TaxTMI 
TaxTMI 
2013 (9) TMI 1292
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....e Petitioners were Directors of the above-mentioned bank during the period from 1996 to 2002. Large number of complaints were received from the depositors stating that the Board of Directors of the bank had swindled away the money of the depositors by creating false documents, amounting to crores of rupees. On receipt of the complaints, enquiry was conducted and, ultimately, Joint Registrar of Cooperative Societies and Chief Executive Officer of the bank registered Crime No. 8 of 2003 on the file of the CID, Police Station Under Section 120(b), 420, 409, 468, 477(A), Indian Penal Code and Under Section 5 of the Andhra Act. Criminal case was later investigated by the Deputy Superintendent of Police, STD-II, CID Hyderabad and charge-sheet was filed against several persons, including the Petitioners. The Charge-sheet was registered as C.C. No. 4 of 2003 before the Special Court-cum-Metropolitan Sessions Judge, Hyderabad. It is at this juncture, the Petitioners have approached this Court seeking the above-mentioned reliefs and also for a writ of certiorari to quash all proceedings or orders passed by the competent authority and by the Special Court constituted under the Andhra Act. Pet....
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....king companies or organizations, enables the RBI to give licence to banking companies to carry out the functions of the bank. It was pointed out that it covered different areas which are not common to the area covered by the Andhra Act. Further, it was pointed out that both the Acts have applicability to different aspects of refund to the depositors. The Banking Regulations Act, it is pointed out, was enacted to regulate the functioning of the banking companies, including the Vasavi Cooperative Urban Bank Limited and that the Petitioners have approached this Court challenging the validity of the Act so as to wriggle out of the clutches of law. 6. Vasavi Cooperative Bank was registered as a cooperative society on 29.05.1982. The bank was issued a licence to carry on the business on June 16, 1982 and was accorded the Scheduled Status in the Banking Regulations Act w.e.f. May 22, 1999. The Bank was placed under the directive of Section 35A of the Banking Regulations Act, 1949 with effect from the close of business on March 7, 2003. Bank is having 17 branches all over the State of Andhra Pradesh. 7. We notice that the State of Andhra Pradesh was contemplating a legislation similar to....
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.... only the Central Government is entitled to enact the law relating to subject "accepting of deposit from the public and repayment of the same on demand". Referring to the judgment of this Court in R.C. Cooper's case (supra), it was contended that the scope, ambit and definition of the term "banking" under Entry 45 List I of the Seventh Schedule appended to Article 246 would include all activities falling Under Section 5(b) of the Banking Regulation Act, 1949. Consequently, only the Parliament alone has the power to frame the law relating to acceptance of deposits or its return or making the same as an offence. Further, it was pointed out that the powers conferred on State Legislature to legislate "corporate societies" as falling under Entry 32 List II of the Seventh Schedule appended to Article 246 of the Constitution can be confined to incorporation, registration, administration, amalgamation, winding-up of the cooperative societies. Further, it was pointed out that the power under that Entry can be stretched to encompass all the activities of banking under Entry 45 of List I of the Seventh Schedule. It was pointed out that under the guise of legi....
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.... been upheld by this Court in Delhi Cloth and General Mills Co. Ltd. v. Union of India (1983) 4 SCC 166 and the provisions of Chapter III-C of the Reserve Bank of India Act, 1934 were upheld by this Court in T. Velayudhan Achari v. Union of India (1993) 2 SCC 582. However, we are not in agreement with the Full Bench decision of the Bombay High Court that the subject-matter covered by the said Act falls squarely within the subject-matter of Sections 58A and 58AA of the Companies Act. 17. We are of the opinion that the impugned Tamil Nadu Act enacted by the State Legislature is not in pith and substance referable to the legislative heads contained in List I of the Seventh Schedule to the Constitution though there may be some overlapping. In our opinion, in pith and substance the said Act comes under the entries in List II (the State List) of the Seventh Schedule. Further, in para 33 of the judgment, this Court expressed the following view: 33. The State being the custodian of the welfare of the citizens as parens patriae cannot be a silent spectator without finding a solution for this malady. The financial swindlers, who are nothing but cheats and charlatans having no social res....