Kerala High Court
Vasudha Gas Agencies vs South Indian Bank on 27 October, 2025
2025:KER:80154
W.P.(C).Nos.45093/2024 & 193/2025
1
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE S.MANU
MONDAY, THE 27TH DAY OF OCTOBER 2025 / 5TH KARTHIKA, 1947
WP(C) NO. 45093 OF 2024
PETITIONERS:
1 VASUDHA GAS AGENCIES
REPRESENTED BY ITS MANAGING PARTNER U USHA,
HAVING ITS OFFICE AT VASUDHA GAS AGENCIES, TIRUR
ROAD, KUTTIPURAM PO MALAPPURAM DISTRICT, PIN -
679571
2 U USHA
AGED 51 YEARS
W/O LATE CT SASEENDRABABU,
RESIDING AT SASEENDRAM VILLA NO.2 HOMESTEAD
SERENE VILLAS,KUTTIPPURAMPO,ATHANI,CIVIL STATION
ROAD,
KUTTIPPURAM,MALAPPURAM,KERALA, PIN - 679571.
BY ADVS.
SRI.SHASHANK DEVAN
SRI.ADARSH KUMAR
RESPONDENTS:
1 SOUTH INDIAN BANK
REPRESENTED BY ITS BRANCH MANAGER,
DO N. 210, WARD NO 17, KT TOWER, BYE-PASS
JUNCTION, KUTTIPURAM PO, MALAPPURAM, PIN -
679571.
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W.P.(C).Nos.45093/2024 & 193/2025
2
2 MARKADAVETH MOHAMMED KABEER,
AGED 53 YEARS
S/O KUNHARAMU,
RESIDING AT MARKADAVETHPUTHANVEETIL HOUSE,
MANGALAM PO, TIRUR TALUK, MALAPPURAM DISTRICT,
NOW RESIDING AT KAAB AL FORT, MANGALAM, MANGALAM-
MLP, TIRUR, MALAPPURAM, KERALA, PIN - 676561.
BY ADVS.
SHRI.SUNIL SHANKER
SRI.K.I.ABDUL RASHEED
SMT.VIDYA GANGADHARAN
SMT.ARYA SATHEESH
SMT.DEEPA SASIDHARAN
OTHER PRESENT:
ADV C AJITH KUMAR (SC FOR SBI)
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD
ON 27.10.2025, ALONG WITH WP(C).193/2025, THE COURT ON THE
SAME DAY DELIVERED THE FOLLOWING:
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W.P.(C).Nos.45093/2024 & 193/2025
3
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE S.MANU
MONDAY, THE 27TH DAY OF OCTOBER 2025 / 5TH KARTHIKA, 1947
WP(C) NO. 193 OF 2025
PETITIONERS:
1 VASUDHA GAS AGENCIES
REPRESENTED BY ITS MANAGING PARTNER U USHA,
HAVING ITS OFFICE AT VASUDHA GAS AGENCIES, TIRUR
ROAD, KUTTIPURAM PO MALAPPURAM DISTRICT, PIN -
679571.
2 U USHA
AGED 51 YEARS
W/O LATE CT SASEENDRA BABU,
RESIDING AT SASEENDRAM VILLA NO.2 HOMESTEAD
SERENE VILLAS, KUTTIPPURAM PO,ATHANI,
CIVIL STATION ROAD,KUTTIPPURAM,
MALAPPURAM,KERALA, PIN - 679571
BY ADVS.
SRI.ADARSH KUMAR
SRI.SHASHANK DEVAN
RESPONDENTS:
1 STATE BANK OF INDIA
REPRESENTED BY ITS CHIEF MANAGER, KUTTIPURAM
BRANCH, BALAKRISHNA ARCADE, KUTTIPURAM P.O, PIN -
679571.
