G.SURYA KUMARI V. UNION BANK OF INDIA

WP/8675/2021

AI Insights

The case involves G. Surya Kuivari, a retired government employee, who filed a writ petition against the Union Bank of India for blocking her pension account without notice. The bank had previously filed a civil suit against her and her sons for recovery of a loan, in which she was a guarantor. The bank's action to block her account was based on its right of set-off due to the outstanding loan amounts. The petitioner argued that her pension account should not be subject to such actions as per legal provisions protecting pension amounts. The court examined the legality of the bank's actions in light of constitutional and statutory protections for pensioners.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 721617 (HC-TELANGANA)
• Appeal Type: Others
• Pronouncement Date: 27-12-2021
• Assessment Year: misc
• Other Referred Cases: Radhey Shyam Gupta v. Punjab National Bank, Syndicate Bank v. Vijay Kumar, State of Jharkhand v. Jitendra Kumar Srivastava
• Laws Referred To: Article 226 of the Constitution of India, Section 151 CPC, Section 60(1)(g) of the Code of Civil Procedure, 1908, Section 11 of the Pension Act, 1871, Article 300-A of the Constitution of India
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: K NARASIMHA
• Assessee Lawyers: MADISHETTY RAMU
• Keywords: Legal Notice; Pension account; Set-off; Writ of Mandamus; Bank's General Lien; Unblock Pension Account
• Section: 11; 151; 226; 300-A; 60(1)(g)

Judgement Text

"HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original J urisdiction) IVONDAY, THE TWENTY SEVENTH DAY OF DECEIVBER TWO THOUSAND AND TWENTY ONE PRESENT THE HONOURABLE SRI JUSTICE B.VIJAYSEN REDDY WRIT PETITION NO:8675 OF 2021 Between: G.SURYA KUIVARI, W/o Late L.G.Shanker Rao Aged about 67 years, Occ. Retired Government Employee, Ryo H. No.16/1/486/4/1 , Flat No.404, Tirumala Arches, Saidabad, Hyderabad-59. ...PETITIONER AND 1. UNION BANK OF lNDIA, (formerly known as Andhra Bank) (a Govt. of lndia Undertaking) Saidabad Branch Office Situated at 16-1-570, Saidabad Hyderabad-500059. Rep. by its Senior Branch l ,4anager. 2. UNION BANK OF lNDlA, (formerly known as Andhra Bank) (a Govt. of lndia Undertaking) Zonal Office Situated at Union Bank of lndia /Andhra Bank Building, Sultan Bazar, Koti, Hyderabad - 500095. ...RESPONDENTS Petition under Adicle 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue Writ or Direction or Order more particularly in the nature of Writ of Mandamus declaring lhe action of the Respondents Bank in blocking / freezing the Petitioners Pension Bank Account bearing No. 0521 10025053522 maintained with the Respondent No.1 and the debit card connected to said Pension Account, as illegal, arbitrary and in violation of law and consequently direct the Respondents to immediately u nblock/unfreeze the Petitioners Pension Bank Account and debit card connected lo said account with a further direction to the Respondents Bank not to make any adjustments or set-off or exercise general lien in respecl of and/or over the Pension Amounts of the Petitioner credited to above mentioned Pension Bank Account maintained with the Respondent No.'l Bank, in the interest of lustice, and equity failing which the Petitioner shall be put lo severe mental and physical pain, inconvenience and hardship. Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to grant interim directions to the Respondents to immediately unblocki unfreeze the Petitioners Pension Bank Account bearing No. 0521 '10025053522 maintained with the Respondent No.1 and activate the debit card connected to said Pension Account with a further direction to the Respondents bank not to make any set-off, adjustments or exercise any general lien in respect of and/or over lhe Petitioners pension amount credited to Petitioners above mentioned Pension Bank Accounl, pending disposal of this writ petition. Counsel for the Petitioner: SRl. MADISHETry RAMU Counsel for the Respondents: K LAKSHMI NARASIMHA, SC FOR AB The Court made the following: ORDER. lA NO: 1 OF 2021 HONOURABLE SRI JUSTICE B' VIJAYSEN REDDY wIlIT PETITI ONN o.8675 oF2 021 ORDER: Aggrieved by the action of the respondents - Union Bank of India in freezing / blocking the petitioner's Pension Bank Account bearing No.052l10025053522 maintained with respondent No l - Union Bank of India, Saidabad