# 1009· STATE BANK OF INDIA v. SHYAMA DEVI - **Citation:** [1978] 3 S.C.R. 1009 - **Court:** Supreme Court of India - **Decided:** 1978-05-05 - **Case number:** Civil Appeal No. 2476 of 1968 - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1009-state-bank-of-india-v-shyama-devi-7448 - **Pages:** 14 ## Headnote - 1009· STATE BANK OF INDIA v. SHYAMA DEVI May 5, 1978 (R. S. SARKARIA, N. L. UNTWALIA AND P. S. KAILASAM, JJ.). Vicarious liabilily.-··Legal principle which gorerns the 1:icario11s1liability of an .employer for the loss caused to a customer thro11gh the niisdefneanour or negligence of an enlp[oyee. B' The respondent opened a Savings Bank Account being No. 90001 with the appellant's predecessor, the ln1perial Bank of India at its Allahabad Branch, having·been introduced io the B3nk by one Kapil Deo Shukhla, an employee of the bank and a close neighbour of the resprndent and a friend of her husband, C Bhz.g\vati P;asud. On a suspicion about the entries in the respondent'i- Vass Book- made by the employees of the Bank; which had been confirming, and ratifying them from time to tiffie, the respondent sent a notice dated August. 13, 1948 to tl].e defendant bank: The appellant bank replied by its letter dated 14-8-1948 explaining the·. deposit of several items making up to Rs. 1932-2-0 anj denied the alleged dep.O$i1s of Rs. 105, Rs. 4000, Rs. 8000/- •nd Rs. JOO/- sa\'I ..to have been deposite_d through Kapil Dev Shukla. On .November, 30, 1948, the respo,ndent file.ct: a suit iri forma pauperis for the recovery of Rs. 15,54]-10 As. iogether wiili pendente lite and future interest from the appellant's predeCessors. The Trial Court found, except for the items of Rs. 105 and Rs. 4000/ - entered in the pass-book the respondent had deposited other amounts _ mentioned in it and ·that the bank was bound by those entries. Holding that the rules were strictly enforced by the bank and if the bank had accerted an amount larger than the sum of Rs. 5,000/- in contravention of its Rules, the respondent was not debarred from claiming sllch deposit, the Trial Court decreed the respon(jen't'S. su.it (in respect of t\vo items) for Rs. 10,040-10 As. togCther with simple intere~t on this amount from January 1st 1946 to August E~ 14,,1947@ Rs. 1-8-0 per cent per annum and fro~ August 15, 1947 to Decen10er, 194-8 nt RS. 7% per annum. lt v:as further ordere'd that the respondent would'. get sin1plc interest on the decretal amount after dedu.:ting Rs. 1986-2·-As. which have been paid during the pendency of the suit, at 6% per annu1n. Proportionate costs was also awarded to the respondent. Aggrieved by the· said Jord~rs.,. tb-e bank appealed: to the Allahabad High Court- and the respondent filed· crosS objections in respect of the amount of Rs. 4,000/- and Rs. 105/- disalldwed by the Trial Court. The High Court. on reappreciation of the evidence dismissed the bank's appeal and allowed the respondent's cros5 objections decreeing the suit for Rs. 14145-10 annas together with simple interest thereon from January 1, 1946 to August 14, 1947@ Rs. 1-8-0 % 'per annum and from August-15, 1941 to·Decemb~r 1. 1948 at 6% per annum: lt w~-i.s further directed that respondei:i.t' could get pendente lite simple interest from_ the appellant on the decretal amount at 6% per annum and as the an1ount of Rs. 1,986-2~0 had' been paid to the ret>porldent on September, 1950 it would be deducted from the total amount found due to the respondent and the decrctal an1ount :-;caled down pro tarito. Allowing the defendant's .appe~I by certificate_and dismissing the plaintiff's· claim \v.ith regard to Rs. ll ,000/ - (consisting of iten1s . of Rs. 4,000/- plu!I Rs; 7 ,000/-) and interest thereon, the Court 1-IELD : ( 1) The legal principle which governs the vic~rious liability nf an employer fQr the loss caused. to a customer through the inis1emeanour or neglig_ence of an employee are.: (a) The. employer is not liable for 1he act of the servant if the cause of the loss or dan1age aros.e without his actual fault · H. or pdvity or Without the fault or neglett of his t1gents or servants in the course of. their employrQent; (b) the daw~ge complained of must be shown to haYe been caused by any wrongful act of his servant fir agent done \Vithin the scope or course of the servant or agell'fs r ## Text _Characters 0–39,773 of 42,878. This is a partial read: ask again with offset=39773 for what follows._ - 1009· STATE BANK OF INDIA v. SHYAMA DEVI May 5, 1978 (R. S. SARKARIA, N. L. UNTWALIA AND P. S. KAILASAM, JJ.). Vicarious liabilily.