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4
2 MARKADAVETH MOHAMMED KABEER
S/O KUNHARAMU, RESIDING AT MARKADAVETH
PUTHANVEETIL HOUSE, MANGALAM PO , TIRUR TALUK,
MALAPPURAM DISTRICT, NOW RESIDING AT KAAB AL
FORT, MANGALAM, MANGALAMMLP, TIRUR, MALAPPURAM,
KERALA, PIN - 676561.
3 RESERVE BANK OF INDIA
REPRESENTED BY ITS REGIONAL DIRECTOR, NO 6507,
BAKERY JUNCTION ROAD, TRIVANDRUM, PIN - 695033.
BY ADVS.
SRI.C.AJITH KUMAR
SRI.K.I.ABDUL RASHEED
SHRI.M.GOPIKRISHNAN NAMBIAR
SHRI.K.JOHN MATHAI
SRI.JOSON MANAVALAN
SRI.KURYAN THOMAS
SHRI.PAULOSE C. ABRAHAM
SHRI.RAJA KANNAN
SHRI.PRANOY HARILAL
SMT.AKHILA NAMBIAR
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
27.10.2025, ALONG WITH WP(C).45093/2024, THE COURT ON THE SAME
DAY DELIVERED THE FOLLOWING:
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W.P.(C).Nos.45093/2024 & 193/2025
5
S.MANU, J.
--------------------------------------------------
W.P.(C).Nos.45093 of 2024 & 193 of 2025
-------------------------------------------------
Dated this the 27th day of October, 2025
JUDGMENT
Petitioners in these cases have approached this Court
seeking selfsame reliefs against the respective respondent
Banks.
2. The first petitioner is a partnership engaged in the
distribution of LPG cylinders of Indian Oil Corporation Ltd. The
second petitioner is its Managing Partner. The party respondent
is another partner. To put the facts succinctly, there is a dispute
between the second petitioner and the party respondent,
consequent to which the party respondent approached the
banks to disable the username and password relating to the
accounts of the partnership and to change the mode of
operation of the account. On the basis of the request, the
respondent bank in W.P.(C) No.193/2025, State Bank of India,
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disabled the exclusive transaction rights enjoyed by the second
petitioner and changed the mode of operation to joint operation
by the partners. The respondent bank in W.P.(C)
No.45093/2024, the South Indian Bank, imposed a freeze on
the account of the petitioners. Challenging the actions taken by
the banks, the petitioners approached this Court.
3. Respondents entered appearance in both cases. In
W.P.(C)No.193/2025, counter affidavits have been filed by the
respondent Bank as well as the 2nd respondent. In W.P.
(C)No.45093/2024 also the 2nd respondent filed a separate
counter affidavit.
4. Heard the learned counsel appearing for the
petitioners, respective Standing Counsel for the respondent
banks as well as the Reserve Bank of India and also the learned
counsel appearing for the party respondent.
5. The learned counsel for the petitioners submitted that
the actions taken by the respondent banks are per se illegal,
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arbitrary and bad in law. He submitted that the party
respondent has no right to approach the banks for disabling the
second petitioner from operating the account and to demand
that the accounts be permitted to be operated jointly. He further
submitted that, as per the terms of the deed of partnership, the
accounts of the firm shall be operated exclusively by the
Managing Partner. That being so, the banks were not at all
justified in entertaining the request from the party respondent.
He also contended that the 2nd petitioner holds 51% of the
stakes of the partnership and admittedly she is the managing
partner. He pointed out that incapacitating of the 2 nd petitioner
from operating the accounts of the 1st petitioner firm has
resulted in paralysing the financial operations. The learned
counsel submitted that the banks have no authority to take such
actions on the basis of the request from one among the
partners. He asserted that by conceding to the request from
the party respondent the banks have virtually ventured to
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adjudicate the dispute between the 2nd petitioner and the party
respondent. He submitted that the impugned actions cannot be
sustained in any view of the matter. He relied on two judgments
of the Calcutta High Court as also the following judgments of
the Hon'ble Supreme Court :-
1) State Bank of India and Ors. v. Rajesh
Agarwal and Ors. [(2023) 6 SCC 1]
2) Opto Circuit India Ltd. v. Axis Bank and
Ors. [(2021) 6 SCC 707].
