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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
NAGESH BHEEMAPAKA
Sukhii Projects LLP – Appellant
Versus
Union of India, Rep. by its Principal Secretary FS, Department of Financial Services, Ministry of Finance, New Delhi – Respondent
| Table of Content |
|---|
| 1. petitioner seeks action against banks for refusal to implement board resolution. (Para 1) |
| 2. details on llp structure and events leading to the dispute. (Para 2) |
| 3. respondents' counterarguments regarding resolution validity and banking operations. (Para 3) |
| 4. counsel for both parties present and refer to judgments supporting arguments. (Para 4 , 5) |
| 5. court's ruling based on examination of facts and legal principles. (Para 6 , 7) |
| 6. writ petition dismissed; petitioner may pursue other legal forums. (Para 9) |
ORDER :
Nagesh Bheemapaka, J.
This Writ Petition questions the inaction of Respondents 4 and 5 in effecting change in authorised signatories of the current account of petitioners' firm in their banks, as per the Board Resolution dated 21-12-2024. A direction is sought to Respondents 4 and 5 to implement the change forthwith. The grievance of petitioner is that respondent banks have refused to honour and implement a valid board resolution duly passed in accordance with the LLP Agreement and confirmed by the Arbitral Award. The impugned refusal lacks authority of law, violates the LLP's contractual autonomy, and infringes upon Articles 14, 19 (1) (g) and 300-A of the C
The court ruled that private banks do not qualify as state instrumentalities under Article 12, and no writ lies against them unless statutory rights or fundamental rights are infringed.
The bank's decision to freeze a partnership account amid disputes is justified to protect interests and comply with arbitration awards regarding partner entitlements.
It is true that jurisdiction of High Court under Art. 226 is an extraordinary jurisdiction vested in High Court not for purpose of declaring the private rights of the parties but for purpose of ensur....
A bank cannot freeze a company's account without a valid order from an adjudicatory forum, even amid management disputes.
A bank cannot unilaterally freeze a partnership firm's account to secure debts from a separate proprietorship, as mutuality of obligation must exist for the right of set-off to apply.
Disputes arising from partnership mismanagement and exclusion of partners merit arbitration, affirming the obligation of partners to act in good faith and uphold fiduciary duties.
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