S.K. Mukherjea, J.
1. This appeal is directed against a judgment and decree of Bijayesh Mukherjee, J. dated September 18. 1963 insofar as by the said judgment and decree the learned Judge dismissed the suit as against Allahabad Bank Ltd., the first defendant, who is a respondent before us. The facts of the case may be briefly stated.
2. In March and April the plaintiff, that is to say, the appellant before us sold and delivered to one W. F. Ducat & Co. Ltd. of 5 Clive Row, Calcutta, diverse quantities of jute for the price of Rupees 57,889-7-0 which became payable by the said buyers.
3. Messrs. W. F. Ducat & Co.. Ltd. drew an uncrossed cheque on their bankers, the respondent Allahabad Bank Ltd. for the said sum payable to the plaintiff or order in payment of the said price and made over the same to the defendant No. 2 Jeth-mall Chandalia, an employee of the plaintiff. In the plaint, the plaintiff claimed that the defendant No. 2 had no authority to operate on the plaintiff's banking account or to endorse any cheque payable to the plaintiff's order. In paragraph 5 of the plaint the plaintiff further averred that there is a well-known usage and/or practice in the banking business and/or trade and commerce in Calcutta, well known to the defendant at all material times, that a cheque payable to a limited Company cannot be encashed at the counter of the drawee bank and that the same can only be encashed if presented for payment through the bank of the payee.
4. The defendant No. 2 wrongfully, dishonestly, fraudulently and without authority endorsed the said cheque on the back thereof purporting to be for and on behalf of the plaintiff and thereafter presented the same at the counter of the defendant bank.
5. It is contended by the plaintiff that the defendant 'bank, contrary to the afore' said custom or usage of the trade, wrongfully and negligently paid the cheque at its 'counter although the said cheque had not been presented through any bank on behalf of the plaintiff. The cheque was paid under circumstances which afforded reasonable grounds for suspicion and put the defendant No. 1 on enquiry as to the authority of the defendant No. 2 to receive payment of the cheque or use the proceeds thereof in fraud of the plaintiff and deprive the plaintiff of the same.
6. The defendant bank should have known on reasonable enquiry that the defendant No. 2 had no authority to endorse the cheque payable to the plaintiff's order or to encash the same.
7. The bank acted negligently in not making due enquiry as to the authority of the defendant No. 2 to realise the proceeds of the said cheque and had any such enquiry been made, the bank would have ascertained that the defendant No. 2 had no authority to endorse or realise the proceeds of the said cheque.
8. The plaintiff contended that the payment, of the said cheque was not made in due course or in the ordinary course of business. The endorsement of the cheque made by the defendant No. 2 was unauthorised, fraudulent and forged.
9. The plaintiff pleaded that the defendants Nos. 1 and 2 had converted the said cheque and the proceeds thereof to their own use as a result whereof the plaintiff has suffered damages.
10. In the alternative, the plaintiff claimed the said sum against the said defendants as moneys had and received by the said defendants to the use of the plaintiff. An allegation of conspiracy was made by the plaintiff against the defendant No. 2 and the defendant No. 3 K. L. Maheswari, a constituent of the bank who identified the defendant No. 2 before payment was made by the bank. It is important to note that the defendant No. 3 was dismissed from the suit by the plaintiff of his own accord with the result that the allegation of conspiracy or of any act of omission or commission on the part of the defendant No. 3 cannot be sustained.
11. On the basis of the aforesaid allegations, the plaintiff claimed a decree for the sum of Rs. 57,889-7-0 interest up to the date of the institution of the suit, interest on judgment and costs.
12. Written statements were filed by the defendant bank and the defendant No. 3. The defendant No. 2 chose not to defend the suit. As the defendant No. 3 has been dismissed from the suit, we are concerned only with the defence of the defendant bank.