-··Legal principle which gorerns the 1:icario11s1liability of an .employer for the loss caused to a customer thro11gh the niisdefneanour or negligence of an enlp[oyee. B' The respondent opened a Savings Bank Account being No. 90001 with the appellant's predecessor, the ln1perial Bank of India at its Allahabad Branch, having·been introduced io the B3nk by one Kapil Deo Shukhla, an employee of the bank and a close neighbour of the resprndent and a friend of her husband, C Bhz.g\vati P;asud. On a suspicion about the entries in the respondent'i- Vass Book- made by the employees of the Bank; which had been confirming, and ratifying them from time to tiffie, the respondent sent a notice dated August. 13, 1948 to tl].e defendant bank: The appellant bank replied by its letter dated 14-8-1948 explaining the·. deposit of several items making up to Rs. 1932-2-0 anj denied the alleged dep.O$i1s of Rs. 105, Rs. 4000, Rs. 8000/- •nd Rs. JOO/- sa\'I ..to have been deposite_d through Kapil Dev Shukla. On .November, 30, 1948, the respo,ndent file.ct: a suit iri forma pauperis for the recovery of Rs. 15,54]-10 As. iogether wiili pendente lite and future interest from the appellant's predeCessors. The Trial Court found, except for the items of Rs. 105 and Rs. 4000/ - entered in the pass-book the respondent had deposited other amounts _ mentioned in it and ·that the bank was bound by those entries. Holding that the rules were strictly enforced by the bank and if the bank had accerted an amount larger than the sum of Rs. 5,000/- in contravention of its Rules, the respondent was not debarred from claiming sllch deposit, the Trial Court decreed the respon(jen't'S. su.it (in respect of t\vo items) for Rs. 10,040-10 As. togCther with simple intere~t on this amount from January 1st 1946 to August E~ 14,,1947@ Rs. 1-8-0 per cent per annum and fro~ August 15, 1947 to Decen10er, 194-8 nt RS. 7% per annum. lt v:as further ordere'd that the respondent would'. get sin1plc interest on the decretal amount after dedu.:ting Rs. 1986-2·-As. which have been paid during the pendency of the suit, at 6% per annu1n. Proportionate costs was also awarded to the respondent. Aggrieved by the· said Jord~rs.,. tb-e bank appealed: to the Allahabad High Court- and the respondent filed· crosS objections in respect of the amount of Rs. 4,000/- and Rs. 105/- disalldwed by the Trial Court. The High Court. on reappreciation of the evidence dismissed the bank's appeal and allowed the respondent's cros5 objections decreeing the suit for Rs. 14145-10 annas together with simple interest thereon from January 1, 1946 to August 14, 1947@ Rs. 1-8-0 % 'per annum and from August-15, 1941 to·Decemb~r 1. 1948 at 6% per annum: lt w~-i.s further directed that respondei:i.t' could get pendente lite simple interest from_ the appellant on the decretal amount at 6% per annum and as the an1ount of Rs. 1,986-2~0 had' been paid to the ret>porldent on September, 1950 it would be deducted from the total amount found due to the respondent and the decrctal an1ount :-;caled down pro tarito. Allowing the defendant's .appe~I by certificate_and dismissing the plaintiff's· claim \v.ith regard to Rs. ll ,000/ - (consisting of iten1s . of Rs. 4,000/- plu!I Rs; 7 ,000/-) and interest thereon, the Court 1-IELD : ( 1) The legal principle which governs the vic~rious liability nf an employer fQr the loss caused. to a customer through the inis1emeanour or neglig_ence of an employee are.: (a) The. employer is not liable for 1he act of the servant if the cause of the loss or dan1age aros.e without his actual fault · H. or pdvity or Without the fault or neglett of his t1gents or servants in the course of. their employrQent; (b) the daw~ge complained of must be shown to haYe been caused by any wrongful act of his servant fir agent done \Vithin the scope or course of the servant or agell'fs rn1ploy1nerit, even if the v.