9911796707
TMI Blog1978 (11) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... rests. ??? failed to pay the amount, the suit was filed for recovery of the amount. The defendants contested the suit by contending that they are agriculturists that the debt was liable to be scaled down under the Andhra Pradesh Agriculturists Relief Act, (Act IV of 1938) and even otherwise, the interest charged was usurious, within the meaning of the Usurious Loans Act as amended by the Madras Amendment Act VIII of 1937. It is not disputed that the defendants are agriculturists. Both the lower Courts held that the defendants were entitled to the benefits of the Andhra Pradash Agriculturists Relief Act in two suits they also held that the interest charged was usurious. 3. The first question for my consideration is whether the defendants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... panies (Acquisition and Transfer of Undertakings) Act, 1970 (hereinafter referred to as the Banking Companies Act) and, therefore the debt due to it by an agriculturist is not affected by the provisions of the Debt Relief Act. On the other hand, adopting the reasoning of both the lower courts it is submitted by the learned counsel for the respondents in one appeal, that the Union Bank of India was there even before the Banking Companies Act was enacted, that it was only acquired by the Government and, therefore, it is not a Corporation constituted pursuant to any Special Indian Law. 7. In order to decide this question it is necessary to refer to the relevant provisions of the Banking Companies Act. Section 2(d) defines corresponding new ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct to the provisions of the Act, to acquire, hold and dispose of property and to contract, and may sue and be sued in its name. By virtue of this sub-section every corresponding new bank is a body corporate with perpetual succession and a common seal Section 4 provides that on the commencement of the Act, the undertaking of every existing bank shall be transferred to and shall vest in the corresponding new bank. Under Section 7(2), the general superintendence, direction and management of the affairs and business of a corresponding new bank shall vest in a Board of Directors, and the Central Government shall in consultation with the Reserve Bank, constitute the first Board of Directors of a corresponding new bank. Section 8 provides that eve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch manner as it may direct. This Section also emphasizes the fact that the Societies Registration Act and the Company Law have no application for dissolution of the corresponding new banks. These provisions go to show that the corresponding new banks are constituted under the Banking Companies Act, and they are bodies corporate with prepetual succession and a common seal. It is not correct to state that the existing Union Bank of India Limited is the same as the corresponding new bank, Union Bank of India . The Union Bank of India Limited is different from Union Bank of India . The Union Bank of India is constituted under and pursuant to the provisions of the Banking Companies Act. Therefore, I do not agree with the lower Courts tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India (2) (1978 (II) A.L.T 48) the question for consideration was whether the Central Bank of India constituted under the Banking Companies Act, 1970 was a statutory authority included within the meaning of a State under Article 12 of the Constitution of India against which a writ of mandamus could be issued under Article 226 of the Constitution. After considering the provisions of the Banking Companies Act and the various decisions of other High Courts and the Supreme Court, Madhava Reddy and Narasinga Rao JJ., came to the conclusion that the Central Bank of India is created by the statute and whatever functions it discharges and whatever powers it exercises are those required of it and conferred on it by the statue. They held that it wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. 14. These decisions also support my finding that the Union Bank, of India is a Corporation constituted under the provisions of the Banking Companies Act. 15. The next question for consideration is whether, alternatively the defendants can claim the benefit of the Usurious Loans Act, 1918. That Act applies to the State of Andhra Pradesh. Section 3, as amended by the Madras Amendment Act 8 of 1937, empowers the Court to reopen, the transaction if it has reason to believe that it was substantially unfair. If the interest is excessive the Court shall presume that the transaction was substantially unfair. But, such presumption may be rebutted by proof of special circumstances justifying the rate of interest. In the case of loans to a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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