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2002 DIGILAW 701 (CAL)

Abhra Sinha v. India Explosive Ltd.

2002-11-28

Altamas Kabir, GORACHAND DE

body2002
JUDGMENT Altamas Kabir, J. The appellant in F.A. No. 158 of 1995, Smt. Abhra Sinha, was one of the joint depositors along with one Jogendra Nath Das in respect of a fixed deposit of Rs. 1 lakh, under Fixed Deposit Receipt No. 780406, issued by M/s. India Explosive Ltd. in the name of Jogendra Nath Das as the first depositor and Smt. Abhra Sinha as the joint depositor for a term of three years. Shri Jogendra Nath Das died on 7th April, 1983, leaving Smt. Abhra Sinha as survivor in respect of the said fixed deposit. 2. On the death of Shri Jogendra Nath Das one Shri Arun Kanti Ghose applied for Letters of Administration under section 276 of the Indian Succession Act before the learned District Judge, Malda, in respect of the properties mentioned in the Will of the deceased Shri Jogendra Nath Das, including the amount indicated in the fixed deposit receipt and the same was numbered as O.C. Suit No. 4 of 1984. The said O.C. Suit No. 4 of 1984 was disposed of by the learned District Judge, Malda, by his judgment and decree dated 11th September, 1987, wherein the learned District Judge held that Shri Arun Kanti Ghose and the other plaintiff, Smt. Arati Ghosh, had been able to prove the due execution and attestation of the Will of Shri Jogendra Nath Das and that the testator was mentally alert and physically fit and had the testamentary capacity to execute the Will which was also found to be the last Will of the deceased, Shri Jogendra Nath Das. 3. Pursuant to his aforesaid finding, the learned District Judge, Malda, allowed the application under section 276 of the Indian Succession Act and granted the Letters of Administration in respect of the estate of the deceased, Shri Jogendra Nath Das, to the plaintiffs, namely, Shri Arun Kanti Ghose and Smt. Arati Ghosh. 4. In the aforesaid background, Smt. Abhra Sinha filed a suit, being Title Suit No. 207 of 1983, in the City Civil Court, at Calcutta, inter alia, for declaration of her title in respect of the fixed deposit lying with M/s. India Explosive Ltd. in the joint names of the plaintiff and Jogendra Nath Das, deceased. 4. In the aforesaid background, Smt. Abhra Sinha filed a suit, being Title Suit No. 207 of 1983, in the City Civil Court, at Calcutta, inter alia, for declaration of her title in respect of the fixed deposit lying with M/s. India Explosive Ltd. in the joint names of the plaintiff and Jogendra Nath Das, deceased. On the issues as framed the suit was dismissed by the learned Judge, 12th Bench, City Civil Court at Calcutta, on 20th March, 1993, upon holding that the amount under the Fixed Deposit Receipt belonged exclusively to the deceased, Jogendra Nath Das, as the first depositor who bequeathed the same under a Will which had been probated by the legatee and that by virtue of the Letters of Administration granted to him Shri Arun Kanti Ghose had stepped into the shoes of the first depositor and he was, therefore, entitled to deal with the estate of the deceased, including the money under the fixed deposit in respect whereof the State Bank of India had rightly treated him as the first depositor. 5. F.A. No. 158 of 1995 has been filed by Smt. Abhra Sinha against the said judgment and decree of the learned Judge, 12th Bench, City Civil Court at Calcutta, dismissing her suit. 6. While the aforesaid suit filed by Smt. Abhra Sinha was pending, Shri Arun Kanti Ghose as the Administrator and legatee of the last Will of Late Jogendra Nath Das filed a separate suit in the City Civil Court at Calcutta, being Title Suit No. 1430 of 1988, inter alia, for a declaration that he was entitled to recover the money deposited under the Term Deposit Receipt No. 382218 dated 15th March, 1982, along with interest thereon, made by the deceased Jogendra Nath Das, with the State Bank of India at its Surya Sen Street Branch. In the said suit it was contended that the term deposit had been made in the joint names of the depositor, Jogendra Nath Das and Smt. Aruna Sinha, the defendant No. 2 in the suit, and was made payable to 'Either or Survivor'. It was claimed that the term deposit had been taken from the retirement benefits of Jogendra Nath Das and he had issued a cheque in favour of the State Bank of India from his Savings Bank account for investing the money for the said term deposit. It was claimed that the term deposit had been taken from the retirement benefits of Jogendra Nath Das and he had issued a cheque in favour of the State Bank of India from his Savings Bank account for investing the money for the said term deposit. It was claimed that notwithstanding the fact that the joint term deposit was in the joint names of Jogendra Nath Das and Smt. Aruna Sinha, the latter had no right to claim the money in respect of the term deposit since the same had been bequeathed to the plaintiff, Shri Arun Kanti Ghose, under the Will of Jogendra Nath Das. It was also contended that the defendant bank had wrongly declined to pay the amount comprising the term deposit, together with interest thereon, mainly on account of a claim having been made in respect thereof by Smt. Aruna Sinha. 