13. In their written statement, the defendant bank denied that the defendant No. 2 had no authority to endorse any cheque payable to the plaintiff's order or to operate on the plaintiff's 'banking account. The existence of the alleged usage and practice of bankers in Calcutta was disputed. It was also denied that the bank was aware of any such usage or practice. The bank stated, as the fact appears to be, that the defendant No. 2 endorsed the cheque on behalf of the plaintiff by signing on the 'back thereof as the Manager of the plaintiff, presented the cheque at the counter and received payment. In paragraph 6 of the written statement, the bank denied the allegation of negligence and disputed that it was necessary that the said cheque should have been presented through a bank on behalf of the plaintiff. The bank further denied that there was any circumstance affording any grounds for suspicion to put the plaintiff on any enquiry.
14. In paragraph 7, the defendant stated that it is the usual custom and practice in Calcutta that before making payment across the counter on an order cheque the bank insists on the person receiving payment being identified by a constituent of the bank or some other person known to the bank. In the facts of this case, the defendant No. 2 was identified by the defendant No. 3, a constituent of the bank.
15. In paragraph 9, the bank denied that there was any occasion for any reasonable enquiry that the defendant No. 2 was duly authorised to endorse any cheque payable to the plaintiff's order, on behalf of the plaintiff or to encash the same or that the bank should have known that the defendant No. 2 was not authorised to endorse the cheque on behalf of the plaintiff or to encash the same.
16. In paragraph 10, the defendant bank denied the allegation of negligence or carelessness. They claimed that the said cheque purported to be endorsed by order on behalf of the plaintiff and the bank paid the cheque in good faith and in due course and/or in the ordinary course of business and as such, the bank was duly discharged by such payment.
17. The bank further contended that the cheque was and/or was purported to be endorsed by or on behalf of the plaintiff in blank or as such was paid to the bearer thereof and by making payment to such bearer, the defendant was duly discharged.
18. In paragraph 12, the bank pleaded estoppel by negligence. It was stated that the plaintiff by his conduct in allowing the defendant No. 2 to have possession and control of the said cheque and in allowing him to sign the same by or on behalf of the plaintiff, the plaintiff is estopped from alleging that the defendant bank had not the authority of the plaintiff to endorse or encash the said cheque. The particulars of the estoppel pleaded by the bank may be set out:
'The said defendant No. 2 was the manager of the plaintiff. The plaintiff allowed and authorised the said defendant to collect, possess and deal with the said cheque. After the defendant No. 2 had taken possession of the said cheque, the plaintiff wilfully did not inform the bank that the defendant No. 2 had no authority to endorse or encash the said cheque which allegation of lack of authority is denied by the bank and thereby implied-ly represented to the bank that the defendant No. 2 had the plaintiff's authority to endorse, deal with, or encash the cheque. Relying upon the said representation, the defendant dealt with the defendant No. 2 and paid the said cheque.'
19. A further point of estoppel is taken in paragraph 14 of the Written Statement. It reads:
'The defendant bank states that if the defendant No. 2 had no authority to endorse or encash the cheque, which allegations are denied, the said cheque was allowed or caused by the plaintiff to be possessed and dealt with by the defendant No. 2 without reasonable care and caution on the part of the plaintiff and in a negligent manner so as to enable the defendant No. 2 to endorse and/or encash the said cheque and by reason thereof the plaintiff ought not to be permitted to allege that the said defendant No. 2 had no authority to endorse or encash the said cheque.'
20. The allegation of conversion was denied by the bank. It was also denied that the bank was liable to the plaintiff for monies had and received by the bank to the use of the plaintiff.
21. In conclusion, the defendant bank alleged that the plaintiff had no cause of action against them and the suit as against them should be dismissed with costs.
22. The parties went to trial on the following issues: --
1. Was the purported indorsement of the cheque in controversy here by the second defendant unauthorised?
2. Is there any usage or practice as alleged in paragraph 5 of the plaint?
3. Is the plaintiff estopped from alleging want of authority for reasons set out in paragraphs 12 to 14 of the written statement?
