Vastulal vs Pareek Commercial Bank

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: supreme-court

Case Number: Appeals Nos. 484 and 485 of 1962

Decision Date: 27 August, 1964

Coram: P.B. Gajendragadkar, J.C. Shah, N. Rajagopala Ayyangar

In this matter, the Supreme Court of India considered two appeals that arose from earlier proceedings concerning the enforcement of directions issued by the Company Judge of the Rajasthan High Court. Those directions had been affirmed by a Division Bench of the same High Court and required the appellant, Vastulal Pareek, to restore certain property that belonged to Pareek Commercial Bank Limited, which was then in liquidation, under the provisions of Section 45H of the Banking Companies Act. The validity of those directions had previously been challenged in Appeals Numbers 484 and 485 of 1962, but the challenges were rejected. Following the High Court’s determination, the orders were sent for execution under Order Twenty‑One, Rule Six of the Code of Civil Procedure, to the District Judge of Bikaner. The appellant, Vastulal, argued before the District Court that the court lacked jurisdiction to entertain an application for execution of an order made under Section 45H of the Banking Companies Act. The District Court rejected this contention and proceeded to entertain the execution application. Undeterred, Vastulal filed a revision petition in the Rajasthan High Court, seeking to set aside the District Court’s order to entertain the execution applications. The High Court, relying upon Section 45T(1) and Rule 745(2) of the High Court Rules, concluded that the execution applications were indeed maintainable. Against the High Court’s order, the two appeals were subsequently filed before this Court with the grant of special leave.

The counsel representing the appellant acknowledged, and the Court agreed, that if the High Court’s orders made under Section 45H of the Banking Companies Act were valid and correctly imposed a liability on Vastulal to pay the amounts specified, then there existed no legitimate basis for him to contest the jurisdiction of the District Court to execute those orders. On the basis of this reasoning, the Court found that the appeals could not succeed. Consequently, the appeals were dismissed. No order regarding costs was made.