Jharkhand High Court
Indian Iron Of Steel Company Ltd. vs Bihar State Electricity Board And Ors. on 27 March, 2003
Equivalent citations: AIR2004JHAR54, [2003(2)JCR483(JHR)], AIR 2004 JHARKHAND 54, 2004 AIR - JHAR. H. C. R. 276, (2003) 2 JCR 483 (JHA), (2004) 2 BANKCAS 7, (2003) 2 JLJR 466
Author: M.Y. Eqbal
Bench: M.Y. Eqbal
ORDER M.Y. Eqbal, J.
1. Petitioner filed the instant writ application seeking issuance of an appropriate writ declaring that the respondents Bihar State Electricity Board is not entitled to demand any bank commission/bank collection charges from the petitioner with respect to its electrical connection because payment made by the pclitioner with respect to the said electrical connection by cheques drawn in favour of the Board at the bank situated in the headquarter of the office of the Assistant Electrical Engineer, Electric Supply Division, Dhanbad and further for a direction upon the respondents Board to calculate and work out such bank collection charges illegally realized from the petitioner and refund/adjust the same which is sought to be realized by the Board from the petitioner under the head of delayed payment of energy bills.
2. Petitioner is having one of its colliery at Chasnala in the District of Dhanbad and it was having High Tension Electrical Connection. The petitioner used to pay electric bills by cheques drawn in favour of the Board and payable at the headquarter of the Assistant Electrical Engineer, Dhanbad with a view to avoid collection charges of those cheques/drafts.
3. Petitioner's case is that as per the instruction of the Board the petitioner had to draw cheques payable in the headquarter of the concerned Electrical Engineer, Dhanbad in order to avoid any collection charges payable to the bank. As per the said instruction, it was obligatory on the part of the concerned respondent to deposit the aforesaid cheques given by the petitioner at the bank within the headquarter of the concerned Assistant Electrical Engineer but the respondent either purposely or due to mistake, deposited all those cheques in the bank outside the headquarter of the Assistant Electrical Engineer. Consequently, petitioner received a bill for the month of June 1999 from the Board raising demand of Rs. 5,41,394/- on account of bank commission/bank collection charges and also delayed payment surcharge levied therein. Petitioner immediately raised objection by letter dated 15.7.99 and in reply thereof respondent/Board asked the petitioner to accept the bank commission/charge of Rs. 5,41,394/- which was charged by the bank in the bill of June, 1999.
4. Respondent/Board appeared and filed counter affidavit stating inter alia that petitioner has been paying the energy bills through cheques drawn in favour of the respondent/Board and payable at State Bank of India, Dhanbad Branch, Dhanbad. Since the State Bank of India, is not the Outstation bank for the office of the Assistant Electrical Engineer, the said bank while clearing the cheques of the petitioner used to charge from the respondent-Board, bank commission and the same is ultimately charged in the bill of the petitioner. It is stated that the said bank commission/collection charge realized by the bank from the respondent-Board from February, 1997 to March, 1999 was charged in the energy bills of the petitioner raised in the Month of June, 1999. Respondents annexed copy of the chart showing bank commission charged by the bank from February, 1997 to March, 1999 as Annexure A to the counter affidavit.
5. For the first time the case was heard on 16.12.2002 when this Court was sought to see Annexure A to the counter affidavit which is the details of the bank commission. It appeared that for the cheque dated 25.2.97 the amount of commission charged by the bank was Rs. 11,686/-. Similarly for some cheques commission charged goes to Rs. 38,000/-. This Court therefore directed the Board to file supplementary affidavit. Relevant portion of the order dated 16.12.2002 is reproduced therein below :--
"It is rather very shocking to see Annexure A which is the details of the bank commission charged from the bank. It appears that one cheque dated 25.2.97, the amount of commission charged by the bank has been shown as Rs. 11,686. For some cheques the commission has been charge goes to Rs. 38,000. The commission charged by the bank of one cheque varies from Rs. 8,000 to 38,000, it is un heard of it. It cannot be believed that bank has charged Rs. 38,000/- by virtue of commission for clearance of one cheque and that too within the same district of Dhanbad. I, therefore, direct the Assistant Engineer to appear before this Court on 3rd January 2003 and file supplementary affidavit satisfying this Court about the correctness of An-nexure A. On that date it is found that a false affidavit has been filed by the officer of the Board then this Court may pass an appropriate order for imposing proper cost on the Board.
Let this matter be place on 6th January, 2003.
6. Pursuant to the aforesaid direction supplementary counter affidavit was filed by the respondent/Board stating that the electric bills paid by the petitioner through the cheques payable at State Bank of India, Dhanbad Branch. While making clearance of the said cheques the local bank namely, Bank of India, Kandra Branch, Sindri used to charge bank collection charges from the respondent-bank which was ultimately charged from the petitioner in its monthly energy bill of June 1999. In proof of the collection charges copy of the statement of account maintained by the Bank of India, Kandra Branch, Sindri was filed as Annexure C to the said affidavit.
7. The matter was again heard on 8.1.93 and after considering the supplementary affidavit filed by the respondent-Board this Court directed Mr. Rajesh Kumar, retained counsel Bank of India, to seek instruction from the bank and filed affidavit justifying collection of Commission/Collection charges realized by the bank. The bank was also directed to annex the circular on the basis of which they have charged such exorbitant collection charges. When no affidavit was filed by the bank then this Court directed the Zonal Manager, Bank of India, Dhanbad Zone to appear in person and filed counter affidavit. Pursuant to that order the Zonal Manager appeared and filed counter affidavit on 24.1.2003 in which he has admitted that the Kandra Branch of Bank of India, recently charged such an exorbitant amount of commission/collection charges. Para 3 and 4 of the counter affidavit filed by the Zonal Manager is worth to be quoted herein below :--
Para 3--"That the Jharkhand State Electricity Board Sindri is maintaining a Current Account with Kandra Branch of the Bank. District Dhanbad and the Branch has debited Rs. 57,567/- in the State Electricity Board Account on 18.8.1998."
Para 4--"That the deponent hereby further wants to clarify that the branch has wrongly charged Rs. 57,567/- by way of arrears and same is refundable to Jharkhand State Electricity Board and for that the answering deponent is absolutely sorry for the mistake committed by the Branch and also under takes that he will take suitable steps against the concerned officer. The deponent is also ready to produce the Head Office Branch circular No. 91/205 and its addendum."
8. Considering the counter affidavit.
this Court passed order on 24.1.2003.
Relevant portion of which is quoted herein below :--
"It is admitted in the counter affidavit that the Branch has wrongly charged collection charges to the extent of Rs. 57,567/- and therefore the same shall be refunded to the Electricity Board. In the affidavit, it is stated that, it is sorry state of affairs that such type of mistake has been committed by the Branch and appropriate steps shall be taken against the concerned officer.
From the affidavit filed by the Zonal Manager, it is clear that the concerned Branch of the Bank of India, may be other branches might have been doing this sort of mistake which is either intentional or may be because of gross negligence. The matter therefore, needs fullfledged inquiry. Before issuing direction for fullfledged inquiry by the outside agency, I direct the Zonal Manager to file detailed counter affidavit on 3rd March, 2003. In the counter affidavit the names of those officers who have done this mischief shall be disclosed and also the action taken against them shall be brought to the notice of this Court.
Put up this case on 3rd March, 2003."
9. Pursuant to the aforesaid order supplementary counter affidavit was filed by the Bank of India, but the affidavit was not sworn by the Zonal Manager rather it was sworn by Chief Officer of the Bank of India. In the said affidavit vague statements were made stating that Bank has refunded the amount of excess collection charges upto date including the amount of Rs. 57,567/-, the deduction of Rs. 5,41,394/- was not explained in the affidavit. This Court therefore directed the Zonal Manager of the Bank to enquire into the matter and file affidavit. The relevant portion of the order dated 4.3.2003 is quoted herein below :--
"In compliance of the order dated 24.1.2003 the Zonal Manager did not take pain to file counter affidavit rather an affidavit has been filed by one Chief Officer of the Bank of India. In para 2 of the affidavit he confirmed the calculation made by the Bank by way of collection charges but a very vague statement has been made that the bank has refunded the amount of excess collection charges upto date including the amount of Rs. 57,567/-. The exact amount of excess collection neither has been mentioned nor the total amount refunded has been shown. The deduction of Rs. 5,41,394/- has not been explained. Since the Zonal Manager has taken the matter very lightly, I direct the Chief Zonal Manager of the Bank of India to inquire into the matter and appear before this Court on 13th March, 2003 and file affidavit. It is made clear that this time if the officers of the Bank fail to satisfy the Court about their negligence and carelessness then this Court may think it desirable to refer the matter to the CBI or direct for lodging criminal prosecution against the erring officers. Put up this case on 13th March, 2003."
10. In compliance of the aforesaid order the Zonal Manager, Bank of India, filed affidavit on 11.3.2003 stating inter alia that he got the matter thoroughly enquired by appointing one Birendra Prasad. Chief Officer, Dhanbad Zone of the Bank as enquiry officer. The said officer after enquiry submitted his report, which revealed that major part of the excess amount realized by the Bank by way of collection charges amounting to Rs. 2,00,185/- has been refunded to the Jharkhand State Electricity Board by crediting to their account. It is worth to quote para 5 of the counter affidavit filed by the Zonal Manager Bank of India.
Para 5 :--"That although Annexure A of the counter affidavit filed by the Bihar State Electricity Board speaks only about 28 cheques but it does not mention about one of the cheques deposited by the petitioner Company bearing Cheque No. 529263 dated 24.10.1998 for Rs. 67,99,475/- in which by way of Bank collection charge a sum of Rs. 27,611/- was charged whereas the actual Bank Collection charge was Rs. 14,627/- and hence the Bank had refunded the balance amount of Rs. 12,984/- to the Jharkhand State Electricity Board on 29.01.2003. Similarly, there were other cheques which were produced after 31.3.1999 and in which also similar mistakes occurred and in those cheques also the Respondent Bank has refunded the excess amount charged by the Bank per mistake by way of collection charges. So, including the cheque which is not mentioned in Annexure A of the counter affidavit filed by the Bihar State Electricity Board being cheque dated 24.10.1998 and all other cheques which are mentioned in the Annexure A, the Respondent Bank has refunded all the excess charged amount to the Jharkhand State Electricity Board i.e, sum of Rs. 8.78,561/-. Both the amount i.e. Rs. 2,00,185/- and Rs. 8,78,561/- were credited to the C.D. Account No. 17 of the Jharkhand State Electricity Board held with the Respondent Bank. The details of amount refunded is as follows :--
24.01.2003 Rs. 57,567.00 29.01.2003 Rs. 1,56,374.00 18.02.2003 Rs. 8,64,805.00 Rs. 10,78,746.00
11. From the facts narrated herein above, it is now clear that it was only because of gross negligence of the officers of the Bank such an exorbitant amount have been illegally deducted by way of collection charges from 1997, as a result of which less amount of the electric bills were credited in the account of the respondent/Board. Because of this less payment of electric bills respondent/Board started raising delayed payment surcharge from the petitioner/ consumer and the impugned demand has been raised by the Board against the petitioner.
12. As noticed above in one of the affidavit the Zonal Manager of the Bank of India, admitted that the branch has wrongly charged Rs. 57,567/- as collection charges and the same is refunded to Jharkhand State Electricity Board and for that in another affidavit the Zonal Manager has made categorical statement that because of the negligence and mistake of the Bank such an exorbitant amount of money has been deducted against the collection charges. The total amount refunded by the bank to the Electricity Board is Rs. 10,78,746/-. Had this amount been not deducted by the Bank as collection charges and the Electricity Board would not have raised demand for delayed payment surcharge from the petitioner.
13. The question therefore, that falls for consideration is as to whether having regard to the admitted position that because of the sheer mistake and negligence of officers and the employees of the bank, the petitioner was put to substantial loss the bank is liable to compensate the loss and damages caused to the petitioner.
14. There is well-settled legal principal, which governs the vicarious liability of an employer for the loss caused to a customer through the misdemeanour or negligence of the employee. It is true that the employer is not liable for the act of the servant if the cause of loss or damages arose without his actual fault or neglect of his agent or servant in the course of their employment. The principle has been illustrated by the decision of House of Lords in Leesh River Tea Co. Ltd. v. British India Steam Navigation Co. Ltd., (1966) 3 All E.R. 593. It has long been established law that Master is liable to third person for any injury or damages done through the negligence or unskillfulness of a servant acting in his master's employment. The reason of this is that every act which is done by a servant in the course of his duty is regarded as done by his master's orders and consequently it is the same as if it were the master's own act, according to the maxim, "qui facit per alium facit per se". If a servant does negligently that which he was authorized to do carefully or if does fraudulently that which he was authorized to honestly, or if he does mistakenly that which he was authorized to do correctly, his master will answer for that negligence, fraud or mistake vide Barwick v. English Joint Stock Bank, (1867) 2 Ex. 259, 266.
15. Taking into consideration the admission of the Zonal Manager regarding negligence and mistake committed by the officers and employee of the Bank and having regard to the settled principle of law discussed herein above, I have no doubt in my mind in holding that the bank is liable to compensate the loss and damages, caused to the petitioner. Admittedly, the bank deducted huge amount by way of collection charges from February 1997 to March 1999 and the bank retained the said amount till the same was refunded to the Electricity Board. The bank is therefore liable to pay interest at the rate of 12% per annum from February, 1997 till the amount was refunded to the Electricity Board. I further hold that the bank liable to pay compensation of Rs. 50,000/- (Rs. Fifty thousand) so that the petitioner could be able to some extent to pay the delayed payment surcharges that has been claimed by the respondent Board.
16. With the aforesaid observation and direction, this writ application stands disposed of.