4. Was the payment of the cheque in controversy here by the first defendant in the ordinary or due course of business?
5. Was the plaintiff the true owner of the cheque in controversy?
6. Have the first and the second defendants converted the cheque as alleged?
7. What relief, if any, is the plaintiff entitled to?
23. One of the main issues which has to be answered is on the question of existence of the trade usage pleaded in paragraph 5 of the plaint. The case is that the usage demands that a cheque payable to a limited Company cannot be cashed at the counter of the drawee Bank and that the same can only be passed for payment through the Bank of the payee, it is clear that the usage on which the plaintiff relies is an unqualified one. The contention is that no cheque payable to a limited Company made payable to order crossed or uncrossed or payable to bearer cannot be paid on presentation but must be encashed through the payee's bank. The date of the cheque in the suit is 1st April 1955. The question is, did such a practice exist at the material time? Oral as well as documentary evidence has been adduced on this question on either side. The documentary evidence consists of Ext 'C' read with CI, Ext. 'D' read with 'D' I, Exts. 'H' and 'I' and Exhibit '9'. Exhibit 'C' is an uncrossed order cheque dated May 20, 1955 payable to Bhu-toria Estate Ltd. for Rs. 10,000/- drawn on the defendant Bank. It appears that the cheque was endorsed and presented by B. Bhutoria Manager of the payee Company. The cheque was returned by the defendant Bank for reason No. 19. the reason given being that the cheque drawn in favour of a Limited Company should be presented through a Bank or payee's identification required In Exhibit CI. the reason for return given on the return slip are all printed upto item No. 18. But reason No. 19 appears in manuscript. On a scrutiny of the hand-writing it appears that there is a conjunction between the words 'presented through a Bank' and 'payee's identification required' the conjunction is not very legible. It may be either the conjunctive 'and' or the disjunctive 'or'. We prefer to read the conjunction as 'or' not merely because in our opinion, it reads as such, but also because that reading is reasonable. It is universally accepted that if a cheque drawn in favour of a limited Company is presented through a bank, no further identification of the payee is required. It will be therefore absurd to suggest that even if a cheque is presented through a bank the payee's identification will have to be established. It is interesting to note that Item No. 19 on the cheque return slip is in handwriting and not in print. It only shows that it is likely to be a later addition made at the discretion of the Bank. Even on the basis of that practice, it cannot be said that in the present case there has been any departure from such practice. The cheque in question, that is to say. Ext. 'B' was not presented through a Bank but the payee, that is to say, the defendant No. 2 was identified by the defendant No. 3. Moreover Ext. 'C' is of 28th May 1955. A custom might have sprung up into existence subsequently. In any event Ex. 'C' by itself does not prove any trade custom. At the best, it indicates that Allahabad Bank had adopted on a subsequent date, the practice of returning a cheque for the reason given in item No. 19 of the cheque return slip. Ext. 'D' again is an uncrossed order cheque dated May 23, 1955 payable to Bhutoria Estate Ltd. The cheque is for Rs. 7,000/-. The cheque was endorsed and presented by the self same Bhutoria. the Manager of the payee Company. The cheque was returned by the Central Bank for the reason given in item No. 21 of the cheque return slip, the reason being that the cheque payable to a Limited Company needs to be presented through a Bank. It is interesting to note that here also the reason given in item No. 21 is in handwriting although all the other items being items Nos. 1 to 20 are in print. This might be treated as evidence of the fact that the Central Bank at its discretion added reason No. 21 for returning a cheque unpaid. It may be accepted that on 23rd May 1955 Central Bank adopted the practice of not paying a cheque payable to a limited Company unless it was presented through a Bank. It does not follow that the practice prevailed on 1st April, 1955 even in the Central Bank. Ext. 'D' and 'D' 1 do not establish the existence of the -practice pleaded by the plaintiff on 1st April 1955. Coming to Exts. 'H' and 'I' it will be seen that the cheque in question is of 13th February 1963 drawn on National Grindlays Bank Ltd. payable to a limited Company or bearer for Rs. 500/- only. The cheque was returned by the Bank with the note 'please present this cheque through your Banker.' This ext. is totally irrelevant for our present purpose because it came into existence years after Ext. 'B', and also because it merely establishes that in February 1963 National Grindlays Bank Ltd. adhered to a particular practice. It is no evidence of any general trade usage pleaded in the plaint. Ext. '9' is a cheque for Rs. 3,000/- dated October 4, 1962 drawn on the Eastern Bank Ltd. payable to a Limited Company or bearer. It appears that the cheque was paid at the counter in cash. This Ext again is of little value for the purpose of the present enquiry. As it is of 1962 and is made payable to bearer it only proves that in 1962 cheques payable to a limited Company or bearer used to be paid on presentation by the Eastern Bank Ltd.