7. The said suit was dismissed by the learned Judge, 3rd Bench, City Civil Court at Calcutta, by his judgment and decree dated 11th July, 1994, upon his finding that since payment in the term deposit had been made to 'Either or Survivor' the defendant bank was bound to perform its obligation to Smt. Aruna Sinha, in view of the provisions of sections 42 and 47 of the Indian Contract Act and section 45ZA of the Banking (Regulation) Act, 1949. The learned Judge also held that under the aforesaid provisions the defendant bank was bound to pay the money under the term deposit to Smt. Aruna Sinha and that the said money would not come within the purview of the Will of Jogendra Nath Das. 8. Aggrieved by the said decision, Shri Arun Kanti Ghose, has filed F.A. No. 91 of 1995 and, inasmuch as, there were two conflicting decisions, one in favour of Shri Arun Kanti Ghose and the other against him, it was directed by an order dated 2nd September, 1998, that the two appeals be heard together for final disposal. The two appeals were accordingly taken up for hearing together. 9. The only question for decision in these two appeals is whether the joint depositors in respect of the fixed deposit with M/s. India Explosive Ltd., and the term deposit with the State Bank of India, were entitled to payment under the said deposits excluding the claim of the legatee under the Will of Jogendra Nath Das, deceased. 10. 9. The only question for decision in these two appeals is whether the joint depositors in respect of the fixed deposit with M/s. India Explosive Ltd., and the term deposit with the State Bank of India, were entitled to payment under the said deposits excluding the claim of the legatee under the Will of Jogendra Nath Das, deceased. 10. As will be evident from the facts related above, while the learned Judge, 12th Bench, City Civil Court at Calcutta, answered the said question in the negative, the learned Judge, 3rd Bench, City Civil Court at Calcutta, answered the said question in the affirmative. 11. Appearing in support of the appeal, being F.A. No. 158 of 1995, Mr. Shivapada Mukhopadhyay urged that having regard to the provisions of sections 42 and 47 of the Indian Contract Act, as also section 45ZA of the Banking (Regulation) Act, 1949, the learned Judge, 3rd Bench, City Civil Court at Calcutta, had correctly decided that the joint holder of the term deposit with the State Bank of India was entitled to receive the money under the said term deposit on the death of the other joint holder, Jogendra Nath Das. Mr. Mukhopadhyay submitted that the learned Judge had correctly held that the Will executed by Jogendra Nath Das, deceased, had no application as far as the term deposit was concerned and under the aforesaid provisions of the Indian Contract Act and the Banking (Regulation) Act, 1949, the defendant bank was bound to pay the money payable under the term deposit to the joint depositor, Smt. Aruna Sinha, as survivor. 12. Mr. Mukhopadhyay also urged that the learned Judge, 12th Bench, City Court at Calcutta, erred in taking a different view and the judgment of the said learned Judge under appeal was liable to be set aside and the suit was liable to be decreed. 13. In support of his submissions, Mr. 12. Mr. Mukhopadhyay also urged that the learned Judge, 12th Bench, City Court at Calcutta, erred in taking a different view and the judgment of the said learned Judge under appeal was liable to be set aside and the suit was liable to be decreed. 13. In support of his submissions, Mr. Mukhopadhyay referred to and relied on the case of Indranarayan vs. Roop Narayan & Anr., reported in AIR 1971 SC page 1962, wherein while considering section 82 of the Indian Trusts, Act, 1882, the Hon'ble Supreme Court observed that in the case of transfer made by a Hindu of his money in a bank to the joint names of himself and his son on the terms that it is payable to either himself or the survivor, the son can successfully put forward the plea of advancement in his favour if he is able to prove that the transfer was genuine and the father intended that the money should go to the son exclusively after his death. 