-·rongful 'later register;:d as a regular suit in 1950 ... :rhe pl~intiff's '.ca~e. as ;pleaded, was as follows : . · The plaintiff had, apart }r'?!n 1,932/.2/- .f!dmitted ,PJ. the defen- ·dand-Bank, the under-noted amounts which were ·deEoS1ted ·by· her :from time to tinie' with the ·Bank:· · ,,. · " · · .. Rs. 105 - do;posited on September 17, 1945 Rs. 4000 - deposited on September 17, 1945 Rs. 8000 - deposited--on December 7, 1945 ·Rs. -100 :- dep0sited on June 20, -1946 ·· ;Rs. 12205 ::These amounts were entered· in the respondent's Pa~s Book. by the •employees of the.Bank which had been confirming' and ratifying those -~ .entries from time to time. · · · · · ' · · Paragraph 3 of the plaint is material. _It may be extracted "There was a ix:rmanent clerk named Kapil Dea Shukla in the .employ of the defendant. Bank,. who. exercised· much .influence on other. emp!Oyees of the. Bank· and ·used ' to ·work at dilkrent counters: The "Bank viewed: his actions with approval and acted with negligence. The· plaintiff as ,)Veil as other constituents regarded .him, as an . employee ·and· a responsible person of the ,Bank· and quite. often used to hand over the money and letter of instructions to him, while this clerk nsed to obtain the signature 'of the officer on the Pass Book as usual. The plaintiff used,to ,believ<> that, the money .had ,been deposited ,and she was satisfied. on perusal . of the Pass Book. She had never ·any occasion for suspicion n ' . . In August 1946, the plaintiff's husband .felt some suspicion in .the Bank's affairs. She thereupon .sent .a notice, .dated August 13, ·1948:to the defendant Bank. The Bank. replied by -letter, ,dated August 14, 1948, in which it.accepted the deposit of.Rs .. 1,932/-.and .d.Onicd the deposit .and payment of the --. The parties went io trial on these bases ~ (1) Did the plaintiff deposit with the defendant the· various sums of money mentioned in Para 4 of the plaint ? (2) Ar~ these amounts mentioned in the plaintiff's Pass. Book ? If so, is the defendant bound by the entries therein ? ( 3) Did the plaintiff ~ke any deposit in contravention of any rule -of the Bank ? If so, to what effect? On Issues (1) and (2); ihe trial court found that, except for the items of Rs~· 105/- and Rs. 4,000/- entered ~n the Pass Book, the respondent had deposited the other amounts mentioned in it and that the Bank was bound by those entries. Pn Issue No. (3), if was held that the Rules were not strictly enforced by the Bank, and if the Bank had accepted an amount larger than the sum of Rs. 5,000/- in contravention of its Rules, the respondent was not debarred from. claiming such deposit. • In the result, the trial court, on July 8, 1952, decreed the res-~ pondent's suit (in respect of two items) for Rs. ,10,040/40/-; to- - gether with simpfo interest on this amount from January 1, 1946 to August 14, 1947 @ Rs. 1/8/C per cent per annum, and from -'<- August 15, 1947 to December 1948 @-Rs. 1/-/- per cent per annum .. H It was furtbor ordered that the respondent would get simple interest." on the decretal amount (after deducting Rs. 1,986/2/- which • had been paid during the pcndency of the su:t) @ 6% per annum. ·Proportionate costs were also awarded to th~ respondent, -- • :\ ' 'Ir' ( \ .(. s. B. ;. l'. SHYAMA DEVI (Sarkuria, !.) Aggrieved, the Bank carried an appeal to the High Court of Judicature at Allahabad, and the respondent filed cross-objections in respect of the amounts of Rs. 4,000/- and Rs. 105/-, disallowed by the trial court.. The High Ccurt observed that the disputed amount of Rs. 8,000/- shown in the Pass Book consisted of two items, the bigger of which was an amount of Rs. 7 ,000 /- in the form of a cheque drawn by Bhagwati Prasad on the account of Bhagwati Prasad & Sons in Bharat Bank Ud., Allahabad, and that Bharat Bank paid the amount of the cheque to Dass Bank Ltd., A'llahabad, who credited it to the account of Lala Babu alias Kapil Deo Shukla, the aforesaid employee of the Imperial Bank. On these premises, the High Court found that the amount of the cheque was not actually deposited, first, in the account of Bhagwati Prasad & Sons, nor later in the Savings Account of the respondent, and that Kapil Deo Shukla had fraudulently taken the money of the cheque and credited it in his own account in the Dass Bank Ltd., Alrahabad. "Therefore, the respondent had to suffer because of the action of Kapil Deo Shukla, an employee of the Imperial Bank.'' Repelling the contention of the appellant-Bank, the High Court held on the