Harish Chandra, J. - (1.) THIS is a revision application by one Jodha Ram directed against an order by a first class magistrate of Dahra Dun discharging the four opposite parties against whom a complaint had been instituted by the applicant under Sections 417, 419 and 477 -A of the Indian Penal Code. Opposite parties 1 and 2 are the Manager and the Managing Director respectively of the Chawla Bank Limited, Dehra Dun, while opposite parties 3 and 4 are the Directors of the same bank. The applicant himself is the proprietor of a firm styled Jodha Ram Bhagwan Das. The Bank had its head quarters at Bannu in the North West frontier Province of Undivided India, but after the partition it transferred its head quarters to Dehra Dun. At Bannu there was a wholesale cloth Association and the applicant's firm was one of the thirty members of the Association. The facts have been stated in the judgment of the learned Sessions Judge. The Association had to its credit a sum of Rs. 3,90,000 in the Chawla Bank Limited at Bannu. By telegraphic transfers a sum of about Rs, 3,00 000 was transferred to the Dehra Dun branch of the bank' between the 6th and the 27th. October, 1947 and this sum was placed to the credit of the Association in the accounts of the branch at Dehra Dun. A further sum of Rs. 90,310 was to be credited by the Dehra Dun branch to the account of the Association under a credit advice aid to have been issued by the Bannu Office on the 25th November, 1947. A cheque for Rs. 12,000 (Ex. P2) was presented through the Dehra Dun branch of the Imperial Bank of India for payment at the Dehra Dun branch on behalf of the applicant on the 8th January, 1949, but the cheque was not paid by the bank for the reason "funds drawn against not received". Previous to that there was some correspondence between the applicant and the bank in their letter (Ex. p5) dated December. 1949, told the applicant that they had not received any instructions from the Syndicate or a copy of their resolution which was said to have authorised the payment of a sum of Rs. 13,000 to each of its members. In another post -card dated the 6th January, 1948, they further informed him that the money had not yet been received from the Syndicate and that they had not accordingly credited anything to his account. It would appear that the Bannu branch had addressed a letter (Ex. P -l) dated the 25th November, 1947, to the Dehra Dun branch in which they referred to a resolution passed by the Bannu Wholesale Cloth Association at their meeting held on the 18th November, 1947, authorizing the crediting of the accounts of all the thirty members of the Association with a sum of Rs. 13,000 each. One of the member firms was divided into two portions, one represented by Dr. Kripa Ram and another by Murli Dhar and they were to be paid a sum of Rs. 6, 500 each instead of the total amount of Rs 13,000 being credited to the firm Ram Vishan Das, but with that we are not concerned.
(2.) THE applicant's case is that the reason given by the bank for not cashing the cheque, namely, that the funds drawn against had not been received, was false and had been dishonestly given and this is the basis of the charge under Section 417 of the Indian Penal Code. One of the charges in the complaint also was that the accused had withdrawn, various sums from the bank dishonestly taking undue advantage of their position and had thereby committed offences under Section 409 of the Indian Penal Code, This charge, however, was not pressed before the learned Sessions Judge and for obvious reasons. The complainant in his statement on oath admitted that the accused had only withdrawn money standing to their credit in their respective accounts although in the original complaint it had been said that they had dishonestly withdrawn sums to the tune of Rs. 2,00.000 from the bank. The charge under Section 477 -A of the Indian Penal Code is based on the allegation that the credit advice received by the Dehra Bun branch from Bannu along with the letter dated the 25th November, 1947, authorizing payment of Rs. 13,000 each to the thirty members of the association had dishonestly not been entered by the accused in their registers. The learned Magistrate on a consideration of the evidence held that no case had been made out against the opposite parties and discharged them. A revision application •was presented to the learned Sessions Judge and was dismissed by him. The charge under Section 409 of the Indian Penal Code was apparently based on a misconception of the relationship between a customer and a banker. The money that a customer deposits in a bank is not held by the latter on trust for him. It becomes part of the banker's funds and he is only under a contractual obligation to pay the sum deposited by the customer to him on demand. As pointed out in a Calcutta case, Gopesh Chandra Pal v. Nibnal Kumar Das Gupta : A.I.R. 1950 Cal. 57 "the relationship between the bank and he customer is one of creditor and debtor. The Bank is free to use the money deposited by the customer or constituent in any way it likes and is not bound to keep the money apart. No bank can ever function if it was obligatory on it not to touch the money of a person who makes a deposit in its current account. The bank is liable to pay the money to the customer when called upon but until called upon to pay it the bank is entitled to utilize the money in investment and in, other ways for earning profit therefrom ". An offence under Section 409 "pre -supposes an entrustment". In an earlier case, S. Pakrasi v. Emperor : A.I.R. 1941 Cal. 713 a bench of the same court took the same view. In that case the complainant's statement was that he had deposited sums of money with the bank in a current account and used to make withdrawals from his account from time to time. On the date in question he drew a cheque on the bank for a sum of money. There was sufficient balance in the customer's account with the bank and the cheque ought to have been paid, but it was not paid and was returned to the person presenting it with instructions that it. may be presented on a particular day, The cheque was presented thereafter but it was not paid. It appeared that the bank had no money and that the representation made by the bank was not true. It was held that a charge under Section 409 of the Indian Penal Code was not sustainable, having regard , to the relationship between a customer and a banker. Their Lordships give the following quotation in their judgment from the speech in the House of Lords of Lord Cottenham in, (1844 48) 2 H. L. C. 28 at pag 35 . Money when paid into a bank, ceases altogether to be the money of the principal; tee (1842) 1 Ph. 356 at page 360; it is then the money 1 of the banker, who is bound to return an equivalent by paying a familiar sum to that deposited with him when be is asked for it. The money paid into the banker's is money known by the principal to be placed there for the purpose of being under the control of the banker; it is then the banker money; he is known to deal with it as his own he makes what profit of it he can, which profit he retains to himself, paying back only the principal, according to the custom of bankers in some places, or the principal and a small rate of interest, according to the custom of bankers in other places. The money placed in the custody of a banker if, to all intends and purposes, the money of the banker, to do with it as he pleases, he is guilty of no breach of trust in employing it; he is not answerable to the principal if he puts it into jeopardy, if he engages in a hazardons speculation; he is not bound to keep it or deal with it as the property of his principal but he is of course answerable for the amount, because he has contracted, having received that money, to repay to the principal, when demanded, a sum equivalent to that paid into his hands. That has been the subject of discussion in various cases, and that has been established to be the relative situation of banker and customer. That being established to be the relative situations of banker and customer, the banker is not an agent or factor, but he is a debtor. Then the analogy between that case and those that have been referred to entirely fails; and the ground upon which those cases have, by analogy to the doctrine of trusteeship. been held to be the subject of the jurisdiction of a Court Equity, baa no application here, as it appears to me.
(3.) IN my view, having regard to the relationship between a customer and a banker it is not possible in the present circumstances to make out a case under Section 417 either. A debtor may not pay a creditor and may put him off on various grounds. It is not possible in such circumstances to charge the debtor with cheating and he only incurs a civil liability by not fulfilling his contract with his creditor. In the present case there is the further fact that the sum of Rs. 13,000 which the Association had authorised the Dehra Dun branch of the bank to be credited to the account of each of its members had not yet been credited to their accounts. The explanation given by the accused is that this was due to the fact that the amount standing to the credit of the association was only Rs. 3, 00,000 and further sum of Rs. 90,000 had to be credited to its account before a sum of Rs. 13,000 could be credited to the account of each of its members. It is said that although the letter (Ex. P.l) had been received, no instructions had been received regarding the crediting of the account of the Association with a further sum of Rs. 90,000. But even if such instructions had been received the complainant had no right to claim that sum of Rs. 13,000 until the Dehra Dun branch of the bank had actually credited his account with that sum. Until that had been done the payment of any cheque drawn by the complainant against that account could be refused by the bank.;