1. This is a Complainant’s Appeal against the order of the State Commission dated 16.05.2022 whereby the claim of the Complainant was dismissed in respect of alleged deficiency of service against the Respondent Bank not having indemnified the Complainant, a sum of Rs.35 lakhs which according to the Complainant was secured under a pay order issued by the Respondent Bank in favour of the Complainant on 02.09.1997. It may be pointed out that the then negotiating bank, namely Lord Krishna Bank was amalgamated with Centurion Bank of Punjab which in turn was again amalgamated with the Opposite Party No.1
2. The Complainant claimed that a pay order was issued for a sum of Rs.35 lakhs in favour of the Complainant on 22.02.1997 which was accidently misplaced by the Complainant. The photostat copy of the pay order is on record and is an account payee pay order drawn in favour of M/s Mahalaxmi Real Estates & Investments Pvt. Ltd.  The validity of the pay order is 6 months and upon expiry it can be revalidated. It is admitted on record by the Appellant in paragraph 5 of the Complaint as follows:

“5) The Complainant submits that the said pay order was misplaced by the Complainant while shifting their office and imeediately on relocating the pay order, the Complainant intimated the 2^nd Opposite Party vide letter dated 11.10.2001 for revalidating the same. Since the Complainant had not encashed the pay order the liability of the Opposite Parties for payment of the said sum of Rs.35,00,000/- in terms of the pay order still exist.”

3. Thus, the request for revalidating was made after 4 years and 7 and a half months on the premise that the pay order had been misplaced while shifting their office. There are no dates available with regard to the date of misplacement and the date of retrieval of the pay order. But the fact remains that it was the first time after more than 4 years that the Appellant alleges to have made a request to the bank for revalidating the same.
4. According to the Complainant/Appellant, no response was received from the bank as a result whereof they made a complaint to the Reserve Bank of India which dispatched a letter on 26.06.2003 informing the Complainant that the concerned Bank has been requested to dispose off the claim.
5. It also appears that the Complainant had sent a letter on 21.11.2011 to the then Lord Krishna Bank which was replied on 26.02.2002 as follows:-

“LKB/MDS/KDAS/FRAUD/J-2/2002                  February 26, 2002 Chennai

The Accounts Manager

Mahalakshmi Real Estates &

Investments P Ltd

Indian Bank Building

3rd Floor,

Rajaji Salai

Chennai-1

Sir,

Sub: claim for payment by Pay Order Revalidation—reg.

*******

         We are in receipt of your letter dated 21/11/01 regarding your request for revalidation of the Pay Order No.7035 dated 22/02/97 and credit thereafter to your account.

         In this connection, we wish to inform you that fraud is suspected in the transaction and therefore the matter is being referred to the police for further investigation. In the circumstances, we are not in a position to accede to your request.

         This is for your kind information.

Yours faithfully,

Sd/-

Assistant General Manager”

6. The Complainant protested to the then Lord Krishna Bank vide letter dated 22.03.2002 through Counsel to which a reply was given on 27.03.2002. which is extracted hereinunder:-

“Date: 27-03-2002

To,

Mr. George Cheriyan,

Advocate,

No.3, Julies Apartment,

11, Pycrofts Garden Road,

Chennai-600006

27, Law Chambers,

High Court Building

REPLY NOTICE

Sir,

This is with reference to your legal notice dated 22-03- 2002 addressed to my client Lord Krishna Bank Ltd, 397, Precision Plaza, Ground Floor, Anna Salai, Teynampet, Chennai 600 Ø18. I am issuing this reply to your notice referred above under instructions from my client.

My client states that your client Mahalaxmi Real Estates and Investment Private Ltd., Chennai had made a demand on 11-10-2001 asking my client Lord Krishna Bank to credit your client a/c No.4849 alleging that the Pay Order No.087935 dated 22-02-97 for Rs. 35,00,000/- was misplaced and has now been traced.

          My client states that from the records it is seen that the Pay Order was not issued from the account of the Customer named by your client but from a different account. Also from the records, it is seen that the Pay Order was сап- celled even as early as on 24-02-97 and the account of the concerned customer was duly credited to that amount.

