INDIAN BANK vs GODHARA NAGRIK COOP.CREDIT SOC.LTD.&ANR.

The Supreme Court addressed the issue of liability concerning Fixed Deposit Receipts (FDRs) issued by banks, where a fraud involving bank officers and commission agents was alleged. The Court held that the High Court's directive for banks to pay depositors was justified, as the Committee's report indicated that the depositors were not parties to the fraud. The Court emphasized that the banks' liability to pay the amounts under the FDRs was not conclusively resolved by the Committee, thus necessitating further examination of the liability and quantum payable to depositors under the Banking Regulations Act, 1949, particularly Section 35A.