DELHI DEVELOPMENT AUTHORITY versus SKIPPER CONSTRUCTION CO. AND ANR.

Citation: [1997] 1 S.C.R. 1122 · Decided: 11-02-1997 · Supreme Court of India · Bench: B.P. JEEVAN REDDY, K.S. PARIPOORNAN · Disposal: Disposed off
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Judgment (excerpt)

A 
B 
c 
D 
E 
DELHI DEVELOPMENT AUTHORITY 
v. 
SKIPPER CONSTRUCTION CO. AND ANR. 
FEBRUARY 11, 1997 
[B.P. JEEVAN REDDY AND K.S. PARIPOORNAN, JJ.] 
Banking: 
Bank guarantee-llregultirities in-Chainnan and Managing Director 
aJld Directors of New Bank of India and other Bank authorities-Irregularities 
by in the matter of bank guarantee to and on behalf of Skipper Group-Held, 
Reserve Bank of India being the authority to regulate and monitor the 
activities of the Banks in the country, would enquire into the matter and send 
a report to the Supreme Court detennining the responsibility, if any, of each 
of the persons involved in the case. 
CIVIL APPELLATE JURISDICTION: IA. Nos. 16, 23, 24, 25, 27, 
29, 30, 31, 32, 38-49, 15, 32A, 33, 34, 51-54. 
In 
Special Leave Petition (C) No. 21000 of 1993. 
From the Judgment and Order dated 9.12.93 of the Delhi High Court 
in Suit No. 770 of 1993. 
V.R. Reddy, K.N. Bhat, Additional Solicitor Generals, H.N. Salve, 
F Kapil.Sibbal, Arun Jaitley, Joseph Vellapally, Arvind Kumar, Ms. Kamini 
Jaiswal, Dayan Krishanan, K.C. Dua, Din Dayal Sharma, K.J. John, Sudhir 
Kumar Gupta, Jana Kalyan Das, P.N. Misra, R.C. Gubrele, Sunil Dogra, 
Ms. Monica Sharma, Ms. Sushila Ram, Devender Singh, S. Sukumaran, · 
Jagdeep Kishore, 
Y.P. Narula, Mukul Mudgal, Y.P. Mahajan, V.K. 
G Verma, K.C. Dua, Ranjit Kumar, Ms. Anu Mohla, H.S. Parihar, Kuldeep 
S. Parihar, R.K. Anand, S.P. Sharma, Lokesh, Arun Birbal, P.R. Ramasesh, 
S.K. Kulkarni, (Jaswant Singh - In-person) for the appearing parties. 
The following Order of the Court was delivered : 
H 
This order is in continuation of the order dated January 31, 1997 and 
1122 
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-..,.,. 
D.D.A. v. SKIPPER CON1N. CO. 
1123 
the order dated February 7, 1997. 
Pursuant to the notice given to Sri R.C. Suneja [formerly Chairman 
and Managing Director of the New Bank of India], he has filed a detailed 
counter setting out several facts and circumstances and putting forward 
several defences. He has also filed a list of all the movable and immovable 
properties held by him, his wife and his children. The Canara Bank has 
filed an elaborate response in the matter. The Punjab National Bank, into 
which the New Bank of India has been merged, has also offered to file their 
:.-
response. 
A 
B 
The other directors of New Bank of India, to whom notices were C 
directed, viz., Ms. Tajwar Rehman Sawhney, Sri Sudershan Lal, Sri S.S. 
Ranade and Sri J .K. Sawhney have filed their explanations. 
On the basis of information furnished by the learned counsel for the 
Canara Bank, with respect to the legal representatives of Late Sri B.R. 
Ratnakar [formerly Chairman and Managing Director of the Canara Bank) D 
~ 
notices have been issued to his legal representatives in India. 
Sri Harish Salve, learned counsel appearing for the Reserve Bank of . 
India, stated that during the course of the day [7th February, 1997], the 
response of the Reserve Bank of India will be filed. 
E 
The question before us is whether, and to what extent, Sri R.C. Suneja, 
Ms. Tajwar Rehman Sawhney, Sri Sudershan Lal, Sri S.S. Ranade and Sri 
J.K. Sawhney are guilty of deliberate and/or intentional misuse/abuse of 
their power in the matter of the New Bank of India extending bank 
guarantees to and on behalf of Skipper group of companies and what loss, 
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if any, have they caused to the bank on that account. Upon the answer to 
the said question will depend the liability of one or the other of the said 
persons to make good the loss caused to the bank. Any action against them 
shall also depend upon such answer. 
Similarly, the question in the case of Sri. B.R. Ratnakar is whether, G 
and to what extent, he is guilty of deliberate and/or intentional 
misuse/abJLse of his power in the matter of New bank of India extending 
Y 
bank guarantees to and on behalf of Skipper group of companies and what 
loss, if any, has he caused to the bank on that account. Upon the answer 
to the said question will depend the liability of the legal representatives of H 
1124 
SUPREME COURT REPORTS 
(1997] 1 S.C.R. 
A said person to make good the loss caused to the bank. 
We may also mention that Sri R.R. Pradhan, Dr. M.R. Kotdawala, 
Sri J.P. Awashti were nominees of Reserve Bank of India on the board of 
Canara Bank during the period April 24, 1984 to November 10, 1988. Their 
B responsibility in the matter has also to be determined. Sri D. Seetharamma 
was the workman Director on the board of this bank from August 1
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