IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.2482 OF 2001

Hubert J. D'souza        ...Appellant(s)

Versus

Corporation Bank & Ors.       ...Respondent(s)

O  R  D  E  R

Heard learned counsel for the parties.

By  the  impugned  order,  the  National  Consumer  Disputes  Redressal

Commission [for short, “the National Commission”] dismissed the complaint filed by

the appellant, in effect and substance, on the ground that the same was barred by

limitation.

A perusal of the complaint and the documents filed by the appellant shows

that  Respondent  No.3-M/s.  Rao  Constructions  gave  a  post-dated  cheque  bearing

No.929131  dated  17th October,  1996,  to  the  appellant  on  17th April,  1996  for

repayment of the loan.  The Manager of Chembur Branch of the Bank guaranteed

encashment of the cheque.  However, on 16th July, 1996, that is a day before the due

date of payment, the Branch Manager asked the appellant not to present the cheque.

On the next day, cheque No.929131 was taken from the appellant and another cheque

bearing No.217401 dated 17th October, 1996 was issued for Rupees twenty lakhs.  The

bank gave fresh guarantee to the appellant that the cheque will be

....2/-

- 2 -  

honoured on its presentation.  The appellant presented the cheque on 10th April, 1997,

for encashment but it was returned on the same day with the remark “insufficient

funds”.  The appellant represented to the bank for payment of Rupees twenty lakhs

by relying upon the guarantee given on 17th July, 1996.  The Chief Manager of the

Bank  sent  communications  dated  November  16,  1998  and  February  5,  1999  and

assured the appellant that the matter is being looked into and they will get back to

him within few days.  After fifteen days, the Chief Manager vide his letter dated 20th

February, 1999 denied the liability of  the Bank to pay the amount of  the cheque.

Thereupon,  the  appellant  filed  complaint  before  the  National  Commission  on  18th

October, 1999 which, as mentioned above, was dismissed as barred by time.

From the facts narrated above, it is clear that cause of action to file the

complaint  had  arisen  on receipt  of  communication  dated  20th February,  1999,  by

which the bank denied its liability to pay the amount of cheque in spite of the fact that

the payment of the said sum was guaranteed.  Therefore, the complaint filed on 18th

October, 1999 was well  within limitation and the National Commission committed

serious error by dismissing the complaint on the ground that the same was barred by

limitation.

Accordingly,  the appeal is allowed,  impugned order is set aside and the

matter  is  remitted  to  the  National  Commission  which  shall  now  dispose  of  the

complaint in accordance with law after giving opportunity of hearing to the parties,

which would obviously include opportunity to adduce evidence.

No costs.

......................J.       [B.N. AGRAWAL]

......................J.       [G.S. SINGHVI]

New Delhi, January 21, 2009.