THE CONSUMER DISPUTES REDRESSAL FORUM, KOTTAYAM
Present:
Sri. Santhosh Kesavanath P., President
Smt. Bindhu M. Thomas, Member
Sri. K.N. Radhakrishnan, Member
CC No. 196/2009
Tuesday, the 29th day of March, 2011
Petitioner : Thomas Mathew,
Vattakkunnel,
Poovarani P.O
Kottayam
(By Adv. Ajith Kathiranthara)
Vs.
Opposite parties : 1) The Federal Bank Ltd.
Poovarani Branch,
Paika Junction, Poovarani P.O
Kottayam dist.
Reptd. by its Branch Manager.
(By Adv. K.J. Kurian)
2) Kiran Prathap,
Thakadiyel House,
Ponkunnam P.O
Kottayam
O R D E R
Sri. Santhosh Kesavanath P., President
Case of the petitioner filed on 3..7..2009 is as follows:
Petitioner is having a savings bank account, with vide No. 4118, with the opposite party. Opposite party is a company conducting banking business having its registered office at Aluva. On 13..2..2009 petitioner presented to the first opposite party a Cheque having No. 275808 Dtd: 10..2..2009 for an amount of Rs. 60,000/- drawn on the Nedumbassery branch of first opposite party. Said Cheque is issued by second opposite party for the due discharge of the debt due to the petitioner. Petitioner approach the first opposite party many times to know whether the Cheque is credited to his account. But the Cheque was neither seen credited to the account of the petitioner nor dishonoured so far. Petitioner on 21..3..2009 give a written
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complaint regarding the same to the first opposite party. As it was not responded on 6..5..2009 petitioner sent another complaint to the General Manager of the first opposite party. In response to the said letter petitioner was informed by a letter dtd: 7..5..2009 that the complaint was being looked in for ascertaining the details. On 27..5..2009 petitioner received a letter from branch manager of the first opposite party intimating that Cheque was sent for collection to the Nedumbassery branch on 17..2..2009 and misplaced . Petitioner is also advised by the first opposite party to obtain another Cheque from the drawer. On 22..6..2009 petitioner sent a registered notice to the drawer requesting him to issue another Cheque. As the earlier Cheque was mis placed. When the petitioner directly approach the drawer and he retorted to the petitioner that it is not going to get the Cheque honoured or return and he will not issue any further Cheque. Petitioner is not in possession of any other document other than the Cheque to prove the debt due to him from the second opposite party. No legal proceedings can be initiated against the second opposite party because only evidence available against the second opposite party is lost. According to the petitioner act of the first opposite party amounts to deficiency in service. So, petitioner prays for direction to the first opposite party to pay an amount of Rs. 60,000/- with 12% interest per annum from 13..2..2009, as compensation for loss along with Rs. 10,000/- as compensation and cost of proceedings.
First opposite party entered appearance and filed version contenting that the petition is not maintainable. Petitioner is not a consumer and the alleged dispute is not a consumer dispute. Cheque dtd: 20..2..2009 for an amount of Rs. 16,000/-, drawn on Nedumbassery branch of Federal Bank, presented by the petitioner was sent on 17..2..2009 by the opposite party to Nedumbassery branch for collection. The
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enquiries made by the petitioner with regard to sending of the Cheque are duly intimated by the opposite party. There is no deficiency in service on the part of the opposite party. Petitioner has not requested to the drawer of the Cheque, Sri. Kiran Pratap, to issue a fresh Cheque. Bank has not given any information to the drawer of the Cheque. Petitioner can realize the amount due from the second opposite party as per section 81 of negotiable instrument act and rule 16 of order 7 CPC . The loss of a negotiable instrument will not absolve the liability of the drawer of the negotiable instrument. First opposite party duly sent the Cheque and is lost. Fact is communicated to the petitioner. As per section 45 of negotiable instrument act the holder of the lost instrument has a right to get another bill of the same tenor from the drawer. First opposite party pray for dismissal of the petition with their costs.
Second opposite party was imp leaded as per order in IA-891/09 Dt: 10..1..2010. Notice was issued to the additional second opposite party he has not entered appearance even after receipt of the notice so additional second opposite party was set ex-parte.
Points for determinations are:
i) Whether there is deficiency in service on the part of the opposite party?
ii) Relief and cost?
Evidence in this case consists of affidavit filed by both parties and Ext. A1 to
A9 Documents on the side of the petitioner and Ext. B1 document on the side of the opposite party.
Point No. 1
Petition is for getting compensation for loss of a negotiable Instrument. Admittedly the Cheque bearing No.275808, Dtd: 10..2..2009, for an amount of Rs. 60,000/-, presented by the petitioner to the first opposite party was mis placed.