basis of the evidence of the appellant's witnessesMahadeo Prasad and Narbada Prasad-that "it could not be said that Kapil Deo Shukla was not acting in the course of his employment in the Bank". A B c D Regarding the entry of Rs. 100/- the High Court held that the initials against this entry purporting to he of L. Anthony, had not E been proved to be forged inasmuch as L. Anthony had not been examined, and that ii any fraud had been committed by Kapil Deo Shukla, the Bank was liable for the same. In respect of the disputed deposit of Rs. 4,000/-, the High Court held that the appellant had not disproved the statement of Bhagwati Prasad by having the accountant of the Calcutta National Bank sumF moned with the accounts relating to Bhagwati Prasad, and as such, r it did not see any reason to disbelieve Bhagwati Prasad's statement that the cheque for Rs. 4,000/- was given to the Bank on September 10, 1945, to open a Savings Bank account in the name of the responclent, and that ii K D. Shukla cashed that cheque, also, and had • the amount deposited in his own account, the respondent could not , be made to suffer for the fraud committed by Kapil Deo Shukla in the G course of his employment in the Bank. With regard to the item of Rs. 105 /- also, the High Court accepted Bhagwati Prasad's statement that amount had been deposited by him on September 7, 1945. The High Court dismissed the Bank's appeal and allowed the plaintiff-respondent's cross-objections, decreeing the suit for Rs. 14,145/10/-, together with simple interest thereon from January 1, 1946 to August 14, 1947 at the rate of Rs. 1/8/- per cent per annum H 1014 SUPREME COURT REPORTS Jl978j 3 $.C.R. A and from August 15, 1947 to December I, 1948 at 6 per cent per annum. It was further directed that the respondent could get pe11dente /itse simple interest from the appellant on the dccretal amount at 6% per annum. As the amount of Rs. 1,986/2/- had been paid to the respondent on September 16, 1950, it would be deducted from the total amount found due to the respondent and the decretal amount scaled down pro tanto. Costs of both the courts were also awarded to H the respondent. / c D E F Hence, this appeal by the Bank on a certificate granted by the High Court under Article 133 of the Constitution read w:th sections 109 and 110 of the Code of Civil Procedure. Dr. Y. S. Chitale, appearing for the appellant, contends that the respondent's case, as laid in the plaint. was that tbo plaintiff had entrusted K. D. Shukla, who was their friend, with moneys from time to time for depositing in her Savings Bank account. In such a Gituatio'n, K. D. Shukla could not be said to have been acting in due course of his employment er an agent of the Bank but only as an agent of the respondent, and· if K. D. Shukla did not deposit those amounts as directed by the plaintiff, but misappropriated the same and to cover up his fraud made false entries in the Pass Book, the Bank was no: liable. Strcs; has been laid on the fact that the disputed amounts were never delivered by cheque or otherwise at the Bank's counter. In this connection, reliance has been plac•cd on th principles enuncia:- ed in Leesh River Tea Co., Ltd. & Ors. v. British India Steam Navigation Co., Lid.('); Ruben and Laden burg v. Great Fingall('); and Morris v. C. W. Martin & Sons Ltd.(') As against the above, Mr. Bhargav submits that tho.; entries in the Pass Book showing the deposit of these amounts in the Savings Bank account of the plaintiff, had admittedly been made by K. D. Shukla, when he was an employee of th•c Bank. It is poi'nted out that there is evidence on the record to show that this K. D. Shukla had manipulated the accounts of three other depositors, also, and the Bank had reimbursed those constituents for thF loss, and here is no reason why a discriminatory treatment should have been meted out to the plaintiff. It is argued that evidence on the reccrd suggests that K. D. ~ Shukla could be called upon to hdp other clerks, also, in transactions .r. with the Bank; that there could be no collmion between Bhagwatl Prasad and K. D. Shukla. became no man in his senses, would collude G with another to cause delit-:rate monetary loss to himself or his wife. It is emphasised that according to the statement of Bhagwati Prasad, the cheque for Rs. 4.000/- drawn by Bhagwati Prasad on the account of Bhagwati Prasad & Sons for transfer to •he account of the plaintiff, was handed over bv him at tho Bank's counter. With regard to all the disputed items, it is urged that the entries in the Pass Book showing thes~ deposits in the plaintiff's accounts were, prima facie, sufficient H (ll [1966] 3 Ail E.L.R.593. 