Branch Otfrce' Saidabad' Hyderabad' and attempting to adjust the amounts standing to the credit of her pension account as being illegal' arbitrary and unsustainable' this writ petition is filed by the petitioner' 2.HeardSriM'I{amu'ieirrnedcounselfbl'thepetitioner'and Dr. K. Lakshmi Narasimha' Iearned counsel tbr the respondents - bank, and perused the material on record' 3. The case of the petitioner is that she is a retired Govemmenl employee. She is 67 Years old FIer husband exPired long back' The petitioner worked as aflendant in the Income Tax Department and retiredflomserviceonattainingageofsuperannuationin200T.After retirement, she is solely dependent on her monthly pension amount credited to her pension account maintained with respondent No'l bank. She is totally dependent on her bank debit card connected to her pension account As per the Reserve Bank of lndia guidelines' pension distributing banks havc been asked to record rhe Pension Payment Order (PPO) number on the bank accoLrnt passbook of its I 2 customers. Accordingly, the bank has mentioned her Pension Payment Order (PPO) No.00000070 on her bank pass book. (ii) The petitioner went to her nearest bank branch on 17.02.2021 for issue of new debit card. Then she was informed by the bank executive that new card will be issued and it will be activated from 19.02.2021. She was not able to 'ivithdraw money from the ATM by using her debit card lor the reason of transaction declined, unable to process and unauthorised usage. When she enquired with the bank, the petitioner was informed that her pension account is blocked by the bank which is without any inlormation and notice to her. (iii) It is stated that respondcnt No.l bank has filed a civiI suit in O.S. No.2l3 of 2015 for recovery of rnoney on 28.02.2015 before the leamed XVIII Additional Senior Civil Judge, City Civil Court at Hyderabad, inter alia, contending that one of its borrowers availed Ioan facility of Rs.2,60,000/- on 12.04.2010 and the petitioner is one ofthe guarantors for the said loan. The petitioner strongly denied the suit transaction on various grounds including on the point of limitation and discrepancies in the case ofthe respondents - bank. The said suit was dismissed for default on 20.08.2019 as the bank did not pursue the case. The petitioner has submitted complaints dated 22.02.2021 and 24.02.2021 to the respondents - bank requesting for de-freezing her pension account. (iv) Since no action has been taken by the bank' petitioner has issued legal notice dated 07 '03 '2021 and reply was issued bv the bank vide notice dated 20.03 2021 through email dated ?2'03 '2021 admitting the fact of blocking the petitioner's pension bank account and by asse(ing that it is done in exercise of irs righr ol set-off' adjust and bankers general lien against the pension amount' 4. The leamed counsel tbr the petitioner has submitted that the action of the respondents - barik in blocking the pension account ol' the petitioner is in gross violation of proviso (g) to Section 60(1) of theCodeofCivilProcedure,lg08(forshort.CPC,)andSectionllof the Pension Act, 1871' It is further submitted that the property contemplated under Article 300-,{ of the Constitution of India' includes pension, as such, action of the bank in depriving the petitioner of her pension amounts to violation of the constitutional rights. Further, in view ofthe law laid down by the Hon'ble Supreme Court in Radhey Shyam Gupta v' Punjab National Bankr' pension and gratuity amounts cannot be attached' 5. The case of the respondents - bank is that son of the petitioner Mr. Gajadi Sanjeev Kumar has availed an educational loan of Rs.4,00,000/- (Rupees lbur lakhs onlv) tor prosecuting M'B'A' at Wolverhampton University, U K ' on 05'02 2010 The petitioner stood as personal guarantor lor the said loan and also for the loan taken by her another son viz', Gajadi Kiran Kumar' The petitioner ' l(2009) I scc 376 l and her son as co-obligants fbiled to repay the loan availed by them. The suit in O.S. No.2l3 of 2015 was filed by respondent No.l before the leamed VII Senior Civil Judge, City Civil Court, Hyderabad, against the petitioner and her sons and the same was dismissed for non-representation on 20.08.2019. An application was filed by the bank for restoration of the suit. (i) It is submitted that the petitioner had opened Abhaya Gold