The Madai Co-Operative Rural Bank … vs State Of Kerala on 10 June, 2009

       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

WP(C).No. 20090 of 2004(N)


1. THE MADAI CO-OPERATIVE RURAL BANK LTD.
                      ...  Petitioner

                        Vs



1. STATE OF KERALA,
                       ...       Respondent

2. THE DIRECTOR OF TREASURIES,

3. THE DISTRICT TREASURY OFFICER, KANNUR.

4. TREASURY OFFICER,

                For Petitioner  :SRI.M.SASINDRAN

                For Respondent  :GOVERNMENT PLEADER

The Hon'ble MR. Justice S.SIRI JAGAN

 Dated :10/06/2009

 O R D E R
                                 S. SIRI JAGAN, J.
                     -------------------------------------------------
                          W.P.(C)No. 20090 OF 2004
                     -------------------------------------------------
                     Dated this the 10th day of June, 2009


                                     JUDGMENT

Petitioner is a Co-operative Society. They have deposited an

amount of Rs.1,02,55,380/- in the Sub Treasury, Payangadi as per

Ext.P1 series of term deposit certificates at the rate of interest

mentioned therein. Even after the date of maturity of the deposits,

the respondents did not pay the deposit amount to the petitioner.

The petitioner filed WP(C) No.4305/04. On behalf of the Government

a submission was made that the amount would be paid within two

weeks. The amount was paid on 18.06.04 but, interest was paid only

up to the date of maturity. Interest from the date of maturity till date

of actual payment was not paid. It is under the above circumstances,

the petitioner has filed this writ petition seeking the following reliefs:

“i. issue a writ of mandamus or any other writ order or
direction to the respondents to pay interest on the amount

deposited as per Ext.P1 series of certificate from the date of

maturity till the date of actual repayment of the deposit amount.

ii. o issue a writ of certiorari or any other writ, order to quash

Ext.P10.

iii. to declare that the petitioner is entitled to get interest for

the deposit amount till the date of returning of the amount by the

respondents.”

WPC : 20090/04
-:2:-

2. According to the petitioner, the petitioner has deposited the

amount in the Treasury savings bank as an ordinary depositor in a

bank. As far as the petitioner is concerned, the relation between the

Treasury and the petitioner is that of a bank and a depositor. Simply

because the Treasury is owned by the Government, they have no

special privilege in payment of the amounts deposited at their will.

Therefore, just like any other bank, if the amount is not paid on the

maturity date, the Treasury is liable to pay interest on the amounts at

the contract rate till date of payment.

3. Learned Government Pleader with the help of a counter

affidavit opposes the contentions of the petitioner. According to the

learned Government Pleader, it is only on account of a ban against

treasury payments, the amounts could not be paid to the petitioner

on the maturity date. Therefore, according the Government Pleader,

no interest is payable. It is also submitted that such writ petition is

not maintainable under Article 226 of the Constitution of India.

4. I have considered the rival contentions in detail. Whenever

injustice is brought to the notice of this Court, this Court cannot deny

justice to the aggrieved party, and this court is bound to exercise its

discretionary jurisdiction to render justice to the party. Here all the

WPC : 20090/04
-:3:-

facts are admitted. Therefore this court is perfectly justified in

entertaining the writ petition. I am also of opinion that, as a banker

who has accepted deposits in his savings bank, the Government or

the Treasury does not have any special privilege in the matter of

payment of the deposit amount on the deposit becoming mature.

Such payment cannot be equated with payment of amounts by the

Government. When they accept deposits from a citizen in a savings

bank account the relation between the Treasury and the depositor is

that of a banker and a depositor. All laws applicable to savings

bank deposits in a bank should apply to such deposits also. The

Government cannot therefore ban payment of amounts deposited by

the depositor in their bank. If they do so, they stand the risk of

paying further interest on the amounts of deposit at contract rate.

Therefore I am satisfied that, despite the contentions of the learned

Government Pleader, the respondents are bound to pay interest on

the deposit amounts at the contract rate till the date of payment and

not till date of maturity. Accordingly, the writ petition is disposed of

with a direction to the respondents to see that interest is paid on the

amount of deposit till date of actual payment at the contract rate

mentioned in Ext.P1(a) series certificates. This shall be done as

WPC : 20090/04
-:4:-

expeditiously as possible, at any rate, within three months from the

date of receipt of a copy of this judgment.

The Writ Petition is disposed of as above.

S. SIRI JAGAN, JUDGE
ttb