BANK OF INDIA Vs. VIDHI CREATIONS

JUDGEMENT

(1.) THIS common judgment disposes of two cross Original Applications (O.As.). The Bank's O.A. is for recovery of US $ 40976 (equivalent to Rs. 29,60,316.16) with interest @ 18% p.a. The amount sought to be recovered in the other O.A. (filed in Hon'ble High Court of Judicature at Bombay first in point of time and transferred to this Tribunal being in the nature of cross suit) is for recovery of money under following 3 heads:

(2.) For the sake of convenience, the Bank would be referred as the 'applicant' even in the other matter while the applicant in the other O.A. (defendant No. 1 in the Bank's O.A.) would be referred as defendant No. 1 even while referring to the O.A. filed by the Bank. Exhibit numbers, unless indicated otherwise, shall be from O.A. No. 2128 of 2000. 3. The defendant No. 1-Partnership Firm (defendant Nos. 2 and 3 being its partners)--carries business of export of readymade garments. It is Banking with the applicant having current account (No. 11270) since 1989-90. The defendant No. 1 used to hand over to the applicant export bills for collection and/or negotiation who upon receipt of payment the (through Banking channel) from foreign party used to credit in the defendant No. 1 's current account and issue foreign inward remittance certificate. 4. In or about 25.2.1994, defendant No. 1 approached the applicant through its partner with a copy of letter dated 22.2.1994 received from one M/s. Pitt & Company, Hong Kong in which (the letter) there was direction to remit suit of US $ 40996 to the credit of the applicant. The defendant No. 2 requested the applicant to urgently give credit for the amount in the account even while the authenticated payment order was not received though required to be received before giving the credit. Due to good relations and mutual faith and trust, the applicant credited the account of defendant No. 1 a sum of US $ 40976. Subsequently i.e., in or about 17.3.1994 the applicant received in respect of the above transaction Swift Message FM 100 dated 23.2.1994 which was an authenticated payment order for US $ 40976 (minus US $ 20 being commission) from the Bankers Trust. The Swift Message however did not mention the branch of the applicant where because the Bank sought for clarification. Accordingly on 8.3.1994 the Bankers Trust Company in New York by FM 999 clarified that the payment pertained to Mahalaxmi Branch at Bhulabhai Desai Road, Mumbai of the applicant. However, the applicant through oversight and due to bona fide mistake once again gave credit in the defendant No. 1's account of said sum of US $ 40956 on 17.3.1994 forgetting that credit of said amount was already given on 25.2.1994 in anticipation of the receipt of authenticated payment order. The double payment however came to be the light only during reconciliation of the amount on or about August 1997. Immediately thereafter i.e. on or about 30.8.1997 the Bank informed the defendant No. 1 about the same and called upon to refund excess payment of US $ 40976. The defendants however feigned ignorance of the receipt of the double payment. By reply dated 3.9.1997 they denied the same and contended that the two amounts were appropriated towards the below noted invoices: