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TMI Blog1961 (12) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... ank of India Ltd. The appeal of the Bank against the decree was dismissed by a Division Bench of the High Court. With special leave the Bank has appealed to this Court. The Bank had its registered office, originally at Lahore but after the partition of India the office was transferred to Amritsar. The plaintiff who was a resident of Lahore had accounts with several banks including the New Bank of India Ltd. In view of the impending partition, the plaintiff was anxious to transfer his moveable property outside the territory it was apprehended would be included in Pakistan, and he gave instructions for transferring his accounts with the Bank to its other branches in India. He also paid an amount of ₹ 1,25,000/- on July 18, 1947, into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Bank from making payments to its depositors. In December, 1947, after the expiry of the period of the moratorium the plaintiff applied to the Bank's branch at Calcutta for facility to withdraw the whole amount but the Calcutta Branch raised certain technical objections against such a course. On March 24, 1948 the plaintiff commenced an action against the Bank inter alia for a decree of ₹ 1,35,000/- in the Calcutta High Court on its original side. During the pendency of the suit the High Court of East Punjab sanctioned a scheme for arrangement under ss. 153 and 153A of the Indian Companies Act, 1913, for settlement of the liability of the Bank. By the first clause of the scheme the expression deposit was to include Fixed Depo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imed that the Bank was a trustee for transmission of the amount and in the absence of any instructions given by him for opening a fixed deposit account, in respect of the amount transmitted the Bank stood qua the plaintiff in a fiduciary relation and was liable to refund the full amount. In substance, it was claimed by the plaintiff that the amount lying with the Bank at Calcutta was not a deposit within the meaning of the scheme and was not liable to any reduction. The Bank submitted that the amount of ₹ 1,35,000/- was deposited by the plaintiff at its head office at Lahore for the purpose of opening a fixed deposit account in the name of the plaintiff upon the terms that the fixed deposit would carry interest as on the respective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Bank at Lahore for opening a fixed deposit account subject to the conditions which the Bank set up. The finding of the trial Court were confirmed, in appeal, by a Division Bench of the High Court at Calcutta. The facts found proved, according to the findings of the trial Court and confirmed by the High Court are therefore that the plaintiff delivered an amount of ₹ 1,25,000/- on July 19, 1947, and ₹ 10,000/- on July 19, 1947, to the Bank at Lahore for transmission to Calcutta, with instructions to await the directions of the plaintiff regarding the opening of accounts for keeping the same in fixed deposit or otherwise in the Calcutta Branch of the Bank, and the plaintiff never gave instructions for opening any account, fixe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... livers money to the Bank an intention to create a relation of creditor and debtor between him and the Bank is presumed, it being the normal course of the business of the Bank to accept deposits from its customers. But this presumption is one of fact arising from the nature of the business carried on by the Bank and is rebutted by proof of special instructions, or circumstances attending the transaction. Where the money is paid to a bank with special instructions to retain the same pending further instructions (The Official Assignee, Madras v. Natesam Pillai (1)) or to pay over the same to another person who has no banking account with the bank and the bank accepts the instructions and holds the money pending instructions from that other per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were not given by the plaintiff for appropriation of the amounts the Bank continued to hold the amounts transmitted for and on behalf of the plaintiff and there is no evidence that the plaintiff gave instructions or acquiesced in the opening of a fixed deposit account after the same reached Calcutta. It is immaterial that the Bank purported to open fixed deposit account in the name of the plaintiff with the amounts received at its head office at Lahore. That course of action was adopted without the consent of the plaintiff and it could not bind the plaintiff. The High Court was, therefore, right in holding that the amount delivered by the plaintiff to the Bank at Lahore remained in trust even after it reached Calcutta, and it was not held ..... X X X X Extracts X X X X X X X X Extracts X X X X
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