My client states that hence a detail perusal of all the relevant books was necessitated. Now since your client has come out with such a demand for revalidation after almost 5 years for such huge amount the same cannot be done in a mechanical fashion without proper scrutiny of records and the Bank satisfying itself of the genuinous of the docu- ments and demand. Your client has not yet produced the original pay order for perusal of my client based on which the demand is made.

My client therefore requests you to advice your client to approach the Bank with the Original Pay Order so as to enable my client to take appropriate steps in the matter.

Thanking you,

Yours faithfully,

Sd/-

(S.Silambanan)”

7. It is thereafter that a legal notice was sent to which a reply was given on 29.04.2002 by the Bank through their Counsel as follows:-

“April 29, 2002

To

Mr. George Cheriyan,

Advocate

27, Law Chambers,

High court Buildings,

Chennai-600014.

Sir,

Received your letter dated 15/4/2002. I am instructed by my client to inform you that the Lord Krishna Bank has lodged a complaint before the Joint Commissioner Special crime Branch Chennai to investigate the matter. The payment against the ‘pay order’ to your client will be decided after the result of investigation by the Police.

Thanking you

Yours faithfully,

Sd/-

(S.Silambanan)"

8. Finally, the Complainant received a reply on 17.07.2003 to the legal notice which is extracted hereinunder:

“Date:17/07/03

To,

Mr. George Cheriyan,

Advocate,

No.3, Julies Apartment,

11, Pycrofts Garden Road,

Chennai-600006.

REPLY NOTICE

This is with reference to your letter dated 16/06/03 addressed to my client, M/s Lord Krishna Bank Limited requesting them to credit a sum of Rs.35 lacs with interest to the current account of your client Mahalaxami Real Estate & investments (P) Ltd.

In this regard, your client has claimed the amount of the Pay Order No.007035 dated 22/02/1997 on 11/10/2001 that is, after a period of 4 years. I am advised to inform you that, on verification, it has been found that the pay order No.007035 dated 22/02/1997, has been obtained fraudulently and without any consideration. A complaint has already been lodged with the police authorities and the matter is under investigation.

For the above reasons, my clients are unable to make payment of the aforesaid pay order. Please advise your client accordingly. In case your client initiates any legal action against my client, it will be defended by my client and your client shall be responsible for all costs and consequences thereof

Thanking you.

Yours faithfully,

Sd/-

(S.Silambanan)”

9. Learned Counsel for the Appellant contends that this response of the bank was absolutely shocking inasmuch as they had themselves intimated that they had lodged a complaint before the Joint Commissioner Special Crime Branch which was investigating the matter and that the issue of the pay order shall be decided accordingly.
10. It is with these documents on record that while proceeding with the appeal orders were passed on 17.08.2023 which is extracted hereinunder:-

“Dated:17.08.2023

ORDER

Heard learned Counsel for the Parties.

The issue of limitation was advanced contending that the cause of action according to the learned Counsel for the Complainant arose only after the communications were exchanged between the Complainant and the Bank in the year 2002 which extended thereafter and upon receiving the reply from the Bank on 17.07.2003, the Complainant alleges to have very promptly lodged the Complaint before the State Commission and as such the Complaint is not barred by any limitation.

Learned Counsel for the Complainant tried to convince and advance the submissions on the strength of other documents to urge that there was a full and complete explanation on limitation with regard to the passage of time from 1997 to 2002, and even otherwise an instrument which was available and for which a request for validation had been made, namely, the Pay Order, did not lose its value or efficacy for the purpose of the claim set up before the Consumer Forum. It is urged that on merits, the Respondent Bank was under an obligation to have discharged its obligation of accepting the claim of the Complainant, which it did not including the validation request and it is only after the refusal of the validation that the Complaint was filed.

During the course of arguments, we have been able to peruse the averments made in the Reply given by the Bank before the State Commission, which is at Annexure –A4 of the paper book. The details given therein speak otherwise including, an allegation of a suspected fraud and rather taking an action by the Bank against its own employees for having colluded in transacting certain amounts that resulted in defrauding the Bank for which a Police Complaint was also lodged.

The State Commission has categorically recorded that inspite of this passage of almost 20 years before the Commission, it was not made known as to what happened to the criminal proceedings of the alleged fraud in the Bank.