24. As regards oral evidence on this issue the plaintiff produced a number of witnesses. Alien Alexander, an Assistant Accountant of the National and Grindlays Bank deposed that he came to India on October 2, 1960. It is clear that he could not have given any evidence from his personal knowledge on the existence of the trade usage claimed by the plaintiff in 1955. The plaintiff's sixth witness Desikan, Head Assistant in the Accounts Department of the Bank of India, Calcutta appears to have come to Calcutta in 1962 and was therefore hardly competent to speak from his personal knowledge on the question of existence of the said trade usage in 1955. Likewise Harding, a witness of the defendant Bank joined the Calcutta office of the Eastern Bank in August 1962 when he came to India. He, again, was not competent to speak on the state of affairs in 1955 so far as trade usage is concerned. Pathak, plaintiff's second witness who had been working in the United Commercial Bank simply said that he would not have paid any uncrossed order cheque in favour of a limited Company on the counter because there is a convention amongst the banks, though the convention is not accepted by all the banks that such cheques are not to be paid at the counter. Chakraborty, the plaintiff's third witness who had been working in the Central Bank since 1935 spoke of many exceptions to the general rule that cheques in favour of a limited Company are not paid across the counter. The substance of his evidence is that an uncrossed order cheque payable to a limited Company may be paid at the counter after the Bank is satisfied that the endorsement on the back of the cheque is verified by the payee's Bankers or if the person endorsing his signature on behalf of the limited company who is solvent and respectable, assures the bank in writing that the endorser is known to the bank and the cheque has been signed in the bank's presence or if the cheque is endorsed by an agent and the Company's banker endorsed the signature of the agent. He then added that if the limited company insists on payment in cash, the drawer of the cheque is contacted and after the drawer signs on the back of the cheque authorising the Bank to pay the bank will pay at the counter. The learned judge has pointed out in his judgment that in course of his evidence-in-chief Chakravarty examined the cheque in controversy and expressed the opinion that the payment made by the defendant in the present case was a payment made in due course.
25. Jati Ranjan Roy, the plaintiff's fourth witness who was an Assistant Accountant of the Mercantile Bank Ltd. in its Calcutta office deposed that he should have paid a cheque payable to a limited Company at the counter after the drawer on being contacted gave him fresh instructions to that effect in writing and as a matter of fact, he did make such payments on two or three occasions. All that he wanted to be sure of was confirmation in writing by the drawer of the cheque having been drawn in favour of a limited company or bearer and the endorsement being in fact the endorsement of the payee. In course of his evidence, he deposed that in encashing or not encashing the cheque in favour of a limited company at the counter, the officer dealing with the cheque will go by his subjective satisfaction and also by relevant rules or instructions by which he is governed. In answer to questions 274 to 276 he admitted that it is impossible to postulate a single uniform practice throughout Calcutta. On his attention being drawn to the trade practice pleaded by the plaintiff he accepted the plaintiff's contention in substance, but made a reservation that in special circumstances the practice could be departed from. Nanda Kishore Ghose, the fifth witness of the plaintiff was the Chief Accountant of the Bank of India. He deposed that an uncrossed cheque in favour of a limited company cannot be paid across the counter. The Bank has nevertheless a discretion to depart from the practice in appropriate circumstances He admitted that on rare occasions payment has been made at the counter in cash. Moreover on the strength of a letter from the payee that the Bank can pay to the bearer, such a cheque may be paid across the counter. Thirdly, if the Bank is satisfied that the person presenting the cheque and signing on the back of the cheque is authorised to sign on behalf of the limited company, payment will be made at the counter. Moreover, if the cheque is for a small sum, payment may be made across the counter in exercise of the Bank's discretion. In answer to question 128 Ghose said that there is no general custom in the matter and it is for every bank to decide whether or not it will exercise its discretion in a particular case.