Savings Bank Account bearing No.05 2l10025053522 with the respondents - bank on 10j22007. On retirernent of the petitioner from service, at her request, the pension received from the Govemment of India is being credited to the said account without opening an exclusive pension account. The petitioner was making other transactions also through the said account. Thus, the account of the petitioner is not exclusive pension account, but it is like any other ordinary savings bank account. Once the anrount of pension is credited to the account and it is mixed up with other amount in the account, it loses its character of pension. Hence, the banker is entitled to exercise the right of set-off and banker's general lien towards amounts due to it. 6. There is no dispute regarding proposition of law that pension account cannot be frozen or attached as per Section 60(1)(g) of CPC and Section I I ofthe Pension Act, 1871. However, the dispute in this case is whether the pension account of the petitioner is an exclusive pension or not? r I 5 7. The petitioner has filed additional documents vide memo dated 16.08.2021. The bank statement of account indicates that periodical pension amount of Rs.17,350/- have been deposited in the account of the petitionel. To rebr.rt such evidence, the respondents - bank have not produced any evidence. Further. to substantiate the claim that other amounts of the petitioner have been credited to the pension account of the petitioner, the respondents - bank have not produced any material. There is an absolute bar under Section 60(1)(g) ofCPC read with Section l1 of the Pension Act, 1871, for attaching pension amounts. In the counter filed by the respondents - bank, the bar under the above provisions and proposition of law enunciated in Radhey Shyam Gupta's Case (Supra 1) are not disputed. The principal contention of the respondents - bank is that the account of the petitioner is not an exclusive pension account' The argument of the learned counsel tbr the respondents - bank that the character of pension account changes if other amounts are credited into that account other than pension alnount, is rvithout any merit At the most, the respondents - bank may' have clairn ovel' the amounts which are credited other than the pension amotlnts However, in the instant case, there is no proof of such contention of the respondents - bank that other amounts of the petitioner are also lying in the pension account of the petitioner. In any case, the suit of the bank filed for recovery of amounts aqainst the petitioner and her two sons was also dismissed for delault and so far, it is not restored' Even if the respondents - bank are to exercise their r'igir of lien' they are entitled t- \"16. The fact remains that there is an imprimatur to the legal principle that the right to receive pension is recognised as a right in \"proper1y\". Article 300-A of the Constiturion of India reads as under: \"300-A. Persons nol to he deprived of prope y save by tuthoritl'of lote.- No person shall be deprived of his property save by authority of law.\" Once we proceed on that premise, the answer to the question posed by us in the r (t992) 2 scc alo I lzot:; tz scc zto I 6 to do so only to the extent of the amounts deposited in the bank other than pension amounts. 8. The judgment of the Hon'ble Supreme Court in Syndicate Bank v. Vijay Kumar2 relied or.r by the learned counsel for the respondents - bank is not applicable to the facts of the present case. The said matter is no way connected to the pension amounts or account. The issue involved therein is the right of general lien of the banker o.rer the fixed deposits of the bomower which is not the controversy herein. 9. In State of Jharkhand v. Jitendra Kumar Srivastavar, it was held that right to receive pension was treated as right to property under Article 300-,4 of the Indian Constitution. Paragraph No.l6 of the judgment reads as under: '7 beginning of this judgment becomes too obvious. A person cannot be deprived ol'this pension without the authority of larv, which is the constitutional mandate enshrined in Article 300-A of the Constitution. It follows that attempt of the appellant to take away a part of pension or gratuity or even leave encashment without ary statutory provision and under the umbrage of administrative instruction cannot be countenanced.