BRANCH MANAGER, South Malabar Gramin Bank vs C.I.RASHEED

BY order dated 16.10.1998 the District Forum, Wayanadu, Kalpetta disposed of two complaints, 59/98 filed by C. Joseph and 60/98 filed by C.I. Rasheed against the Branch Manager, South Malabar Grameen Bank, Kalpetta, alleging deficiency of service on the part of the opposite party. The District Forum allowed both complaints and directed the opposite party to pay a sum of Rs. 2,039/- with 12% interest from 23.3.1998 and to pay of Rs. 500/- towards cost alongwith Rs. 500/- as initial expenses to the complainant in OP 59/98 and to pay Rs. 1,415/- with 12% interest from 23.3.1998 and Rs. 500/- as cost to the complainant in OP 60/98.

AGGRIEVED by these orders the opposite party preferred appeal 1152/98 against the order in OP 59/98 and 1151/98 against the order in 60/98. The facts of the complainant''s case are as follows : The complainant in OP 59/98 approached the District Forum with a grievance that he has entrusted a cheque bearing No. 668829, dated 7.2.1997 drawn on the State Bank of Tranvancore, Vytila for a sum of Rs. 1,550/- on 7.2.1997 for collection with the opposite party, whereas the complainant in OP 60/98 alleged that he entrusted a cheque bearing No. 668828 dated 5.2.1997 drawn on the SBT, Vytila for a sum of Rs. 1,000/- with the opposite party on 7.2.1997. Both complainants alleged that the opposite party has not credited the respective amounts in their accounts or returned the cheques. Hence the complainants approached the District Forum for redressal of their grievance. The complainant in OP No. 59/98 claimed the cheque amount of Rs. 1,550/- and Rs. 209/- towards interest alongwith Rs. 130/- as expenses for going over to the opposite party and Rs. 150/- expenses for filing the complaint. The complainant in OP 60/98 claimed Rs. 1,000/- with interest amounting to Rs. 135/-, Rs. 130/- as expenses and Rs. 150/- as costs. Opposite party entered appearance in both complaints and filed separate versions and admitted the entrustment of both cheques on 7.2.1997 and averred that on 10.2.1997 both cheques were sent for collection to the Canara Bank, Ernakulam through speed couriers as the opposite party is the sponsor Bank of Canara Bank, but both cheques were misplaced at the end of the Canara Bank. Opposite party also contended that inspite of their earnest attempts they could not find out the fate of the cheques and informed this fact to the complainants.

In OP 59/98 the complainant was examined as P.W. 1 and the opposite party was examined as O.P.W. 1 and marked documents Exts. B1 to B5. In OP 60/98 complainant was examined as P.W. 1 and opposite party examined as O.P.W. 1 and marked documents B1 to B6.

THE District Forum raised necessary points on the basis of the allegations and rejected all the contentions of the opposite party and found deficiency on the part of the opposite party in both complaints. Aggrieved by the said findings the opposite party have come up in appeal. THE complainant in OP 59/98 appeared in person in Appeal 1152/98 and as agent in Appeal 1151/98. Both appeals were heard together as the question of law raised is the same and facts are similar and disposed of the matter. In the appeals before us the learned Counsel for the appellant, the South Malabar Grameen Bank has reiterated the stand taken by the Bank before the District Forum by contending that there was no deficiency in service on the part of the Bank. The learned Counsel submitted that the appellant/opposite party sent the cheques for collection on 10.2.1997 but was misplaced at Canara Bank, Ernakulam through whom they have sent the cheque for collection from State Bank of Travancore, Vytila. They also submitted that they have taken sufficient steps to find out the where abouts of the cheque by writing several letters and came to know from the Canara Bank, Ernakulam that the cheques were misplaced.

THE main complaint of both complainants is that the opposite party has neither remitted the amount in their accounts nor returned the cheques. It is an admitted fact that the said cheques were received and acknowledged by the Canara Bank, and the Canara Bank informed the opposite party that two cheques of Rs. 1,000/- and Rs. 1,500/- were misplaced. It is also admitted that the opposite party is the sponsor Bank of Canara bank. THE learned Counsel for the Appellant/opposite party has contended that the opposite party has informed these facts to the complainant, hence there is no negligence. The opposite party further contended that there is an agreement between the parties marked as B5 in Appeal 1151/98 and as B1 in Appeal 1152/98, hereinafter referred as agreement, and as per the agreement the cheques have been sent for collection at the risk of the complainants and the opposite party is not at all liable for the loss of the cheques in any manner. It is admitted that the agreement was signed by the complainants while opening a Savings Bank Account with the opposite party Bank. The appellant further stated in the Appeal Memorandums that all possible steps have been taken by the Bank without any delay and unfortunately the cheque has been misplaced at the end of the Canara Bank, Ernakulam branch which has been confirmed by them. Hence it is an admitted fact that the cheque has been misplaced at the end of the Canara Bank which is the sponsor Bank of the appellant. The learned Counsel for the appellant contented that the cheque was sent for collection to Ernakulam on the complainant''s own risk and responsibility and thus the Bank is not at all liable for the amount until the instrument is realised in cash by the collecting Bank or till the amount is realised in cash. He added that when a valid contract between the parties exist, the complainant cannot claim compensation for damages or charges against the Bank.

THE appellant in support of these contentions relied on the previous decisions of this Commission in 661/93, 341/95 and 1027/98 and contended that in all these appeals with similar facts this Commission followed its own decision in Meera S. Bhat v. Manager, Syndicate Bank, 1992 (2) CPR 484, and set aside the order of District Forum that the opposite party Bank is liable for loss of cheque in transit. Hence the appellant prayed for the dismissal of these appeals.

