BANK OF BARODA Vs. PANJAB NATIONAL BANK

JUDGEMENT

(1.) THE appellant is a company doing banking business, established: in the State of Baroda, under the Baroda Companies Act, 1896-97, and having its registered office in Baroda with branches in British India. THE respondent is a bank incorporated under the Indian Companies Act. Both banks have branches in Calcutta. M. P. Amin was manager of the Calcutta branch of the appellant bank. Bhagwan Das was manager of the Calcutta branch of the respondent bank. One Mitter (respondent No, 2) became a customer of the appellant bank at Calcutta. In May, 1939, one Ghose (respondent No. 3) opened an account with the appellant bank on the understanding that he should be allowed "temporary accommodation from time to time. " That account was guaranteed by Mitter.

(2.) ON June 13, 1939, Ghose's account with the appellant bank showed an opening debit balance of Rs. 1,26,339 reduced during the course of the day to Rs. 89,274. ON the same day Mitter's account with the respondent bank was overdrawn to the extent of about Rs. 35,000. ON that day, Mitter brought to the respondent bank two cheques drawn by Ghose on the appellant bank both in favour of Mitter and both dated June 13, 1939 ; both cheques were marked on their face with the words "Marked good for payment up to 20th June, 1939", and signed by Amin on behalf of the appellant bank. ONe cheque was for Rs. 1,40,000 and the other for Rs. 1,35,000. Mitter informed Bhagwan Das that the cheques would not be paid until June 20, 1939, and asked to be allowed to draw Rs. 2,40,000 against them. Bhagwan Das said he wanted a cheque the date of which was the same as that on which payment was to be made. Mitter then took away the cheques and returned a little later on the same day with one cheque dated June 20, 1939, drawn by Ghose on the appellant bank in favour of Mitter or order, for Rs. 2,75,000. The cheque was crossed "& Co. " and on the face of it were written crosswise the words "marked good for payment on 20-6-39. For the Bank of Baroda Limited, M. P. Amin, Manager. " It has not been questioned that the signature was that of Amin. Mitter endorsed the cheque generally and handed it to Bhagwan Das, with two letters, in which he asked the respondent bank to credit Rs. 2,75,000 to his account "on realisation on due date," and also requested an overdraft of Rs. 2,40,000, besides the previous balance, which he promised to adjust on June 20, 1939.

(3.) AT the trial before Panckridge J. the evidence called included some Calcutta bankers, who deposed on the question of there being a practice in Calcutta to mark or certify cheques, but it is clear that on any view there was no satisfactory evidence that it was usual to certify post-dated cheques. Panckridge J. held the appellant bank liable on the cheque on the ground that they were acceptors, because in his judgment the certification constituted an acceptance within the meaning of the Negotiable Instruments Act, though he went on to hold as a further ground that the evidence showed that bankers, at Calcutta are by usage liable on cheques certified by them when presented by parties entitled thereto. He did not deal specifically with the case that the cheques were post-dated.