WASUDEV RAMCHANDRA Vs. NATIONAL SAVINGS BANK LTD

JUDGEMENT

(1.) This is a suit by the owner of a Government promissory note, which has been negotiated by 3 forged endorsement, against the endorsers and endorsees of the promissory note, claiming that the said note, or the new note into which it was converted, or the value thereof, may be given to him. The facts, which are not in dispute, and are taken to have been admitted by the parties, are that a Government promissory note for Rs. 10,000, which had been duly endorsed over to the plaintiff, was endorsed to the first defendant bank. The first defendant bank took delivery of this promissory note on behalf of their constituent one Istiwarlal Joshi. The first defendants in their turn endorsed over the promissory note to the second defendant bank who received it on behalf of their constituents, the fourth defendants, in a loan account of the fourth defendants with them. That was on 20-9-1945. On 18-10-1945, the second defendant bank endorsed over the said note to the third defendants under instructions from the fourth defendants, who had sold the note to the third defendants. On 30-1-1940, the third defendants resold the note to the fourth defendants and endorsed it over to the fourth defendants who again endorsed it over to the second defendants as his bankers. On 30-1-1946, the fourth defendant instructed his bankers the second defendants to surrender the note and get it converted into a new note. Accordingly the second defendants lodged the note with the Reserve Bank of India and received a renewed promissory note on 14-2-1916. It is the case of the plaintiff that the endorsement by which the note was purported to be endorsed over to the first defendants was a forged endorsement and, therefore, no title to the said note passed to any of the defendants at any time. Since admittedly the original note has been converted into a new note, there can be no question of any order directing that the old note, which has been cancelled by the Reserve Bank of India and is lying with it, be handed over to the plaintiff. The only reliefs which the plaintiff can ask for are a return of the renewed note or its value.

(2.) Now, none of the defendants admit that the plaintiff was the owner of the note, nor do they admit that the endorsement purporting to be by. the plaintiff is a forged endorsement. All of them deny their liability to the plaintiff either for the return of the converted note or for paying its value. The defendants other than the first defendants also plead that the plaintiff was guilty of negligence, Wasudev Ramchandra vs. National Savings Bank Ltd. (28.06.1951 -BOMHC) Page 4 of 12 gs Bank Ltd. (28.06.1951 -BOMHC) Page 4 of 12 which enabled someone to forge the endorsement and that, therefore, in any event, they are absolved from liability by reason of such negligence.

(3.) Three third party notices have also been taken out in these proceedings; one by the first defendants against their constituent Ishwarlal Joshi; another by the second defendant bank against the first defendant bank and the fourth defendants; and the third by the fourth defendants against the first defendants who are the prior endorsers.