Bombay High Court
Case BriefsHigh Courts

Bombay High Court: In a commercial division summary suit instituted by Aziz Amir Ali (‘plaintiff’) who is former employee of a registered partnership firm (‘defendant 1’) which is engaged in the business of selling umbrellas for more than a century and has acquired goodwill in the market., for recovery of a sum of Rs. 1,20,00,000/- along with interest at the rate of 24% p.a. on the principal sum of Rs. 1 Crore, N.J. Jamdar, J. held the summary suit to be maintainable on confirmation of accounts through deposit receipt presented before Court.

The plaintiffs invested their lifetime savings with the defendants under the Collective Investment Scheme and invested a total sum of Rs. 1 Crore by cross payee cheques drawn in favor of defendant 1. In turn, the defendants issued credit notes and kept paying the money until January 2020 however stopped payment of interest from the month of February 2020. Thus, letters and legal notices were sent but to no response, present summary suit was filed.

Defendant 2 assailed the tenability of the suit under Order XXXVII Civil Procedure Code, contending that there is no contract between the plaintiffs and the defendants as alleged credit notes/deposit receipts do not constitute written contract.

The Court noted that the claim of the plaintiff is substantiated by the statements of bank accounts which evidence the transfer of amount to the account of defendant 1 through cheques. Particulars of the cheques are mentioned in the credit notes/deposit receipts, thus giving credence to the receipt of the amount of Rs. 1 Crore.

On the contention raised by the counsel for defendant that the transaction allegedly evidenced by credit notes does not partake the character of ‘deposit’, the Court placed reliance on Basant Lal Agarwal v. Lloyds Finance Ltd., 2003 SCC OnLine Bom 1129, to explain the distinction between ‘loan’ and ‘deposit’.

The Court observed that the credit note/receipt clearly acknowledges the receipt of the amount thereunder and the legal notices sent constitute a specific and unequivocal demand of the said amount.

On the thrust of the defense regarding absence of stipulation as to the ‘term of deposit’ implying no contract to repay the amount, the Court opined that the very acknowledgment of the receipt of the amount evidenced by the credit note/receipt gives rise to a contract to repay the said amount and the obligation becomes enforceable upon demand, e-ven in the absence of stipulation as to period of payment.

Placing reliance on Jyotsna K. Valia v. TS Parekh and Co., 2007 SCC OnLine Bom 413, wherein it was observed that a summary suit on the accounts duly confirmed by the defendants would be maintainable, thus, the Court did not accede to the challenge to the tenability of the suit on the ground that it is not based on a written contract.

The Court held that the defendants cannot be granted an unconditional leave to defend the suit when there is material to show that the receipt of the principal amount of Rs. 1 Crore is incontestable and borders on an admitted liability.

The Court directed defendants to repay a sum of Rs. 1 Crore within a period of six weeks from the date of this order, failing which the plaintiffs shall be entitled to apply for an ex-parte decree against the defendants after obtaining a non-deposit certificate from the Prothonotary and Senior Master of this Court.

[Aziz Amirali Ghesani v. Ibrabim Currim, 2022 SCC OnLine Bom 2300, decided on 14-09-2022]

Advocates who appeared in this case:

Mr. Rashmin Khandekar, a/w Ms. Karishni Khanna, i/b Amit Tungare, Ms. Jill Rodricks, Vinit Jain and Deep Dighe, Advocates, for the Plaintiffs;

Mr. Zain Mookhi, a/w Janhavi Doshi, i/b Maniar Srivastava Asso., Advocates, for the Defendant no. 2;

Mr. Jamshed Master, i/b Natasha Bhot, Advocates, for the Defendant no. 3;

Mr. Siddha Pamesha, a/w Declan Fernandes, i/b Purazar Fouzdar, Advocates, for the Defendant no. 4.

*Arunima Bose, Editorial Assistant has put this report together.

Case BriefsHigh Courts

Andhra Pradesh High Court: C Praveen Kumar, J. allowed the petition and quashed the FIR in Crime No.294 of 2013 of II Town Police Station, Eluru.

The facts of the case are such that the informant was working as Manager in Central Bank of India wherein he availed a housing loan of Rs.5,00,000/- for constructing a house. The said house was mortgaged with the bank as security for the loan. In some sudden turn of events the Bank dismissed the informant from the service because of a conviction in a C.B.I. case. Later on, the Bank settled his benefits and paid Provident Fund after recovering the housing loan. The informant requested the Bank to release the title deeds and documents due to repayment and no outstanding dues but to no avail.

The informant claims to have been harassed because he belongs to Scheduled Caste. The informant thus approached the National Commission for Scheduled Castes for release of the title deeds and house documents and settlement of issues like Gratuity etc which was thereby settled. On 16-08-2013, the Bank Manager informed the informant that they have misplaced the documents and title deeds of his house and further the General Manager informed the National Commission for Scheduled Castes about the same and also informed them about the steps being taken against the local branch. Non-delivery of house documents lead to filing of the present report alleging the offences constitutes punishable under Section 3(1)(v) and 3(2)(vii) and Section 4 of POA, Act.

The present Criminal Petition was filed, under Section 482 Cr.P.C., seeking quashing of investigation in the crime of II Town Police Station, Eluru, registered for the offences under Section 3(1)(v), 3(2)(vii) and 4 of Scheduled Castes and Scheduled Tribes (Prevention of Atrocities) Act, 1989 [for short, “POA, Act”].

The Court after perusing Section 3(1) (v) and 3(2) (vii) and Section 4 of POA, Act, which deals with punishment for neglect of duties it is clear that these cannot be made applicable to the facts in issue. Section 3(2)(vii) postulates a situation where a person being a public servant commits any offence under this section i.e., Section 3(2) shall be punishable with imprisonment for a term which shall be less than one year but which may extend to the punishment provided for that offence. A reading of the above section makes it clear that it is only a punishment section and would get attracted, if an offence under Section 3(2) has been committed by a Public Servant.

The Court further observed that Section 4 of the POA, Act deals with punishment for neglect of duties, which defines that whoever, being a public servant but not being a member of a Scheduled Caste or Scheduled Tribe, willfully neglects his duties requires to be performed by him under this Act, shall be punishable with imprisonment for a term which shall not be less than six months but may extend to one year.

The Court concluded that it is no doubt true that the petitioners are Public Servants, working in a Bank where the informant has also worked and where he has taken loan. However, the averments in the First Information Report does not anywhere indicate any willful negligence of duties which were required to be performed under the POA, Act. On the other hand, the averments show misplacing of some documents, for which, the Head Office informed the National Commission for Scheduled Castes about the action which they intended to take.

The Court held “it is very clear that even accepting the allegations in the report to be true, no offence under the Scheduled Castes and Scheduled Tribes (POA) Act, is made out and as such, I am of the view that continuation of the proceedings against the petitioners, who are the Branch Manager, General Manager and Regional Manager of the Bank would be an abuse of process of law.” [N. Appa Rao v. State of AP, Criminal Petition No. 13548 of 2013, decided on 01-04-2022]

Arunima Bose, Editorial Assistant has reported this brief.