12) [1904-07] All E.L.R 460. (3) [1965] 2 All E.L.R. 725. ' • \ 'y .~· - \.. " • s. B. J. v. SHY AMA DEVI (Sark aria, ,/.) lO l 5 to establish the plaintiff's claim and cast liability on 1hc appellant. A\ Our attcntio'n has also been drawn to the entries in th•c Bank's ledger showing the deposit of this amount of Rs. 4,000/- in the account ot the plaintiff. It is maintained that if K. D. Shukla or any other employee of the Bank made thue, excepting with regard to the items of Rs. 4,000/- and Rs. 105/-, in favour of the plaintiff. The High Court, on appeal, decided this issue D E F y witl1 regard to the item of Rs. 4,000/- in favour of the plaintiff. / , Since it is contended that the court below has misread the evidence and has not paid due attention to some of its features, we propose fo ~ re-examine the same ourselves. The main items shown in the Pass Book, ~s deposited in the respondent's Savings Bank Account are of Rs. 4,000/- and Rs. 8,000/-. · In regard to the item of Rs. 4,000/- shown as deposited on September 17, 1945, Bhagwati Prasad testified: G "Rs. 4000/- was deposited by cheque on 17th SeptemR ber 1945. It was presented in the Bank on 10th September, (I). 1955]AC. 130. A c D E F H 1018 SUPREME COURT REPORTS [1978) 3 S.C.R. 1945 ...... The counterfoil (Paper No. 4 of List 41/C) of · Rs. 4000/- relates to this cheque, showing the amount deposited on 17th September 1945. This is a crossed cheque. _I had written a letter in Hindi to the Bank to deposit the amount of this cheque in Shyama Devi's account." In cross-examination, he clarified that this cheque for Rs. 4,000/-, dated 10th September 1945, was drawn by him on his account in favour of 'self'. The witness bad drawn two parallel lines on it so as to make it a crossed cheque. He did not issue this cheque in Shyama Devi's name. This crossed cheque was banded over by the witness at the counter of the Bank. The Counter Clerk asked the witness to go away, assuring that the witness would later on receive the Pass Bank with the amount duly entered in it. The witness then went out of station iri connection with his bamboo business. On his return on the 17th September 1945, he went to the Bank.. The Counter Clerk then asked the witness to deposit some money in cash before a new Pass Book could be issued and the amount of the cheque credited by the transfer in the plaintiff's account. On the same day, the witness went to the Bank and deposited Rs. 415 /- in cash. Thereupon, a new Pass Book was issued to the witness. The amount of Rs. 4000/- was shown as deposited in the account of the plaintiff on 17th September 1945. The cross-examination reveals that the witness did not obtain any receipt for the deposit of this cheque. He further admitted that he had crossed the cheaue. so that it could not be credited to anyb!)dy else's account or be cashed by anyone also, but would go to his account. He further clarified that he had signed this cheque on· its back as it was a 'self' cheque. He denied the suggestion that be signed the cheque on 10th September 1945 on its back, as he ca~hed it at the Calcutta National Bank. He expressed ignorance if the payment of this cheque was paid by the Calcutta National Bank. As testified by Shri A. Ganguli, who was Agent of the Imperial Bank at Allahabad in Augmt 1946, the procedure for making deposits in an account with the Bank, was as follows :- "When a depositor comes to deposit money in his or her Savings Bank account, the related voucher together with cash is tendered by him at the cash department counter in the Bank. The receiving Cashier counts and checks up the amount tendered, enters the items in the cash scroll maintained by him, certifies the voucher on the back by his signature in token of having received the money and passes the voucher on to the Cashier for his signature. The Head Cashier after certifying the voucher sends it to the official in the Banking Department who enters the voucher in his cash scroll