TaxTMI 
TaxTMI 
2006 (3) TMI 116
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.... behalf of the respondents, relying upon the decision in the case of Chief Conservator of Forests, Government of A. P. v. Collector [2003] 3 SCC 472, wherein vide paragraph 14 of the above reported judgment, the apex court observed"...It is neither appropriate nor permissible for two Departments of a State or the Union of India to fight litigation in a court of law. Indeed, such a course cannot but be detrimental to the public interest as it also entails avoidable wastage of public money and time. Various Departments of the Government are its limbs and, therefore, they must act in co-ordination and not in confrontation. Filing of a writ petition by one Department against the other by invoking the extraordinary jurisdiction of the High Court....
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....ramers of the Constitution or the Civil Procedure Code that two Departments of a State or Union of India and/or a Department of the Government and a public sector undertaking fight a litigation in a court of law. Such a course is detrimental to public interest as it entails avoidable wastage of public money and time. These are all limbs of the Government and must act in co-ordination and not confrontation. The mechanism set up by this court is not, as suggested by Mr. Andhyarujina, only to conciliate between Government Departments. It is also set up for purposes of ensuring that frivolous disputes do not come before courts without clearance from the High Powered Committee. If it can, the High Powered Committee will resolve the dispute. If t....
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....ition of law are binding on us. We hold that unless clearance is given to the petitioner, these proceedings cannot be permitted in the High Court. Learned counsel for the petitioner, however, referred to section 3 of the Regional Rural Banks Act, 1976, wherein the petitioner-bank is constituted. For convenience, we produce sections 3, 4, 5 and 9 of the Act: "3. Establishment and incorporation of Regional Rural Banks.-(l) The Central Government may, if requested so to do by a sponsor bank, by notification in the Official Gazette, establish in a State or Union territory, one or more regional rural banks with such name as may be specified in the notification and may by the said or subsequent notification, specify the local limits within ....
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....Government may, after consultation with the (National) Bank and the sponsor bank, increase or reduce such authorised capital; so, however, that the authorised capital shall not be reduced below twenty-five lakhs of rupees, and the shares shall be in all cases, fully paid-up shares of one hundred rupees each... 9. Board of directors.-(l) The board of directors shall consist of the Chairman appointed under sub-section (1) of section 11, and the following other members, namely: (a) two directors, who are not officers of the Central Government, State Government, Reserve Bank, National Bank, sponsor bank or any other bank, to be nominated by the Central Government; (b) one director, who is an officer of the Reserve Bank, to be nominated....
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....; 35% The Government has its own mechanism of control over the regional rural banks and Reserve Bank of India issues guidelines from time-to-time to all regional rural banks. 4. That it may be stated here that the petitioner-bank is State within the meaning of article 12 of the Constitution of India. It is fully owned and controlled by the Government.... 6. That it may be stated here that under the Act, the Central Government exercises a very close control and supervision over the activities of the bank. Under section 5 of the Act, the authorised capital of each regional rural bank is Rs. 5 crores. However, under the proviso thereto the Central Government may, in consultation with the....