Admitting the appeal filed by Dalal, a division bench comprising Justice B N Kirpal and Justice S Rajendra Babu, also issued notice to the bank on Dalal's application seeking stay on the sale of the shares. On December 24 last year, special Judge S N Variava had passed a decree declaring that the shares have been validly pledged in favour of the bank to secure the loss to the extent of Rs 280.8 crore.

The judge had also awarded costs against Dalal of Rs 1,84,395 payable to the custodian and Rs 30 lakh payable to the bank.

The bank alleged that as Dalal had assumed responsibility to deliver the securities, which were never handed over, he should make good the loss. In the agreement for the transactions, Dalal had given variousshares, bonds and debentures as security, the bank said and claimed that it suffered a loss to the tune of Rs 1,253 crore and that the broker by giving the security had partially discharged his liability.

Dalal had refused to accept liability to pay any amount to Stanchart and said the terms and conditions pertaining to the transaction "was got executed by the officers of the bank under threat of physical torture, criminal prosecution. and duress.