PUNJAB NATIONAL BANK vs Charan Singh Gura Singh Alias Charan Singh Tuteja

THIS first appeal has been filed by the opposite party against the order dated 24.6.93 passed by the State Consumer Disputes Redressal Commission, Gujarat, Ahmedabad. By the impugned order the State Commission has ordered the opposite party to pay Rs. 82,785/ - with running interest @ 12% p.a. from 7.8.92 till the date of realisation to the complainant. The complainant was also awarded Rs. 500/ - as costs. The respondent No. 1 herein was the complainant before the State Commission. The parties will be referred to by their nomenclature.

ACCORDING to the allegations in the complaint the complainant is a client of the opposite party -Punjab National Bank. On 6.8.91 the complainant made a fixed Deposit of Rs. 75,000/ - with the opposite party for a period of one year. The deposit was to carry interest @ 12% per annum. The deposit matured on 5.8.92. Thus the complainant was entitled to receive Rs. 82,785/ - as the maturity value of the fixed deposit. He approached the Bank but the amount was not paid to him. He filed a complaint before the State Commission claiming the maturity value of the fixed deposit as well as for loss in profit and compensation for mental torture and harassment. The complaint was opposed by the opposite party -Bank. The case of the opposite party is that the complainant is a surety for M/s. C. Mahendra & Co., in which his daughter is a partner. The Bank had filed a suit against M/s. C. Mahendra & Co., his partners and complainant for the amount due from them. The Court has since passed a decree against M/s. C. Mahendra & Co. and its partners and has kept the suit pending against the complainant. The complainant had made the fixed deposit by selling the hypothecated goods. The complainant wants to withdraw the money of the fixed deposit and not to pay the dues/loans which are due to the Bank.

THE State Commission accepted the plea of the Bank to the extent that the complainant is one of the sureties for his daughter and he is also defendant in the suit filed against the said Company and its partners. However, it was held that it did not entitle the Bank to refuse payment of maturity value of the fixed deposit to the complainant as it is an obligation on a Banker to refund the amount when demanded. The State Commission was, therefore, of the opinion that the Bank has committed deficiency in service and acted negligently. Thus, the impugned order came to be passed. Feeling aggrieved the Bank has filed this appeal.

THE learned Counsel for the appellant referred to the suit which the appellant Bank has filed against M/s. C. Mahendra & Co., its partners and the complainant and the decree passed in that suit. It was submitted on behalf of the appellant that the Bank has a lien/set off over the said deposit under Section 171 of the Contract Act as well as under the Guarantee Deed executed by the complainant. We are of the opinion that the said argument has force. In view of the Section 171 of the Contract Act the Bank has a lien over the amount standing to the credit of the guarantor. In addition to above in the present case Clause 15 of the Guarantee Deed also can be referred to. It reads : ''So long as any money remains owing under this guarantee, the Bank shall have lien on all moneys standing to the credit of guarantor(s) and on any securities or goods in the hands of the Bank belonging to any of the Guarantor(s) and the Bank shall be entitled to appropriate/set off/realise the same.'' Thus the complainant has given specific instructions to the Bank to keep a lien over the amount due to him so long as the money under the guarantee remains unpaid/due. The City Civil Court, Ahmedabad has passed a decree against M/s. C. Mahendra & Co. and its partners for Rs. 51,936.80 p. with interest @ 13% p.a. from the date of decree i.e. 9.2.92 till realisation with cost amounting to Rs. 2,750.87 p. Copy of the decree is at Annexure G of the paper book. The suit has been kept pending by the Court against the complainant who has been impleaded in the suit as defendant No. 4. Hence, in terms of the Guarantee Deed executed by the complainant as well as under Bankers general lien the Bank was entitled to retain the maturity value of FDR till the amount due under the decree is recovered by the Bank. Hence, the order of the State Commission cannot be upheld.

IN the light of the above observations, we set aside the impugned order and dismiss the complainant filed by the complainant. The appellant will be entitled to the present proceedings which we assess Rs. 2.000/ -.

IT may be mentioned here that in the appeal filed by the appellant this Commission had not granted stay and therefore the Appellant -Bank paid to the complainant the maturity value of fixed deposit with interest and cost imposed upon the Bank by the State Commission. This fact is admitted by the complainant - respondent herein in Para 3 of his affidavit filed in reply to Memorandum of Appeal. The complainant will refund the amount received from the Bank under the order of the State Commission within a period of one month from the date of receipt of a copy of this order with interest @ 12% per annum from the date amount was received by him. The Bank will calculate the amount due to them under the above referred decree and refund the balance amount, if any, to the complainant with interest at the above rate from the date of maturity till payment. Ordered accordingly.