Arab Bangladesh Bank Ltd. (Appellant)
Ziauddin and others (Respondent)
High Court Division
(Civil Appellate Jurisdiction)
Mahmudul Amin Choudhury J
Md. Abdul Aziz J
Judgment : December 7, 1998.
Cases Referred To-
S K Panikar Vs. Travancore National and Quilon Bank Ltd 1942 (Madras) 351; Dalavai Nagarajamma Vs. State Bank of India, AIR 1962 (Andhra) 260; Guran Ditta and another Vs. T Ram Ditta, 32 CWN 817.
Rokanuddin Mahmud with SH Md. Nurul Huda Jaigirdar, Advocates—For Respondent Nos. 1-4.
Habibul Islam Bhuiyan, Advocate— For Respondent No. 5.
Not Represented- the Appellant.
Appeal from Original Order No. 221 of 1995.
Cross Objection No. 2 of 1997.
Mahmudul Amin Choudhury J.- This appeal is directed against judgment and order dated 8-7-95 passed by the learned Subordinate Judge, 1st Court, Comilla in Title Suit No.4 of 1995 who by the said order restrained the appellant from making any payment to defendant No.1 exceeding 1/4th of her share now being kept in the bank with the name of her late husband and the trial Court also allow defendant No.1 who is respondent No.5 here withdraw 1/4th of the deposited amount from the appellant bank.
2. The short fact leading to this appeal is that, the plaintiffs who are respondents here instituted the aforesaid suit praying for a declaration that they are entitled to 3/4th amount of money now being kept with the appellant-bank in FDR showing in the name of defendant No.1 and her late husband Nur Uddin Ahmed and they are also entitled to 3/4th of the amount now lying with Mr Omar Krishna amounting to Tk 5, 00,000.00. The fact leading to this appeal is that, late Nur Uddin Ahmed with his own money made a fixed deposit with the appellant bank with a stipulation that he or his wife defendant No.1 would operate the account and in case of death of one of the account-holders the survivor shall operate the same. The plaintiff’s further case is that after the death of said Nur Uddin Ahmed these plaintiff’s became co-sharers in the properties left behind by him and they as co-sharers inherited the properties left behind by late Nur Uddin Ahmed. After filing of the suit the plaintiffs filed an application under Order 39, rule 1 read with section 151 of the Code of Civil Procedure and prayed for restraining the appellant bank from making any payment to defendant No.1 from the account maintained with them by Late Nur Uddin Ahmed and his wife defendant No.1. Before the trial Court defendant No.1 entered appearance and contested the application for injunction and her case is that the money was deposited in the joint account with a clear instruction that any one or survivor may operate the account and after the death of Nur Uddin Ahmed she is now legally entitled to the money and to operate the account. The learned Subordinate Judge on hearing both the sides by the impugned order dated 8-7-95 restrained the bank as well as respondent No.5 as aforesaid.
3. Mr. Rafiq-Ul Huq, the learned Counsel appearing on behalf of the appellant at the very outset submits that this appellant is the banker of respondent No.5 and her late husband and as a banker they are debtors and the bank is bound to pay the money to the survivor. He submits that trial Court failed to appreciate the latest position in Banking Laws in this country and relying on a decision reported in 32 CWN 817 passed the order of injunction. It is submitted by Mr. Huq that the banks in such cases are now guided under section 103 of the Banking Companies Act, 1991 and the bank cannot withhold the payment when there is a direction of the account-holder at the time of opening of the account. He argued that in view of the clear provision of section 103 of the Banking Companies Act, 1991 the bank may not be injuncted in fulfilling their contractual obligation.
4. Mr. SH Nurul Huda Jaigirdar, the learned Advocate appearing with Mr. Rokanuddin Mahmud, on the other hand, submits that even under section 103 of the Banking Companies Act, 1991 the plaintiffs right has been protected. They have no claim over the share of defendant No.1 but they claimed their share in the assets left behind by late Nur Uddin Ahmed. It is submitted that the money deposited with the appellant originally belonged to Late Nur Uddin Ahmed and when he died childless his brother and sisters who are the plaintiffs are entitled to inherit these properties along with his wife defendant No.1. The learned Advocate submits that till the matter is finalised in the suit the defendant may be restrained as prayed for and the learned Subordinate Judge holding a prima facie case in favour of the plaintiffs rightly passed the order of injunction.
5. Admittedly after repealing the Banking Companies Ordinance, 1962, the Banking Companies Act of 1991 which is Act 14/1991 has been promulgated in this country and the banking companies are now fully guided and operated under this new law. Admittedly the dispute is over certain fixed deposit accounts now lying with the appellant bank which was earlier opened in the name of defendant No.1 and her husband Late Nur Uddin Ahmed alias N Ahmed. It is also an admitted fact that at the time of opening the account there was specific direction that the account would be operated by any of the account-holders or survivor. Now what will happen if one account-holder dies during the continuance of the fixed deposit? The legal position has been provided for in section 103 of the Banking Companies Act, 1991 and it runs as follows:
“103. Nomination for payment of depositor’s money.— (1) Where a deposit is held by a banking company to the credit of one or more persons, the depositor or, as the case may be, all the depositors together may nominate, in the prescribed manner, one person to whom, in the event of the death of the sole depositor or the death of all the depositors, the amount of deposit may be returned by the banking company:
Provided that the depositor or, as the case may be, all the depositors together may cancel the said nomination in the prescribed manner and may give fresh nomination.
(2) Where the nominated person under sub-section (1) is a minor, the said depositor or, as the case may be all the depositors may decide in the prescribed manner as to who shall receive the deposited money after their death.
(3) Notwithstanding anything contained in any other law for the time being in force or in any disposition whether testamentary or otherwise, in respect of such deposit, where a person is determined under sub-section (1) or where a person is conferred under sub-section (2) he shall on the death of the sole depositor or, as the case may be, on the death of all the depositors, become entitled to all the rights of the sole depositor or, as the case may be, of all depositors, in relation to such deposit to the exclusion of all other persons.
(2) Payment by a banking company in accordance with the provisions of this section shall constitute a full discharge by the banking company of its liability in respect of the deposit:
Provided that nothing contained in this sub-section shall affect that right of claim which any person may have against the person to whom any payment is made under this section.”
6. Now, in the present case, the disputed accounts were opened in the name of late Nur Uddin Ahmed and his wife defendant No.1 and admittedly there was a direction in the account opening form that any of them may operate the accounts in bank of survivor.
7. The learned Advocate appearing on behalf of the appellant submits that as one of the account-holders died the survivor may operate the account as per the provision of section 103 of the Banking Companies Act, 1991. It is well known that when a customer deposits money in a bank account, be does not strictly speaking deposit the money, he lends it to the banker. The banker is entitled to use it in the manner they desire. The relationship between banker and the customer is there of a contractual relationship of the debtor and creditor. Here, in the present case, the amount was admittedly deposited in the joint account. Now the question here before us is whether the bank may be injuncted in allowing defendant No.1 to operate the account in view of the death of Nur Uddin Ahmed alias N Ahmed who is also a signatory in the joint account. Section 103 of the Banking Companies Act, 1991 as quoted above, particularly sub-section (1) provides that when any person deposits any amount with the bank in the joint name of two or more persons on the death of the one, the surviving one may operate the account if there was any instruction at the time of opening the account. Sub-section (1) at this point is very clear. From this it appears that when a joint account is opened and stopped because of the death of one of the parties the doctrine of survival comes into play. This means that the balance in the account is transferred to the surviving party and the banker may with safety allow the money to be paid to surviving account-holder after they have been shown the death certificate of the deceased party when they have been directed to do that in case of death of one of the account-holders and in the modern banking system the banks have now accepted the view that in an account where the accounts will be operated by either of survivors, the survivor is the only person who is entitled to the balance thereof after the death of one of the account holders. This practice is based on the principle that the terms of operation of the account forms part of the contract of the deposit. Here in the present case the bank accepted the deposit on condition that any one of the account holders or the survivor may operate the account.