Even at this stage, neither Counsel have been able to inform us about the status of the criminal case stated to have been initiated at the instance of the Bank referring to the same fraud as well as the transaction in question.

We, apart from the issue of limitation, find it necessary to seek information from both the learned Counsel about the exact rules relating to a request of validation of a Pay Order. Learned Counsel for both the Parties pray for ten days’ time to assist us on this issue.

We would also prefer having any information regarding to the criminal case, if any, pending or closed or otherwise from both the Parties within this period. In the absence of such information being tendered to us, prima facie an adverse inference is likely to be drawn. Learned Counsel for the Appellant insisted that her arguments be recorded that it is a police investigation at the instance of the Bank about which they have no information nor it is possible for them to find out as they were not even a party or even involved in that investigation. We are unable to accept this contention for the simple reason that even without knowing about the investigation, such a statement can’t be made that they were not involved in it. Nonetheless, we will definitely place the responsibility on the Complainant as well as the Bank in case such an restricted attitude is adopted by the Complainant or the Bank not to disclose any further information about the criminal case.

Let the matter be listed on 01.09.2023.”

11. The information with regard to the criminal investigation was not available as such orders were passed on 01.09.2023 to the following effect:-

“Dated: 01.09.2023

ORDER

Heard learned counsel for the parties.

We had passed a detailed order on 17.08.2023.  The first count on which we needed information was with regard to process of validation of a demand draft or a pay order for which learned counsel has tendered a compilation of 6 notifications regarding the customer service/reversal of erroneous debit which are circulars issued by the Reserve Bank of India itself.  A copy of the same has been handed over to the learned counsel for the bank as it is the contention of the learned counsel for the appellant/complainant that even though a revalidation is required, there is no optimum time limit indicated in these circulars so as to move an application or get it revalidated.  

Apart from this, we also had called upon the learned counsel to tender information with regard to the criminal proceedings of the alleged fraud in the bank which would throw any light or have impact in the present appeal which has been filed against the order of the State Commission refusing to entertain the claim of the appellant.

Since the criminal proceedings might have a definite impact on these proceedings and the learned counsel have pleaded for another adjournment to enable them to retrieve the information for the said purpose, we as a last measure extend this opportunity to both the learned counsel for the parties for informing the Bench about the information as sought in our order dated 17.08.2023.

This order shall be also tendered before the concerned Police Commissioner at Chennai by the respondent bank for seeking this information, in particular about the status of the pendency of the investigation or proceedings or any orders passed in this regard.  We request the concerned Police Commissioner to instruct the appropriate Police Officer/Prosecuting Officer to obtain this information from the concerned Court/Police Station and supply it to the bank for the purpose of adjudication of the present controversy.

Let the matter be listed on 22.11.2023.  

In view of the above orders and directions, IA No. 10751 of 2023, filed by the appellant, seeking a direction to summon the status of the police complaint, stands disposed of. ”

12. Finally on 22.11.2023, information was tendered that the facts relating to the criminal proceedings are being gathered and shall be intimated to the Bench accordingly. The order dated 22.11.2023 is extracted hereinunder:-

“Dated: 22.11.2023

ORDER

Learned Counsel for the Respondent states that the information about the criminal proceedings as well as the status of the complaint had to be tendered as per the order dated 01.09.2023 with regard to which certain progress has been made as is evident from the emails that have been received by them. Learned Counsel submits that a copy of the complaint has been asked for by the concerned officer and it is stated that Mr. H. Saravanan who is the Inspector and is Enquiry Officer relating to the Bank Fraud Investigation Wing has tendered this information. This communication was sent to the Bank on 17.11.2023.

Let a copy of the complaint be provided by the bank to the concerned officer and file a status report with regard to this progress by the next date of hearing.

List on 23.02.2024.”

