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Customer of the Bank

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HomeBrud.gifBanking LawBrud.gifCustomer of the Bank
  • Heber L Hart, in Account Theory, defined Customer of the Bank as a person who has an account with the banker, and he keeps either a current or a deposit account with.
  • Sir John Paget: To constitute a customer there must be some recognizable course or habit of dealing in the nature of regular banking business.

Related Case / Recent Case / Case Law

  • Great Western Railway Vs London and County Banking Co: Bank en-cashes cheques of a person for a period of 20 years even though the person has no account with it. Held, the person is not a customer of the bank
  • Ladbroke and Co Vs Todd: Relationship between banker and customer begins as soon as a cheque is paid in and accepted for collection and not merely it is paid.
  • Great Western Railway Vs London and County Banking Co (1901): Appellate Court held that "There must be some sort of Account - either a deposit or current account or some similar relationship - to make a man customer of a bank".
  • Central Bank of India Vs Gopinathan and Nair, 1970: Supreme Court of India held that: "So far as the banking transactions are concerned, the customer is one whose money has been accepted on the understanding that the bank will honor transactions up to the amount standing to his credit, irrespective of his connections being of short or long standing. Thus it is not necessary that the account shall have been operated sometime to merit that the person is known as a customer and even if there is a singe transaction, it is sufficient."

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