CRL.A. NO. 1486 OF 2004                                                                                                                                            REPORTABLE 1

IN THE SUPREME COURT OF INDIA CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO.  1486 OF 2003

  RESERVE BANK OF INDIA     ..... APPELLANT

VERSUS

GM, COOPE. BANK DEPOSIT A/C HR.SHA &ORS.     ..... RESPONDENTS

WITH CRIMINAL APPEAL NO. 24 OF 2005

O R D E R

1. We have heard learned counsel for the appellant  

which is the Reserve Bank of India in this case.

2. The appellant is aggrieved by the order  dated  

20th of  December,  2002  whereby  a  direction  has  been  

issued by the learned Single Judge in an application  

for bail under Section 439 of the Code of Criminal  

Procedure made by an accused that depositors who had  

made deposits of less than Rs. 10,000/- should have  

their deposits released as and when funds were received  

by the respondent No. 3 – cooperative bank.   

3. In this case, an application for bail was made

CRL.A. NO. 1486 OF 2004                                                                                                                                            REPORTABLE 2

by some of the accused in Cr. No. 121/2002 of Naranpura  

Police Station in respect of an offence alleged to have  

been committed by respondent No. 3, the Ex-Chairman of  

the Bank, respondent No. 4.  Bail was granted by the  

Magistrate vide order dated 22nd February, 2002.  This  

order was challenged by the depositors before the High  

Court.  The High Court, however, did not cancel the  

bail  granted  to  respondent  No.  3  but  made  a  

consequential  order  on  20/12/2002.   This  order  is  

reproduced below:-  

“At  this  stage,  learned  counsel  Shri  Prajapati  appearing  for  the  depositors rightly made a grievance that  so far poor depositors are not paid by  the bank out of the amount, which has  been received by the bank.  If it is so,  then it is most unfortunate Mr. Munshaw  tried to explain that the said amount is  used by paying salary etc. of the bank  employees.  This amount should not have  been used by the bank authorities for any  other  purpose  except  distributing  the  same amongst  the poor depositors.  Mr.  Prajapati for the depositors association  has pointed out that there are more than  75,000 depositors.  Out of that, number  of depositors are poor persons who have  invested their life time saving in the  bank.  He, therefore, requested the court  that  the  bank  should  start  paying  the  amount  to  the  depositors  who  have  invested not more than Rs. 10,000/- at  the  first  instance.   There  is  lot  of  substance in what has been submitted by  Mr.  Prajapati  for  the  depositors.  Accordingly,  the  bank  should  start  distributing the amount, which is so far  recovered by them from the accused under  the interim orders of this Court.  On the

CRL.A. NO. 1486 OF 2004                                                                                                                                            REPORTABLE 3

next  date  of  hearing  the  bank  shall  furnish the details of the money  being  paid  to  the  poor  depositors,  who  have  invested not more than Rs. 10,000/- at  the first instance.  On the next date of  hearing, all the accused as well as I.O.  And  Administrator  of  the  bank  shall  personally  remain  present  at  2:15  P.M.  before this Court.”

4. The  Reserve  Bank  of  India  has  challenged  the  

operative portion of this order as being beyond the  

scope of an application under Section 439 of the Code  

of Criminal Procedure and as it infringes on several  

provisions of the Banking Regulation Act, 1949.  It has  

been urged that these facets had been pointed out to  

the learned Single Judge in an application dated 13th  

January,  2003,  which  too  had  been  rejected  on  7th  

February, 2003.

5. The respondents before us have been served but  

only the accused, respondent No. 3, who has already  

been granted bail is before us. The learned counsel  

contends that as far as he is concerned, he has nothing  

to say in this matter as  his bail has been confirmed.  

6. We  are  of  the  opinion  that  the  far  reaching  

consequences of the directions of the High Court are  

way beyond the scope of an application for bail filed  

by an accused under Section 439 of the Code of Criminal

CRL.A. NO. 1486 OF 2004                                                                                                                                            REPORTABLE 4

Procedure and the High Court, as much as anyone else,  

must stay confined to the issues relevant to the matter  

before it.  It was thus not open to the High Court to  

pass orders which could affect the working of Banks all  

over  the  country.   It  has  been  pointed  out  by  Mr.  

Basava Prabhu S. Patil, the learned senior counsel for  

the  appellant  that  it  is  for  this  reason  that  the  

Reserve  Bank  of  India  had  filed  these  appeals.  We,  

accordingly,  allow  these  appeals  and  set  aside  the  

orders dated 20th December, 2002 and dated 7th February,  

2003.  

    ........................J      [HARJIT SINGH BEDI]

    ........................J      [CHANDRAMAULI KR. PRASAD]

NEW DELHI AUGUST 12, 2010.