- (1.) Indian Bank has filed these applications praying for clarification of certain directions contained in the final judgment dated 16.05.2008 of this Court in Civil Appeal No. 3303/2005 along with Civil Appeal Nos. 3336, 3337, 3338 and 3304-3335 of 2005.
(2.) 1 Respondents herein are cooperative societies registered under the Cooperative Societies Act. They deposited certain amounts in cash in fixed deposits of Banks wherefor Fixed Deposit Receipts (FDRs) were to be issued. Such deposits were made through some so-called Commission Agents of the Banks on payment of huge commission which is ordinarily not allowed by the Nationalized Banks. 2.2 Applications for grant of loans by various persons were filed before the prescribed authorities of the banks on the basis of the said FDRs. Allegedly a large number of officers of the banks were involved in a scam whereby unofficial investments of the said amount were being made. 2.3 As and when the FDRs matured, the investors requested the Banks for their encashment. The banks refused to accede thereto stating that the amount under the FDRs had already been paid by way of loans and, thus, no further amount was payable. It was contended that a fraud on the banks has been practiced to which the depositors and the officers of the banks were parties. 2.4 Writ petitions were filed. A learned Single Judge of the High Court opined that serious disputed questions of fact being involved in the said writ petitions, no relief can be granted to the writ petitioners. 2.5 Despite the same, the learned single judge relying on the provisions contained in Section 35A of the Banking Regulations Act, 1949 directed constitution of a Committee under the Chairmanship of the Deputy Governor of Reserve Bank of India or his nominee to go into the matter in great details. Various powers were delegated in favour of the Committee including the one that the decision of the Committee shall be final and binding upon the parties. 2.5.1 A Division Bench of the said Court in an intra court appeal preferred thereagainst, however, stayed only the operation of some of the clauses of the said order. The Committee, however, was allowed to function. 2.5.2 A special leave petition filed thereagainst has been dismissed by this Court with certain observations. 2.6 The Committee submitted its report. It was found that principally the officers of the banks were involved in the matter of commission of the alleged fraud on the Banks. 2.6.1 Members of the Committee, however, differed in their opinion as to whether, having regard to the limited scope of the enquiry, any positive direction could be issued. 2.7 Relying on the report of the Committee, the Division Bench of the High Court opined that as the writ petitioners were not parties to the fraud, subject to any other or further orders that may be passed in the criminal case, appellant- banks should be directed to pay the amounts under the FDRs to the depositors. 2.8.1 Appellants filed appeals aggrieved by the said order, upon obtaining special leave thereof. 2.8.2 On 5th April 2004, a limited notice was issued by this Court, which is to the following effect: Issue notice on the special leave petition limited to the question as to whether the High Court should have directed payment having regard to the fact that the Committee itself had not finally resolved the question of liability as far as the disputed amount was concerned. Issue notice on the prayer for interim relief also. 2.8.3 This Court in its order dated 10th December, 2004 explained the said order stating: The issue which is now required to be resolved is a narrow one viz. whether the Committee had finally decided that the amounts payable by the Bank (a) were the liability of the Bank and (b) if so, what was the quantum if any, payable by the Bank to the depositors. Learned Counsel appearing on behalf of the respondent prays for time till after the vacation. Let the matter appear two weeks after reopening on a miscellaneous day. There will be interim order staying the operation of the impugned order. 2.8.4 However, by an order dated 9th May, 2005, upon hearing the counsel for the parties, Leave was granted, as a result whereof all the contentions of the parties are now open.
(3.) Having heard the learned Counsel for the parties at length and having noticed and considered the propositions of law touching the issues involved in these appeals, this Court allowed the appeals with the following directions [see 2008 (7) SCALE 363 paras 18,19,20,21,22,& 23 at pgs. 376-377]: 18. But it is, in our opinion, not a public interest litigation in that sense of the term. The report, however, was not unanimous. The opinion of the Committee was a divided one on the crucial issue. Two members of the Committee were of the opinion that whether the amount deposited by the cooperative banks was received back by them or not, was yet to be ascertained. We are, therefore, of the opinion that it cannot be said that the fact finding body, assuming that the same could be constituted, made such recommendations which could be accepted by the Court without going into the merit thereof. It is also not a case where any mandatory relief could be granted in favour of the respondents. 19. Having however said so, we must pose unto ourselves a further question. Could those cooperative societies which had absolutely no role to play in the entire episode should suffer in any manner whatsoever The cooperative societies/cooperative banks for the purpose of their day-to-day functioning require the amount which they have invested in FDRs on their maturity. Should they wait till the criminal cases are over Should they be pushed to institute civil suits They can indisputably be compensated by grant of interest. What, however, happens if in the meanwhile in the absence of the requisite funds being available to them, they find it difficult to run the day-to-day affairs 20. Answers thereto may be difficult to find but it is not a wholly impossible task. We think that the appellant Bank being a State within the meaning of Article 12 of the Constitution of India with the assistance of officer(s) of the Central Bureau of Investigation should make all attempts to ascertain as to which of the cooperative societies/cooperative banks are in no way involved with the scam, and subject to such precautions as may be found necessary to be taken, release the amount in their favour. 21. In any event, the quantum of the amount which all the depositors would have otherwise received, in the event their investment in FDRs is found to be genuine, should be informed thereabout. Once the liability of the bank is determined, the bank may invest the said amount in its own account and issue fresh FDRs therefor. Whereas the bank may keep the original FDRs with itself, it may issue the duplicate copies thereof to the eligible cooperative bank. Such an exercise should be completed within a period of four weeks from date. 22. In the event, the cooperative society intending to avail loan facilities from the banks for running their business, may approach them which may apart from usual conditions release the same on a further condition that the amount of FDR would remain with them and on that basis, loans may be granted of such amount. The usual precautions in regard thereto may also be taken by the Bank(s). 23. We, while saying so, do not intend to lay down any law. These directions should not be treated to be precedent. We are issuing these directions keeping in view that the factual scenario obtaining in the case and that non- release of the amount is likely to enure hardships that may be faced by the cooperative societies. We would also direct the criminal court to dispose of the criminal cases pending before them with utmost expedition. These appeals are allowed with the aforementioned directions. There shall, however, be no order as to costs.;