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2011 DIGILAW 622 (MAD)

E. S. Neeraja v. Indian Bank, Mylapore

2011-02-07

VINOD K.SHARMA

body2011
JUDGMENT : 1. The petitioner has invoked the writ jurisdiction of this Court, with a prayer for issuance of writ, in the nature of Certiorari for quashing the notification dated 13.08.2004, with a further prayer for issuance of writ in the nature of mandamus, directing the respondents 1 and 2 to pay the amount of Rs.1,35,063.41 towards interest and corpus due, under the DSRGE A/c No.8 Deposit with future interest, till the date of payment. 2. The petitioner deposited a sum of Rs.5 lakhs, being the retiral benefits under the DSRGE A/c No.8, with the Indian Bank, Mylapore Branch, Chennai on 22.01.2001. The amount was received by the Indian Bank under the scheme formulated vide notification dated 30.6.1989, 07.07.1989 and 26.7.1989. The rate of interest payable under the said scheme was 9% p.a. It was payable every six months i.e. ending 30th June and 30th December every year. In the said scheme, it was also provided, that on expiry of three years, if the deposit is continued, the balance amount in the account will earn interest at the same rate till the account is closed. 3. The Central Government reserved the power to relax any condition of the scheme. The petitioner's claim is that the scheme was for the benefit of retiral Government servants as whole of the interest on the deposit was exempted from Income Tax. 4. It is the case of the petitioner that from the very beginning, the Bank did not pay interest at 9% p.a. as promised under the scheme,therefore the due towards interest arrears comes to Rs.11,383/-. The further case of the petitioner is that on the representation made by the petitioner complaining about the interest payment, it is not only to the respondents, but the Reserve Bank of India also sent no reply. 5. The following table shows the payment of interest and arrears due from the first respondent Bank. The Table showing entries in the pass book for payment of interest & arrears; Due date period ending Date of payment of interest Amount paid Arrear amount due 21.01.2001 to 31.06.2001 3.7.2001 Rs.18,852 Rs.900/- 31.12.2001 8.1.2002 Rs.21.250/- Rs.1250/- 30.06.2002 5.7.2002 Rs.20,240/- Rs.2360/- 31.12.2006 14.1.2003 Rs. 20,000/- Rs.2,500/- 30.6.2003 08.07.2003 Rs.20,000/- ---- For the same 5.10.2003 Rs.2,500/- ------ period 31.12.2003 08.01.2004 Rs.17,644/- ----- For the same 22.5.2004 Rs. 20,000/- Rs.2,500/- 30.6.2003 08.07.2003 Rs.20,000/- ---- For the same 5.10.2003 Rs.2,500/- ------ period 31.12.2003 08.01.2004 Rs.17,644/- ----- For the same 22.5.2004 Rs. 4,856/- ------ period 30.6.2004 10.7.2004 Rs.18,024/- Rs.4473/- ----------- Rs.11,383/- ----------- Arrears upto 30.06.2004 31.12.2004 13.3.2005 Rs.22,500/- 30.06.2005 27.7.2005 Rs.22,500/- 31.12.2005 11.2.2006 Rs.22,500/- 30.06.2006 ----- ----- Rs.22,500/- 30.12.2006 ----- ------ Rs.22,500/- ------------------------ Rs.45,000/- Amount deducted from Corpus on 30.12.2006 .... Rs.67,500/- Total arrears due Rs.11,833 plus Rs.45,000 + Rs.67,500 .... Rs.1,23,883 Interest on them comes to .... Rs.11,180.41 6. It is the case of the petitioner that the Bank by way of communication dated 21.2.2004, on the request made for withdrawal of corpus, wrote to the petitioner that he was entitled to interest at the rate of 9% p.a only up to 22.1.2004. 7. The Indian Bank i.e. the respondent released a sum of Rs.4,39,596/- on the ground that the petitioner was wrongly paid interest on deposit, even after withdrawal of the scheme, therefore excess interest paid was to be deducted from the corpus. 8. This Court is not to adjudicate as to whether the petitioner is entitled to interest on this amount or not, as it is not open to the petitioner to challenge the notification dated 13-08-2004 at this stage, especially when the petitioner has himself withdrawn the deposit under the scheme. 9. The case of the petitioner, is that he was entitled to refund of corpus of Rs. 5 lakhs, without any deductions. 10. The respondent Bank deducted the sum of Rs.67,500/- from the corpus, stating that since the Reserve Bank of India had refused and disallowed the interest to the first respondent, therefore the amount of interest paid to him was required to be deducted. 11. The petitioner therefore challenged the notification vide which the scheme was withdrawn, on the ground that it being a beneficiary scheme for the retired persons, it could not have been unilaterally withdrawn, or in any case, not retrospectively, to the detrimental of the persons, who under the scheme, had deposited their hard earned retiral benefits. 12. This contention is opposed by the learned counsel for the respondent by contending, that challenge to scheme is highly belated, as the petitioner was aware of the withdrawal of the scheme in the year 2004,whereas the present writ petition has been filed after the period of 4 years. 13. 12. This contention is opposed by the learned counsel for the respondent by contending, that challenge to scheme is highly belated, as the petitioner was aware of the withdrawal of the scheme in the year 2004,whereas the present writ petition has been filed after the period of 4 years. 