8. Mr. Rokanuddin Mahmud, the learned Advocate for the respondents, on the other hand, submits that the money has been deposited by late Nur Uddin Ahmed though it is in the joint name but for all practical purposes the amount belonged to him and when such a deposit is made it must be presumed that the deposit belonged to the husband, that is, Nur Uddin Ahmed alias N Ahmed and relied on the case of S K Panikar Vs. Travancore National and Quilon Bank Ltd. reported in 1942 (Madras) 351. Mr Rokanuddin Mahmud also placed reliance on the case of Dalavai Nagarajamma Vs. State Bank of India, reported in AIR 1962 (Andhra) 260, wherein a deposit was made by a Hindu of money in a bank in the joint names of himself and his wife and another person and on terms that it is payable to either or survivor, does not, on his death, constitute a gift by him to the latter. In that decision it has been held that on his death the amount in deposit is payable to his heirs as his absolute property and we have also before us the case of Guran Ditta and another Vs. T Ram Ditta, reported in 32 CWN 817. In that case a Hindu husband deposited his money with the bank in his name and also his wife directing payment to either or survivor. It has been held that there was no presumption in the deposit note so phrased that the deposit was an advancement or resulting trust in favour of the wife and on the death of the husband the money would belong to his estate. Mr. Mahmud placing reliance in these decisions submits that the account which the appellant is holding actually belonged to late Nur Uddin Ahmed alias N Ahmed and his wife along with his brothers and sisters entitled to the deposited money as heirs. But those decisions on which Mr. Mahmud relied are of the years prior to 1991 when our banking law came into force, and in those deposits the depositors were all Hindus and not a single decision had been cited wherein Muslim couples or two Muslims made any deposit Though these decisions are apparently in favour of Mr. Rokanuddin Mahmud’s contention but the thing is that much water has flown by these years over the river Buriganga and we have our own banking laws. Mr. Mahmud failed to cite any decision of this Court on section 103 of our banking law. Our section 103, particularly sub-section (1) is very clear on this point. When a joint account is opened and there is specific direction that any of the joint account-holders or survivors may operate the account then under sub-section (1) of section 103 the bank is bound to follow it in case of death of one of the account-holders. This is the accepted view in the banking system now prevalent in the rest of the world also and the practice is based on the principle that the terms of operation form the contract of deposit. The bank entered into a contract with late N Ahmed alias Nur Uddin Ahmed and his wife that the account will be operated by any of them or survivor and when Nur Uddin Ahmed died his wife as a survivor is entitled to operate the account and the bank cannot be injuncted in making any payment or allow the survivor that is wife of Nur Uddin Ahmed to operate the account. The account was opened with a specific condition guiding the mode of operation of the said account as stated above. So, the bank is bound to comply with the condition on which they have accepted the deposit and if in pursuance to sub-section (1) of section 103 of the Banking Companies Act, 1991 the bank transfers the deposited amount in the name of the survivor then this will constitute as a full discharge of the liability of the bank. So, on a consideration of the materials on record it prima facie appears that the banking companies in our country, particularly the appellant cannot be injuncted from following the instructions given in the account opening form by the account-holders. But it appears from the judgment of the trial Court that while disposing of the injunction matter the trial Court has simply followed the principles of law enunciated in 32 CWN 817 but has not at all considered the aspect that the banking law has been changed in our country in 1991 and has not considered the provision of section 103 of the aforesaid Act and, as such, came to a wrong finding.
