Southern States - Andhra Pradesh-Hyderabad   

Vasavi ex-directors' plea dismissed

By Our Legal Correspondent

HYDERABAD MARCH 27. K.C. Bhanu, a judge of the A.P. High Court, on Thursday dismissed a petition seeking to quash the cases registered against the erstwhile directors of Vasavi Cooperative Urban Bank.

The judge was dealing with the petition filed by the former bank directors. After reports that the bank had collapsed, the directors had been arrested citing various penal provisions. The petitioners took a stand that bank was a cooperative body and the statute meant for the banking companies could not have been invoked.

The judge discussed the contents of the FIR and said the cases could not be quashed at this stage and dismissed the case.

CPI opposes proposal

Our Staff Reporter writes: Meanwhile, the Communist Party of India has opposed the proposal of the administrator of Vasavi bank of a `one-time settlement' for enabling loan defaulters to settle their dues.

At a press conference held here on Thursday, S. Sudhakar Reddy, State secretary, said this might be beneficial for defaulters but it would hit depositors badly. In all, 21 urban cooperative banks had closed and several others were on the brink of closure, he said.

He demanded that stringent action be taken against erring officials and managements. The RBI, the State and the Central Governments should recover the lost money. Mr. Reddy wanted a probe by a High Court judge into the allegations being traded among senior IAS officials involving hundreds of crores of rupees.

Mahesh bank allays fears

The chairman of A.P. Mahesh Cooperative Urban Bank, B.N. Rathi, has said teams, comprising bank directors, former directors, founders and well-wishers, have been going around the bank branches in the twin cities in a bid to assure staff and customers. The visits were aimed at reassuring customers that their money was safe in the bank, a press release said. The bank was financially healthy, the release said, adding that withdrawls had come down.

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