6. The learned Standing Counsel for SBI submitted that
his bank had acted only in accordance with the normal operating
process followed by the bank. The party respondent is a partner
and he made a request to disable the username and password
relating to the current account of the 1 st petitioner to prevent
the unauthorized access. The bank promptly communicated the
same to the 2nd respondent and thereafter took the impugned
actions. The learned counsel referred to clause 15 of the deed
of partnership which provides that in case of any difference of
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opinion between the partners the dispute should be resolved
through arbitration. He submitted that the basic dispute is
contractual and it being purely of civil nature, interference under
Article 226 by this Court would not be justified. He placed
reliance on a judgment of this Court in W.P.(C)No.3110/2021
and submitted that the factual situation involved in the said writ
petition was identical. He urged that the writ petition may be
dismissed as not maintainable, following the judgment in W.P.
(C)No.3110/2021. The learned Standing Counsel for South
Indian Bank also made submissions on similar lines.
7. The learned counsel appearing for the party
respondent submitted that the firm as well as the managing
partner cannot maintain a writ petition in respect of a dispute
arising from the terms of the partnership. He contended that no
violation of any fundamental or statutory right of the petitioners
is pleaded and no element of public duty on the part of the
respondent banks is also involved. Further, the learned counsel
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contended that the 2nd respondent is not entitled to sue on
behalf of the partnership, against the party respondent. He also
referred to the factual contentions raised in the counter affidavit
in justification to the request made by the party respondent to
the banks. He too referred to the judgment in W.P.
(C)No.3110/2021 and submitted that the said judgment would
bind this Court and hence the writ petition is liable to be
rejected as not maintainable.
8. On hearing the respective counsel and perusing the
pleadings it is clear that the foundational dispute pertains to
rights of the partners of the 1 st petitioner. The party respondent
approached the respondent Banks on account of the conflict
between him and the 2nd petitioner.
9. In W.P.(C)No.3110/2021 this Court considered a
similar issue. Petitioners and the party respondent in the said
case were partners of a firm engaged in distribution and sale of
LPG. The party respondent therein approached the bank
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concerned on account of disputes between him and the
petitioners and the Bank stopped internet banking facilities. The
action taken by the bank was challenged. The learned Single
Judge held as under in paragraphs 12 and 13 of the judgment:-
"12. The case of the petitioners is that the 2 nd
respondent has been expelled from the
Partnership for good and sufficient reasons. Such
expulsion is permitted by the provisions of the
Partnership Act. The 1st respondent-Bank,
therefore, ought to have relied on the information
given by the petitioners as regards expulsion of
the 2nd respondent from the Partnership and ought
not have acted upon the instructions of the 2 nd
respondent. However, the 2nd respondent has
disputed the fact of his expulsion from the
Partnership. According to the 2nd respondent, he
cannot be expelled from the Partnership in view of
the specific provisions contained in the
Partnership Deed, except with the leave of the
Indian Oil Corporation Limited. Furthermore, in
view of the provisions contained in the Partnership
Deed, the petitioners ought to have resorted to
arbitral proceedings.
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13. The dispute involved in this writ petition falls
under the realm of contract. When the legality of
expulsion of a party from the Partnership is
disputed by the Partner who is allegedly expelled,
the appropriate remedy available to the
petitioners is either arbitral proceedings as
provided for under the Partnership Deed or civil
remedies. The jurisdiction of the High Court under
Article 226 of the Constitution of India cannot be
invoked to resolve disputes between Partners of a
Firm. Though the relief sought for by the
petitioners is against the 1 st respondent-Bank
which is a Public Sector Undertaking, the issue
involved is of purely civil nature and would fall
under the realm of contract. No element of public
duty on the part of the 1st respondent-Bank is
involved in this case.
