PUNJAB & SIND BANK versus ALLAHABAD BANK AND ANR.

Citation: [2006] 3 S.C.R. 489 · Decided: 28-03-2006 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Appeal(s) allowed
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Judgment (excerpt)

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PUNJAB & SINO BANK 
A 
v. 
ALLAHABAD BANK AND ANR. 
MARCH 28, 2006 
[ARIJIT PASAYA T AND TARUN CHATTERJEE, JJ.] 
B 
Practice and Procedure-Civil dispute between banks-Dismissal of 
suit sought by one bank on the ground that procedure indicated by Supreme 
Court in ONGC-1 case that when parties are Government or its Undertakings, 
dispute is to be resolved before in-house committee not followed-High C 
Court holding that decision in ONGC-1 case was administrative in nature 
and has force to emasculate judiciary-On appeal, held: Order passed in 
judicial proceeding cannot be described to be administrative in nature-
Thus, order of High Court set aside and matter remitted back to it. 
Respondent no.I-Bank filed suit for recovery and other reliefs 
against the appellant-Bank. Appellant-Bank filed application for dismissal 
of the suit on the ground that the procedure indicated by this Court in Oi/ 
and Natural Gas Commission-! case* that when parties are Government or 
its Undertakings dispute should be resolved before in-house Committee, were 
D 
not followed. Single Judge of High Court held that the decision has to be read E 
in the context in which it was passed and this Court never intended to 
extinguish the right to sue. Division Bench upheld the order with an additional 
view that the decision in the ONGC-1 case is itself of an administrative nature 
and has force to emasculate the judiciary. Hence the present appeals. 
Allowing the appeals and remitting the matters to High Court, the Court F 
HELD: The view expressed by the Division Bench of the High Court 
that the decision in the ONGC-1 case is itself of an administrative nature and 
has force to emasculate the judiciary, is confusing and patently shows that 
the ratio of the various decisions has not been understood in the proper G 
perspective. To say that the decision in the ONGC-1 case was of an 
administrative nature though a judicial order, shows non-application of mind. 
Any order passed in a judicial proceeding, (much less an order passed by 
this Court) can by no stretch of imagination be described as one of 
"administrative nature". Therefore, the judgment of the Division Bench is 
489 
H 
490 
SUPREME COURT REPORTS 
[2006) 3 S.C.R. 
A set aside and the matters are remitted back for fresh consideration. 
(496-B-C; C-EI 
*Oil and Natural Gas Commission and Anr. v. Collector of Central 
Excise, (1992( Supp. 2 SCC 432; Oil and Natural Gas Commission v. C.C.£. 
(1995( Supp. 4 SCC 541; Oil and Natural Gas Commission v. C.C.£., (2004( 
B 6 SCC 437; Chief Conservator of Forest v. Collector, (2003( 3 SCC 472; 
Mahanagar Telephone Nigam Ltd. v. Chairman, Central Board, Direct Taxes 
and Anr., (20041 6 SCC 431, distinguished. 
U.P.S.E.B. and Anr. v. Sant Kabir Sahakari Katai Mills Ltd., (20051 7 
c sec 576, referred to. 
CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 9688-9689/ 
2003. 
From the Final Judgment and Order dated 25.6.2003 of the High Court 
D of Calcutta in G.A. No. 2162/2002 in APOT No. 809/2002 arising out of Suit 
No. 60/1999. 
Arun K. Sinha and G.S. Sistani for the Appellant. 
C. Mukund, Bijoy Kumar Jain and Mrs. V.D. Khanna for the 
E Respondents. 
The Judgment of the Court was delivered by 
ARIJIT PASAYAT, J. Challenge in these appeals is to the judgment 
delivered by a Division Bench of the Calcutta High Court, in an appeal filed 
by the appellant, the defendant in the suit filed by respondent no. I-Bank. 
F Learned Single Judge in the said suit held that there was no need to adopt 
procedure indicated by this Court in Oil and Natural Gas Commission and 
Anr. v. Collector of Central Excise, (1992] Supp. 2 SCC 432 (described 
hereinafter case as ONGC-1 Case). The Division Bench affirmed the view of 
learned Single Judge. The correctness of the view expressed by the learned 
G Single Judge and the Division Bench forms the subject-matter of challenge 
in this appeal. 
The suit was filed by the respondent no. I-Bank against the appellant-
Bank along with 11 other defendants with the following prayers:-
H 
(a) 
Declaration that the Banker's cheque copy whereof is annexed 
PUNJAB & SIND BANK v. ALLAHABAD BANK [PASA Y AT, J.) 491 
Marked A hereto is void and not binding on the plaintiff. 
A 
(b) 
Decree of Rs. 5,62,66,671 against the defendants jointly and/or 
severally and/or such of them for such amount as this Hon'ble 
Court may deem fit and proper. 
(c) 
Decree of Rs. 5,62,66,67 l against the defendant no. I together B 
with interest. 
(d)
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