after branding the voucher with the big 'received' round rubber stamp bearing the date of transaction. The voucher then goes to the ledger Keeper for entry in the relative account after which it is passed on to the Day-Book writer for entrv. If the depositor had on that date lodged his pass-book with the Ledger-Keeper then the entry is also made in his - - • \ s. B. l. v. SHVAMA DEVI (Sarkaria, J.) pass-book and the pass-book togetber with the voucher and Ledger is sent to the official for attestation. The pass-book need not necessarily be lodged with the Bank at the time of making the deposit but it must be produced when a withdrawal is effected. In the cash voucher that is, tendered, the ledger's sigilature is invariably taken before the money is accepted by the Cashier." 1019 It may be noted that whereas in the case of the undisputed items this procedure was followed, evidence with regard to the observance of this procedure is not available, in the case of the disputed deposits. Bhagwati Prasad has not produced any deposit receipt or voucher evidencing the presentation of this crossed cheque for Rs. 4000/- in the Bank to any employee of the Bank, nor is there any entry in the cash scroll with regard to the deposit of any cash. Another suspicious feature about this deposit was that being a crossed cheque drawn in favour of 'self', it could be deposited in the account of the drawer or the endorsee of the cheque only. lt was not explained how it was cashed by the Calcutta National Bank. There was no evidence to show that in whose account in the Calcutta National Bank it was deposited. Bhagwati Prasad ,;ays that he had handed over a covering letter in Hindi from the plaintiff to the Bank, requesting it to transfer and deposit the amount of the cheque in the Savings Bank account of his wife, Shyama Devi. No such letter is forthcoming, nor is there any evidence on the record to show that the plaintiff made any attempt to call for the production of any such letter from the Bank. No question with regard to this letter was put to Shri A. Ganguli, the Agent of the Bank, or the other officiafs of the defendant-Bank who appeared as witnesses. Bhag:wati Prasad was a man of business. Why did he not straightaway endorse that cheque in favour of his wife? This interval of 7 days between the alleged presentation of the cheque to the defendant-Bank and the date of the false deposit entry, i.e. 17th September 1945, is itself a very suspicious feature. The entry in the pass-hook, showing the deposit of Rs. 4000/- on 17th September was obviously false. It is not disputed that this cheque of Rs. 4000/- (Ex. 20) had already been credited to some one • else's account in the Calcutta National Bank Ltd, on the 15th Septem- ~ ber, 1945. So far as this deposit of Rs. 4000/- is concerned, it will not be wrong to say that the decree passed by the High Court against ~ the defendant-Bank proceed mainly on the ground that the false deposit entry in the Pass Book in respect thereto is in the hand of K. D. Shukla who was at the material time an employee of the Bank. There is no corresponding entry in the Ledger of the Bank, showing that the amount of this cheque was first debited in Bhagwati Prasad's l!ccount and then transferred to the plaintiff's account. A B c D E F G The High Court was thus not right in reversing the finding of the H trial court in respect of this item of Rs. 4000/-. The onus was on the plaintiff to show that she paid the amount to an employee of the A B c D E F G H 1020 SUPREME COURT REPORTS [1978] 3 S.C.R. Bank and was received by that employee in the course of his employment. The false and fraudulent entry about the deposit of thi& amount in the Pass Book, could not shift the onus on the Bank to prove the contrary. This takes us to the next big deposit in dispute. This deposit of Rs. 8000/- consists of two items. In examination-in-chief, all that Bhagwati Prasad stated with regard to the deposit of this cheque and the transfer of this amount from his account to that of the plaiilfiff was thus: "On 7th December, 1945 I deposited Rs. 8000/-. I gave a letter that a sum of R!i, 7000/- from my current account be transferred to the account of Shyama Devi and I deposited Rs. 1000/- in cash with the Bank." He did not say as to which employee of the Bank he had handed