DELHI DEVELOPMENT AUTHORITY versus SKIPPER CONSTRUCTION CO. (PVT.) LTD. AND ANR.

Citation: [2002] SUPP. 4 S.C.R. 177 · Decided: 13-11-2002 · Supreme Court of India · Bench: U.C. BANERJEE · Disposal: Directions issued
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Judgment (excerpt)

... 
DELHI DEVELOPMENT AUTHORITY 
A 
V. 
SKIPPER CONSTRUCTION CO. (PVT.) LTD. AND ANR. 
NOVEMBER 13, 2002 
[UMESH C. BANERJEE AND SHIVARAJ V. PATIL, JJ.] 
B 
Bank Guarantee-Role played by Bank officials-Loss to Bank-
Administrative Authority initiated disciplinary action against the erring Bank 
officials-Supreme Court dropped the proceedings in the light of Wednesburry C 
principles-Administrative Authority did not take appropriate steps-Central 
Vigilance Commission to investigate into the n1atter to ascertain quantun1 of 
loss suffered by banks by malfeasance and misfeasance of erring officials and 
submit report-Directions issued 
Respondent, a construction Company engaged in the development D 
and construction of commercial and residential complexes was a successful 
bidder in respect of plot of land auctioned by the appellant and had 
deposited part payment and subsequently, some more amount was paid 
to the appellant. Appellant agreed to recover balance amount with certain 
rate of interest in instalments. Respondent approached a Bank for issuance 
of bank guarantee for the balance amount and interest. Bank guarantee E 
was allowed by mortgaging certain properties belonging to respondent, 
personal guarantee of its directors, lien over unsold space and collateral 
security of counter guarantee of the company. This Court noticed 
irregularities committed by the bank officials in advancement of loans and 
bank guarantees and, therefore, got the matter enquired into by a sitting F 
Judge of High Court. In the meanwhile, on the question of issuance of bank 
guarantee for and on behalf of respondent, two Dy. Governors of the 
Reserve Bank of India also submitted their report. This Court vide its 
judgment dated 17.11.2000, upon consideration of the Commission Report 
and in the light of Wednesbury principles, dropped further proceedings 
against the erring officials. Administrative Authority did not feel it G 
expedient to take any step or steps against the erring officials. 
Considering the matter further, this Court 
ORDERED: 
177 
H 
178 
SUPREME COURT REPORTS [2002] SUPP. 4 S.C.R. 
A 
The matter requires a further look by the Court for the purposes of 
ascertainment of the quantum of loss suffered by the bank or banks by 
reason of malfeasance and misfeasance of the concerned officials of the 
public sector banks, irrespective of factum of death or retirement. The 
Central Vigilance Commission shall investigate the matter in terms of this 
B .order without being inhibited by any restraint or any other Report or 
Reports for the purposes of assessment of the situation. In this context 
that the Commission should also take note of the Report of the Deputy 
Superintendent of Police, CBI, New Delhi. (186-G-H; 187-A-B) 
CIVIL APPELLATE JURISDICTION : Special Leave Petition No. 
C (C) No. 21000 of 1993. 
From the Judgment and Order dated 9.12.1993 of the Delhi High 
Court in suit No. 770 of 1993. 
Ms. Kamini Jaiswal, K.J. John, Jana Kalyan Das, R.C. Gubrele, 
D V.K. Verma, M/s. Rajinder Narain & Co., S.P. Sharma, H.S. Parihar, P.R. 
Ramasesh, K.K. Gupta, Anil K. Chopra, Mrs. Manita Sharma, Sunil Dogra, 
Ms. Sayali Phakat, for M/s. Suresh A. Shroff & Co., C.N. Sree Kumar, 
Arvind Kumar Sharma, S.K. Verma, Davinder Kumar, for Mis. J.B.D. & 
Co., Ms. Manjula Gupta, Sandeep Narain, for Mis. S. Narain & Co., H.K. 
Puri, K.S. Rana, Mrs Sumita Mukherjee, A. Mariarputham, Ms. Aruna 
E Mathur, for Mis. Arputham, .Aruna & Co., Ms. Abba R. Sharma, Ms. 
Sushma Suri, Arun K. Sinha, P. Parmeswaran, 8. Krishna Prasad, Prem 
Malhotra, Ms. S. Janani, Abhijat, P. Medh, Ashok Mathur, Annam D.N. 
Rao, Ravindra Kumar, Chander Shekhar Ashri, S. Uday Kumar Sagar, 
Ramesh Babu M.R., Rajeev Sharma, Vishnu B. Saharaya, for M/s. Saharya 
F & Co., Ms. Asha Jain Madan, B.K. Satija, P.K. Manohar, Sanjay R. Hegde, 
Pradeep Mishra, S. Muralidhar, P.H. Parekh, K.B. Rohtagi, Krishnamurti 
Swami, Ashok K. Srivastava, Ms. Indua Malhotra and Ms. Nasmine Tarapore, 
for M/s. Narendra Lal & Co., for the appearing parties. 
G 
The Judgment of the Court was delivered by 
BANERJEE, J. Mis Skipper Constructions (P) Ltd. was incorporated 
on 14th February, 1986 to undertake development and construction of 
commercial and residential complexes. The activity is generally financed 
from advances/deposits from prospective buyers. Skipper has had five other 
associates : Skipper Tower Private Limited; Skipper Builders Private ·Limited; 
H Skipper Salis Private Limit
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