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2021 DIGILAW 436 (TS)

G. Surya Kumari v. Union Bank of India

2021-12-27

B.VIJAYSEN REDDY

body2021
ORDER : Aggrieved by the action of the respondents - Union Bank of India in freezing / blocking the petitioner’s Pension Bank Account bearing No.052110025053522 maintained with respondent No.1 - Union Bank of India, Saidabad Branch Office, Saidabad, Hyderabad, and attempting to adjust the amounts standing to the credit of her pension account as being illegal, arbitrary and unsustainable, this writ petition is filed by the petitioner. 2. Heard Sri M. Ramu, learned counsel for the petitioner, and Dr. K. Lakshmi Narasimha, learned counsel for the respondents - bank, and perused the material on record. 3. The case of the petitioner is that she is a retired Government employee. She is 67 years old. Her husband expired long back. The petitioner worked as attendant in the Income Tax Department and retired from service on attaining age of superannuation in 2007. After retirement, she is solely dependent on her monthly pension amount credited to her pension account maintained with respondent No.1 bank. She is totally dependent on her bank debit card connected to her pension account. As per the Reserve Bank of India guidelines, pension distributing banks have been asked to record the Pension Payment Order (PPO) number on the bank account passbook of its customers. Accordingly, the bank has mentioned her Pension Payment Order (PPO) No.00000070 on her bank pass book. (ii) The petitioner went to her nearest bank branch on 17.02.2021 for issue of new debit card. Then she was informed by the bank executive that new card will be issued and it will be activated from 19.02.2021. She was not able to withdraw money from the ATM by using her debit card for the reason of transaction declined, unable to process and unauthorised usage. When she enquired with the bank, the petitioner was informed that her pension account is blocked by the bank which is without any information and notice to her. (iii) It is stated that respondent No.1 bank has filed a civil suit in O.S. No.213 of 2015 for recovery of money on 28.02.2015 before the learned XVIII Additional Senior Civil Judge, City Civil Court at Hyderabad, inter alia, contending that one of its borrowers availed loan facility of Rs.2,60,000/- on 12.04.2010 and the petitioner is one of the guarantors for the said loan. The petitioner strongly denied the suit transaction on various grounds including on the point of limitation and discrepancies in the case of the respondents - bank. The said suit was dismissed for default on 20.08.2019 as the bank did not pursue the case. The petitioner has submitted complaints dated 22.02.2021 and 24.02.2021 to the respondents - bank requesting for de-freezing her pension account. (iv) Since no action has been taken by the bank, petitioner has issued legal notice dated 07.03.2021 and reply was issued by the bank vide notice dated 20.03.2021 through email dated 22.03.2021 admitting the fact of blocking the petitioner’s pension bank account and by asserting that it is done in exercise of its right of set-off, adjust and bankers general lien against the pension amount. 4. The learned counsel for the petitioner has submitted that the action of the respondents - bank in blocking the pension account of the petitioner is in gross violation of proviso (g) to Section 60(1) of the Code of Civil Procedure, 1908 (for short ‘CPC’) and Section 11 of the Pension Act, 1871. It is further submitted that the property contemplated under Article 300-A of the Constitution of India, includes pension, as such, action of the bank in depriving the petitioner of her pension amounts to violation of the constitutional rights. Further, in view of the law laid down by the Hon’ble Supreme Court in Radhey Shyam Gupta v. Punjab National Bank, (2009) 1 SCC 376 , pension and gratuity amounts cannot be attached. 5. The case of the respondents - bank is that son of the petitioner Mr. Gajadi Sanjeev Kumar has availed an educational loan of Rs.4,00,000/- (Rupees four lakhs only) for prosecuting M.B.A. at Wolverhampton University, U.K., on 05.02.2010. The petitioner stood as personal guarantor for the said loan and also for the loan taken by her another son viz., Gajadi Kiran Kumar. The petitioner and her son as co-obligants failed to repay the loan availed by them. The suit in O.S. No.213 of 2015 was filed by respondent No.1 before the learned VII Senior Civil Judge, City Civil Court, Hyderabad, against the petitioner and her sons and the same was dismissed for non-representation on 20.08.2019. An application was filed by the bank for restoration of the suit. The suit in O.S. No.213 of 2015 was filed by respondent No.1 before the learned VII Senior Civil Judge, City Civil Court, Hyderabad, against the petitioner and her sons and the same was dismissed for non-representation on 20.08.2019. An application was filed by the bank for restoration of the suit. (i) It is submitted that the petitioner had opened Abhaya Gold Savings Bank Account bearing No.052110025053522 with the respondents - bank on 10.12.2007. On retirement of the petitioner from service, at her request, the pension received from the Government of India is being credited to the said account without opening an exclusive pension account. The petitioner was making other transactions also through the said account. Thus, the account of the petitioner is not exclusive pension account, but it is like any other ordinary savings bank account. Once the amount of pension is credited to the account and it is mixed up with other amount in the account, it loses its character of pension. Hence, the banker is entitled to exercise the right of set-off and banker’s general lien towards amounts due to it. 6. There is no dispute regarding proposition of law that pension account cannot be frozen or attached as per Section 60(1)(g) of CPC and Section 11 of the Pension Act, 1871. However, the dispute in this case is whether the pension account of the petitioner is an exclusive pension or not? 7. The petitioner has filed additional documents vide memo dated 16.08.2021. The bank statement of account indicates that periodical pension amount of Rs.17,350/- have been deposited in the account of the petitioner. To rebut such evidence, the respondents bank have not produced any evidence. Further, to substantiate the claim that other amounts of the petitioner have been credited to the pension account of the petitioner, the respondents - bank have not produced any material. There is an absolute bar under Section 60(1)(g) of CPC read with Section 11 of the Pension Act, 1871, for attaching pension amounts. In the counter filed by the