26. The learned judge on an analysis of the evidence has rightly concluded that no general trade practice as alleged by the plaintiff in paragraph 5 of the plaint has been established by the evidence oral or documentary, adduced in this case. In our opinion, the evidence is pitifully inadequate, amorphous, occasionally contradictory and falls far short of the standard required to establish a general trade practice common to all the banks in Calcutta. Oral as well as documentary evidence clearly indicates that individual banks exercise their discretion in regulating their own business practice. They exercise their discretion in the manner they think best. In the light of the evidence, we have no hesitation in holding that the trade practice alleged in paragraph 5 of the plaint has not been proved and issue No. 2 must therefore be answered in the negative.
27. The first issue raised the question whether Jethmall the defendant No. 2 had the authority to endorse the cheque in controversy on behalf of the plaintiff. In this connection it is relevant to refer to Section 89 of the Indian Companies Act 1913 which was in force at the material time. The Section provides that
'a bill of exchange.........shall be deemed to have been endorsed on behalf of the Company if.........,..endorsed in the name of by or on behalf or on account of the Company by any person acting under its authority, express or implied''.
The learned Judge found on scrutiny that the minutes of proceedings of certain meetings and for that matter, the minute book produced by the company, were mutilated and contained interpolations. In fact, he disbelieved the minutes and the minute book. The reasons given by the learned Judge for holding that the minutes are not authentic are unexceptionable. In fact the learned Judge has gone to the length of observing that it is possible that if the genuine minute book were produced it might have been found that authority was expressly conferred on Jethmall to endorse cheques and bills of exchange on behalf of the plaintiff. The learned Judge also criticised the plaintiff's failure to produce the statutory register, returns and notifications contemplated in Section 87 of the Companies Act of 1913. These books and documents ought to have settled the point whether Jethmall was the Manager at the material, time. The learned Judge has also commented on the failure of the plaintiff to produce the relevanl Articles of Association. He has rightly remarked that the position of Jethmall in the plaintiff Company and the scope of his authority were peculiarly within the knowledge of the plaintiff and therefore the onus was on the plaintiff to satisfy the Court that Jethmall was not the Manager as he claimed to be, on the basis of the endorsements on the cheque and that he was not competent to endorse the cheque. The learned Judge has alluded to and analysed the evidence in great detail and with meticulous care. To avoid prolixity and repetition, we do not propose to analyse the evidence on this question over again. It is abundantly clear in the light of the entire evidence that whatever might have been the designation of Jethmall, he was the life and soul of the jute business of the plaintiff company and he represented the plaintiff for the purpose of that business in every aspect. It is true that Malchand's evidence is that Jethmall in conducting the business of the plaintiff company did merely as he was told by Malchand. But as the learned Judge has pointed out, Malchand betrays a lamentable lack of knowledge of the business of the plaintiff company and it is therefore safe to assume that Jethmall, in doing whatever he did, acted on his own initiative on behalf of the Company. Malchand's evidence is that in 1955 the duties of Jethmall were to purchase and sell jute as well as to make out bills and deliver the bills to the parties. When the bills were issued, he contacted the parties, collected cheques from them and deposited the cheques so collected in the account of the plaintiff. He further added that he did all these important things not on his own but in accordance with Malchand's instructions. The learned Judge has given reasons for disbelieving the evidence that Jethmall did not act on his own but under instructions of Malchand. In fact Malchand admitted that if Jethmall had deposited the cheque in question in the banking account of the plaintiff company it would have been perfectly in order. The evidence of Ghose of W. F. Ducat and Company Ltd. may be treated as evidence of an independent character because Ducat is not a party to the suit and the bona fides of Ducat in paying the price of jute by the cheque has not been called in question. Ghose deposed that he knew only Jethmall of the plaintiff company at the relevant time and no other person. In answer to Question 15 he said that Jethmall. 'used to come to our office occasionally --often to give offers and also to close business, receive payments, settling claims all concerning the transactions.'
