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Unauthorized transfer of funds by a bank, liability of the bank to recredit the amount, failure of the bank to honor its commitment, plea of oral instructions by the bank, dismissal of Writ Petition by High Court on the ground of disputed questions of facts, appellant's entitlement to relief. Analysis: The appellant, a Sub-Distributor of a company, maintained a Current Account with a bank. The bank transferred a substantial amount from the appellant's account to another account without authorization. Despite admitting the unauthorized transfer and promising to recredit the amount, the bank failed to do so, leading to the appellant filing a Writ Petition seeking a direction for the bank to deposit the disputed amount back into the appellant's account. The High Court dismissed the petition citing disputed questions of facts. However, the Supreme Court found that the case did not involve disputed facts, as the bank had admitted to the unauthorized transfer and its liability to repay the amount. The Court criticized the bank's conduct, noting that transferring funds based on oral instructions without written authorization is unacceptable and damages public trust in the banking system. The Supreme Court held that since the bank had admitted to the unauthorized transfer and its obligation to recredit the amount, there was no justification for the High Court to dismiss the petition on the grounds of disputed facts. The Court emphasized that as a state instrumentality, the bank must act honestly and in the best interest of its customers. Consequently, the Supreme Court allowed the appeal, overturned the High Court's decision, and directed the bank to recredit the disputed amount to the appellant's account within three weeks, along with any accrued interest. The Court refrained from expressing an opinion on the dispute between the appellant and other parties involved in the case, while also ordering the respondent bank to bear the appellant's costs. In conclusion, the judgment highlighted the bank's obligation to rectify unauthorized transfers promptly, emphasized the importance of maintaining public trust in banking institutions, and underscored the need for banks to act transparently and in accordance with legal obligations to serve their customers effectively.
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