UNION BANK OF INDIA Vs. C D LAZAR

JUDGEMENT

(1.) MATTANCHERRY Branch of the Union Bank of India, a nationalised bank is the appellant. They are aggrieved that the money suit filed by them was dismissed by the Trial Court holding that the suit is barred by limitation. The facts as averred in the plaint are that a partnership firm by name M/s. Alleppey Vegetables was maintaining a current account with the plaintiff bank. The defendant C. D. Lazar and Sri. V. V. Sasidharan were the partners of that firm. The current account was being operated by them jointly. During the period from 19/01/1981 and 26/05/1982, Sri. Lazar withdrew a total amount of Rs. 77,030/- from the current account of the firm as per 12 cheques. The Bank honoured those cheques on the bona fide belief that they were issued in the course of the trade and business of the firm. The plaintiff bank came to know that the first defendant had unauthorisedly withdrawn the amounts without knowledge of the other partner Sri. P. V. Sasidhraarn only when he made enquiries regarding the balance in the current account. Sri. Sasidharan sued the bank and the defendant. The Suit OS No. 11/1985 was dismissed by the Trial Court. But the appeal preferred by Sri. Sasidharan was allowed and this Court directed the bank to credit the sum of Rs. 77,030/- to the current account of the firm. Accordingly, the amount was credited and the present suit is instituted against the defendant seeking reimbursement of the amounts with interest at the rate of 18. 5% from the date on which the bank credited the amount into the account.

(2.) THE defendant filed a written statement contending that the cheques referred to in the plaint were issued by him with the knowledge of Sasidharan and that Sasidharan challenged the withdrawal only in the wake of certain dispute which arose between the partners subsequently. It was contended that the plaintiff, after having honoured the cheques, has no locus standi to sue the defendant. THE defendant is not be penalised for the inactions of the bank. THE bank ought to have preferred SLP before the Supreme Court against the decree in the suit filed by Sri. Sasidharan. Lastly it was contended that the suit is barred by limitation. THE learned Subordinate Judge framed the following issues for trial on the basis of the pleadings raised. 1. Whether the defendant had unauthorizedly withdrawn Rs. 77,030/- from the account of the firm M/s. Alleppey Vegetables? 2. Is he defendant liable for the plaint claim?

(3.) MR. K. G. Balasubramanian, the learned amicus curiae submitted that the Court below appears to have gone wrong in holding that for the purpose of limitation the suit is governed by the residuary article, Art. 113. The apposite article for the present suit is Art. 101 of the Limitation Act, according to him. Analysing the averments in the plaint MR. Balasubramanian would submit that the suit is essentially based on the judgment of this Court in AS No. 467/86. MR. Balasubramanian referred to the judgment of the Division Bench in KSEB v. Chacko Pillai, 1982 KHC 21 : 1982 KLT 76 : 1982 KLT 76 : 1982 KLJ 27 : 1982 KLN SN 10, the judgment of the Madras High Court in Ramaswami v. Muthayya Chetti, AIR 1925 Mad. 279 : (MLJ (XLVII) 829 as well as on the judgment of Nagpur High Court in Yeswantrao v. Bhaskerrao, AIR 1956 Nagpur 250 in support of his submissions.