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Vijaya Bank v. Gurnam Singh .
Factual and Procedural Background
The respondent-complainant maintained a savings account with the appellant Bank. He lost his cheque-book, which contained a single unused cheque leaf and the requisition slip for obtaining a fresh cheque-book. Subsequent inquiries revealed:
- The lost requisition slip was used to secure a new cheque-book from the Bank.
- The remaining cheque leaf from the lost cheque-book was utilised to withdraw Rs 2,500 from the respondent’s account.
- A cheque from the newly issued cheque-book was used to withdraw Rs 3,50,000, even though the account balance stood at only Rs 3,46,682.93. The Bank honoured the cheque by recording a debit of Rs 3,317.07, thereby overdrawing the account without any sanctioned overdraft facility.
Having failed to obtain reimbursement, the respondent filed a complaint before the District Consumer Disputes Redressal Forum, Chandigarh (“District Forum”). The District Forum found the Bank grossly deficient in service and ordered it to credit the misappropriated amounts (Rs 2,500 and Rs 3,50,000 less Rs 5,000) with 10% interest from 17-8-1999. The appellant’s appeal to the State Commission was dismissed, and its revision petition under Section 21(b) of the Consumer Protection Act, 1986 was rejected by the National Commission on 16-7-2002 for raising no question warranting interference with concurrent factual findings. The present appeal to the Supreme Court was filed by special leave.
Legal Issues Presented
- Whether the National Commission erred in refusing to entertain the appellant’s revision petition despite concurrent findings of negligence against the Bank.
- Whether the Bank could rely on an unproved handwriting expert’s report to negate allegations of forged signatures on the cheques.
- Whether honouring a cheque in excess of the available balance, absent any overdraft facility, constituted negligence/deficiency in service by the Bank.
Arguments of the Parties
Appellant Bank’s Arguments
- The forums below ignored an expert opinion adduced by the Bank indicating no forgery in the signatures on the impugned cheques.
The opinion does not contain a detailed account of the respondent-complainant’s legal arguments.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
- Evidentiary value of expert report: The Supreme Court held that the handwriting expert’s report annexed to the Bank Manager’s affidavit was “no evidence in the eye of law.” Because the expert was not summoned and examined, the report was unproved and rightly ignored by the lower forums.
- Cheque honoured in excess of balance: In response to the Court’s query, counsel for the Bank could not explain how a cheque exceeding the account balance was honoured without an overdraft facility. The Court treated this fact, emphasized by the State Commission, as a “glaring example of negligence/deficiency” on the Bank’s part.
- Scope of revision jurisdiction: Given the concurrent factual findings of negligence by both the District and State Commissions, the Supreme Court agreed that the National Commission, exercising limited revisional jurisdiction under Section 21(b) of the Act, was justified in declining to interfere.
Holding and Implications
APPEAL DISMISSED WITH COSTS OF RS 10,000.
The Supreme Court upheld the orders of the District Forum, State Commission, and National Commission. As a result, the Bank must credit the misappropriated sums with interest to the respondent’s account and pay costs of Rs 10,000. The decision affirms the limited scope of the National Commission’s revisional powers and reinforces banks’ duty of care in honouring cheques. No new legal precedent of broader applicability was established.
Order
1. This appeal, by special leave is directed against the order dated 16-7-2002, passed by the National Consumer Disputes Redressal Commission, New Delhi (for short “the National Commission”) declining to entertain the appellant's revision petition under Section 21(b) of the Consumer Protection Act, 1986 (for short “the Act”).
2. The material facts, found by the forums below and relevant for the purpose of this appeal, are as follows: the respondent (hereinafter referred to as “the complainant”) had a savings bank account with the appellant Bank. Somehow he lost his cheque-book containing one unused leaf and the requisition slip required for issue of a new cheque-book. On 24-9-1999, when the complainant visited the Bank to draw money, he was surprised to find that there was only a balance of Rs. 1682.93 in his account.
3. On enquiries being made, it transpired that the requisition slip had been used to get a new cheque-book issued from the Bank and the leftover cheque in the lost cheque-book had been misused to draw an amount of Rs. 2500 from the complainant's account. It was also discovered that an amount of Rs. 3,50,000 had been withdrawn from the account by using a cheque leaf of the newly issued cheque-book.
4. Having failed to get the amount so withdrawn from his account reimbursed by the Bank, the complainant filed a complaint with the District Consumer Disputes Redressal Forum, UT Chandigarh (for short “the District Forum”) alleging deficiency in service by the Bank.
5. Upon consideration of the material before it, which included examination of the complainant's account opening form; the requisition slip; and the cheque in question, vide order dated 4-12-2001, the District Forum came to the conclusion that there was gross deficiency in the service by the Bank which resulted in loss to the complainant.
6. The District Forum found that specimen signatures on the account opening form and the cheque used for withdrawal of money were different and more significantly when the cheque in the sum of Rs. 3,50,000 was presented, balance in the account of the complainant was only Rs. 3,46,682.93 and yet it was honoured by recording a debit entry of Rs. 3,317.07 as recoverable from the complainant. Consequently, the District Forum accepted the complaint and directed the Bank to credit the amounts of Rs. 2500 and Rs. 3,50,000 less Rs. 5000 in the account of the complainant along with interest @ 10% p.a w.e.f 17-8-1999 till the date of the correct entry.
7. Being aggrieved, the appellant preferred appeal to the Consumer Disputes Redressal Commission, UT Chandigarh (for short “the State Commission”) but without any success. The State Commission affirmed the findings recorded by the District Forum.
8. Not being satisfied, the appellant preferred revision petition before the National Commission. As aforestated, the National Commission has dismissed the revision petition on the ground that both the forums below have recorded a concurrent finding of fact that there is negligence on the part of the Bank in rendering the services. Hence, the present appeal.
9. We have heard Mr Sanjay R. Hegde, learned counsel appearing on behalf of the appellant. It is strenuously urged by the learned counsel that all the forums below have erred in ignoring the expert's opinion adduced in evidence by the Bank in support of its stand that there was no forgery in the signatures on the cheques in question.
10. We do not find any substance in the submission for the simple reason that the said report was no evidence in the eye of the law. Admittedly, the report was not proved by summoning the expert. The Manager who had merely annexed the report with his affidavit could not prove the same and, therefore, the forums below were justified in ignoring the report.
11. On a query by the Court as to how in the absence of any overdraft facility being enjoyed by the complainant, a cheque for the amount which was in excess of the balance amount in the account of the complainant could be honoured, the learned counsel is unable to furnish any satisfactory explanation. In our opinion, this fact, highlighted by the State Commission, by itself is a glaring example of negligence/deficiency in the service of the Bank.
12. In the light of the factual scenario as emanating from the orders of the District Forum as also the State Commission and bearing in mind the limited scope of revisionary jurisdiction of the National Commission, we are of the opinion that the National Commission was justified in declining to entertain the revision petition against the said orders.
13. The appeal, being bereft of any merit, is dismissed accordingly with costs quantified at Rs. 10,000.
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