IN the light of the above submissions by the appellant, we heard both appellant/opposite party and the respondent/complainant perused the records and found that the appellant/opposite party used the words "misplaced" at the end of the Canara Bank whereas the decisions relied on by the appellant referred to cheques were "lost" in transit. Hence the question before this Commission is regarding the liability of the Bank for misplacement of a cheque and not "loss" of a cheque as alleged by the appellant. The meaning of these two words are entirely different and used in different contexts. The dictionary (Oxford Dictionary)meaning of the word "misplace" is "put in wrong place or hands" whereas "lost" means "deprived of". IN Malayalam lost means "xxxxx" whereas the word "misplace" means "xxxxxx". Thus the word "misplace" does not mean lost irrecoverably or otherwise. If a thing is misplaced it is very well clear that it could be recovered without much effort. A reading of Ext. B1/B5 agreement it is very clear that the conditions therein are meant for the loss of a cheque and no where it covers the misplacement of a cheque, whereas the appellant and the sponsor Bank clearly admits that the cheques were "misplaced" at the Canara Bank end and not "lost in transit". It is seen that no where, in the version, Appeal Memorandum etc. the appellant or in the matters the sponsor Bank, Canara Bank it is stated that the cheque is lost, whereas every where repeatedly with great stress the opposite party and the sponsor Bank used the words the cheque misplaced which is not covered by agreement as the agreement covers only loss of a cheque and not misplacement of a cheque. IN the light of the above finding we have gone through the previous decisions of this Commission including the Meera S. Bhat''s case which were relied on by the appellant and found that in Meera S. Bhat''s case the State Commission took the view that as per the agreement the collection was entirely at the risk of the customer and the Bank cannot be fastened with liability if it was "lost" in transit" and reiterated this view in all its later decisions. A detailed study clearly shows in the above referred appeals the question before the Commission was "loss of a cheque in transit" whereas in these two appeals the question is "misplacement of cheque" in transit, which in fact an entirely different question. Hence we are of opinion that the decisions relied on by the appellant are distinguishable. The meaning of the word "misplace" clearly indicates negligence and carelessness in handling a thing and it is recoverable. Hence it is very well clear that there was negligence on the part of Canara Bank which is the sponsored Bank of the appellant. Thus the only question before us is the liability of the appellant/opposite party towards the complainant/respondent for the injury/loss they suffered.

The appellant contended that as per the agreement the respondent/complainant authorised the appellant/opposite party to collect the cheques through other Banks where the opposite party has no branch, at the risk of the complainant. And the appellant forwarded the cheques for collection to the Canara Bank, Ernakulam at its discretion as per the agreement and not as per the request or with the knowledge of the complainants. The appellant explained the follow-up made by them for recovery of the cheques by producing 3 letters dated 20.4.1997, 20.3.1997 and 20.5.1997 written by them to the Canara Bank and submitted that "all the necessary steps have been taken by the appellant Bank to collect the proceeds of the cheques which was sent for collection". But it is seen that the appellant closed the chapter after getting a letter dated, 27.5.1997 from the Canara Bank confirming the misplacement of the cheque. Considering the special nature of the relationship between a Bank and a customer, as the Supreme Court said "There is always an element of trust between the Bank and its customer, the Bank''s business depends upon the trust" (AIR 1987 SC 1603). We are of the opinion that in these two complaints the appellant/opposite party Bank has not discharged their duty properly, whereas it was negligent towards the grievance of the complainants which amounts to clear deficiency of service.

THE appellant further contended that as per Ext. B1/B5 agreement they are not liable to pay the cheque amount which they have not collected. On perusal of the agreement it is found that there is nothing in the agreement that the appellant/opposite party is not bound to trace out and return the "misplaced" cheques, and no where they stated that they are continuing their efforts to trace out the cheques which shows negligence on the part of the appellant/opposite party which ultimately resulted in deficiency of service which could be compensated only by an order for payment of cheque amount and other reliefs. The learned Counsel for the appellant submitted that the lower Forum''s findings that, Canara Bank, Ernakulam need not be impleaded is not correct because they have received and lost the instrument at their end. But the appellant already substantiated their argument mainly on the basis of Ext. B1/B5 agreement which gives uncontrolled freedom to the appellant to collect the cheque amounts through any Bank without the permission or knowledge of the complainant. It is clear from the records that the appellant exercised this discretion and preferred Canara Bank which they claim to be their sponsored Bank. In the light of the above discussion we are of opinion that the finding of the District Forum that if any mistake or foul play made by the agencies selected by the opposite party it is no way concerned to the complainant, hence Canara Bank need not be impleaded, is correct and needs no interference.

THIS Commission on an analysis of the facts of this case, even though there is no allegation of foul play in the missing of the cheques, in the interest of justice perused the records to confirm that there is a account operative and whether the account is such that it could honour the cheques. We noted a statement in para 8 of the Appeal Memorandum which states that "Further it may be noted that the cheque amount has not been drawn by anybody", so no loss has been sustained by the complainant. Hence we presume that the appellant verified the Account of the drawer in the State Bank with S.B.T. Ernakulam. The words "amount has not been drawn by any body" shows that there is a operative account and there is sufficient fund in the account to honour both cheques; otherwise they would have raised the matter before the District Forum that the Account is not in operative or the fund is not sufficient. In the light of the aforesaid discussion and for the reasons recorded above, we find no merit in the appeals and both appeals are hereby dismissed. In the facts and circumstances of these cases, we make no order as to costs in any of these appeals. Appeals dismissed.