DURGA PRASHAD Vs. BANARAS BANK LIMITED

JUDGEMENT

(1.) The Banaras Bank Ltd. - hereinafter called "the Bank" was directed to be wound up by Order of the Allahabad High Court. A committee of inspection was appointed under S. 178-A of the Indian Companies Act, 1913 to act with the official Liquidator, and one of the members of the Committee was Durga Prasad the first appellant in this appeal. The official Liquidator advertised for sale two houses which formed part of the assets of the Bank. Roshan Lal the second appellant made an offer to purchase the two houses for Rs. 18000/-. This offer was accepted by the Official Liquidator and with the sanction of the Court the two houses were sold to Roshan Lal on August 2, 1941. Roshan Lal thereafter transferred the house to Durga Prasad reciting in the deed that the latter was "the real owner" of the houses and that the sale deed from the Official Liquidator was obtained by him 'benami' for Durga Prasad. On coming to learn about this conveyance, the Official Liquidator moved the High Court of Allahabad for an Order that the sale be declared null and void and that Durga Prasad be called upon to surrender the two houses and to re-transfer the same to the Bank. The High Court held that the sale deed was obtained by Durga Prasad who was the real purchaser, that he had suppressed his interest in the purchase, and that being a member of the committee for inspection, qua the Bank he occupied the position of a trustee and was on that account precluded from buying the property of the Bank. The High Court accordingly directed Durga Prasad to convey the houses to the official Liquidator of the Bank. This Order was confirmed in appeal under Cl. 10 of the Letters Patent by a Division Bench of the High Court. The High Court however, certified the case under Art. 133(1) of the Constitution for appeal to this Court. The High Court observed:

(2.) At the hearing before this Court counsel for the official Liquidator submitted that the appeal is incompetent, for the High Court had no jurisdiction to grant the certificate under Art. 133(1) (a) of the Constitution without certifying that the appeal involved some substantial question of law. In our view this contention must succeed.

(3.) In ILR (1958) 2 All 657 the Allahabad High Court held: