FAO No.2658 of 2007 - 1 - IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** FAO No.2658 of 2007 DATE OF DECISION: 25.02.2009 **** Oriental Bank of Commerce, Delhi Gate Malerkotla Breath District Sangrur through its Senior Manager Ashish Kohli. . . . . Appellant VS. Punjab National Bank and another . . . . Respondents **** CORAM : HON’BLE MR.JUSTICE RAKESH KUMAR JAIN **** Present: Mr.T.S. Gujral, Advocate for the appellant. Mr.B.S. Bhatia, Advocate for respondent No.1. **** RAKESH KUMAR JAIN J.(ORAL) This appeal is directed against the order of the District Judge Sangrur dated 21.4.2007 whereby the petition filed by the appellant under Section 34 of the Indian Arbitration and Conciliation Act, 1996 (in short ‘the Act’). Brief facts culled out from the record are that on 24.10.1998, six leaves of draft were stolen from the Punjab National Bank, City Branch, Faridkot. The alleged theft was not brought to the notice of the higher officers of the Bank. On 1.12.1998, out of the six stolen leaves of draft, one leaf of the draft was used at Punjab National Bank, Sector 8, Chandigarh after FAO No.2658 of 2007 - 2 - erasing the stamp of City Branch, Faridkot. The draft was drawn in favour of M/s Gupta Trading Company for an amount of Rs.2,40,000/- which was deposited with the Oriental Bank of Commerce (Appellant). The said draft was sent to Punjab National Bank, Malerkotla for encashment. It was cleared on 8.12.1998. On 18.12.1998, Punjab National Bank informed the appellant bank that the said draft which has been got encashed for an amount of Rs.2,40,000/- was forged. On the same day, the Punjab National Bank informed about the theft of other five leaves of the draft to its other branches. On 24.12.1998, Punjab National Bank lodged FIR No.229 dated 24.12.1998 at Police Station Malerkotla in respect of forgery of the draft which was got encashed from the appellant Bank. Besides the criminal proceedings, Punjab National Bank also filed a civil suit for recovery on 3.12.2001 against the appellant bank as well as M/s Gupta Trading Company. During the pendency of the suit, the Punjab National bank filed an application on 25.6.2003 before the Banking Ombudsman. After filing the application before the Banking Ombudsman, on 30.7.2003 consent was given by the appellant bank for their participation and adjudication of the matter by the Banking Ombudsman. Thereafter, an application was filed before the Civil court, where the suit for recovery was pending for getting the suit adjourned sine die on the ground that the matter was pending before the Banking Ombudsman. On 31.12.2004, the Banking Ombudsman decided the matter in favour of the Punjab National Bank. The appellant was aggrieved against the award of the Banking Ombudsman dated 31.12.2004, filed a petition under Section 34 of the Act before the Civil Court at Sangrur, which has been dismissed on 21.4.2007. FAO No.2658 of 2007 - 3 - Mr.T.S. Gujral, learned counsel appearing on behalf of the appellant has, inter alia, challenged the impugned order passed by the District Judge, Sangrur on the ground that the order is totally without reasons and against the settled principle of natural justice which demands at least application of mind to the issues raised before it. It is contended that the learned District Judge has concluded by observing “None of the said grounds is available to the applicant and the arbitral award is not liable to be set aside”. As against this Mr.B.S. Bhatia, learned counsel appearing on behalf of the respondent No.1/Bank submits that the finding recorded by the learned District Judge, Sangrur is well in accordance with law and does not call for any interference. I have heard both the learned counsel for the parties and perused the record with their assistance. After giving my thoughtful consideration, I am of the view that the present appeal deserves to be allowed. The basic tenet of law is that the justice should not only be done but also seems to have been done. In the present case, all the cannons of principle of natural justice have been thrown to the winds by the learned District Judge, Sangrur while making the aforesaid observations without adverting to the arguments raised by the appellant. In these facts and circumstances of the case, I find it appropriate to set aside the order of the Court below and remand the matter back to District Judge, Sangrur for deciding afresh by passing speaking order with reasons in support of its decision. The learned counsel for the respondent has also got no objection to the remand of the matter. FAO No.2658 of 2007 - 4 - The appeal is thus allowed. The order of the learned District Judge, Sangrur is set aside. The matter is remanded back to the Court of District Judge, Sangrur for deciding the matter afresh by passing speaking order. The parties are directed to appear before the District Judge, Sangrur on 24.3.2009. The learned Court below is further directed to decide the lis between the parties as expeditiously as possible preferably within a period of six months from the date of appearance of the parties. No costs. (RAKESH KUMAR JAIN) FEBRUARY 25, 2009 JUDGE vivek