘okl fd;k tkrk gSA iqu% vfHkys[k ls] ;g Li"V gS fd oknh us] fdlh Hkh le;] cSad dks ;g fo‘okl ugha fnyk;k fd og /ku dk O;fDrxr Lokeh FkkA vr% oknh ftlus cpr cSad [kkrk [kksyk Fkk og fu;eksa ds vuqlkj Li"Vr% C;kt dk gdnkj gS rFkk ;g ugha dgk tk ldrk fd mlus cSad ls lafonk vf/kfu;e dh /kkjk 17 ds fdlh Hkh rRo dk Qk;nk fy;k gSA oknh us ek= /ku ftls og fjlhoj dh gSfl;r ls /kkfjr dj jgk Fkk] çFker% mldh j{kk rFkk nwljs ml ij C;kt mikftZr djus ds fy, cpr cSad [kkrk [kksykA ¼iSjk 14 ,oa 15½
¼3½ flfoy çfØ;k lafgrk] 1908& &/kkjk 96& &vfHkys[kxr lkexzh ds ewY;kadu rFkk fof/k ds laca/k eas Hkh vk{ksfir fu.kZ; esa dksbZ folaxfr bafxr ugha& &gLr{ksi ugha fd;k tk ldrkA ¼2000½5 ,l lh lh 652] ¼2004½2 ,l lh lh 177 rFkk 1971 ts ,y ts 505 çHksfnrA ¼iSjk 17½
¼4½ flfoy çfØ;k lafgrk] 1908& &vk-6 fu-4& &diV ;k nqO;Zins‘ku& &;Fkk visf{kr Bhd ls vfHkopfur ugha& &oknh us diV vFkok nqO;Zins‘ku ugha fd;kA ¼iSjk 19½
¼5½ lafonk vf/kfu;e] 1872& &/kkjk 17& &oknh }kjk cpr cSad [kkrk [kksyk tkuk& &/ku dk L=ksr çdV djus ds fy, ck/; ugha& &dksbZ diV ugha fd;k x;k& &og C;kt dk Hkh gdnkj gSA ¼iSjk 20½
¼6½ lafonk vf/kfu;e] 1872& &/kkjk 72& &çfrnk; fd;k tkuk visf{kr gksrk gS lc lank; Hkwy ls fd;k x;k gS& &cpr cSad [kkrk [kksyk x;k& &Ckt Hkh lanÙk& &og Hkwy ls fd;k x;k lank; ugha gSA ¼iSjk 21½
¼7½ cSad& &Hkkjrh fjtoZ cSad ds vuqns‘k& &çR;sd cSad ij vkc)dj gS& &,sls vuqns‘kksa ij fdlh xzkgd dk [kksyk x;k [kkrk& &xzkgd dk /ku jksd dj j[kk ugha tk ldrkA ¼iSjk 22½
¼8½ C;kt& &cSad }kjk xzkgd dk cpr cSad [kkrk [kksyk tkuk vuqKkr& &xzkgd dks C;kt ls oafpr ugha j[kk tk ldrkA ¼iSjk 22½
¼9½ U;k;ky; Qhl vf/kfu;e] 1870& &vuqlwph 1 vuqPNsn 1 rFkk /kkjk 13& &okndkyhu C;kt& &vuqlwph 1 ds vuqPNsn 1 ds ç;kstu ds fy, vihy ds ewY;kadu esa lfEefyr ugha fd;k tk ldrk& &Uk;ky; Qhl xyrh ls nh xbZ& &okil dh tkuk gksrh gSA , vkb vkj 1964 ,l lh 457 vuqlfjrA , vkb vkj 2002 fnYyh 305 voyafcrA ¼iSjk 24½
This judgment decides FA No.259/90 and the cross-objections submitted therein as well as CR No.46/93.
1. Short facts relevant for the purposes of the matter under conroversy are that Civil Suit No.1-A/75 was instituted in the Court of Civil Judge, Class-I, Damoh, by one Shiv Kumar against M/s. Jagdish Talkies Kasturchand Singhai was appointed as receiver in the said civil suit by the aforesaid Court. The building, furniture and machinery of Jagdish Talkies were used to be let out to third persons and the receiver was invested with a power to realise and recover the rent payable by such third persons. Kasturchand Singhai, in the capacity of receiver, decided to keep the money so received by him in the State Bank of India, Damoh Branch. Accordingly, he opened a savings bank account in his own name and started depositing the money therein, He was assured by the bank that he will be paid the interest as per the rules of banking, This account bearing SB A/c,No.201 4918 was opened by the plaintiff on 29.4.1982 with the defendant Bank in the City Branch at Damoh. The bank used to pay the interest by crediting it in the same savings bank account. On 28.5.1986, the defendant informed the plaintiff that it would not pay interest to the plaintiff. The defendant, despite opposition by the plaintiff, debited the amount of Rs.23,785.45 ps. from the said account.
2. Kasturchand Singhai, the original plaintiff in the capacity of receiver instituted Civil Suit No. 7-B/88 for the recovery ofRs.23,785.45 ps. with interest pendente lite on the ground that the defendant has no right or power to debit his account and is liable to pay the same with interest from the date of institution of the suit.
3. The defendant-appellant submitted its written statement denying the claim of the plaintiff. It has been contended in the written statement that M/s. Jagdish Talkies is a commercial concern and the plaintiff was holding the capacity of merely a receiver. The said savings bank account was opened with the money belonging to M/s. Jagdish Talkies, although no savings bank account could have legally been opened by it. As per the rules and instructions of the Reserve Bank of India, only current account could have been opened with the aid of the money received from the assets of M/s. Jagdish Talkies and the same could have been opened legally only as a current account in the name of M/s. Jagdish Talkies and the same would not have attracted any interest in the current account at all. It is denied that the plaintiff was assured that he would be paid the interest as per the savings account. It is specifically contended in the light of the aforesaid facts that the interest was wrongly credited in the subject account and the same has been debited in pursuance of the directions issued by the Reserve Bank of India. It is further contended that the money was deposited with the defendant Bank only to ensure its safety and no interest was payable on it. Thus, it is further contended that the amount was credited in the plaintiff's account in a mistaken manner which has been rightly debited and the plaintiff has no right to seek its refund.
4. Learned trial Judge granted decree in favour of the plaintiff on 23.8.1990 for the principal sum of Rs.23,785.45 ps. However, the learned trial Court did not grant a decree for pendente lite interest and costs of litigation without assigning any reason therefor.
5. Aggrieved by the aforesaid, the defendant-appellant preferred FA No.259/90 mainly on the grounds that the regulations/instructions of the Reserve Bank of India are having statutory force and are binding on the plaintiff as well as defendant; that in case of a business concern, only a current account could have been opened which does not attract interest at all. In view of this, the plaintiff was not entitled to interest on the money received by him in the capacity of receiver for M/s. Jagdish Talkies. Since the interest was paid to the plaintiff mistakenly in his acco
