ORDER
Manmohan Sarin, J.
1. The plaintiff Bank has instituted the suit for recovery of Rs.
5,34,791.83 (five lacs, thirty four thousand, seven hundred ninety one
rupees and eighty three paisa) together with pendente lite and future
interest @ 23.75 % p.a. The suit was instituted on 28.7.1997 and summons
were directed to be issued to the defendant. The defendant was duly served.
As the defendant failed to appear on 20.3.1998, 12.5.1998 and 4.9.1998, the
defendant was directed to be proceeded ex-parte. The plaintiff was permit-
ted to file affidavit by way of ex-parte evidence. The plaintiff duly filed
its affidavit dated 29.1.1999 of its attorney Shri N.K. Jaitley by way of
evidence. The original documents were also placed on record and the same
were exhibited.
2. The plaint has been signed and verified by Shri N.K. Jaitley, who is
stated to be the duly constituted attorney of the plaintiff Bank. The
original power of attorney in favour of Shri N.K. Jaitley was produced
before the Joint Registrar and copy of the same has been duly exhibitted as
Ex. PW.1/1. The affidavit by way of evidence has been filed by Shri. N.K.
Jaitley as noted earlier. The plaintiff has, thus, proved on record the due
institution of the suit by Shri N.K. Jaitley, Principal Officer/Branch
Manager.
3. The facts in brief as averred in the plaint and sworn as per the
affidavit by way of evidence may be noticed. The defendant, who has an
account with the plaintiff Bank, issued a cheque No. 077505 for Rs. 5 lacs
dated 30.7.1996 in favour of Shri Charanjit Singh. Shri Charanjit Singh is
also having an account (Account No. OISKP 0879900) with the plaintiff Bank.
The plaintiff’s case is that on the basis of the cheque issued by the
defendant, the account of Shri Charanjit Singh was erroneously credited
with the sum of Rs. 5 lacs. Even though there was insufficient balance in
the account of the defendant. Simultaneously, at the request of Shri Cha-
ranjit Singh, whose account had been credited with Rs. 5 lacs, a pay order
in favour of M/s. Krown Exports was issued at the behest of Shri Charanjit
Singh. On realising that there was insufficient balance in the account of
the defendant, the credit entry made in the account of Shri Charanjit Singh
was reversed and the plaintiff in compelling circumstances stopped the
payment of the pay orders. M/s. Krown Exports, in whose favour the pay
order has been issued, lodged a complaint before the Banking Ombudsman
dated 17.9.1996 against the plaintiff Bank. The said complaint is Ex.
PW.1/2. The plaintiff Bank vide its letter dated 7.11.1996 Ex.PW.1/3 to the
Banking Ombudsman stated the factual position. It was explained that the
cheque of Rs. 5 lacs drawn by the defendant was returned to Shri Charanjit
Singh on account of insufficient funds in the account of the defendant and
Shri Charanjit Singh was informed and called upon to return the pay order
that had been issued under bona fide mistake and without consideration.
Shri Charanjit Singh, who had duly received back the returned cheque issued
by the defendant, did not return the pay order and on the other hand M/s.
Krown Exports insisted on its payment being made. The plaintiff Bank stated
before the Banking Ombudsman that Shri Charanjit Singh did not acquire any
title in the purchase order, which was without consideration.
4. The plaintiff Bank explained the whole position to the defendant and
sought its authorisation to make the payment to Shri Charanjit Singh and
sent a draft authorisation letter to the defendant. The defendant vide his
letter dated 20.11.1996 Ex. PW.1/5 accepted his liability to make payment
to Shri Charanjit Singh and promised to make good the payment. However, in
view of business constraints, he was unable to do so immediately and sought
a temporary overdraft of a like sum to be repaid by 30.1.1997. The defend-
ant also authorised the plaintiff Bank to debit his account No. OICKP
0318500 for Rs. 5 lacs and transfer the same to the account of Shri Charan-
jit Singh. In the meanwhile, the Banking Ombudsman gave its decision on
13.12.1996 vide Ex.PW.1/6. The plaintiff was directed to honour the pay
order No. 003212 dated 10.9.1996 for Rs. 5 lacs in favour of M/s. Krown
Exports. The plaintiff Bank accordingly complied with the said decision and
made the payment and honoured the pay order and confirmed the same to the
Banking Ombudsman by PW.1/7. Shri Charanjit Singh also returned the cheque.
5. The defendant contrary to his assurance of making good the payment of
Rs. 5 lacs that had been credited to the account of Shri Charanjit Singh
failed to do so. Defendant was requested to liquidate the outstanding of
Rs. 5 lacas together with accused interest within 7 days vide plaintiff’s
letter dated 3.3.1997 i.e. Ex. PW.1/10. However, the defendant failed and
neglected to do so. The plaintiff has also tendered in evidence the state-
ment of account, which exhibited as Ex. PW.1/14.
6. In view of the foregoing facts as stated in the affidavit by way of
evidence duly supported by the documents as exhibited, to which reference
has been made earlier, the plaintiff has proved that a sum of Rs. 5 lacs
was erroneously credited to the account of Shri Charanjit Singh on the
basis of the cheque issued by the defendant. The defendant did not have
sufficient balance at that time. The defendant, however, vide letter dated
20.11.1996 Ex.PW.1/5 duly accepted the liability for the payment of Shri
Charanjit Singh and undertook to make good the said payment. He also autho-
rised the debiting of his account No. OICKP 0318500 for Rs. 5 lacs and for
transfer of the amount to the account of Shri Charanjit Singh. The defend-
ant despite demands has not paid the amount in question. There is a pre-
sumption as to the correctness of the entries in the statement of account
as per the Banker Books Evidence Act. The plaintiff has also claimed inter-
est @ 23.75% p.a. on the principle amount till 31.5.1997 being the normal
rate of interest charged by the Bank in overdraft account.
7. The suit is accordingly decreed in the sum of Rs.5,34,791.83/- togeth-
er with costs and pendente lite and future interest @ 15% p.a. on the suit
amount.