NEW BANK OF INDIA LIMITED Vs. PEAREY LAL

JUDGEMENT

(1.) Mr. Justice Bachawat of the High Court of Judicature at Calcutta decreed Suit No. 1039 of 1948 filed by one Pearey Lal - hereinafter called the plaintiff-for a decree for Rs. 1,35,000/- with interest against the New Bank of India Ltd. The appeal of the Bank against the decree was dismissed by a Division Bench of the High Court. With special leave the Bank has appealed to this Court.

(2.) The Bank had its registered office originally at Lahore but after the partition of India the office was transferred to Amritsar. The plaintiff who was a resident of Lahore had accounts with several banks including the New Bank of India Ltd. In view of the impending partition, the plaintiff was anxious to transfer his moveable property outside the territory which it was apprehended would be included in Pakistan, and he gave instructions for transferring his accounts with the Bank to its other branches in India. He also paid an amount of Rs. 1,25,000/- on July 18, 1917, into the Bank at Lahore with instructions to transmit the same to the Bank's branch at Calcutta which it then proposed to open in the near future. An amount of Rs. 10,000/- was also paid into the Bank at Lahore on July 19, 1947, with similar instructions. In respect of these two transactions the Bank executed receipts which are set out below:

(3.) The plaintiff claimed by his suit that he had entrusted to the Bank at its registered office at Lahore Rs. 1,35,000/on July 18 and 19, 1947, with instructions to transmit the same to the branch of the Bank which it proposed to open at Calcutta and to hold the amount subject to further instructions to be given by him when he would call personally at the branch at Calcutta on or after the opening date that prior to the opening of the said Calcutta Branch the plaintiff countermanded his instructions on or about September 13, 1947, and demanded at Lahore that it be returned, but the Bank wrongfully claimed to have remitted the two sums to its Calcutta Branch and to have kept the same in a fixed deposit account in the name of the plaintiff, even though the plaintiff, had opened no such account at the Calcutta Branch and had given no instructions to put the same into any account by way of fixed deposit or otherwise. The plaintiff, accordingly, claimed that the Bank was a trustee for transmission of the amount and in the absence of any instructions given by him for opening a fixed deposit account in respect of the amount transmitted the Bank stood qua the plaintiff in a fiduciary relation and was liable to refund the full amount. In substance, it was claimed by the plaintiff that the amount lying with the Bank it Calcutta was not a deposit within the meaning of the scheme and was not liable to any reduction.