Earlier on September 23, Justice Anil Dev Singh had directed the company to file a list of its properties and provide details of matured deposits within three weeks. In his ruling on Friday, Justice C M Nayar also directed the company to file the list of properties and matured deposits along with an affidavit before the next date of hearing on May 3.

The court order came on petition filed by Rockland challenging a RBI circular which prohibited the company from accepting any deposit. Rockland, in its petition, claimed that the company was registered with the Securities and Exchange Board of India (sebi) as a merchant banker and RBI order dated June 9, 1998 was without jurisdiction.

RBI, in its reply, submitted that Rockland had been prohibited from accepting deposits under section 45-K ofthe RBI Act and the order in question was fully within powers of the bank and had been issued in the public interest.

RBI further contended that the impugned order does not cause any prejudice to the petitioner and the main business of the company would not be hampered if the order was not stayed. Rockland's petition claimed that from January 8, 1998, the company stopped fund-based operations as an NBFC, thus ceased to be as such with effect from the said date.

RBI alleged that Rockland failed to maintain the minimum percentage of liquid assets and produce government securities for physical verification. ``It failed to obtain minimum credit rating by any credit rating agency and defaulted in payment of the matured deposits and periodical interest to the depositors,'' RBI submitted.

The bank further alleged that a chartered accountant was appointed by the RBI to conduct special audit of the company which was not allowed by Rockland under one or the other pretext. RBI submitted that if the order inquestion was stayed, it would jeopardise the interest of depositors and prove detrimental. Rockland contended that since January 8, 1998, the company had been carrying out the business of a category-I merchant banker such as issue management, investment advice, underwriting of issues and portfolio management etc.