Bank of Ceylon v. Aswedduma Tea Manufactures (Pvt) Ltd. – SC LA APPEAL 175/2015-2017

In the case between Bank of Ceylon and Aswedduma Tea Manufactures (Pvt) Ltd., the court addressed the issue of whether the granting of overdraft facilities creates a binding contract in the absence of a written agreement, the evidentiary sufficiency of secondary documents such as bank statements, and the application of estoppel where the recipient has benefited from such facilities. It was held that a binding contract was formed by offer and acceptance, even without a formal written agreement; that bank statements and related evidence suffice to establish the existence and terms of the overdraft facility; and that the defendant, having received and utilized the benefit, is estopped from contesting liability. The principle reaffirmed is that banking facilities, when acted upon, can create e