14. Mr. Mukhopadhyay urged that in the instant case admittedly the money in respect of the fixed deposit with M/s. India Explosive Ltd. belonged to the deceased, Jogendra Nath Das, but that by making the appellant the joint depositor with him, he had intended that the sum payable under the said Fixed Deposit Receipt was to be paid to the appellant after his death. Mr. Mukhopadhyay also submitted that the appellant had received a sum of Rs. 14,667/- towards interest on the fixed deposit after the death of Jogendra Nath Das. Mr. Mukhopadhyay urged that since it was intended by the deceased that the amount payable under the fixed deposit was to be a gift in favour of the joint depositor, such gift took effect on the death of Jogendra Nath Das. Mr. Mukhopadhyay contended that there was a similar intention in respect of the term deposit with the State Bank of India which had been correctly interpreted by the learned trial Judge in the light of the provisions of the Indian Contract Act and the Banking (Regulation) Act, 1949. 15. Mr. Mr. Mukhopadhyay contended that there was a similar intention in respect of the term deposit with the State Bank of India which had been correctly interpreted by the learned trial Judge in the light of the provisions of the Indian Contract Act and the Banking (Regulation) Act, 1949. 15. Mr. Mukhopadhyay then referred to a single Bench decision of this court "in the goods of Nisha Sinha", 1987 (1) C.L.J. page 309, wherein the power of the Probate Court to enter into questions of title of property in an application under section 218 of the Indian Succession Act and the doctrine of advancement in terms of section 80 of the Indian Trusts Act were being considered in relation to a joint fixed deposit account in a bank on the basis that the proceeds on maturity would be payable to 'Either or Survivor'. In the said case also one of the joint depositors died leaving a Will. The question arose as to whether in the probate proceedings a caveator would be entitled to obtain an order of injunction to prevent the other joint holder from receiving the amount payable under the said fixed deposit. 16. While holding that in a probate proceeding the duty of the Probate Court is to decide whether or not a document should be probated as testamentary instrument, and that it was not the duty of the Probate Court to consider any issue as to the title of the testator to the property under the Will, it was also held that in view of the banking laws, on the death of an individual customer the title to his assets vests in his legal representatives and it is only after obtaining Succession Certificate of Probate or Letters of Administration, that the legal representatives are entitled to draw upon or otherwise deal with such account. But when the account is a joint account payable to ‘Either or Survivor’ and one party dies, the survivor is ordinarily entitled to the whole amount. The learned Judge observed that the said proposition was really based on the law of devolution between joint owners or on the custom of bankers or an express or implied agreement. 17. Mr. But when the account is a joint account payable to ‘Either or Survivor’ and one party dies, the survivor is ordinarily entitled to the whole amount. The learned Judge observed that the said proposition was really based on the law of devolution between joint owners or on the custom of bankers or an express or implied agreement. 17. Mr. Mukhopadhyay lastly referred to a Bench decision of the Madras High Court in the case of Hepzibah Annathi Rangachari vs. R. Ananthlakshmi Rangachari, reported in AIR 1975 Madras Page 342, wherein it was held that where there was a joint account in a bank and the amount was payable to either or survivor, the survivor was entitled to draw the amount in his/her own right and Letters of Administration were unnecessary. 18. Mr. Mukhopadhyay urged that in view of the aforesaid pronouncement on the question which is also in issue in the two appeals, the appeal preferred by the legatee under the Will of Jogendra Nath Das, Shri Arun Kanti Ghose, was liable to be dismissed and the appeal filed by Smt. Abhra Sinha was liable to be allowed. 19. Appearing for the respondent No. 3 in F.A. No. 158 of 1995 who is the appellant in F.A. No. 91 of 1995, Mr. D.P. Adhikary, learned advocate, urged that a gift could not be presumed merely on account of the fact that Jogendra Nath Das has included Smt. Abhra Sinha and Aruna Sinha as the joint depositors along with him in the Fixed Deposit Receipt with M/s. India Explosive Ltd. and the term deposit with State Bank of India. Mr. Adhikary submitted that the purported intention of Jogendra Nath Das to create a gift by adding Smt. Abhra Sinha and Aruna Sinha as the joint depositors with him would have to be normally established in respect of the money payable under the fixed deposit and the term deposit and the same could not be presumed. Mr. Adhikary submitted that the provisions of sections 42 and 47 of the Indian Contract Act and/or section 45ZA of the Banking (Regulation) Act, 1949 would not have application in the facts of the instant case. Mr. Adhikary submitted that the provisions of sections 42 and 47 of the Indian Contract Act and/or section 45ZA of the Banking (Regulation) Act, 1949 would not have application in the facts of the instant case. It was urged that the plea of advancement considered by the Hon'ble Supreme Court in the case of Indranaryan (supra) could not also be applied to the facts of the instant case, having regard to the execution of the Will by Jogendra Nath Das in respect of the sums payable under the fixed deposit with M/s. India Explosive Ltd. and the term deposit with the State Bank of India. Mr. Adhikary submitted that the said decision was distinguishable on such ground and could not be relied upon to answer the question raised in the instant appeals. 20. Mr. Adhikary also referred to the decision of the learned Single Judge in the goods of Nisha Sinha (supra) wherein a caveator sought to injunct the sole legatee under a Will from claiming the proceeds of the joint account held in the name of the deceased and the said legatee. Mr. Adhikary submitted that the facts of the said case were completely different in view of the fact that the legatee under the Will was himself one of the joint holders of the account in question, and, in any event, the learned Judge refused to grant injunction as prayed for by the caveator. 21. As to the Bench decision of the Madras High Court in the case of Hepzibah Annathi Rangachari (supra), Mr. Adhikary referred to a Bench decision of the Andhra Pradesh High Court in the case of Dalavai Nagarajamma vs. State Bank of India, Cuttapah & Ors., reported in AIR 1961 Andhra Pradesh Page 320, wherein a view contrary to the view expressed in the Madras judgment was taken to the effect that a deposit by a Hindu of his money in a bank in the joint names of himself and his wife or another person and on the term that it is payable to 'Either or Survivor' does not on his death constitute a gift by him to the latter. On the contrary, there is a resulting trust in his favour in the absence of proof of a contrary intention. Accordingly, on his death the money in deposit becomes payable to his heirs as his absolute property. 22. Mr. On the contrary, there is a resulting trust in his favour in the absence of proof of a contrary intention. Accordingly, on his death the money in deposit becomes payable to his heirs as his absolute property. 22. Mr. Adhikary also referred to a Bench Decision of the Hon'ble Supreme Court in the case of Sarvati Devi & Anr. vs. Usha Devi, reported in AIR 1984 SC page 346. In the said case what fell for consideration was whether a nomination made in a Life Insurance Policy creates an absolute right to the amount due in favour of the nominee. Rejecting such a proposition, the Hon'ble Supreme Court held that mere nomination made under section 39 of the Insurance Act does not have the effect of conferring on the nominee any beneficial interest in the amount payable under the Life Insurance Policy on the death the of the insurer. The nomination only indicates the hand which is authorised to receive the amount, on the payment of which the insurer gets a valid discharge of his liabilities under the policy. However, the amount could be claimed by the heirs on the insurer in accordance with the law of succession governing them. 23. Certain other decisions on the same lines were also cited by Mr. Adhikary in support of his contention that the inclusion of a person as one of the joint holders of a fixed deposit of term deposit did not automatically entitle such person to receive the money payable under the said instruments on the death of the principal depositor. 24. On behalf of M/s. India Explosive Ltd. and State Bank of India, it has been contended that the company could have no hesitation in paying the amounts under the Fixed Deposit Receipt and the Term Deposit to the person/persons entitled to receive the same in law. 25. We have carefully considered the submissions made on behalf of the respective parties and we are inclined to agree with Mr. Adhikary that although normally in a deposit made on the basis of the condition that the same on maturity would be payable to either the first depositor or the survivor payment would be made to the survivor, the position would stand altered when a Will made by the first depositor intervened. Adhikary that although normally in a deposit made on the basis of the condition that the same on maturity would be payable to either the first depositor or the survivor payment would be made to the survivor, the position would stand altered when a Will made by the first depositor intervened. In such a case, in order that a plea of advancement should succeed the intention of the first depositor to create a gift