over this cheque, and where. He did not even allege that he had received any voucher evidencing the deposit of this cheque or cash from the Bank, much less he produced any documentary evidence to show the deposit. Cross-examined, he expressed ignorance if the Bank had sent him any letter informing that Rs. 7000/- had been debited in his account and transferred to Shyama Devi's account. He further admitted that he did not receive or remember if any 'receipt' from the Bank. transferring Rs. 7000/- from his account to Shyama Devi's account was obtained by him. In this connection, he added : "From the pass-book, I verified the correctness of the entries and did not make further enquiries of the transfer of this amount of Rs. 7000/-." The Bank's case was that it could not have accepted, th() deposit of Rs. 7000/- for crediting to the Savings Bank Account as it would have been contrary to Rules 6 and 7 of the Savings Bank Rules. According to these Rules a depositor cannot pay a sum larger than Rs. 5000/- at a time, nor can he deposit a sum exceeding Rs. 10,000/- in a year. When Bhagwati Prasad's attention was drawn to these Rules printed in the Pass Book, he stated that at the time of iSsuing this cheque, he was not aware of these Rules. Then there is the ledger entry (Ex. 19) which purports to show that Rs. 7000/- were withdrawn from the current account of Bhagwati Prasad & Sons with the Imperial Bank of India, Allahabad, on December 7, 1945, by cheque. The evidence of the Bank officials, Mahadeo Prasad and Shri A. Ganguli was to the effect, that the: entry in words and figures on December 7, 1945 in the Pass Book issued to the respondent, is in the hand· writing of K. D. Shukla, while the initials against that entry in the relevant column purporting to be of Mahadeo Prasad (Head Cashier), were forged initials. · The trial court allowed the respondent's claim in respect of this item of Rs. 7000/-, on the basis that the entries in the Pass Book and the Statement of Ledger Account (Ex. 19) relating to the current account of Bhagwati Prasad & Sons supported Bhagwati Prasad's word of mouth. It did not accept Mahadeo Prasad's testimony, who was. } ' "' ' - '" \ .. ' - I "'- • s. B. I. v. SHYAMA DEVI (Sarkaria, !.) 10 21 at the material time, a Sub-Accountant of the Bank to the effect, that A the initials '!Jurporting to be his against the items of Rs. J 05 /-, Rs. 4000/-, Rs. 400/, Rs. 432/- in the Ledger Account, were not executed by him, but "ere imitations of his initials. The High Court, at the appellate stage, admitted additional do~u mentary evidence consisting of certmn letters which passed between the defendant-Bank, the Agent of the Bharat Bank, Allahabad and Dass B Bank Ltd. These letters would show that the Ledger Entry (Ex. P-9B) showing the withdrawal of Rs. 7000/- on December 7, 1945 from the current account of Bhagwati Prasad & Sons with the Imperial Bank, Allahabad, is a false entry. The first of these letters is dated October 7, 1946 (Ex. 1) addressed by the Imperial Bank of India to the Agent, Bharat Bank Ltd., Allahabad. It is marked 'Private and Confidential'. It reads : C ''Dear Sir, Cheque No. 620149 dated 21st November, 1945 for Rs. 7000 drawn by Messrs Bhagwati Prasad & Sons. We have been advised by Messrs Bhagwati Prasad & Sons, the drawer of the above cheque that this cheque was D sent by him to us f.or credit of his account. From our records we are unable to trace this entry in our books. I shall, therefore be glad if you will advise me of the date on which and the name of the person or Bank to whom the amount of the above cheque was paid by you." In reply. the Bharat Bank Ltd., on October 18, 1946, wrote (Ex. 3) E "Dear Sir, With reference to your P&C letter, dated the 7th ;nstant, we beg to advise that the amount of the cheque for Rs. 7000/- in question was paid by us to the Dass Bank Ltd., on 21-11-45." Thereupon, the Imperial Bank addressed a letter, dated October 22, 1946 (Ex. 2) to the Dass Bank Ltd., Allahabad, as follows :- "Cheque No. 620149, dated 21st November, 1945 for Rs. 7,000 on Bharat Bank Ltd. The above noted cheque was paid to you through the clearing on the 21st November, 1945. Please advise me for whose credit the above cheque was collected by yon." In reply, Dass Bank Ltd., informed the Imperial Bank by their letter,