Mango supplier’s heirs win 27-year legal battle against bank, food firm

The dispute arose after Shafi Hassan Nadkar supplied 61,403 kg of mangoes, valued at ₹8.13 lakh, to the company’s processing unit in Wai, Satara district, under an agreement dated April 21, 1999

A Pune court has dismissed a nationalised bank’s appeal against an order directing it to pay ₹3.79 lakh, with 8% annual interest, to the legal heirs of an Alphonso mango supplier who delivered over 61 tonnes of the fruit to a food processing company in 1999.

The bank’s witness also lacked personal knowledge of whether the required demand letters had been submitted. (REPRESENTATIVE PIC)

In a judgment delivered on Monday, district judge-5 Sachin B Bhansali upheld the March 30, 2013, decree holding the bank jointly and severally liable with Ambrosia Agro Industries Ltd and its chairman and managing director for the outstanding dues.

The dispute arose after Shafi Hassan Nadkar supplied 61,403 kg of mangoes, valued at ₹8.13 lakh, to the company’s processing unit in Wai, Satara district, under an agreement dated April 21, 1999. The company paid ₹2 lakh in advance and agreed to route the balance through the bank. After part payment through mango pulp cans and other adjustments, ₹3,79,510 remained outstanding.

Following Nadkar’s death, his legal heirs sued the company, its chairman and managing director, and the bank. The bank argued that its undertaking to pay was conditional on the realisation of export bills and submission of a demand letter accepted by the company.

Rejecting the appeal, judge Bhansali noted that the bank had failed to produce its ledger, export bill register, account statements or a certificate establishing that export proceeds had not been realised. The bank’s witness also lacked personal knowledge of whether the required demand letters had been submitted.

The court held that the bank could not shift the burden of proving non-realisation of export proceeds onto the supplier’s heirs when the relevant records were within its control.

It also found that the bank had not responded to a demand letter dated August 10, 2002, denying receipt or stating that payment conditions remained unmet.

The judge held that the undertaking created an enforceable obligation in favour of Nadkar. The appeal was dismissed with costs, and the trial court’s decree was confirmed.

Advocate Ranjeet Srinivasan appeared for the bank, while advocate SA Kazi represented the respondents. Ambrosia Agro Industries and its chairman and managing director remained ex parte in the appeal.