He also deposed that the claims in respect of four bills (Ext. 5) on the basis of which the cheque in the suit was paid, were settled by Jethmall. It has also been established that Jethmall signed all the four bills in Ext. 5. Dudhoria an Assistant of an underbroker of W. F. Ducat and Company is another independent witness. The trend of his evidence is also that Jethmall was all in all in the plaintiff's Jute business. The learned Judge has relied on answers to Questions 18 and 19 put to Dudhoria. The substance of his evidence is that Jethmall represented the plaintiff Company in all transactions in a complete measure. The learned Judge, in our opinion, was justified in finding as a fact upon the whole of the evidence that appearances are very much in favour of Jethmall having been the Manager of plaintiff Company at the relevant time. We are also in agreement with the learned Judge when he says that 'even if it be assumed that that is not a safe conclusion to come to, there can be no running away from the fact so patent upon evidence that he was at or about the relevant time a big person in B.T.C.'s organization drawing the pay and occupying the position, of the manager.
28. Apart from the question whether Jethmall was in fact the Manager of the plaintiff Company as he represented to be, by the endorsement on the back of the cheque, there are good reasons why the plaintiff Company should not be permitted to allege that he was not. It is not in dispute that the rubber stamp inscriptions on the back of Ext. 'B' viz., 'Bhuto-ria Trading Co. Ltd., and 'Manager' were produced by use of the genuine seal, that is to say, of the rubber stamp in the custody, control and possession of the plaintiff Company. The plaintiff Company, obviously, by permitting Jethmall to use those rubber stamps for the purpose of endorsement on the back, represented to the defendant bank that Jethmall was, in fact, the Manager and had the authority to make the endorsement on the cheque on behalf of the plaintiff Company. There is no evidence that the relevant rubber stamps were procured by Jethmall dishonestly for use or that Jethmall fraudulently obtained possession of the rubber stamps in spite of exercise of due care and caution on the part of the plaintiff Company. In our opinion, acquiescence on the part of the plaintiff Company in the use of the relevant rubber stamps by Jethmall without any objection on the part of the plaintiff Company makes it clear that Jethmall was the Manager and had the implied authority to endorse the cheque for and on behalf of the plaintiff Company. It was faintly argued that as the word 'for' or 'on behalf of does not appear on the body of the endorsement, the plaintiff company is not bound to its banker by the endorsement made on the back of the cheque. The objection is of no substance. The endorsement was made, so to say, by the plaintiff company itself by the pen of its manager, Jethmall and the absence of the words 'for' and 'on behalf of is a matter of no consequence. In this connection reference may be made to a decision of the Supreme Court in Oriol Industries v. Bombay Mercantile Bank : 3SCR652 where it was held that the 'law in regard to the company's power to issue negotiable instrument has to be found in the relevant . provision of the Companies Act itself and the principle enunciated in Section 89 of the Companies Act 1913 cannot be extended to the claim made by the Company against its bank on the ground that the cheque which the bank accepted and honoured was defective in that it did not comply with the requirements of Section 89 and could not have been enforced against it.'
29. An issue of estoppel was raised on behalf of the defendant bank on the grounds set out in paragraphs 12 to 14 of the written statement. In paragraph 12 it is pleaded that the plaintiff is estopped from relying on Jethmall's lack of authority because of its conduct in allowing Jethmall to possess, control, and endorse the cheque, in wilfully not informing the defendant bank of Jethmall's lack of authority thereby impliedly representing to the defendant bank the existence of its authority and in not taking reasonable care or precaution to obviate the exercise of authority by Jethmall to endorse the cheque thereby enabling Jethmall to encash the cheque and realise the proceeds thereof.
