CANARA BANK Vs. KANDASWAMY

JUDGEMENT

(1.) FOR the These applications are filed by the applicant-bank/plaintiff under Order XIV, rule 8 of the Original Side Rules read with order 39, rule 1 of the CODE OF CIVIL PROCEDURE, 1908, to pass an order directing the second defendant-bank to release the amount to the plaintiff-bank on such terms and conditions as the court may deem fit and proper and also restrain defendants Nos. 1 and 2 by an order of injunction preventing them from withdrawing or allowing any withdrawal of any amount from S.B. Accounts Nos. 8818, 8819 and 8820 in the name of the first defendant. The case in brief for disposal of all these applications is as follows : On September 5, 1996, three instruments each for Rs. 9. 50 lakhs purporting to be demand drafts issued by the plaintiff-bank's Cantonment branch, Bangalore were presented by the first defendant and two others. The second defendant acting as the banker of the first defendant its customer, presented in clearing at Madras the instrument on September 6, 1996. The amount mentioned in the instrument was realised and received from the applicant-bank. Later, it was found that the instrument was not a genuine demand draft issued by the applicant-bank but was a fake and fraudulent one, fraudulently created and presented to defraud the applicant-bank and the instrument was deceptively similar to a genuine instrument. The applicant-bank made payment to the second defendant-bank in the usual and ordinary course of business.

(2.) ON coming to know of this fraud, the second defendant-bank was apprised of the same and they were requested to return the amount and not to allow any money to be withdrawn by the customer in the S.B. Accounts Nos. 8818 to 8820 with the second defendant branch. The plaintiff-bank is entitled to the amount fraudulently collected from it and the same cannot be allowed to be withdrawn by the first defendant. The first defendant is an imposter and the second defendant-bank without proper and sufficient investigation and introduction, allowed the savings bank account to be opened in the name of the first defendant. The plaintiff's attempts to trace or keep track of the first defendant have been in vain. The notices sent were returned with a postal endorsement "no such person". The plaintiff called upon the second defendant-bank to release the amount realised on the fake instrument, but the second defendant was reluctant to release the amount in the absence of a court order. The plaintiff even offered to provide proper and sufficient indemnity to persuade the second defendant to release the amount without resort to the court. Hence, these applications.

(3.) IN spite of several communications, they evaded to return the same but learned counsel for the second defendant stated that the present application has been filed not for return of the amount but for other reliefs and, as such, no direction can be given to the second defendant to return the amount. Admittedly, the amount belongs to the plaintiff bank and the amount was cleared when it was presented by the second defendant bank for clearance. Under law, the plaintiff is entitled to get back the amount which was wrongly cleared by them presuming to be genuine documents issued by their branch at Cantonment. Under the circumstances, I am of the view that the second defendant has no legal right whatsoever to retain the money and the retention of the same all these years is not a proper one. So far as the claim of interest raised by the parties is concerned, it can be considered in the suit.For the reasons stated above, the second respondent is directed to return the amounts covered under the three demand drafts to the plaintiff-bank within a period of two weeks from this date and the dispute relating to the interest will be considered in the suit. These applications are ordered accordingly.