9911796707
TMI Blog2007 (1) TMI 271X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1949 (hereinafter referred to as the Act ) for grant of a licence to it to commence banking business. In January, 1999 the RBI, conveyed its approval in principle for the promotion of a local area bank subject to various terms and conditions and finally on 28-7-2000, granted a licence to the appellant to carry on banking business. It was an express condition of the said licence that the appellant would always maintain a minimum paid-up capital of Rs. 5 crores as per the requirement of the RBI Guidelines regarding capital adequacy. 3. However, various irregularities, and in particular the non-maintenance of minimum capital as was required by the RBI Guidelines, were noticed during onsite supervisory visits on two occasions, which were duly intimated to the appellants. In spite of regular reminders, the appellant did not restore the original minimum capital of Rs. 500 lakhs which was an essential requirement for grant of the licence and accordingly a Notice to Show Cause was issued to the appellant on 4-7-2001. 4. In September, 2001, in exercise of powers conferred under section 35A of the Act, the RBI prohibited the appellant from granting any loans and advances, making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner therein, respondent No. 1 herein was guilty of forum shopping. The learned Single Judge rejected the contentions of the appellant on the ground that the writ petition preferred by the appellant before the Rajasthan High Court was dismissed without any observations as to the legal propriety of the order dated 14-9-2004 passed in the second review petition, which is under challenge in the present writ petition. It was further held by the learned Single Judge that since the Appellate Authority is located in Delhi and all the hearings took place in Delhi, this High Court has jurisdiction to entertain the writ petition. 9. Having rejected the above-mentioned preliminary objection, the Learned Single Judge went ahead to test the validity of the order passed by the Appellate Authority in a second review petition. After perusing the provisions of section 22(4), (5) and (6) of the Act and specifically relying on sub-section (6) of section 22 which lays down that the decision of the Central Government where an appeal has been preferred to it under sub-section (5), or of the Reserve Bank where no such appeal has been preferred, shall be final, the learned Single Judge referred to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 1 submitted that the jurisdiction for entertaining the writ petition vests in the Delhi High Court and the same flows from article 226(2) of the Constitution of India and that if the Act would alone apply for deciding the issue of territorial jurisdiction in instituting a writ petition, as sought to be argued by the learned senior counsel for the appellant, then it shall result in denuding the High Court of a power vested in it under the Constitution. It was further argued that in the present case, the Appellate Authority being located in Delhi where all the hearings took place, this Court would ipso facto have territorial jurisdiction to deal with the writ petition. Learned senior counsel for respondent No. 1 submitted that reliance placed by the appellant on the provisions of section 36B of the Act was misconceived as the same is not applicable to the facts of the present case for the reason that the order in question had been passed under section 22 which is not included in Part III and Part IIIA of the Act and that section 36B defines the words High Court for the purposes of winding up proceedings under Part III and Part IIIA of the Act. 12. On the issue of maintai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, notwithstanding that the seat of the Government or authority or the residence of the person against whom the direction, order or writ is issued is not within the said territories. We may usefully advert to the following observations of the Supreme Court in the aforesaid case : "Para 6. . . . . Therefore, in determining the objection of lack of territorial juris- diction the Court must take all the facts pleaded in support of the cause of action into consideration albeit without embarking upon an enquiry as to the correctness or otherwise of the said facts. In other words the question whether a High Court has territorial jurisdiction to entertain a writ petition must be answered on the basis of the averments made in the petition, the truth or otherwise whereof being immaterial. To put it differently, the question of territorial jurisdiction must be decided on the facts pleaded in the petition. . . ." 16. We may note that clause (1A) was inserted by 15th Amendment Act, 1963, to confer on the High Courts, jurisdiction to entertain a petition under article 226 against the Union of India or any other body or authority located in Delhi if the cause of action has arisen, wholl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct that the order of the appellate authority is also required to be set aside and as the order of the original authority merges with that of the appellate authority." 17. We may also observe that merely because the appellant chose to approach the High Court of Rajasthan by assailing the orders dated 16-1-2002 and 13-9-2002 passed by respondent No. 1 that by itself is no ground to state that respondent No. 1 ought to have approached the said High Court for impugning the subsequent order dated 14-9-2004 passed by the Appellate Authority on the second review petition preferred by the appellant during the pendency of the writ petition before the Rajasthan High Court. The claim of the appellant that section 368 read with section 5( o ) of the Act and section 10(1) of the Companies Act confers jurisdiction on Rajasthan High Court alone, is misconceived and misplaced. Section 36B defines High Court in relation to a banking company in the context of winding up of a banking company under the Companies Act as contained in Part III and Part IIIA of the Act. In fact, orders have been passed by respondent No. 1 under section 22, which is (not) ( sic ) included in Part III of the Act, to w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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