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2004 (7) TMI 351 - SC - Companies LawWhether the suit is not maintainable and should be dismissed for non-joinder of Canbank Financial Services? Whether upon the original Bankers Receipt No. 47 being handed over duly discharged to the defendants the plaintiffs ceased to have any right in respect thereof or for the IRFC Bonds of the face value of Rs. 72.50 crores mentioned therein, the said discharge being in view of the plaintiffs accepting unconditionally from the defendants the said CANFINA Bankers Receipt No. 1401 for Rs. 50 crores and the defendants Bankers Receipt for IRFC Bonds of the face value of Rs. 22.50 crores as alleged in paragraph 8 of the written statement? Whether there was an established and accepted market practice to deliver and accept Bankers Receipts in effective discharge of the obligations to deliver physical securities as stated in para 6(c) and para 12 of the written statement? Whether the plaintiffs are estopped from denying that the defendants have discharged their obligations in respect of the IRFC Bonds of the face value of Rs. 50 crores or from contending that the defendants obligations in that behalf remains outstanding or subsisting as alleged in paragraphs 3 and 12 of the written statement? Whether the plaintiffs remedy is against CANFINA only and not against the defendants as alleged in paragraphs 12 and 13 of the written statement of the defendants? Whether the plaintiffs are entitled to any relief and if so, what relief? Held that:- It is held that SCB voluntarily and unconditionally received and accepted non-transferable CANFINA’s BR 1401 with an obvious inference that SCB desired the said CANFINA BR for its own purpose for the reasons best known to itself. The Special Court fell in error in applying section 41 of the Indian Contract Act to the facts of the present case. Thus Civil Appeal filed by Citibank is accepted. Judgment and decree passed by the Special Court is set aside and the suit is ordered to be dismissed with costs throughout. CANFINA becomes entitled to restitution of the total amount paid by it to the Citibank (principal and interest) along with interest @ 9% p.a. from the date of payment provided it is paid on or before 1-9-2004 and in default to pay the interest @ 12% p.a. from the date of payment till it is repaid by the Citibank.
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