BANK OF INDIA Vs. T R ARORA

JUDGEMENT

(1.) This suit has been filed by the plaintiff bank for recovery of Rs. 1,51,319.61 including interest against the defendant.

(2.) Briefly the facts alleged are that the defendant is carrying on his business as a dealer in two wheeler automobiles in the name of M/s. Swadeshi Motors at 1 E-2, Jhandewalan Extension, New Delhi. He had a current account with the plaintiff bank at its Jhandewalan Extension Branch. On 3.6.1983, due to mistake/clerical error on the part of the bank, an excess amount of Rs. 1.00 lakh had been credited in his current account. The defendant on 4.6.1983 had issued a cheque in this account for withdrawing Rs. 1.00 lakh and purchased a bank draft in favour of M/s. Bombay Oil Industries Pvt. Ltd. His account was so debited and the bank draft was issued. Later on, in August 1984 the aforesaid mistake was discovered, the defendant was asked orally as well as in writing to deposit the said amount with the plaintiff bank which was not done. A letter of demand dated 27.2.1985 and then legal notice dated 22/ 24.7.1985 were saved on the defendant claiming a sum of Rs. 99,479.97 due in his current account. This having not been paid, plaintiff has filed this suit with interest @ 18% per annum for the period 3.6.1983 to 31.3.1985 and thereafter@ 17.5% per annum till the filing of the suit being the prevalent rates of interest charged by the bank. Accordingly the plaintiff has filed the present suit.

(3.) The defendant filed the written statement primarily contesting his liability to pay interest. It is, not disputed that the defendant had issued a cheque of Rs. 1.00 lakh on 4.6.1983 in this account and having purchased bank draft of Rs. 1.00 lakh in favour of M/s. Bombay Oil industries Pvt. Ltd, He has taken the plea that the amount was withdrawn by the defendant honestly and bona fide, acting on the representation of the staff of the plaintiff bank that the amount was due in his account and that the plaintiff bank is estopped from claiming any amount from the defendant. However, he/by way of compromise, was prepared to pay Rs. 1.00 lakh in easy instalments without interest. No payment was, however, paid.