CANARA BANK Vs. CITI BANK N A

JUDGEMENT

(1.) The challenge by means of this Regular First Appeal under Section 96 of the Code of Civil Procedure, 1908 is to the impugned judgment dated 29.1.2002 which has dismissed the suit of the Appellant/Plaintiff qua the Respondent No. 1 herein. The suit was filed for recovery of amounts of two cheques which were collected by the Respondent No. 1 for its customer/Respondent No. 2/Defendant No. 2/Sh. Kumar Shekhar. It was found subsequently that the signatures on these two cheques of the customer of the Appellant/Plaintiff were forged by the Respondent No. 2/Defendant No. 2.

(2.) The facts of the case are that the Defendant No. 3/Respondent No. 3, M/s. Ramji Lal Ram Saroop had an account with the Appellant/Plaintiff. The Respondent No. 2/Defendant No. 2 wrongly obtained two cheques bearing numbers 338587 and 338595 of the Respondent No. 3/Defendant No. 3 and presented it for collection by filling the amounts of Rs. 44,438/- and Rs. 48,682/- respectively. When this fraud was discovered by the customer of the Appellant, i.e. Defendant No. 3, the Appellant was forced to make payment of these amounts to its customer inasmuch as a forged cheque is no mandate to pay in the eyes of the law. After paying the amount its customer, the Appellant/Plaintiff raised the appropriate demand on the Respondent No. 1, which refused to pay the amount, resulting in filing of the subject suit.

(3.) The only issue relevant to the disposal of the present appeal is as to whether the Respondent No. 1 was guilty in opening and operating the account of its customer/Defendant No. 2/Respondent No. 2. If there is no negligence in opening the account or in operating the account then the Respondent No. 1 will not be liable, however, in case of negligence in opening the account or operating of the account, the Respondent No. 1 would be liable.