in favour of the joint depositor would have to be established. In our view, the provision of sections 42 and 47 of the Indian Contract Act and section 45ZA of the Banking (Regulation) Act, 1949, relied upon by the learned Judge, 3rd Bench, City Civil Court at Calcutta in arriving at the conclusion that the defendant bank was bound to pay the money payable under the terms deposit to the joint depositor, would not be attracted to the facts of the instant case. While section 42 of the Indian Contract Act speaks of a promise made by one or more persons and the devolution of the joint liabilities in respect thereof, the same stands abrogated by the Will executed by the principal depositor which indicates to whom payment of the amount payable in respect of the deposit is to be made. 26. Section 45ZA of the Banking (Regulation) Act contemplates nomination on the death of a sole depositor, which is not the case before us. In the situation contemplated in section 45ZA of the above Act the nomination made by the depositor or depositors would prevail over any testamentary disposition. However, the same would apply only where a nomination is made in the circumstances indicated in the section itself. In our view, the learned Judge, 3rd Bench, City Civil Court at Calcutta, misapplied the provisions, both of the Indian Contract Act as also the Banking (Regulation) Act, 1949, in coming to the conclusion that the joint depositor and not the legatee under the Will of Jogendra Nath Das; deceased, would be entitled to the amount payable under the Term Deposit made out of the funds provided by Jogendra Nath Das. We are inclined to agree with the view expressed by the Division Bench of the Andhra Pradesh High Court that no intention to create a gift could be presumed in favour of a joint depositor unless a specific intention to the said effect was proved. We are inclined to agree with the view expressed by the Division Bench of the Andhra Pradesh High Court that no intention to create a gift could be presumed in favour of a joint depositor unless a specific intention to the said effect was proved. Following the decision of the Hon'ble Supreme Court in Sarvati Devi's case cited by Mr. Adhikary, we are of the view that the joint depositors would have been entitled to receive the amounts under the Fixed Deposit and Term Deposit if the Will of Jogendra Nath Das had not intervened. In our view, the joint depositors had no title to the moneys in the absence of any intention of the first depositor to create a gift in their favour. On the death of the first depositor, the said moneys became part of the estate of Jogendra Nath Das and the legatee under this Will became entitled to receive the same. 27. As far as the joint depositor in respect of the fixed deposit made by Jogendra Nath Das with the India Explosive Ltd. is concerned, it has been clearly noted by the learned Judge, 12th Bench, City Civil Court at Calcutta, that the first depositor had not given any instruction that the amount was payable on the death of one of the depositors to the survivor of the two depositors. There was, therefore, no condition that the amount payable under the said fixed deposit would be payable either to the first depositor or his survivor. Accordingly, the arguments advanced on behalf of Smt. Abhra Sinha cannot be accepted in the absence of any intention of the first survivor to create a gift in her favour. 28. In the aforesaid circumstances, the appeal preferred by Smt. Abhra Sinha (F.A. No. 158 of 1995) fails and is, accordingly, dismissed, while the appeal filed by Shri Arun Kanti Ghose (F.A. No. 91 of 1995) is allowed. The judgment and decree passed by the learned Judge, 12th Bench, City Civil Court at Calcutta, in Title Suit No. 2071 of 1983 on 20th March, 1993, forming the subject matter of F.A. 158 of 1995 is affirmed. The judgment and decree passed by the learned Judge, 3rd Bench, City Civil Court at Calcutta, in Title Suit No. 1430 of 1998 on 11th July, 1994 is set aside, and the suit filed by the plaintiff stands decreed with costs. The judgment and decree passed by the learned Judge, 3rd Bench, City Civil Court at Calcutta, in Title Suit No. 1430 of 1998 on 11th July, 1994 is set aside, and the suit filed by the plaintiff stands decreed with costs. It is declared that the appellant/plaintiff is entitled to recover the money deposited in Term Deposit Receipt No. 382218 dated 15th March, 1982, along with interest thereon, as Administrator and legatee under the last Will of Late Jogendra Nath Das. The State Bank of India, being the respondent No. 1/ defendant, is permanently restrained from making any payment in respect of the said term deposit to the respondent/defendant No. 2 Smt. Aruna Sinha. G.C. De, J.: I agree. F.A. No. 158 of 1995 dismissed. F.A. No. 91 of 1995 allowed.