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Being a negotiable instrument according to the petitioner he can not realize the amount from the drawer, second opposite party, in any manner. No legal proceedings can be initiated against the drawer, as the Cheque, only evidence available is lost. The counsel for the petitioner vehumently argued that the Cheque is lost only because of the negligence and deficiency in service on the part of the first opposite party. Further more, being a company conducting banking business first opposite party is expected to be vigilant and responsible while handling valuable documents like Cheques. Counsel for the petitioner further argued that as per Section 45 (a) of negotiable instrument act. The holder of a lost instrument has a right to get another bill from the drawer. As per Section 8 of the NI Act “holder” in case of Cheque is lost or destroyed is the persons so entitled at the time of such loss or distruction. As per section 7 of NI Act when a Cheque is endorsed for collection . The endorsee though may not have property in the instrument, is a “holder” under the act and is entitled to sue so the bank is legally liable to sue and recover amount from the second opposite party. Counsel for the opposite party argued that as per Section 45 (a) of the negotiable instrument act the “holder” of a lost instrument has right to get another bill of the some tenor from the drawer. In this case the liability of the second opposite party is subsisting and there are ways and means for the petitioner to recover the amount due from second opposite party by proper proceedings as envisaged under section 81 of the negotiable instrument act and the rule 16 of order 7 CPC. In our view a together reading of section 8 of the negotiable instrument act it can be seen that the essential ingradiance for the definition of “holder” can be summaries as follows (1) The holder must be specifically named in the Cheque (2) The holder must be entitled to possess a Cheque (3) Holder must be legally entitled to
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recover or receive the amount due under the Cheque from the person who are liable to pay the amount mentioned there in (4) In case of Cheque is lost or destroyed, its holder is the person so, entitled at the time of such loss or destruction. It is true that by way endorsement the endorsee be came a holder but reading together of the entire definition as stated in section 8 of negotiable instrument act. We are of the view that the petitioner as a holder of the lost instrument has right to sue against the drawer as per the provisions of the law. Further more in civil appeal No. 43/2009 in a case between the Branch Manager Federal Bank Vs. N.S Sebastian the Apex Court Stated that in case of lost Cheque. There is no deficiency in service and directed the petitioner to obtain duplicate Cheque from the drawer by invoking 45 (a) of negotiable instrument act or approach a court or appropriate forum for recovery of the money. In another decision of the Hon’ble NCDRC in AP Bopanna Vs. Kodagu District Co-Op. Central Bank (reported in 2009 (1) CPR 91 (NC) ). Hon’ble National Commission opined that if Cheque sent for encashment was not credited or not honoured there can not be any liability on the bank for Cheque amount. Liability could be limited to deficiency in service. In our view there is imperfection, shortcoming and inadequacy in the quality, nature and manner of performance which is required to be maintained by the first opposite party in handling a negotiable instrument. During cross examination of the first opposite party he deposed that no enquiry with regard to the lost Cheque is conducted by the first opposite party. No enquiry or disciplinary action was taken against the concerned manager responsible for the lost Cheque was conducted. DW1 further deposed that he does not know at which point the Cheque is lost. So, in our view the conduct of the first opposite party amounts to deficiency in service. Admittedly there was no sufficient amounts in the
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account of the second opposite party in order to honour the Cheque. Being a bank, as a service provider, is duty bound to give a proper service to its consumers. Further more first opposite party is expected to vigilant and responsible while handling valuable documents like Cheque. So, there is clear deficiency on the part of the first opposite party. Point No. 1 is found accordingly.
Point No. 2
In view of the finding in point No. 1, petition is allowed and the petitioner is entitled for the following relief’s.
First opposite party is ordered to pay the petitioner an amount of Rs. 25,000/- as compensation for the loss suffered by the petitioner along with 12% interest per annum from 13..2..2009 till realization. Since interest is allowed no further compensation for mental agony is ordered.. Opposite party is ordered to pay an amount of Rs. 2,000/- as cost of the proceedings. Order shall be complied with within one month of the receipt of the copy of this order.
Dictated by me, transcribed by the Confidential Assistant, corrected by me and
pronounced in the Open Forum on this the 29th day of March, 2011.
Sri. Santhosh Kesavanath P., President Sd/-
Smt. Bindhu M. Thomas, Member Sd/-
Sri. K.N. Radhakrishnan, Member Sd/-
APPENDIX
Documents for the Petitioner:
Ext. A1: Pay slip Dtd: 13..2..2009
Ext. A2: Copy of letter Dtd: 21..3..2009
Ext. A3: Copy of letter Dtd: 6..5..2009
Ext. A4: Receipt Dtd: 6..5..2009
Ext. A5: Letter Dtd: 7..5..2009 issued by the opposite party to the petitioner.
Ext. A6: Letter Dtd: 27..5..2009 issued by the opposite party to the petitioner.
Ext. A7: Letter Dtd: 20..6..2009 issued by the petitioner to the second opposite
party.
Ext. A8: Postal receipt Dtd: 22..6..2009
Ext. A9: Postal AD card Dtd: 22..6..2009
Documents for the opposite party:
Ext. B1: Copy of the statement of account of second opposite party.
PW1: Thomas Mathew.
DW1: K.G Joseph.
By Order,
Senior Superintendent
