Public sector banks’merger move challenged

AIBOC petition admitted by Delhi HC; Hearing on October 29

 

NEW DELHI: The move to merge the public sector Vijaya Bank, Dena Bank and Bank of Baroda (BoB) has met with its first hurdle as the bank officers’ union, AIBOC, has challenged the Government decision at the Delhi High Court.

An official statement from All India Bank Officers’ Confederation (AIBOC) confirmed that the Delhi High Court has admitted the petition challenging the proposal by the Central Government to amalgamate the three banks, and the HC is expected to hear the writ petition filed by the Confederation on October 29.

“A Division Bench of the Hon’ble Delhi High Court comprising Justice Ravindra Bhat and Justice AK Chawla has effectively issued the notice and agreed to hear the plea,” the statement added.

While senior advocate Arvind P Datar appeared for AIBOC, the Central Government and Bank of Baroda were represented by the newly appointed Solicitor-General Tushar Mehta and ASG Ms Maninder Acharya.

AIBOC has contended that the process by which the decision to merge these three banks was taken in violation of the Banking Regulation Act, 1949 and the Banking Companies (Acquisition and Transfer of Undertakings) Act 1970/1980 and the Constitution.

The Confederation also maintained that the ‘In-principle Approval’ given by the banks’ boards remains void as the posts of workmen and non-workmen directors in the Board have been kept open for years by the Government.

“And hence the decision to give approval to amalgamate the entities could not be validly taken without the participation by the workmen and non-workmen directors, who are important stakeholders in such a decision,” the statement said.

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