Bank fraud not just a civil dispute: SC

Nov 28 2013, 05:44 IST
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SummaryThe two judges of a Supreme Court bench have differed over the status of workers employed by Air India

SC bench disagrees over workers issue

The two judges of a Supreme Court bench have differed over the status of workers employed by Air India but not regularised by keeping them temporary for long periods by using unfair labour practice. The issue will be now decided by a larger bench.

The workers of Chef Air, a unit of the Hotel Corporation of India which runs the Air India canteens, had approached the Central Government Industrial Tribunal. They alleged that Air Indias contracts with the Corporation circumvented many provisions of the Contract Labour (Regulation and Abolition) Act, 1970. According to them, they were performing duties of a permanent and perennial nature but were being paid less than the regular employees.

The tribunal concluded that the Corporation was a 100% subsidiary of Air India and the workers were deemed employees of Air India. It also directed the airline to reinstate workers who had been terminated with 50% back wages. Air India challenged the order before the Delhi High Court, which set it aside saying the Corporation was not a part of Air India.

However, the SC judges differedJustice CK Prasad endorsed the HC while Justice V Gopala Gowda agreed with the findings of the tribunal and directed Air India to absorb all the workers as permanent ones with consequential benefits like back wages.

Bank fraud not a civil dispute

Setting aside the Madras High Court judgment in the case Tamil Nadu Mercantile Bank Ltd vs State, the Supreme Court has directed the trial court to go ahead with the prosecution of former directors of the bank who colluded with the managers of five firms to commit fraud against the bank.

The managers of the firms, maintaining current accounts with the bank since 2000, colluded with the branch manager and other accused and siphoned of around Rs 2.51 crore. The fraud was discovered in June 2003. The modus operandi was as follows: The accused encashed cheques at the Tiruppur branch of the bank knowing well that the drawers accounts did not have the amount (because the cheques were drawn by parties known to them). The branch manager, using the Local Bill Discounting provisions, credited the accounts of the accused before the cheques were sent to the drawee bank for clearance. The amounts were withdrawn immediately after. Later when the cheques bounced, the accused deposited similar cheques for even higher amounts to clear the debt. The accused had moved the

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