Appeal No.
8,500 and Rs.
The explanation given by Vastulal in his public examination under Section 450 of the Banking Companies Act, 1949, about the transfer of amounts to the stock brokers was found unsatisfactory.
These amounts had been transferred to the account of those brokers from the sundries register of the bank.
700, Rs.
5 of 1960 was held number maintainable and was accordingly dismissed.
24,846 11 0 with interest on each of those sums at six per cent.
It was also found that payments had been made in the accounts of those stock brokers in different banks on instructions given by Vastulal on behalf of the bank.
6 and 7 of 1960 were heard on the merits and were ultimately dismissed by the High Court.
In 1943 a public limited companypany was registered under the Bikaner Companies Act called the Pareek Commercial Bank Ltd. hereinafter called the bank and all the assets and liabilities of the Pareek Commercial Bank were transferred to that public limited companypany.
Under the articles of association of the bank general management of the business was, subject to the companytrol and supervision of the directors, vested in Vastulal who was appointed chairman of the bank.
Two letters which should numbermally be in the custody of the bank but were produced by Vastulal were sought to be relied upon in support of the case that the amounts transferred to Messrs. S. Ramdas were in respect of the order for the purchase of debentures of the Calcutta Electric Supply Co. Ltd. But even these letters do number support his case.
It was averred in the petitions that Vastulal had done speculative business in buying and selling shares and securities in the name of M s. B. R. Pareek Sons Ltd. through different stock brokers and had suffered heavy losses and that towards payment of or as advance in companynection with his personal and private transactions and in any case number in respect of transactions of the bank had got paid large amounts of money through the Imperial Bank of India at Bombay to the brokers and had debited or allowed to be debited the said amounts in the sundries register to the account of the brokers and had thereby gained advantage for himself and on that account was guilty of misfeasance, malfeasance and number feasance.
The liquidator submitted three petitions to the companypany judge of the High Court of Rajasthan at Jodhpur under Section 235 of the Indian Companies Act 7 of 1913 and Section 45H of the Banking Companies Act 10 of 1949 , for directions against Vastulal and other directors of the bank that they be ordered to restore the amounts belonging to the bank which had been transferred to the stock brokers and for orders for assessment of damages.
891 10 6 remained outstanding against Messrs. B. R. Pareek Sons Ltd. in the account books of Messrs. S. Ramdas.
66,821 was the balance due from diverse parties through whom shares were purchased and sold, but number transacted through share account , and that the same was unverified owing to the lack of information .
In an application under the Indian Companies Act, 1913, submitted in February, 1952, before the High Court of Rajasthan which at the material time had acquired, on account of political changes, jurisdiction over the territory of the former Indian State of Bikaner by one of the depositors of the bank, the High Court passed an order for companypulsory winding up and appointed an official liquidator to wind up the affairs of the bank.
485 of 1962 arises out of the order passed in Company Case No.
On examining the books of account of the bank, the liquidator found that in the cash credit accounts of six stock brokers stood diverse amounts which aggregated to Rs, 66,821.
484 of 1962 arises out of the order made in Company Case No.
The letters written by Messrs. S. Ramdas advising appropriation of the amounts received have number been produced.
Admittedly, Messrs. S. Ramdas had credited the amounts received by them in the account of Messrs. B. R. Pareek Sons Ltd. Their ledger was produced to prove the transactions which were carried on in the name of Messrs. B. R. Pareek Sons Ltd. and in that account book all the amounts in dispute are credited as received through the Imperial Bank of India.
176 of 1957 for payment of Rs.
Appeals Nos.
8,500 which was the amount transferred by Vastulal to M s. Naraindas Aidan, stock brokers of Bombay, and Appeal No.
Appeal No.
Against the orders passed by the High Court these two appeals have been preferred with special leave.
177 of 1957 for payment of Rs.
In that account were also credited the sale proceeds of 19 shares of the Kohinoor Mills Ltd., and after crediting the amounts, Rs.
Nor were the books of account of Messrs. B. R. Pareek Sons Ltd. produced.
In the directors report dated December 31, 1950, under the caption Loans, advances, cash credits and overdrafts , certain amounts were companylectively described as debts companysidered good for which the bank held numberother security than the debtors personal security , that the amount of Rs.
On enquiry the stock brokers informed the liquidator that the items were credited by them to the account of M s. B. R. Pareek Sons Ltd. a private companycern of which Vastulal was the managing director and the amounts were utilised towards discharge of the liability for payment of losses of that companycern in its dealings in shares which had been carried on through them.
Shah, J. The appellant, Vastulal Pareek hereinafter referred to as Vastulal started in 1921 at Bikaner a banking business in the name and style of the Pareek Commercial Bank.
The companypany judge rejected the plea raised by Vastulal and passed orders in the three petitions that Vastulal do pay to the bank three sums, Rs.
It was also averred that the other directors had rendered themselves liable under Section 235 of the Indian Companies Act, 1913, in that, being directors of the bank, they either abetted or companynived at the companyduct of Vastulal in misapplying the funds belonging to the bank towards payment of his personal losses.
5, 6 and 7 of 1960.
The claim against those directors has been dismissed by the High Court and numberhing more need be said in that behalf.
Against those orders three appeals were preferred to the High Court being Appeals Nos.
per annum simple up to the date of realization.
