JUDGMENT : 1. Hon'ble Mr. Justice Saharya, a Learned Judge of the Delhi High Court was appointed as One-Man Commission by this Court to investigate into the circumstances in which loans/bank guarantees were advanced by the New Bank of India (now merged with the Punjab National Bank) and the Canara Bank, and into the conduct of officials of the aforesaid two banks, in the matter of advancement of loans/bank guarantees to Messrs. Skipper Construction Pvt. Ltd. 2. Justice Saharya Commission has enquired into the matter and has submitted the report on 20th January, 1997. 3. So far as the New Bank of India is concerned the Commission has reported that Mr. R.C. Suneja (who was the Chairman and Managing Director of the said Bank) working in tandem with the General Manager (Credit) and Deputy General Manager (Credit) has defrauded the bank by corrupt and illegal means. It has found that the bank by corrupt and illegal means. It has found that the said Shri Suneja has "deliberately and fraudulently committed the funds of the bank and extended ?facility to the company in clear and direct violation of the prescribed norms, practice and procedure. He disregarded and threw to the winds all norms, rules and guidelines...... adverse factors of the proposal were twisted and misrepresented in the credit notes with a view to help the company rather than protecting the interest of the bank....... in the circumstances, the only inference that can be drawn is that Mr. R.C. Suneja, Chairman- cum-Managing Director and the other top officials in the head office of the Bank connived and acted hand in glove with the Company to enter illegitimate gains upon the latter and that they must have done so for secret benefits." 4. We are told that Shri R.C. Suneja is no longer connected with the Punjab National Bank into which New Bank of India has been amalgamated. 5. The findings recorded by the Commission called for appropriate action at the hands of this Court to safeguard public interest, public funds and the interests of administration. Accordingly, we issue notice to Shri R.C. Suneja, the former Chairman-cum-Managing Director of New Bank of India, to show cause why the loss caused by him to the said Bank, which is said to be in the region of about Rs. Accordingly, we issue notice to Shri R.C. Suneja, the former Chairman-cum-Managing Director of New Bank of India, to show cause why the loss caused by him to the said Bank, which is said to be in the region of about Rs. 11 Crores, be not recovered from his person and the properties held by him and his wife and his children. With a view to ensure that any orders passed in these proceedings are effective, we direct Shri Suneja not to deal with or dispose of any property held by him or by his wife or by his children, movable or immovable, directly or indirectly. Any Company of which he is a Director or in the Management thereof in any way or any firm of which he is a partner or in control thereof, directly or through any other person, shall also not deal with or dispose of any assets except in the usual course of business. He shall, however, be entitled to withdraw upto Rs. 10,000/- (Rupees Ten thousand only) from any one of his bank accounts. He is, of course, entitled to apply to this Court for further directions. 6. The Commissioner of Police(Delhi) is directed to forthwith serve a copy of this order upon him. This matter is posted on 3.2.97. Shri Suneja shall present himself in the Court on that day. The Commissioner of Police shall ensure that he is kept present in the Court on that day. 7. Justice Saharya Commission has further reported that there was one 1 Government Nominee Director, One RBI Nominee Director (who was of course, changing from time to time) and and a Workman Director in charge of the affairs of the bank viz., (1) Ms. Tajwar Rehman Sawhney Government Nominee Director 13.9.85 - 18.8.88 (2) Mr. Sudershan Lal RBI Nominee Director 20.11.85 - 3.2.87 (3) Mr. P. Krishnamurthy RBI Nominee Director 4.2.87 - 15.4.87 (4) Mr. S.S. Ranade RBI Nominee Director 16.4.87 - 2.5.90 (5) Mr. J.K. Sawhney Workman Director 1.9.84 - 31.8.87 8. It was during the period of Shri Sudershan Lal and Shri S.S. Ranade (Nominees of RBI) that the bank guarantees were extended and enhanced, as the case may be, by the New Bank of India. S.S. Ranade RBI Nominee Director 16.4.87 - 2.5.90 (5) Mr. J.K. Sawhney Workman Director 1.9.84 - 31.8.87 8. It was during the period of Shri Sudershan Lal and Shri S.S. Ranade (Nominees of RBI) that the bank guarantees were extended and enhanced, as the case may be, by the New Bank of India. Notice shall also go to the said persons to show cause why appropriate action be not taken against them, by this Court, for the acts of misfeasance or non-feasance as the case may be. Notice returnable - 7th February, 1997. 9. Now, coming to the Canara Bank, it is reported by the Justice Saharya Commission that Shri B. Ratnakar was the Chairman cum Managing Director of Bank from 30.6.82 to 29.6.88. One Shri N.D. Prabhu was the Executive Director from 14.3.83 to 20.9.88. Shri M.C. Satyawadi was the Government Director from 13.9.85 to 17.10.89. So far as the Nominee Director of the Reserve Bank of India is concerned there were three persons successively (1) Mr. R.R. Pradhan 24.4.84 - 13.5.86 (2) Dr. M.R. Kotdawala 4.2.86 - 3.2.87 (3) Mr. J.P. Awasthi 4.2.87 - 10.11.88 (4) Mr. D. Seetharama Workman Director 1.8.81 - 17.8.87 10. The findings of the Commission with respect to the role of this bank is to the following effect: "Mr. R.B. Ratnakar, Chairman-cum-Managing Director, Canara Bank intentionally and with knowledge that sanction of the proposal was neither in consonance with norms nor was it for the benefit and in the interest of the bank involved the bank in the transaction" and further that "the other functionaries of the Canara Bank as named in the Issue No.2 directly and indirectly assisted the Company to get participation of Canara Bank in the unprofitable, transaction and did not ensure fulfilment of the conditions contained, in the guarantee." It is also found by the Commission that the aforesaid "two banks intentionally and with full knowledge sacrificed all norms, caution, care and prudence in granting the facility." 11. We are told that Shri B.R. Ratnakar is dead. The Commissioner of Police (Delhi) is required to find out who are the Legal Representatives of the said deceased and report to this Court within one week. It shall be open to the Commissioner of Police(Delhi) to seek the assistance of the Commissioner of Police (Bangalore) or any other official for this purpose. The Commissioner of Police (Delhi) is required to find out who are the Legal Representatives of the said deceased and report to this Court within one week. It shall be open to the Commissioner of Police(Delhi) to seek the assistance of the Commissioner of Police (Bangalore) or any other official for this purpose. Orders with respect to the officials of this Bank shall be passed after obtaining the said information. Notice returnable - 7.2.97. 12. The report shows that there was no proper supervision by the Reserve Bank of India. It appears that when the question of extending bank guarantee by the New Bank of India to M/s Skipper Construction arose, Nominee Director of the RBI objected to it. But thereafter what happened may better be set out in the words of the said Nominee Director, in which he had submitted his report to the RBI: "Company made a request to the bank to issue to it a guarantee favouring DDA. The Company's financial position was bad and accounts of its associate concerns showed similar situation. Despite that, the case was placed before the Board. Even though this was once declined, the Bank resubmitted the same. It was said that Shri P.K. Kaul, the then Cabinet Secretary and Shri Buta Singh, the then Minister had spoken in favour of this case." 13. It is not known as to what the Reserve Bank of India did in the matter when it received the said note. We would like to know the action, if any, taken by the RBI against the persons and officers of the said two banks, responsible for the said transactions which have caused substantial loss to the said Banks, which are ultimately trustees of Public funds. The RBI shall file an affidavit ultimately trustees of public funds. The RBI shall file an affidavit detailing the action taken by them and all the other attendant facts and circumstances, within one week. List on 7.2.97.