respondents - bank, the bar under the above provisions and proposition of law enunciated in Radhey Shyam Gupta’s Case (Supra 1) are not disputed. The principal contention of the respondents - bank is that the account of the petitioner is not an exclusive pension account. In the counter filed by the respondents - bank, the bar under the above provisions and proposition of law enunciated in Radhey Shyam Gupta’s Case (Supra 1) are not disputed. The principal contention of the respondents - bank is that the account of the petitioner is not an exclusive pension account. The argument of the learned counsel for the respondents - bank that the character of pension account changes if other amounts are credited into that account other than pension amount, is without any merit. At the most, the respondents - bank may have claim over the amounts which are credited other than the pension amounts. However, in the instant case, there is no proof of such contention of the respondents -bank that other amounts of the petitioner are also lying in the pension account of the petitioner. In any case, the suit of the bank filed for recovery of amounts against the petitioner and her two sons was also dismissed for default and so far, it is not restored. Even if the respondents - bank are to exercise their right of lien, they are entitled to do so only to the extent of the amounts deposited in the bank other than pension amounts. 8. The judgment of the Hon’ble Supreme Court in Syndicate Bank v. Vijay Kumar, (1992) 2 SCC 330 relied on by the learned counsel for the respondents - bank is not applicable to the facts of the present case. The said matter is no way connected to the pension amounts or account. The issue involved therein is the right of general lien of the banker over the fixed deposits of the borrower which is not the controversy herein. 9. In State of Jharkhand v. Jitendra Kumar Srivastava, (2013) 12 SCC 210 , it was held that right to receive pension was treated as right to property under Article 300-A of the Indian Constitution. Paragraph No.16 of the judgment reads as under : “16. The fact remains that there is an imprimatur to the legal principle that the right to receive pension is recognised as a right in “property”. Paragraph No.16 of the judgment reads as under : “16. The fact remains that there is an imprimatur to the legal principle that the right to receive pension is recognised as a right in “property”. Article 300-A of the Constitution of India reads as under: “300-A. Persons not to be deprived of property save by authority of law.— No person shall be deprived of his property save by authority of law.” Once we proceed on that premise, the answer to the question posed by us in the beginning of this judgment becomes too obvious. A person cannot be deprived of this pension without the authority of law, which is the constitutional mandate enshrined in Article 300-A of the Constitution. It follows that attempt of the appellant to take away a part of pension or gratuity or even leave encashment without any statutory provision and under the umbrage of administrative instruction cannot be countenanced.” Thus, a person cannot be deprived of pension without due process of law. As noted above, there is a bar under Section 60(1)(g) of CPC read with Section 11 of the Pension Act, 1871, for attaching the pension amounts and the respondents - bank is debarred from exercising lien on the pension account. 10. In Radhey Shyam Gupta’s Case (Supra 1), the dispute involved was regarding attachment of pension and gratuity amounts which were converted into fixed deposit receipts. The contention of the bank placing reliance on the judgment of the Hon’ble Supreme Court in Union of India v. Jyoti Chit Fund and Finance, (1976) 3 SCC 607 was that once payments (pension and gratuity) are made, their character stood altered as they become mixed with the other assets of the employee concerned [Paragraph No.27 in Radhey Shyam Gupta’s Case (Supra 1)]. However, such contention was impliedly rejected by making the following observations : “33. However, we are also of the view that having regard to proviso (g) to Section 60(1) of the Code, the High Court committed a jurisdictional error in directing that a portion of the decretal amount be satisfied from the fixed deposit receipts of the appellant held by the Bank. The High Court also erred in placing the onus on the appellant to produce the Matador in question for being auctioned for recovery of the decretal dues. The High Court also erred in placing the onus on the appellant to produce the Matador in question for being auctioned for recovery of the decretal dues. In other words, the High Court erred in altering the decree of the trial court in its revisional jurisdiction, particularly when the pension and gratuity of the appellant which had been converted into fixed deposits, could not be attached under the provisions of the Code of Civil Procedure. The decision in Jyoti Chit Fund case has been considerably watered down by later decisions which have been indicated in para 22 hereinbefore and it has been held that gratuity payable would not be liable to attachment for satisfaction of a court decree in view of proviso (g) to Section 60(1) of the Code.” 11. The statement of account of the petitioner shows remittance of Rs.1,000/- every month (other than pension of Rs.17,350/-), the details of which are not known. In any case, applying the ratio laid down in Radhey Shyam Gupta’s Case, this Court holds that the character of the petitioner’s account does not change merely because some other amounts have been remitted in the account. 12. Though there is a distinction between ‘lien’ and ‘attachment’, it needs to be noted that the underlying object of ‘lien’ is to appropriate or adjust the funds of the borrower, which the bank has in its possession, for recovering dues to he borrower. Thus, the analogy under provision (g) to Section 60(1) of CPC applies in as much as there is a statutory mandate debarring attachment sale of pension amounts. 13. Therefore, the respondents - bank are directed to forthwith defreeze the pension account of the petitioner to the extent of her pension amounts. The respondents - bank are further directed to issue debit card / ATM card to the petitioner. However, it is made clear that the respondents - bank are at liberty to attach the amounts in the pension account of the petitioner other than the pension amounts, if they are already lying in the account or deposited in future. 14. Accordingly, the writ petition is allowed to the extent indicated above, at the admission stage itself. No order as to costs. As a sequel thereto, miscellaneous petitions, if any, pending in the writ petition stand closed.