The learned Judge has disposed of this issue by saying that as he found as a matter of fact that Jethmall had the authority to endorse the cheque and realise the proceeds thereof, the issue did not arise. Even then, he answered the issue in the negative. The learned Judge said in his judgment 'again, BTC never holds out Jethmall before the defendant bank as its Manager, so the plea of estoppel appears lo be misconceived one'. With utmost respect, the learned Judge ought to have pointed out that by permitting Jethmall to use the seal of the plaintiff's Manager, or in other words, by making the seal available to Jethmall thereby enabling him to use it for the purpose of endorsement of the cheque, the plaintiff impliedly made representations to the bank on the basis of which the bank paid the cheque. The plaintiff represented to the Bank that Jethmall was the plaintiff's Manager. The rubber stamp of the Company, that is to say, the seal of the Company was [also made available to Jethmall which he used in endorsing the cheque. Therefore the plaintiff, by its conduct, represented to the Bank that Jethmall had authority to act on behalf of the plaintiff Company as its Manager.
30. In these circumstances, we hold fhat in any event, the plaintiff is estopped by its conduct from challenging the authority of Jethmall to endorse the cheque and realise the proceeds. We, therefore, answer the third issue in the affirmative.
31. The fourth issue was framed in the following terms:
'Was the payment of the cheque in controversy by the first defendant made in the ordinary or due course of business?'
The expression 'payment in due course' has been defined in Section 10 of the Negotiable Instruments Act to mean payment in accordance with the apparent tenor of the inslrument in good faith and without negligence to any person in possession thereof, under circumstances which do not afford reasonable ground for believing that he is not entitled to receive payment of the amount therein mentioned. It can hardly be questioned that the payment by the defendant bank of the cheque in question has been made by the defendant bank in accordance with its apparent tenor. The cheque is an uncrossed cheque payable to the plaintiff or order. The cheque was endorsed by the plaintiff through its Manager. The fact that Jethmall is the Manager is borne out by the seal of the Company which is unquestionably an authentic seal. The seal of the Manager is also equally authentic That the payment was made in good faith has not been disputed for all practical purposes. There is not a grain of evidence before the Court from which if remotely appears that the payment was not made in good faith. Now that the en-the evidence is before the Court, the question of onus to prove good faith loses much of its importance. No negligence has been proved against the bank. The defendant bank insisted on identification of Jethmall and Jethmall was in fact identified by Kishanlal Maheswari a constituent of the Bank the defendant No. 3. The defendant bank therefore look all reasonable precautions even though the circumstances in which the cheque was presented for payment did not afford any reasonable ground for believing that Jethmall was not entitled to receive payment of the amount mentioned therein. The plaintiff having failed to prove the trade practice which he alleged and the bank having paid the cheque, in accordance with the apparent tenor of the instrument, in good faith, and without negligence, to Jethmall who was in possession thereof the defendant is entitled to succeed. There were no circumstances which afforded any reasonable ground for believing that he was not entitled to receive payment of the cheque. It must be held that the bank made the payment in due course. The learned Judge, in our opinion, has rightly pointed out that payment in due course is necessarily payment in the ordinary course.
32. Sub-section (1) of Section 85 of the Negotiable Instruments Act provides:--
'Where a cheque payable to order purports to be endorsed on behalf of the payee the drawee is discharged by payment in due course.'
33. In view of the aforesaid provision, it must be held that the defendant bank has been discharged by payment of the cheque in due course.
34. With regard to the fifth issue there is no controversy before us that the plaintiff was the true owner of the cheque in question nor is there any controversy that Jethmull had the authority to receive the cheque from W.F. Ducat and Co. Ltd. on behalf of the plaintiff Company and that he received the cheque. As regards the sixth issue, we hold that the defendant bank had not converted the said cheque. The learned judge has held and rightly held, in our opinion, that Jethmall the defendant No. 2 converted the said cheque. No appeal or cross-objection has been preferred by Jethmall and the finding of the learned Judge against Jethmall stands. Be that as it may, in agreement with the learned Judge we hold that Jethmall converted the said cheque and is liable in respect of the said act of conversion. In view of the manner in which we have answered all other issues, we must hold in agreement with the learned Judge, that the plaintiff is not entitled to any relief as against defendant bank. In the view we have taken the appeal fails and is dismissed with costs. The case is certified as fit for employment of two counsel.
35. I agree.