- (1.) The Court : This is an application for modification and/or correction of the order dated 9th February, 1999 passed by a Division Bench presided over by Ruma Pal, J and Ansari J. (as Their Lordships then were). The appeal arose out of an order passed under section 9 of the Arbitration and Conciliation Act, 1996 by which the learned Trial Court passed an order dated 4th May, 1998 directing the appellant to return the two bank drafts both dated 8th January, 1998 to the bank for cancellation and the Branch Manager, Sayajigunj Branch of Bank of Baroda was directed to invest the money in a separate fixed deposit account free from any lien. It was further directed that the money shall remain to the credit of the arbitration proceedings and shall abide by the result of the arbitrator. The appellant/ petitioner preferred the appeal which was finally disposed of by a judgment and order dated 9th February, 1999. The Appellate Court came to a conclusion that the bank guarantee was unconditional and no case had been made out by the respondent No. 2 warranting an order restraining the bank from making payment under the bank guarantee. The Appellate Court was of the view that the ld. Trial Court had in effect granted injunction restraining enforcement of the two bank guarantees furnished in favour of the appellant/petitioner. After considering the submissions made on behalf of the parties, the appeal was allowed and the order dated 4th May, 1998 passed by the learned Trial Court was set aside.
(2.) The judgment dated 9th February, 1999 itself goes to show that pursuant to the order passed by the learned Trial Court on 4th May, 1998, the appellant/petitioner had in the meantime returned the bank drafts to the bank and the proceeds were invested by the bank in a separate account. The short and simple submissions of Mr. Roy Chowdhury appearing on behalf of the appellant/petitioner is that at the time of disposal of the appeal the Appellate Court should have provided in its order that the interest accrued to the fixed deposit should be made over to the appellant. This is a consequential order which should have been passed. There is no indication in the judgment that the Appellate Court intended to withhold the consequential relief. Omission to do so was really an inadvertent error on the part of the Court. No party should be made to suffer for the omission or error on the part of the Court. The bank has also written to the petitioner that the accrued interest shall be made over to the petitioner provided there is an order of Court to do so. It, therefore submitted that the order dated 9th February, 1999 should suitably be modified or a direction should be issued directing the respondent bank to pay the interest accrued upon the fixed deposit. In support of his submission he relied on a judgment of the Apex Court in the case of Mahijibhai Bhai vs. Patel Manibhai, reported in AIR 1965 SC 1477, wherein the following view was expressed: "It is the duty of the Court under section 144 of the Civil Procedure Code to place the parties in the position which they would have occupied, but for such decree or such part thereof as has been varied or reversed. Nor indeed does this duty or jurisdiction arise merely under the said section it is inherent in the general jurisdiction of the Court to act rightly and fairly according to the circumstances towards all parties invloved."
(3.) In spite of service no one has appeared to oppose this application. We are of the considered opinion that there is a great deal of substance in the submission made by Mr. Roy Chowdhury. The appellant/petitioner returned the bank drafts pursuant to the order of the Trial Court. He had preferred the appeal. The Appellate Court has taken note of the situation and thereafter has set aside the order passed by the Trial Court, After the appeal was allowed and the order passed by the Trial Court was set aside, the bank appears to have paid the principal amount to the appellant/petitioner but has not paid the interest accrued upon the deposit made pursuant to the order of the Trial Court which, in our view, should also have been paid to the appellant. The bank cannot retain the money which was lawfully due to the appellant. The interest earned by the bank is really the money had and received by them to the benefit of the appellant. Therefore, allowing the money to remain with the bank would result in unjust enrichment which should be avoided. It is really on the basis of the theory of unjust enrichment that restitution is directed. If any authority is needed for this view, reference may be made to the judgment in the case of South Eastern Coal Fields Limited vs. State of M.P. (SC) & Ors. reported in 2004(1) ICC 173 wherein it was held that unjust impoverishment as well as unjust enrichment is a ground for resitution. In the self-same judgment as regards remedy to a litigant in a situation arising out of an inadvertent error or omission on the part of the Court. Their Lordships held as follows: "That no one shall suffer by an act of the Court is not a rule confined to an erroneous act of the Court the act of the Court, embraces within its sweep all such acts as to which the Court may form opinion in any legal proceedings that the Court would not have so acted had it been correctly apprised of the facts and the law. The factor attracting applicability of a restitution is not the act of the Court being wrongful or a mistake or error committed by the Court the lest is whether on account of an act of the party persuading the Court to pass an order held at the end is not sustainable has resulted in one party gaining an advantage which it would not have otherwise earned, or the other party has suffered in impoverishment which it would not have suffered but for the order of the Court and the act of such party. The quantum situation depending on the facts and circumstances of a given case, may take into consideration not only what the party excluded would have made but also what the party under obligation has or might reasonably have made. There is nothing wrong in the parties demanding being placed in the same position in which they would have been had the Court not intervened by its interim order when at the end of the proceedings the Court pronounces its judicial verdict which does not match with the countenance its own interim verdict. Whenever called upon to adjudicate, the Court would act in conjunction with what is the read and substantial justice. The injury, if any caused by the act of the Court shall be undone and the gain which the party would have earned unless it was interdicted by the order of the Court would be recorded to or conferred on the party by suitably commanding the party liable to do so. Any opinion to the contrary would lead to unjust if not disastrous consequences. Litigation may turn into a fruitful industry.;