In the circumstances, this Court finds that
the writ petition filed by the petitioners is
misconceived and no relief can be granted to the
petitioners in exercise of the jurisdiction of this
Court under Article 226 of the Constitution of
India. The writ petition is therefore dismissed."
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10. The learned Single Judge categorically held that
though the relief sought was against the bank, the issue was of
purely civil nature and would fall under the realm of contract.
Hence the writ petition was rejected as misconceived.
11. The respective standing counsel for the respondent
Banks and the learned counsel appearing for the party
respondent vehemently argued that these writ petitions are
liable to be dismissed following the above judgment. On the
contrary, the learned counsel for the petitioner made an attempt
to distinguish the judgment by contending that factual situation
in the said case was materially different. I find it difficult to
accept the said contention. Factual situation in the said case
was almost identical.
12. The learned counsel for the petitioner relied on two
judgments of the Calcutta High Court, rendered by a Division
Bench of the Court and a learned Single Judge. In both cases
the Calcutta High Court took the view that debit freeze cannot
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be imposed on an account in the absence of an order of Court or
an instruction from the RBI. It is true that in those cases also
the action was taken by the banks on the basis of complaints
from quarreling partners. However, as rightly contended by the
respective standing counsel appearing for the respondent Banks
and the learned counsel appearing for the party respondent
those judgments have only persuasive value as far as this Court
is concerned. Judgment in W.P.(C)No.3110/2021, rendered on
identical facts cannot be disregarded. I do not find any reason
to take a different view from that adopted by the learned Single
Judge in W.P.(C)No.3110/2021.
13. Learned counsel for the petitioner had relied on
judgment of the Hon'ble Supreme Court in State Bank of India
and Ors. v. Rajesh Agarwal and Ors. [(2023) 6 SCC 1]. He
relied on the observations in paragraph 42. However, the
Hon'ble Supreme Court considered the issue of classifying a
borrower's account as fraud under the 'Master Directions on
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W.P.(C).Nos.45093/2024 & 193/2025
Frauds' issued by the Bank. In that context, the Hon'ble
Supreme Court held that the principles of natural justice are
applicable. However, the said dictum is of no help to the
petitioners in the totally different factual backdrop of these writ
petitions.
14. The learned counsel had placed reliance on the
judgment of the Apex Court in Opto Circuit India Ltd. v. Axis
Bank and Ors. [(2021) 6 SCC 707] also. He referred to
paragraph 11 of the judgment. However, the issue considered
by the Hon'ble Supreme Court in the said case was freezing of
bank accounts on the basis of instructions issued under the PML
Act. The observation of the Hon'ble Supreme Court regarding
freezing or the continuation thereof without due compliance with
legal requirement was obviously in the context of the provisions
of the PMLA. The said judgment also can be of no help to the
petitioners.
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In the result, I hold that these writ petitions are not
maintainable and dismiss both cases, following the judgment of
this Court in W.P.(C)No.3110/2021.
