RAJAN GUPTA Vs. CITI BANK

JUDGEMENT

(1.) Complainant No. 1, Rajan Gupta is one of the directors of Hotel Picnic (P) Ltd. Hotel Picnic (P) Ltd. is complainant No. 2. Rajan Gupta has filed this complaint against the Citi Bank and his father and brother who are directors of Company for a direction to Citi Bank to remit the amount of Rs. 70,000/- in the account of the Company which according to the complainant had been illegally transferred by the Bank from the account of the Company to the personal account of Devendra Gupta, brother of the complainant. The opposite parties are : the Bank, its officials, N.D. Gupta, father of the complainant, Devendra Gupta, brother of the complainant. Company has five directors. Others are Ashok Kumar and Sanjay Kumar, brothers of the complainant. These two brothers are not impleaded as opposite parties. Name of the complainant is in fact Rajendra Kumar Gupta @ Rajan Gupta and it is not pleaded before us why he is described as Rajan Gupta in the memo of parties.

(2.) Allegation is that Company by means of resolution authorised opening of account in the Citi Bank which was to be operated by Rajendra Gupta and Ashok Kumar Gupta, directors of the Company. However, on 1.1.1997 N.D. Gupta, father of the complainant and one of the directors instructed the Bank to transfer all the amount in the account of the Company which was in excess of Rs. 1.00 lakh. On these instructions the Bank did transfer the money, which according to the complainant is deficiency in service on the part of the Bank inasmuch as in view of the earlier resolution dated 14.7.1995 the account could not have been operated at the instance of N.D. Gupta.

(3.) Written versions have been filed by both, by N.D. Gupta, Devendra Gupta and also by the Bank. It is the case of N.D. Gupta and Devendra Gupta that there was another resolution of the Board of Directors authorizing N.D. Gupta to issue instructions to the Bank to transfer the amount in excess of Rs. 1.00 lakh from the Company account to the account of Devendra Gupta. It was on this basis letter dated 1.1.1997 was written by N.D. Gupta to the Bank and the amount transferred. It is also the submission of both, N.D. Gupta and Devendra Gupta that complainant and Ashok Gupta were mismanaging the affairs of the Company and an action was taken to prevent them from misappropriation and diversification of the funds of the Company. To same effect, it is the reply of the City Bank.