“Since the direct and relevant evidence has been withheld, the benefit of doubt for such failure ought to be accorded to the Appellant.”
Noticing the non-production of these relevant ledgers by the Bank, the Bench was of the view that,
With respect to the charge of ‘deceit’, the depositions of the Auditor and Accountant unveiled that though the relevant entries were missing in the Current Account Ledger, they did find a mention in the Officer’s Cash Scroll and the Cashier Payment Register. Therefore, the Bench held that the Bank did not suffer any loss. The case of the Prosecution rested heavily on the premise that the three cheques in question were passed even though there weren’t adequate funds in account however, the Auditor and the accountant had testified about there being sufficient funds in account throughout which was corroborate the Current Account Ledger for account in question. “Since no explicit prohibition on issuing of loose cheques has been proved, the mere fact that the Appellant issued those loose cheques, is not sufficient to conclude that he acted unlawfully or committed a ‘criminal misconduct’.” Noticeably, the record though clearly revealed that issuance of a loose cheque was a departure from the standard operating procedure followed at the Bank, but no evidence had been led that it was an ‘illegal practice’ as in certain contingencies the Bank could issue loose cheques also. Fraudulent and unlawful withdrawal of Rs. Further accused 2 and accused 3 were acquitted of all the other charges, while the appellant was held guilty and was convicted and sentenced to five years imprisonment along with various fines. The Courts below acquitted all the accused of offences under Section 120B IPC. The case was referred to CBI for offences under Sections 409, 477(A), and 120B Penal Code, 1860 and Section 13(2) read with 13(1)(c) & (d) of the Prevention of Corruption Act, 1988. 10,00,000 and 4,00,000 respectively, and stood in the name of one B. The Appellant was further accused of prematurely closing two FDRs for a sum of Rs. The endorsement on the third cheque showed the payment in favour of the accused 3 however, the signature on the cheque did not tally with that of accused 3.
The prosecution contested that the Appellant, in his capacity as a Branch Manager, issued three loose-leaf cheques and despite withdrawal of the said amount, the debit was deliberately not entered into the ledger book. 10,00,000 from the account of the Academy in spite of availability of requisite funds for such withdrawal. Raghavender, Branch Manager of Sri Rama Grameena Bank along with accused 2 abused their respective position in the Bank and conspired with accused 3-Treasurer of the Nishita Educational Academy and brother-in-law of Appellant, by allowing withdrawal of amounts up to Rs. The prosecution case was that the Appellant-N. Such a relationship between the customer and the Bank is one of a creditor and a debtor.
The money so deposited becomes a part of the banker’s funds who is under a contractual obligation to pay the sum deposited by a customer to him on demand with the agreed rate of interest. Ramana, CJ., Surya Kant* and Hima Kohli, JJ., held that the Bank is not the trustee of the money that a customer deposits in a bank and the same is not held by the former on trust for him.