Sd/-
S.MANU
JUDGE
skj
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APPENDIX OF WP(C) 45093/2024
PETITIONERS' EXHIBITS:
Exhibit P1 A TRUE COPY OF THE MEMORANDUM OF AGREEMENT
DATED 19.05.2015, EVIDENCING THE INDANE LPG
DISTRIBUTORSHIP AGREEMENT
Exhibit P2 A TRUE COPY OF THE DEED OF PARTNERSHIP
DATED 18.08.2015, BETWEEN THE 2ND
PETITIONER MANAGING PARTNER AND THE 2ND
RESPONDENT
Exhibit P3 A TRUE COPY OF THE AMENDMENT TO THE
PARTNERSHIP DEED, WHICH HAS THE VERY
LIMITED EFFECT OF CORRECTING THE
DISCREPANCY IN THE NAME AND ADDRESS OF THE
2ND RESPONDENT
Exhibit P3(A) A TRUE COPY OF THE 2ND RESPONDENT'S ADHAR
CARD, SHOWING HIS IDENTITY AND ADDRESS;
Exhibit P4 A TRUE COPY OF THE EMAIL COMMUNICATIONDATED
12.12.2024 ISSUED BY THE RESPONDENT BANK
Exhibit P5 A TRUE COPY OF THE REQUEST COMMUNICATION
ISSUED BY THE 2ND RESPONDENT TO THE BANK
DATED 12.12.2024, CONTAINING THE
AFOREMENTIONED BASELESS AND UNFOUNDED
ALLEGATIONS;
Exhibit P6 A TRUE COPY OF THE COMMUNICATION DATED
13-12-2024 SENT BY THE 1ST PETITIONER TO
THE RESPONDENT BANK
RESPONDENTS' EXHIBITS
Exhibit R2(a) True copy of the relevant page of the
schedule forming part of the balance sheet
as on 31-03-2023
Exhibit R2(b) True copy of the letter dated 12-12-2024,
in respect of Account No.0621073000000253
addressed to the 1st respondent
Exhibit R2(c) True copy of the judgment dated 25-03-2021
in W.P.(C) No.3110/2021 of this
Court reported in 2021 KHC 5210
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W.P.(C).Nos.45093/2024 & 193/2025
APPENDIX OF WP(C) 193/2025
PETITIONERS' EXHIBITS:
Exhibit P1 A TRUE COPY OF THE MEMORANDUM OF AGREEMENT
DATED 19.05.2015, EVIDENCING THE INDANE LPG
DISTRIBUTORSHIP AGREEMENT
Exhibit P2 A TRUE COPY OF THE DEED OF PARTNERSHIP
DATED 18.08.2015, BETWEEN THE 2ND
PETITIONER MANAGING PARTNER AND THE 2ND
RESPONDENT
Exhibit P3 A TRUE COPY OF THE AMENDMENT TO THE
PARTNERSHIP DEED, WHICH HAS THE VERY
LIMITED EFFECT OF CORRECTING THE
DISCREPANCY IN THE NAME AND ADDRESS OF THE
2ND RESPONDENT
Exhibit P3 (A) A TRUE COPY OF THE 2ND RESPONDENT'S ADHAR
CARD, SHOWING HIS IDENTITY AND ADDRESS;
Exhibit P4 A TRUE COPY OF THE INTERIM ORDER DATED
24-12-2024 PASSED BY THIS COURT IN WP(C)NO.
Exhibit P5 A TRUE COPY OF E-MAIL COMMUNICATION DATED
02-01-2025 SENT BY THE 1ST RESPONDENT TO
THE PETITIONERS AND 2ND RESPONDENT
Exhibit P6 A TRUE COPY OF EMAIL COMMUNICATION ISSUED
BY THE 1ST RESPONDENT TO THE 2ND PETITIONER
Exhibit P7 A TRUE COPY OF THE RELEVANT PORTIONS OF
MASTER CIRCULAR ON MAINTENANCE OF DEPOSIT
ACCOUNTS - UCBS OF THE YEAR 2006 ISSUED BY
THE RESERVE BANK OF INDIA
Exhibit P8 A TRUE COPY OF THE RELEVANT PORTIONS OF
MASTER DIRECTION- KNOW YOUR CUSTOMER (KYC)
DIRECTIONS, 2016 ISSUED BY THE RESERVE BANK
OF INDIA.
RESPONDENTS' EXHIBITS:
Exhibit-R1(a) True copy of the judgment in W.P.(C) 3110
of 2021 dated 25/03/2021 of this Court
Exhibit R2(a) True copy of the relevant page of the
schedule forming part of the balance sheet
as on 31-03-2023
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Exhibit R2(b) True copy of the letter dated 11-12-2024,
in respect of Account No.67293828511
addressed to the 1st respondent
Exhibit R2(c) True copy of the judgment dated 25-03-2021
in W.P.(C) No.3110/2021 (reported in 2021
KHC 5210)
