Law:

Section:

(a) Contract Act (IX of 1872)--- ----S. 171---Lien/right of banker to set off---Principle---Banker and customer---Even under the law which provided for recovery through coercive process such as land revenue, determination of amount due is an essential pre-requisite---Bank cannot be conferred with judicial powers for determination of amount due against its customer/borrower---Right/power to sell off is available only where amount claimed is due and is certain and determined by competent judicial forum. (b) Civil Procedure Code (V of 1908)--- ----S. 50---Decree, satisfaction of---Legal representatives---Extend of liability---Principle---Pecuniary obligation undertaken by deceased promisor would be binding on his legal representatives to the extent of estate of deceased promisor in their hand. (c) Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act (XV of 1997)--- ----Ss. 7(4) & 9---Contract Act (IX of 1872), S. 171---Civil Procedure Code (V of 1908), S. 50---Suit for recovery of money---Lien/right to set off---Determination---Legal heirs of deceased loanee---Extent of liability---Outstanding finance facility of father of plaintiffs, after his death was adjusted by Bank seeking to right of set off against funds of plaintiffs---Plaintiffs filed suit for recovery of money against Bank which was dismissed by Trial Court but High Court allowed appeal and decreed the suit in favour of plaintiffs---Plea raised by Bank was that Banking Court was proper forum for determination of dispute between the parties---Validity---Neither there was any adjudication of claim of Bank against principal debtor or against deceased, nor it was judicially determined as to whether plaintiffs had inherited any property from deceased---No question of Bank seeking to right to set off the alleged liability and/or seeking any recovery from plaintiffs without adjudication of such aspect of the matter---Neither there was any question pertaining to 'finance' as defined by S. 9, nor the question as to whether plaintiffs were 'customer's in the context of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997, involved in the matter and no documents…

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