13. On consideration of respective contentions, it is held that it is now not open to the petitioner to challenge the scheme after he has opted out of the scheme by withdrawing the amount. The petitioner has not concerned with the scheme under challenge. The challenge to scheme otherwise also, is liable to be rejected on the ground of delay and laches. 14. Learned counsel for the petitioner challenged the action of the respondent in deducting a sum of Rs.67,500/-on the ground, that inspite of withdrawal of scheme, the bank did not take any steps, to refund the amount by making an offer rather, the petitioner was paid interest on half yearly basis, on the deposit. It was only when the petitioner sought for refund, that the respondent bank deducted a sum of Rs.67,500/-, by claiming the amount to have been paid in excess towards interest, after the withdrawal of scheme by the Central Government. 15. The contention of the learned counsel for the petitioner is that the action of the respondent bank cannot be sustained. 16. Firstly, for the reason that it is well settled law that the amount which is paid even wrongly without attributing any fraud or misrepresentation to the beneficiary cannot be subsequently recovered. 17. Secondly that in spite of closure of the scheme, the respondents retained the money of the petitioner, without offering the refund. Therefore, it is not open to the respondent now to deduct the amount from the corpus. 18. On consideration, it is held that the action of the respondent on the face of it is arbitrary and therefore hit by Article 14 of the Constitution of India, inasmuch as on the closure of the scheme, it was the duty of the bank to refund the corpus, to the petitioner, though under normal circumstances, petitioner would be entitled to interest also, as per scheme, but on the notice issued by the petitioner, it was admitted that the petitioner had come to know about the closure of the scheme. Therefore, petitioner cannot claim the future interest at the rate of 9% p.a. on the amount retained as he would only be entitled interest at normal rate payable on deposit with the Bank, the petitioner is entitled to refund the amount of Rs.67,500/- deducted from the corpus, with normal rate of interest. 19. Learned counsel for the respondent challenged the maintainability of the writ petition on the ground that the relief claimed is for refund of determined amount, therefore he is to file a civil suit as the remedy of writ can be availed for recovery of money. 20. This contention of the learned counsel for the respondent deserves to be noticed to be rejected, for the simple reason that the petitioner is not claiming the amount, but has challenged the action of the respondent in deducting interest paid to the petitioner, out of the corpus. There is no bar to exercise the jurisdiction under Article 226 of the Constitution to set aside a decision of State authority which on the face of it is arbitrary and amounts to colourable exercise of powers. The money claim is only consequence of setting aside of decision, that too, when the facts are not in dispute. The restriction to exercise powers under Article 226 of the Constitution is self imposed otherwise there is no bar to entertain even money claiming on admitted facts. 21. The contention of the learned counsel for the respondent that the scheme, under which, the money was deposited by the petitioner was withdrawn by the Central Government. The respondents 1 & 2 therefore, cannot be blamed, as action taken was in view thereof. It is also the contention of the learned counsel for the respondents that the benefit of deposit under the scheme was going to the Central Government whereas the bank who was only entitled to some commission, therefore the petitioner cannot raise claim against the respondent Bank. This contention is misconceived. It is not in dispute that the money was retained by the bank and was not offered/given to the petitioner. The respondent bank, on the closure of the scheme, used the money for its commercial business. It is not correct on the part of the Bank now to say that the amount was lying with the Bank, as admittedly on closure of scheme, the amount was neither transferred to the Central Government nor to the petitioner. The respondent bank, on the closure of the scheme, used the money for its commercial business. It is not correct on the part of the Bank now to say that the amount was lying with the Bank, as admittedly on closure of scheme, the amount was neither transferred to the Central Government nor to the petitioner. In view of admitted facts, there is absolutely no justification with the respondent bank to deduct a sum of Rs.67,500/- (Rupees sixty seven thousand five hundred only) from the corpus fund. 22. For the reasons stated above, this writ petition is allowed, while challenge to the notification of the Central Government is rejected, but the claim of refund of amount wrongly deducted from the corpus is accepted. The respondent Bank is directed to refund an amount of 67,500/- along with interest @ rate of 6% p.a. from the date of deduction till date of payment. 23. The payment be made to the petitioner, within a period of one months of receipt of certified a copy of this order. No costs. Consequently, M.P.No.1 of 2008 is also closed.