Bashir UD Peracha (Appellant v Anthony Reginald Miley (Respondent
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE DILLON,LORD JUSTICE PARKER,LORD JUSTICE STOCKER |
| Judgment Date | 18 June 1990 |
| Judgment citation (vLex) | [1990] EWCA Civ J0618-1 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 90/0556 |
| Date | 18 June 1990 |
[1990] EWCA Civ J0618-1
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
(Mr. Justice Vinelott)
Royal Courts of Justice
Lord Justice Dillon
Lord Justice Parker
and
Lord Justice Stocker
90/0556
MR. ROBIN K. MATHEW (instructed by Messrs Clifford Chance) appeared on behalf of the Appellant (Appellant).
MR. JONATHAN PARKER, Q.C. (instructed by The Solicitor for the Inland Revenue) appeared on behalf of the Respondent (Respondent).
This is an appeal by the taxpayer, Mr. Peracha, against a decision of Mr. Justice Vinelott of the 21st December 1988 whereby the judge dismissed an appeal by the taxpayer by Case Stated against a decision of one of the Special Commissioners, Mr. O'Brien. The facts are clearly set out in the Case Stated and the decision of Mr. Justice Vinelott. I do not propose to set them out afresh.
There was before the Special Commissioner oral evidence by the taxpayer. There was also, as the basis of the tax appeal, a statement of agreed facts. Basically what it comes down to is that the taxpayer in 1971 made a deposit in London with the London branch of the United Bank as security under the terms of a Letter of Lien to guarantee advances by the Dacca branch of the United Bank to a company operating in East Pakistan, as it then was, called Transocean Trading (EP) Limited. In the Letter of Lien the taxpayer guaranteed the repayment of the advances to Transocean and further accepted that his liability should be as that of a principal debtor.
As a result of hostilities between India and Pakistan, which led to the establishment of Bangladesh as an independent state at the end of 1971, there was an order which brought about the vesting of the business and assets of Transocean in Bangladesh in the Bangladesh Jute Board. There was also another order whereby United Bank's undertakings in Bangladesh, including their right to be repaid the loan made to Transocean, were transferred to and vested in another bank, the Janata Bank. In the agreed statement of facts it was stated that it was generally thought that those two orders would be recognised as valid and effective by the English courts so that if the United Bank tried to bring an action against Transocean for the repayment of the loans, then Transocean would have a complete defence.
In 1984 the taxpayer, using his trade name, General Produce Company, brought an action in the Queen's Bench Division against the United Bank claiming that as a result of the decrees in Bangladesh the debt from Transocean had ceased to be due to that bank, that consequently there was nothing relevant owing to the bank from the taxpayer and so the taxpayer was entitled to claim back with interest the moneys he had deposited with the United Bank. The bank in that action averred that the debt remained due and that the bank was entitled to retain the deposit made by the taxpayer on which it had a lien. In paragraph 11 of the defence it was pleaded in the alternative:
"If, contrary to the defendants' contention, they are not entitled to retain the said deposit, they will set off against that sum, the sum of [the debt plus interest] as aforesaid."
That action came on for trial before Mr. Justice Lloyd in January 1979 and he delivered judgment, holding that there was a debt still outstanding and due from the taxpayer as a principal debtor, that the Letter of Lien accordingly subsisted and the bank was entitled to retain the deposit. He did not deal with the question of set off which had been raised because, he said, "It is unnecessary to reach...
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