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Madras High Court
M. Subramanian vs State Bank Of Mysore, (Ho) K.G. … on 30 August, 2000
Equivalent citations: 2000 (4) CTC 451
Bench: K Govindarajan


ORDER

1. This Writ Petition is filed, challenging the show cause notice issued by the 3rd respondent/Estate Officer, State Bank of Mysore under the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, hereinafter called ‘the Act’.

2. The learned counsel appearing for the petitioner has submitted that since the respondents have not rights and jurisdiction to invoke the provisions under the Act, the petitioner can sustain the writ petition at this stage. The learned counsel has relied on Section 2(2)(ii) of the Act, which reads as follows:-

“any Corporation (not being a company as defined in Sections of the Companies Act, 1956 (1 of 1956), established by or under a Central Act and owned or controlled by the Central Government”.

On the basis of the said Section, the learned counsel has submitted that the 1st respondent-bank is not owned by the Central Government, though it is established under the Acts 23 of 1955 and 38 of 1959.

3. While dealing with the scope of the Act in question with reference to the nationalised bank, the Apex Court in the decision in Ashoka Marketing Ltd., and another v. Punjab National Bank and others, , has held as follows-

“25, Keeping in view the provisions of the Banks Nationalisation Act we are of the opinion that the nationalised bank is a corporation established by a Central Act and it is owned and controlled by the Central Government. The premises belonging to a nationalised bank are public premises under Section 2(e)(2)(ii) of the Public Premises Act. We are, therefore, unable to accept the contention of Shri Yogeshwar Prasad that premises belonging to a nationalised bank do not fall within the ambit of the definition of ‘public premises’ contained in section 2(e) of the Public Premises Act.”

4. According to the learned counsel appearing for the petitioner, the same principle cannot be applied to the 1st respondent-bank, as it is not owned and controlled by the Central Government. Only on the basis of the said submission, the learned counsel has tried to sustain his argument that the 3rd respondent has no jurisdiction to issue the impugned show cause notice.

5. In the decision in C.V.Raman v. Management of Bank of India,
, while dealing with the scope of Act 23 of 1955, the Apex Court has held as follows:-

“8. we may now advert to the composition and constitution of the State Bank of India and the nationalised banks. The preamble of the State Bank of India Act, 1955 (hereinafter referred to as Act No.23 of 1955) reads as under:-

‘Whereas for the extension of banking facilities on a large scale, more particularly in the rural and semi-urban areas, and for diverse other public purposes it is expedient to constitute a State Bank for India, and to transfer to it the undertaking of the Imperial Bank of India and to provide for other matters connected therewith or incidental thereto.’

Section 3 provides that a bank to be called the State Bank of India shall be constituted to carry on the business of a banking and other business in accordance with the provisions of the Act and for the purpose of taking over the undertaking of the Imperial Bank. It further provides that the Reserve Bank together with such other persons as may from time to time become shareholders in the State Bank in accordance with the provisions of this Act, shall, so long as they are shareholders in the State Bank, constitute a body corporate with perpetual succession and a common seal under the name of the State Bank of India and shall sue and be sued in that name. It shall have power to acquire and hold property, whether movable or immovable for the purpose for which it is constituted (and) to dispose of the same. According to S. 4 the authorised capital of the State Bank is to be twenty crores of rupees divided into twenty lakhs of fully paid up shares of one hundred rupees each. The Central Government, however, has been given the power to increase or reduce the authorised capital as it thinks fit so, however that the shares in all the cases shall be fully paid up shares of one hundred rupees each. Likewise the Central Government under s. 5(2) has been given the power from time to time to increase issued capital in the manner stated therein, sub-sec.(3) contemplates

that no increase in the issued capital beyond twelve crores and fifty lakhs of rupees shall be made without the previous sanction of Central Government. Section 6 contemplates that all shares in the capital of the Imperial Bank shall be transferred to and shall vest in the Reserve Bank free of all trusts, liabilities and encumbrance and the undertaking of the Imperial Bank shall be transfer-red to and shall vest in the State Bank subject to the other conditions laid down therein. Under sub-sec.(2) of S. 7 the power to determine as to whether persons mentioned therein have observed the conditions contemplated by the said sub-section has been given to the Central Government and its decision has been made final, sub- section (3) of S.7 contemplates that the appointment, promotion or increment contemplated by the said sub-section as have been confirmed by the Central Government shall have effect or be payable or climbable. Likewise, the continued grant of the pension, allowance or other benefit, as the case may be has been made subject to the direction of the Central Government in this behalf. Section 8 contemplates that for the persons who immediately before the appointed day were the trustees of the funds mentioned therein, there shall be substituted as trustees such persons as the Central Government may by general or special order specify. Sub-sec.(1) of S. 16 contemplates that the Central office of the State Bank shall be at Bombay. The Central Government, however, has been conferred with the power to provide otherwise by Notification in the official Gazette. Sub sec. (5) of s. 16 provides that notwithstanding anything contained in sub- sec.(4) the State Bank shall establish not less than four hundred branches in addition to the branches referred to in sub-sec. (3) within five years of the appointed day, or such extended period as the Central Government may specify in this behalf and the places where such additional branches are to be established shall be determined in accordance with any such programme as may be drawn up by the Central Government from time to time in consultation with the Reserve Bank and the State Bank. Even though in view of S. 17 the general superintendence and direction of the affairs and business of the State Bank have been entrusted to the Central Board, S. 18 contemplates that in the discharge of its functions the State Bank shall be guided by such directions in matters of policy involving public interest as the Central Government may in consultation with the Governor of the Reserve Bank and the Chairman of the State Bank, give to it and that if any question arises whether the direction relates to a matter of policy involving public interest, the decision of the Central Government thereon is to be final. Section 19 deals with the composition of the Central Board. Clauses (a), (b), (c), (ca), (cb) and (c) of sub-sec. (1). sub-secs. (1A), (2) and (3A) indicate that the Central Government has been given extensive power in the matter of composition of the Central Board. Section 45 provides that no provision of law relating to The winding up of companies shall apply to the State Bank and the State Bank shall not be placed in liquidation save by order of the Central Government and in such manner as it may direct. This Section, therefore, entitled the Central Government even to liquidate the State Bank. Section 49 confers power on the Central Government in consultation with the Reserve Bank to make rules to provide for all matters mentioned therein. The power given under S. 50 to the Central Board to make regulations has been made subject to the previous sanction of the Central Government. These provisions indicate that the Central Government has a deep and pervasive control over the State Bank of India.

9. .. .. … …

10. A conspectus of the provisions of Act No.23 of 1955 and Act No.5 of 1970 read with the meanings of the term ‘under’ referred to above leaves no manner of doubt that the State Bank of India and the nationalised banks are clearly establishments under the Central Government.”

6. In view of the abovesaid ruling of the Apex Court, the submission of the learned counsel appearing for the petitioner that the respondents have no jurisdiction to issue the impugned show cause notice cannot be countenanced. Since the respondents are having jurisdiction to issue the notice under the Act, it is for the petitioner to give proper reply to the said show cause notice. With the above observations, this writ petition is dismissed. W.M.P.No.21002 of 2000 is also dismissed.


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