The Bankers’ Books Evidence Act 1891: A brief overview

This article on “The Banker’s Books Evidence Act 1891: A brief overview” was written by Shudhi Malhotra, an intern at Legal Upanishad.

Introduction

The Bankers’ Books Evidence Act, of 1891, a piece of legislation from the British colonial era in India, is still in effect and hasn’t altered much through the years. In banking institutions, records have been kept since the beginning. Such establishments must follow the record-keeping procedure. The ledger books, account books, etc. that serve as the primary storage for these documents are known as bankers’ books.

The legislature adopted the Banker Books, Evidence Bill on October 1st, 1891. This Act’s primary goal was to implement in India the prerequisites of the 1879 English Bankers’ Books Evidence Act. The Information Technology Act of 2000 revised this statute to contemplate the usage of computer systems in banking organizations to retain records rather than paper. This article talks about the meaning, the importance of the bankers’ books evidence act 1891, its amendments, and recent judgments.

Historical overview

At the end of the 19th century, India’s banking industry was expanding significantly. The Bankers’ Books, Evidence Bill received legislative approval on October 1st, 1891. The initial purpose of this statute was to carry out the terms of the English Bankers’ Books Evidence Act of 1879 in India. To amend the Law of Evidence concerning bankers’ books, this rule was put into place in England. In all legal processes conducted under this Act, manuscript access to the bankers’ books, including transactions and invoices, must be considered at the first appearance as proof of such access.

Definitions

Section 2 of this Act characterizes the following;

• Company– “Company” includes a foreign organization as specified by section 591 of the Companies Act, 1956 (1 of 1956), and refers to any organization as defined in section 3 of that Act.

• Corporation- “Corporation” refers to any legal entity created by a statute currently in effect in India; this comprises the RBI, SBI, and any subordinate bank as specified by the SBI (Subordinate Banks) Act, 1959. (38 of 1959).

• Bank–
  • (a) Any type of business or firm engaged in the banking industry.
  • (b) coalition or someone whose books the terms of this Act has been expanded as further indicated
  • (c)  Any post office savings bank or money order office.

• Legal Proceedings- These refer to;
  • (a) Any Investigation or proceeding in which testimony is given.
  • (b) Any analysis under the Code of Criminal Procedure, 1973 (2 of 1974), or any other regulation currently in effect for the compilation of proof, performed by a police administration or any further individual (not being an arbiter) permitted in this regard by an arbiter or by any law currently in power.

Significance and significant sections of bankers’ books evidence act 1891

Section 2

Section 2A

Section 2A stipulates that particular certificates must be looked after by the printout or replica of the print directed to in Section 2(8). These are:

• A statement made on a certificate signed by the branch manager’s principal accountant that:
  • (a) A printed copy of the entry
  • (b)  A further printout of this kind

• A certificate signed by the computer system’s manager that includes the following information in addition to a precise explanation of the computer system;
  • (a) The system has taken special precautions to make sure that only authorized users have input the data or conducted any other actions.
  • (b) To ensure the prevention and identification of an unauthorized alteration to data, specific safeguards are implemented.
  • (c) Information about the precautions is accessible to recover lost data caused by things like systemic failure.

Section 3

The State Government is allowed to prolong the representations of this Act, as expressed in Section 3. Any partnership or individual operating the banker’s business within the areas under its control may have the provisions of this Act extended to their financial records by the State Government. The State government has the authority to do so by publishing a notice in the official gazette, and it also has the power to revoke such a notice.

Section 5

According to Section 5, unless the court or judge issues a special cause order, the bank’s office shall not be forced to submit bankers’ books to prove any content or testify in support of any matters, transactions, or accounts documented in lawful cases in which the bank is not a member.

Section 8

In applying sections 5, 6, and 7 by section 8, an analysis under the Criminal Procedure Code, 1973, or in further law that is in effect for the accumulation of proof by an administrator or any further individual permitted to do the exact by an arbiter or any current law shall be interpreted as directed to a ruling produced by leaders of the Superintendent of Police or above as determined in Section 8. The government that employs the police officer or anyone else executing the investigation or inquiry is referred to as the appropriate government in this instance.

Amendments

The Bankers’ Books Evidence Act of 1891 was modified by the Information Technology Act of 2000 to modify the meaning of bankers’ books. This Act changed the following things:

• Amendment to Section 2(3): Previously, the term “bankers’ books” only applied to catalogues, daybooks, money books, accounts books, and further books operated in the normal course of a bank’s corporation. Following the change, it now includes documents kept on a small film, magnetic tape, or other mechanical data retrieval systems.

• Section 2(8)(b): This section was summed up to the explanation of a certified copy, and it specifies that it includes printouts of any entries accumulated on a small film, magnetic tape, or any other type of mechanical or electronic data retrieval mechanism, as long as the mechanism itself guarantees the precision of the printout as a replica of the entry.

• Section 2A: Section 2A was put in to address the credential criteria for a certified copy’s acceptance in the printout form. It specifies the certifications the computer system administrator must have.

Recent judgments

• Sonu @ Amar v. State of Haryana: In this case, it was noted that the norm to specify even if or not to grant disapproval considering the compatibility of banking records relies on even if or not the reasonable defect could have been rectified at the time of the manuscript marking and the party delivering proof could have used the customary method of confirmation.

• Radheshyam G. Garg v. Safiya bai Ibrahim Lightwalla: It noted that it was specified that the tribunal should not concentrate on all the conditions outlined in Section 2(8) of the Act and assume a hyper-technical approach when determining whether a record is a valid document of the source, sustained in the procedure of the corporation, and retained in the bank’s possession. The provisions made in Section 2(8) of the Act are simply advisory and not mandatory.

Conclusion

Bank assertions are deemed trustworthy references of input. The Bankers’ Books Evidence Act, of 1891 entrenched a credential process to ensure the integrity of these parts of confirmation. When bank ledgers must be stimulated in a legal case, the Act describes regulations for banking organizations or industries that operate banking. These monetary organizations are subject to this Act’s regulations and are obligated to voluntarily comply with them. The Act would be violated if there was any discrepancy in the records.

Society has altered as a result of the development of computers and the internet. Not specifically banking. To manage the records, almost every bank uses computer systems. The Information Technology Act of 2000 was modified to address certified copies of printouts of entries and the credentials required to ascertain their lawfulness.

References

• Meenal Sharma, “An overview of the Bankers’ Books Evidence Act, 1891”, iPleaders Blog, 16 December 2020, available at: https://blog.ipleaders.in/overview-bankers-books-evidence-act-1891/
• “The Bankers Books Evidence Act, 1891”, Bare Acts Live, available at: http://www.bareactslive.com/ACA/ACT006.HTM
• Recent judgments https://indiankanoon.org/doc/1502503/
• Importance of Bankers books evidence act,1891 https://www.google.com/amp/s/blog.ipleaders.in/overview-bankers-books-evidence-act-1891/%3famp=1