Rajasthan High Court Raps Axis Bank For 'Unwarranted' Withdrawal Of Court-Sealed Fixed Deposit, Says No One Above Law

The Rajasthan High Court has dismissed a petition filed by Axis Bank challenging Trial Court order directing it to re-deposit around Rs. 8 crore that it had unilaterally appropriated from a Fixed Deposit which was mandated by the Court.The bench of Justice Anoop Kumar Dhand observed that when a constitutional court or any court passes an order, every person or authority, regardless of rank, is duty bound to comply with it; and disobedience attacks the very foundation of rule of law on which the entire democracy is based.The matter related to the respondents cheating around 600 farmers of their agricultural produce, and mortgaging the same to take a bank loan which they eventually defaulted. In this relation, during trial in 2012, the trial court had directed creation of a Fixed Deposit Reserve of the auction proceeds of the seized agricultural produce, in the name of the Court. An application was filed by the Axis Bank to use these proceeds which was rejected. Aggrieved by this, plea was moved before the Court, which was withdrawn to initiate recovery proceedings before DRT which allowed the bank for temporary appropriation of the Original Application amount. Based on this order, the amount was withdrawn from the FD. This was challenged before the trial court which directed the Bank to refund the appropriate amount which was lying in the bank's custody failing which action would be taken against the Managing Directors/CEOs of the Bank and the concerned Bank Manager. This order was challenged before the Court. It was highlighted before the Court, by the respondents that the orders passed by the trial court of the creation of Fixed Deposit was not brought to the notice of DRT. And without seeking permission of the trial court, the Bank appropriated the amount from the FD. “The orders dated 07.07.2012 and 03.06.2013 passed by the Trial Court and the orders passed by this Court were not brought into the notice of the DRT, at the time of arguments made in I.A. No.142/2018 and that is why the petitioner-Bank was permitted by the DRT for temporary appropriation of the OA amount. Had all these facts and orders were brought into the notice of the DRT, the order dated 20.04.2018 would not have been passed.”In this light, the Court held that the Bank's act was contrary to the orders passed by the trial court and in utter violation of law. And the notices were rightly issued to the MD/CEO of the Bank and the concerned bank manager seeking refund of the appropriated amount with interest."Whosoever he may be, howsoever high, is not above the rule of law...Whether any one like the petitioner can act against any order or directions passed by the Trial Court and upheld by this Court?" the Court remarked and rejected the bank's plea.Title: Axis Bank v State of Rajasthan & Ors. Citation: 2025 LiveLaw (Raj) 413Click Here To Read/Download Order

Rajasthan High Court Raps Axis Bank For 'Unwarranted' Withdrawal Of Court-Sealed Fixed Deposit, Says No One Above Law

Nupur Agrawal

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