\" Thus, a person cannot be deprived of pension without due process of law. As noted above, there is a bar under Section 60(l)(9) of CPC read with Section 11 of the Pension Act, 1871, for atlaching the pension amounts and the respondents - bank is debaned lrom exercising lien on the pension account. 10. [n Radhey Shyam Gupta's Case (Supra 1), the dispute involved was regarding attachment of pension and gratuity amounts which were converted into fixed deposit receipts. The contention of the bank placing reliance on the judgment of the Hon'ble Supreme Court in Union of India v. Jyoti Chit Fund and Financea was that once payments (pension and gratuity) are made, their character stood altered as they become mixed with the other assets of the employee concemed [Paragraph No.27 in Radhey Shyam Gupta's Case (Supra l)]. However, such contention was impliedly rejected by making the following observations: ' ( r9?6) I scc 607 I 8 \"33. However, we are also of the view that having regard to proviso (g) to Section 60(l) of the Code, the High Court committed a jurisdictional error in directing that a portion of the decretal amount be satisfied from the fixed deposit receiprs of the appellant held by the Bank. The High Court also erred in placing the onus on the appellant to produce thc Matador in qucstion lor being auctioned lbr recoverv of the decretal dues. In other rvords, the High Court crred in altering the decree olthe trial court in its revisional .jurisdiction, particularly when the pension and gratuity of the appellant which had been converted into fixed deposits. could not be attached under the provisions of the Code of Civil Procedure. The decision in Jyoti Chit Fund case has been considerably rvatered do*,n by later decisions which have been indicated in para 22 hereinbefore and it has been held that gratuity payable would not be liable to attachment for satisfaction of a court decree iu view of proviso (g) to Section 60(l) ol the Code.\" 11. The statement ofaccount ofthe petitioner shows remittance of Rs.1,000/- every month (other than pension of Rs.17,350/-), the details ol which are not known. In any case, applying the ratio laid down in Radhey Shyam Gupta,s Case, this Coun holds that the character of the petitioner's account does not change merely because some other amounts have been remitted in the account. (.) 12, Though there is a distinction between 'lien' and 'attachment', it needs to be noted that the underlying object of 'lien' is to appropriate or adjust the funds of the borrower' which the bank has in its possession, for recovering dues to he borrower' Thus' the analogy under provision (g) to Section 60(1) of CPC applies in as much as there is a statutory mandate debarring attachment sale of pension amounts. 13. Therefore, the respondents - bank are directed to forthwith defreeze the pension account of the petitioner to the extent of her pension amounts. The respondents - bank are further directed to issue debit card / ATM card to the petitioner' However' it is made clear that the respondents - bank are at libeny to attach the amounts in the pension account of the petitioner other than the pension amounts' if they are already lying in the account or deposited in future' 14. Accordingly, the writ petition is allowed to the extent indicated above, at the admission stage itself' No order as to costs' As a sequel thereto, miscellaneous petitions' if any' pending in the writ Petition stand closed' sD/- MoHD'SANAU LLAH A s3'Bl ASSISTANT REGISTRAR r/TRuE coPY// srcrLr#orrrcec 1 2 To, rhe senior Branch Manasel yljl\".)\"1\"til5,?: UBn lfr\"i[\"^''3'i,l3H'3]\"0 \"' An.lhra Bank) (a Govt of lndla L +i;LTdil'fi i'+:i$f ,,ffi lrx*i:iifl :?itiil;iT**;llr;; Undertaking; Zonal Office srtua' ;;;;ffi;;' Koti Hyderabad - soooes t- 3. 11 LR Copies 4. The Under Secretary, Union of lndia, I ilinistry of Law, Justice and Company affairs, New Delhi. 5. The Secrelary, Telanagana Advocales Associalion Library, High Court Buildings, Hyderabad. One fair Copy to the HON'BLE SRt JUSTTCE B.VIJAYSEN REDDY (For His Lordship's Kind Persual) 6. One CC to SRl. MADISHETTY RA|VU, Advocate IOPUC] 7. One CC to SRl. K LAKSHIVI NARASII/HA, SC FOR AB [OPUC] 8. Two CD Copies 9. One Spare Copy PB *.- C) v' HIGH COURT DATED:2711212021 ORDER WP.No.8675 of 2021 ALLOWING OF THE WRIT PETITION WITHOUT COSTS ( J o 11 A?n ttl:r l.E 5TA&- D v .-d * ri z' "