13. Thereafter, the Bank has brought on record the status report from the Chennai Police which refers to the intimation received from the Greater Chennai Police on 19.02.2024 which is extracted hereinunder:-

"19.02.2024

Intimation Letter

To

Tr. Anbalagan.S,

Asst.Vice President, Branch Head,

HDFC Bank Ltd,

Anna Salai, Teynampet Branch,

Chennai,

       Sub: Chennai Police-CCB-Action Taken Against your petition-Intimation sent –Reg

       Ref:1.N.Dis.No.PG/6349-1/67988/2023

             2.C.No.1053/CCB-I/NPG/2023

             3.Your letter Dated.09.10.2023 addressed to the COP, Greater Chennai Police

                                                                                           ********

       The petition given by you is entrusted to me for enquiry. On perusal of the complaint given by M/s. Lord Krishna Bank against Mahalakshmi Real Estate and Investments Pvt Ltd, while verifying our office records, it is ascertained that we have not registered any FIR in Central Crime Branch, Chennai, on this report of M/s.Lord Krishna Bank from 2001 to 2008. It is informed that we have no information as requested in your petition. This  is for favour of information please.

       Inspector of Police,

       Bank Fraud Investigation Wing,

       Team-XII, Central Crime Branch,

       Vepery, Chennai-07.”

