DICGC Entitled to Priority Recovery; Amendment Challenge Dismissed

G.K. Gururajrao Vs Union of India (Karnataka High Court) DICGC was entitled to recover the insured amounts paid to depositors in priority and challenge to constitutional validity of Amendment Act was dismissed Conclusion: Reimbursement of interim payments from insured banks in priority to other liabilities was a valid exercise of legislative competence. The argument that the DICGC, being an insurer, was limited to the rights of subrogation and could not rank higher than the insured depositors was rejected. Held: The present writ appeal arose from the financial collapse of a co-operative bank w...