TRADERS BANK LTD Vs. S KALYAN SINGH

JUDGEMENT

(1.) THE appellant in this appeal is the Traders Bank Limited. The respondent is a merchant dealing in 'ghee' at Amritsar. On 17-9-1947 the respondent went to the Branch of the appellant bank at Amritsar and purchased a draft on their Delhi Branch for an amount of Rs. 11000/ -. On 19th September he purchased a similar draft for Rs. 12000/ -. According to the respondent, he came to Delhi and during the period the 20th to the 27th September he endeavoured to cash the first draft but was met with the objection that advice from Amritsar had not been received. The second draft, it appears was endorsed by the respondent to some third person at some date and apparently encashment of this draft was not sought by the respondent. On 26-9-1947 a moratorium was declared by Government for a period of three months. Before the expiry of those three months the Bank had applied for a scheme under Section 153, Indian Companies Act, which scheme was sanctioned by the District Judge in March 1948. In December 1948 the respondent had made an application to the District Judge to obtain payment of the Bank draft purchased on 17-9-1947. The matter eventually came to the High Court and in November 1949 it was held that after sanctioning the scheme the District Court had no further jurisdiction in the matter. On 6-3-1950 the present suit was filed to recover Rs. 8750/- principal and Rs. 1345/-interest, the difference between the principal and the amount of the draft being due, I understand, to an interim payment to the creditors made under the scheme.

(2.) THE learned trial Judge has held that the relationship between the parties was that of debtor and creditor but relying on a judgment given by Achhru Ram J. 'in the matter of New Bank of India limited Amritsar', which appears in 'air 1949 EP 373 (A)', held that as the plaintiff had made demands for payment at Delhi which had been wrongly refused the plaintiff, as he put it, "was kept out of his money unjustly and hence must have priority over the general body of creditors". He, therefore, passed a decree for Rs. 8750/- only having held that the plaintiff was not entitled to interest.

(3.) THE Bank has now come in appeal but has restricted its appeal to the amount of Rs. 6270/-in view of a further instalment under the scheme having become due to the plaintiff as an ordinary creditor.