14. Thus, it is clear from the aforesaid information that not even an FIR was registered and there was no information available from the Police in this regard.
15. Learned Counsel for the Appellant submits that it is now established that no criminal investigation was made and in effect this information was withheld even before the State Commission. It is also urged that the officials of the Bank kept the Appellant in dark and as a matter of fact gave an incorrect information with regard to criminal investigation. It is submitted that no efforts were made by the Bank and the result was that the Complainant was deprived of the amount of Rs.35 lakhs which he was entitled to receive under the pay order. The Respondent bank erroneously did not validate the pay order and make the payments thereby unjustly enriching itself at the cost of the Appellant.
16. The Complainant therefore has come up with a case that it was in possession of a valid pay order dated 22.02.1997 for a sum of Rs.35 lakhs which was presented for revalidation before the then Lord Krishna Bank now finally amalgamated with the Opposite Party No.1 Bank, and a request had been made for crediting the said pay order in the account of the Complainant. The Bank having failed to fulfill its services, there was a clear deficiency on its part and therefore the complaint ought to have been allowed.
17. According to the learned Counsel, there is no optimum period for revalidation of a pay order and even otherwise in the event there is any such error or fraud on the part of the Bank, the Complainant who is a genuine account holder should not be deprived of the payments to which he is entitled under the said pay order. Learned Counsel has invited the attention of the Bench to the circular of the Reserve Bank of India regarding reversal of erroneous debits arising on fraudulent or other transactions dated 08.04.2002. With the aid of this circular and other circulars it is urged that it is the obligation of the Bank to make good the amount that was payable to the Complainant under the pay order in dispute. Consequently, factually as well as legally, the Complainant is entitled for the indemnification of the amount together with interest and compensation.
18. The claim was contested before the State Commission by the then Lord Krishna bank by filing written version that is on record. The contention of the Bank was that on investigation it was found that the pay order had not been purchased through any genuine transaction after any credit either through the account of the Complainant or any other account. A fraud had been played and a fake entry had been made in current account no. 1661 in the name of Mahalaxmi Investments & Services through its proprietor Shri MT Rangarajan. In that account, a debit entry of Rs.43,50,000/- dated 22.02.1997 was discovered which was a fraudulent debit without any request from anybody when there was no credit balance therein. This was evidenced by two credit vouchers dated 22.02.1997 which show the name of the payee of the two pay orders no.7035 for Rs.35 lakhs and pay order no.7036 for Rs.8,50,000/- in the name of Mahalaxmi Securities & Investments Pvt. Ltd. and not Mahalaxmi Real Estates & Investments Pvt. Ltd. The two pay orders were cancelled on 24.02.1997 reversing the debit entry made in current account no.1661 of Mahalaxmi Investments & Services.
19. It has been argued by the learned Counsel for the Bank that the fraud transactions upon being discovered the Complainant was also duly intimated that fraud is suspected as the pay order appears to have been signed by one Mr. MSN Murthy the then Chief Manager who was not authorized to issue any such pay order. It was also urged that the Bank had clearly stated in the written statement that during the years 1995-1997, the said Chief Manager in collusion and conspiracy with Shri L Parthasarathy of Southern Township Promoters Ltd. and Shri MT Rangarajan proprietor of a concerned called Mahalaxmi Investments & Services had facilitated opening of several such current accounts by unknown parties in various names including the Southern Township Promoters Ltd., LSK Finance & Allied Services Ltd., Mahalakshmi Investment and Services, Vijayalakshmi Services, Srividya Investments, Venkateswara Investments, Balajee Investments, R.K. Financer. In collusion with these persons with another Assistant Manager Shri Raj Gopal Prabhu fraudulent operations were allowed for large sums permitting withdrawals of money causing heavy losses to the Bank. Consequently on the discovery of the said fraud by the Bank, Mr. MSN Murthy (the Chief Manager) and Mr. Raj Gopal Prabhu (the Assistant Manager) were dismissed from the services of the Bank.
20. It was further submitted that the Police was also informed and so far as the Complainant is concerned, he had submitted the request of revalidation only on the strength of the photostat copy of the pay order. It is for this reason that the bank had called upon the Complainant to come with the original pay order vide letter dated 27.03.2002. The Bank finally on 17.07.2003 suspecting the fraud relating to pay order no.7035 dated 22.02.1997 that was claimed by the Complainant declined to credit the same.
21. Learned Counsel further pointed out the averments contained in the written version from where it is gathered that the Bank had taken a clear stand that the pay order had become sterile and unnegotiable after 6 months which period expired on 22.08.1997. The averments in the written version further indicate that the period of two years expired on 22.08.1999 as such the Complaint which was filed in 2003 was beyond time and barred by limitation as it had been filed almost 4 years of the expiry of the period referred to above.
22. It has also been averred in the written version that the period of limitation for even filing a civil suit for recovery had expired and therefore the Complainant found this circumvented method of filing a complaint after 4 years.
23. It is submitted that even if the Police did not investigate the matter further, the same does not improve the claim of the Complainant as there is no transaction of the debit of the amount from the account of M/s Southern Township Promoters Ltd. from where also the aforesaid story of purchase by them to pay it to the Complainant can be corroborated. It is submitted that there is no document of any voucher or any written request by M/s Southern Township Promoters Ltd. requesting for a purchase of a pay order in favour of the complainant. In the absence of any such record or document, negotiation or proof or remittance, the pay order relied on is fictitious and without authority carrying no negotiable weight. It is therefore submitted that the request of the Complainant to credit pay order no.7035 in its current account no.4849 was an attempt to defraud the Bank.
24. It may be pointed out that the written version also records that the dismissed Chief Manager, Mr. MSN Murthy, had permitted the opening of current account no.4849 on 20.03.1997 on the application of Mr. Umesh Nagpal as Attorney of Mahalaxmi Real Estates & Investments Pvt. Ltd. who is the Complainant herein. It has also been stated that the said account was opened with the help of the passport size photographs of three persons who had issued a power of attorney in favour of Mr. Nagpal on 23.11.1995. The account opening was wholly unauthorized and illegal inasmuch as the power of attorney had not been issued by the Complainant Company.
25. Learned Counsel for the Complainant then urged that these are all seriously disputed and complicated questions of fact involving fraudulent transactions attempted by the Complainant and therefore a complaint under the Consumer Protection Act for such exercise could not be maintained and the Complainant ought to have availed of the remedy of filing a civil suit if available under law. Reference be made to the judgment of the Apex Court in the case of Oriental Insurance Co. Ltd. Vs. Munimahesh Patel (2006)7 SCC 655  where the Apex Court in paragraph 10 to 13 thereof which are extracted hereinunder:

“10. Proceedings before the Commission are essentially summary in nature and adjudication of issues which involve disputed factual questions should not be adjudicated. It is to be noted that the Commission accepted that the insured was not a teacher. The complainant raised a dispute about the genuineness of the documents (i.e. proposal forms) produced by the appellant.

11. The Commission having accepted that there was wrong declaration of the nature of occupation of the person insured, should not have granted the relief in the manner done.

12. The nature of the proceedings before the Commission as noted above, are essentially summary in nature. The factual position was required to be established by documents. The Commission was required to examine whether in view of the disputed facts it would exercise the jurisdiction. The State Commission was right in its view that the complex factual position requires that the matter should be examined by an appropriate court of law and not by the Commission.