9. Mr. Habibul Islam Bhuiyan, the learned Advocate at the time of hearing of the arguments of the learned Advocates of the appellant and the plaintiffs-respondents, entered appearance by filing a Vokalatnama on behalf of defendant No.1 who is respondent No.5 before us. It is submitted by Mr. Bhuiyan that previously this respondent No.5 filed an appeal against this order of injunction but the same was dismissed for default, but when this appeal is pending wherein the injunction matter is agitated he submits that he may be accommodated on behalf of respondent No. 5 and we accordingly, heard him on the matter. Mr. Habibul Islam Bhuiyan supported and adopted the argument advanced by the learned Advocate for the appellant and he further added that the money was deposited by Mr. N Ahmed alias Nur Uddin Ahmed and respondent No.5 in their joint names with a specific direction that in case of death of one of them the surviving one will operate the account and when that was the direction in the account opening form this respondent No. 5 cannot be injuncted as prayed for because there was a stipulation in the account opening form in operating the account on the death of late Nur Uddin Ahmed. When Mr. Habibul Islam Bhuiyan was confronted on the proviso to sub-section (4) of section 103 of the Banking Companies Act he submitted that in such a case if the plaintiffs have any claim over the estate left behind by Nur Uddin Ahmed they shall have to file a separate money suit. They cannot lay any claim over the aforesaid account by filing a simple suit for declaration. If they have any claim over the money involved they may file a regular money suit against defendant No.1. But in the present suit they cannot maintain the injunction and debar the respondent No. 5 which will be against the provision of section 103 of the Banking Companies Act. On consideration of section 103 of the said Act particularly the proviso to sub-section (4) we find force in the argument advanced by Mr. Habibul Islam Bhuiyan. Prima facie it appears that if the plaintiff has claim over the estate left behind by late Nur Uddin Ahmed they may file an appropriate suit and seek adequate relief there but by keeping the present suit pending and in view of the clear provision of section 103 of the Banking Companies Act and the prevalent practice in banking system in our country or elsewhere respondent No.5 cannot be injuncted in operating the bank account as both the bank and the account-holders are guided under the instructions given in the account opening form.
10. Furthermore, in case of joint accounts if the survivor is debarred from operating the account by an order of injunction the spirit and intent of the authors of the joint account who consciously put the condition in the account opening form in good health, spirit and mind some definite philosophy/intention, their purpose would be frustrated in such a case. Order 39, rules 1 and 2 of the Code of Civil Procedure may not be used as an instrument to obstruct/defeat the aforesaid intention of the account-holders. While passing the order of injunction the learned Subordinate Judge failed to appreciate this aspect of the matter.
11. Mr. Rokanuddin Mahmud submits that unless an injunction is granted the plaintiffs will have no remedy and they may be non-suited as in such suits injunction is the life. It is true that in some suits injunctions are lives of the suit but that has no general application. The plaintiffs may have a claim against defendant No. 1 over the estate left behind by Late Nur Uddin Ahmed but merely having a claim there cannot be any injunction against the defendants.
12. Mr. Rafiq-ul-Huq, the learned Counsel appearing on behalf of the appellant, further submits that if injunction is granted against the bank the bank will suffer in their businesses as no one will come with fixed deposit with the bank if conditions are not complied with by the bank in case of death of one of the account-holders and if the surviving account-holder cannot operate the account it will have adverse effect in the present system of joint accounts in our country. We fully agree with the submission made by Mr. Rafiqul Huq in this respect. Why a person having money will deposit the amount in the bank if his conditions are not complied with by the bank in case of his death or in case of death of one of the account-holders. In such a situation we hold that the balance convenience and inconvenience is in favour of the appellant.
13. Having given our anxious consideration to the materials on record and after hearing the learned Advocates of both the sides, we hold that the learned Subordinate Judge failed to appreciate the legal position and came to an incorrect finding and wrongly granted injunction against the bank and the, respondent No.5 and it requires interference. The plaintiffs for all the aforesaid failed to make out any prima facie case for Injunction in their favour.
Court-fees paid are correct.
15. The appeal, is accordingly allowed. The order dated 8-7-95 passed by the learned Subordinate Judge, 1st Court, Comilla in Title Suit No. 4 of 1995 is hereby set aside and the plaintiff’s prayer made under Order 39, rule 1 and section 151 of the Code of Civil Procedure is hereby rejected with costs. Any opinion expressed by us on the merit of this suit while disposing of the appeal may be construed as prima facie opinion and may be-ignored by the trial Court while disposing of the suit on merit.
The connected Memorandum of Cross Objection is accordingly disposed of.
Source : 52 DLR (HCD) (2000) 36