STATE BANK OF INDIA Vs. DILIP MANNA

JUDGEMENT

(1.) This Civil Revisional Application by the plaintiff-petitioner, State Bank of India is directed against an order dated September 22, 1989 passed by the learned Assistant District Judge, Tamluk, Midnapore in Money Suit No. 1 of 1988.

(2.) It appears that the petitioner Bank instituted the above suit against the defendants opposite parties to recover a sum of Rs. 3,68,217.79/- Paise including interest on declaration of first charge on hypothecated goods for future interest and for certain other incidental reliefs. The contention of the Bank was that it sanctioned loan to the Opposite Party No. 1 against a cash credit account with a limit up to Rs. 1,00,000/- on the security of certain goods and on further colateral securities. The Opposite Party Nos. 2 and 3 stood guarantors for repayment of such amount by the Opposite Party No. l. The Opposite Party No. 1 was also maintaining another current account with the Bank with over-draft facility to the extent of Rs 4,00,000/-. A sum of Rs. 3,68,217.79/- Paise was due by the Opposite Party No. 1 including interest calculated upto February 17, 1987. For the purpose of repayment of the loan with interest, the Opposite Party No. 1 also executed a Power of Attorney on November 26, 1984 authorising the petitioner Bank to receive the amount of the bills payable by Indian Oil Corporation Ltd. to the Opposite Party No. 1 for the works which the Opposite Party No. 1 was doing under the said Company. In terms of the agreement contained in the Power of Attorney, the petitioner Bank agreed to advance money against the supply bills for payment submitted by the Opposite Party No. 1 to the Indian Oil Corporation Ltd. in respect of contract works done by the Opposite Party No. 1 under the Indian Oil Corporation Ltd. with further stipulation that the petitioner Bank shall have the first charge over the cheques in payment of the bills and shall also be entitled to realise the amounts of the hills direct from the Indian Oil Corporation Ltd.

(3.) The Opposite Party No. 1 made art application under section 151 of the Civil Procedure Code for short the Code before the learned trial Court contending, inter alia, that in an arbitration proceeding an award was made for a sum of Rs. 4,39,344/- to be paid by the Indian Oil Corporation Ltd. to the Opposite Party No. 1 and a cheque for that amount was forwarded by the Company to the petitioner Bank under the Company's letter dated May 30, 1989. The Indian Oil Corporation Ltd. by a letter dated June 6, 1989 intimated the Opposite Party No. 1 that the amount in question was sent to the petitioner Bank by cheque. It was alleged by the Opposite Party No. 1 that the claim made by the Bank in the suit was already satisfied and that only a small amount was due by the Opposite Party No. 1 to the Bank on account of interest. It was further alleged that the amount claimed by the batik in the suit was sufficiently secured, but inspite of that the Bank was not releasing the amount of Rs. 4,39,344/- in favour of the Opposite Party No. 1 and kept such amount in suspense account. The Opposite Party No. 1 accordingly made a prayer for directing the Bank to release the amount of the aforesaid cheque in favour of the Opposite Party No. 1.