13. Above being the position, the Commission was not justified to deal with the matter in the manner as was done. In our view, the directions of the State Commission were more appropriate keeping in line with the nature of dispute. Accordingly, the appeal is allowed but with no order as to costs.”

26. And paragraph 12 as followed in City Union Bank Ltd. v. R. Chandramohan, (2023) 7 SCC 775 to urge that this matter requires leading of evidence which cannot be gone into by the Consumer Forum. Paragraph 12 is extracted hereinunder:

“12. The ratio of the aforestated decision in Ravneet Singh Bagga has also been followed in Branch Manager, Indigo Airlines . In Oriental Insurance Co. Ltd. v. Munimahesh Patel, this Court held that the proceedings before the Commission are essentially summary in nature and the issues which involve disputed factual questions, should not be adjudicated by the Commission.”

27. Learned Counsel for the Complainant in rejoinder urged that the pay order has not been cancelled by the Bank nor any FIR has been lodged and hence the inaction of the Bank cannot act to the disadvantage of the Complainant whose huge investment is sought to be denied by the Bank for no valid reason. Learned Counsel for the Complainant has also invited the attention of the Bench to the entries made in the account of Mahalaxmi Investments & Services that was filed along with the written version of the Respondent Bank before the State Commission as also the entries made in the bank account of M/s Southern Township Promoters Ltd. to substantiate her submissions. Having heard learned Counsel for the parties and having considered the submissions raised as well as the pleadings on record of the State Commission, the Complainant in paragraph 4 of the Complaint has disclosed the identity of the pay order dated 22.02.1997 as bearing pay order no.007035 for a sum of Rs.35 lakhs. A photostat copy of the said pay order is on record and the learned Counsel for the Complainant/Appellant stated that she was in possession of the original pay order even as on date. Be that as it may, the Bank has categorically disputed the authenticity, the validity and the negotiability of the said pay order as narrated above.
28. It is a fact that the said pay order dated 22.02.1997 had a validity period of six months which expired on 22.08.1997. Neither the Complaint was filed within a period of two years of the expiry of the said period nor any civil action was taken. The Complainant has nowhere disclosed as to when and how the said pay order was lost except for a bald statement that it was misplaced during the shifting of the office. There is no averment as to who was in possession of the said pay order or from where it was lost or misplaced or even the person who was responsible for the same. The same mystery shrouds the recovery of the pay order and there is no averment as to from where, when and how was it retrieved. This casts a serious doubt on the theory set up by the Complainant of the pay order having been misplaced.
29. The second reason for this doubt is that it was reproduced before the Bank after 4 years 7 and a half months in the year 2001, that too even a xerox copy. It is on the strength of such an instrument that the claim was set up for revalidation of the pay order. The explanation as indicated above confirms the doubt of genuineness of such an instrument and there is no cogent explanation about this huge gap of 4 and a half years.
30. There is no averment as to why the Complainant kept quiet for 4 years 7 and a half months without lodging a police report about misplacing of the pay order or even informing the Bank that such a pay order had been misplaced. No averment or any proof has been brought forth to the notice of this Commission or even the State Commission and hence the emergence of the pay order after 4 and a half years severely discounts the story of the Complainant in the absence of any averment or explanation. Afterall, a person who has misplaced or lost his pay order of Rs.35 lakhs would not remain quiet and seated back at home without intimating the police or the Bank about it being misplaced. This circumstance by itself therefore is sufficient to discredit the theory of the Complainant of a misplaced instrument for more than 4 and a half years.
31. Even though the learned Counsel for the Bank is correct that the Complaint itself was filed after more than 2 years and after the lapse of the period of limitation for filing a civil suit of recovery of money, nonetheless even assuming that limitation was available as the final communication of the Bank came on 17.07.2003, yet the Complainant also in spite of having knowledge of the fact that the Police had been intimated does not seem to have taken any steps or any interest to confirm this fact as fraud had already been alleged by the Bank with clarity in its letter dated 26.02.2002 with further clarification in respect of the cancellation of the pay orders and the doubt about seeking revalidation after 5 years in its letter dated 27.03.2002. The Complainant therefore had ample information and still it did not take any steps for reporting the matter to the Police or filing any Criminal Complaint. This also raises an adverse presumption that on coming to know of the allegations of fraud, the Complainant could not muster courage to approach the police. This is just a circumstance to indicate that the complainant found an easier method of lodging a Consumer Complaint or in probability was not a victim but might have been himself a part of the alleged fraud and he therefore adopted a wait and watch stance sitting on the fence looking for some via media to make his case look genuine.
32. The contention of the learned Counsel for the Complainant that nothing came out of the intimation to the Police as is now evident from the letter dated 19.02.2024 brought on record by the Bank itself that is itself indicative of the fact that the Bank did not pursue the matter before the Police at all and no action was taken. Another submission of the learned Counsel for the Complaint/Appellant that the Bank had not cancelled the pay order is incorrect. The pay order no. 7035 was stated to have been cancelled on 24.02.1997 which fact is clearly stated in paragraph 10 of the written version that has not been effectively rebutted by the Complainant. This, oral argument therefore of the learned Counsel for the Complainant deserves rejection.
33. Coming to the stand taken by the Bank, the written version in paragraph 7 to 14 has disclosed its clear defense. The bank has categorically stated in paragraph 14(b) as follows:

“14 (b)  …..The Complainant has failed to state as to who purchased the pay order in question and the purpose for which it was purchased in the name of the complainant. The non mention of the name of the purchaser and the purpose for which it was purchased showing the complainant’s name as payee clearly establishes that the said instrument is not a genuine and legally valid instruments issued by the Bank.”

34. Neither the grounds or memo of appeal nor any response thereto rebuts the same except for an allegation that it was an arrangement of return on behalf of a concern namely Southern township Promoters Ltd. (STPL). No proof or cogent evidence has been filed in support thereof. To the contrary the Bank has filed the statement of the Bank Account of STPL for the period in question that does not reflect any credit or debit transaction for the issuance of pay odder NO.7035 dated 22.02.1997 or even remotely corroborate the same.
35. It is admitted that the pay order had lost its validity way back in 1997 itself. Nonetheless, it was issued during a period when Mr. MSN Murthy was the Chief Manager of the Bank and Mr. Raj Gopal Prabhu was the Assistant Manager both of whom were dismissed from the service of the Bank which fact is categorically stated in paragraph 9 of the written version. Their dismissal by the Bank in respect of such fraudulent transactions including the one with a concern named M/s Southern Township Promoters Ltd. has also been stated to be the cause of their dubious role with such concerns resulting in their dismissal. Paragraph 9 of the written version is extracted hereinunder:-

“9.      It was discovered, by the Bank that when one Shri. M.S.N Murthy was the Chief Manager of the 2^nd Opposite Party during the years 1995-1997, he, in collusion and conspiracy with certain persons namely Shri L.Parthasarathy of a Company called Southern Township promoters Limited, Shri. M.T.Rangarajan, proprietor of a concern called Mahalakshmi Investments and Services and other allowed to open several current accounts by unknown parties in various concern names such as Southern Township Promoters Limite, LSK Finance and Allied Services Limited, Mahalakshmi Investment and Services, Vijayalakshmi Services, Srividya Investments, Venkateswara Investments, Balajee Investments, R.K. Financer. The said Official (Shri. M.S.N.Murthy) along with another official Shri. Rajagopal Prabhu, Assistant Manager acting in collusion and conspiracy with Shri.L.Parthasarthy and Shri.M.T. Rangarajan fraudulently allowed operations on  the above said current accounts and discounting of local cheques for large sums, permitting withdrawals of money from the accounts before realization of the discounted cheques many of which were returned unpaid thereby causing heavy monetary loss to the Bank. On the discovery of the said fraud by the Bank, both the above mentioned officials were charge sheeted and dismissed from the Bank’s service.”

36. The Bank has admitted having received a xerox copy of the pay order no.007035 dated 22.02.1997 from the Complainant alleging that the said transaction was from the account of M/s Southern Township Promoters Ltd. Two other letters were also written thereafter by the Complainant to the Bank which have been indicated above to which the replies were given by the Bank.  Para 10 of the written version of the Bank narrates as follows:

“10.    After the receipt of the first 2 letters (dated 11.10.2001 and 21.11.2001) the matter relating to the issuance of any such pay order for Rs.35 lacks on 22.2.1997 was investigated by search of the relevant records at the 2^nd Opposite Party Branch. It was then discovered that on 22.2.1997. (a) there was a debit entry of Rs.43,50,000/- in the Current Account No.1661 in the name of Mahalakshmi Investments and Services by proprietor Shri. M.T. Rangarajan, (b) there was no credit entry therein to match the said debit or any credit balance to allow the said debit which clearly indicated that a huge sum of Rs.43,50,000/- was fraudulently debited to the account without any request from anybody when there was no credit balance therein. The credit vouchers dated 22.2.1997 available at the 2^nd Opposite Party’s Branch show the name of the Payee of the 2 pay orders No.7035 dated 22.2.1997 for Rs.35,00,000/- and No.7036 dated 22.2.1997 for Rs.8,50,000/- as Mahalakshmi Securities and Investments Private Limited (and not Mahalakshmi Real Estates and Investments Private Limited or Mahalakshmi Real Estates and Investments Private Limited). (c) On 24.2.1997, 2 credit entries for Rs.35,00,000/- and Rs.8,50,000/- on cancellation of 2 pay orders for Rs.35,00,000/- and Rs.8,50,000/- have been made in the said account no.1661 which together amounted to reversal of the debit entry of Rs.43,50,000/- made in the said account on 22.2.1997. These 2 entries in the Current Account No.1661 of Mahalakshmi Investments and Services (by Proprietor Shri. M.T.Rangarajan that 2 pay orders for Rs.35,00,000/- and Rs.8,50,000/- were shown as having been issued on 22.2.1997 and that both of them were cancelled on 24.2.1997 thereby nullifying the effect of having issued any such pay orders. There were no credits received for issuance of any such pay orders and if at all any such instrument had been issued it was wholly unauthorized and illegal. The Chief Manager had no authority to issue a pay order without the applicant for the said instrument remitting requisite funds for its issue as no funds were remitted by Mahalakshmi Investments and Services for issuance of any pay orders for Rs.35,00,000/- and Rs.8,50,00,000/- are null and void and inoperative instruments and are in any event not binding on the Bank. In any event they stood canceled on 24.2.1997.”

37. A perusal of the said narrative sheds enough light on the shady unauthorized transactions  that were nullified including the pay order in question the number whereof is 7035 for Rs.35 lakhs and there is no material to contradict or disbelieve the same. This therefore indicates that the Bank undertook measures to neutralize the said fraudulent transactions that had been negotiated through the account of Mahalaxmi Securities & Investments Pvt. ltd., the proprietorship of Mr. MT Rangarajan. These facts render the stand taken by the Bank as highly probable.
38. Learned Counsel for the Complainant urged that the Complainant has got nothing to do with Mahalaxmi Securities & investments Pvt. Ltd. which is a different concern altogether. There is no explanation by the Complainant about the pay order no.7035 having been correlated with the credit vouchers available with the Bank and the amount being debited fraudulently. It may be possible that the similarities of name of Mahalaxmi in respect of both the entities may further raise a serious doubt but the pay order no.7035 is the same pay order which has been admittedly presented by the Complainant as stated in paragraph 4 of the Complaint and admitted by the Bank in the written version. This pay order no.7035 is therefore a part of a transaction which seems to be not only fake but touching upon the allegations of a highly probable fraud played on the Bank. Consequently, the claim on the basis of such an instrument does not seem to be creditworthy and at least not worth entertaining a Consumer Complaint on the foundation thereof.
39. The opening of the current account no.4849 on 20.03.1997 through power of Attorney Mr. Umesh Nagpal has also been doubted by the Bank. It is the same account wherein the Complainant made a request to credit the said pay order.
40. Thus, on an overall conspectus of the entire facts and having perused the statement of the Bank accounts that have been filed along with the written version of the bank, there does not seem to be any remote possibility of either the crediting, the purchase or the debiting of a pay order of the amount of Rs.35 lakhs so as to correlate it to the pay order possessed by the Complainant.
41. For all the reasons hereinabove, I do not find any reason worth credit to accept the contentions on behalf of the Complainant to find fault with the order of the State Commission dated 16.05.2022 which deserves to be affirmed. No deficiency in service could be established against the Bank as such the Appeal lacks merit and is accordingly dismissed.