In a related move, BoR managing director I Sadashiva Gupta has resigned from the bank. Sources said Gupta is serving his notice period in the bank and the RBI was reportedly not happy with his services.

In yet another development, the RBI is directing the Tayal group to bring in Rs 10 crore in addition to the Rs 20 crore brought in last year.

BoR chairman PK Tayal said he was committed to bring in fresh funds into the bank. He has underwritten the entire Rs 67 crore rights issue which has currently been stayed by the Supreme Court. "I will pump in whatever amount theRBI asks for. I am commited to the bank," Tayal told The Financial Express.

The RBI move has effectively sealed the Bangur group's move to take control over the bank from the Mumbai-based Tayals. The RBI directive is being sent under the Section 35 (A) of the Banking Regulation Act which prohibits any bank to appoint new directors without the consent of the RBI. The central bank had invoked the same law when it removed the Bangurs from the saddle.

With the central bank deciding to send a directive quashing all resolutions seeking appointment of new directors, the AGM will only take up the balance sheet and the accounts for vote. "The other resolutions have become redundant. Only the Bangur group directors are retiring and under the Companies Act they are eligible for re-appointement. However, the RBI move will not allow this (to happen). None of the Tayal group directors are retiring and hence there is no question of their re-appointment," a source said.

The last round of spat had broken outover the control of the bank after the bank sent a letter to the RBI which made it clear that the Calcutta-based Bangur group was clearly set to wrest control of the bank through appointment of directors of its front companies.

The bank had received notices from shareholders under Section 190 of the Companies Act 1956 about their intention to remove the existing auditors of the bank ML Sharma and appoint TR Chadha and Co as statutory auditors of the bank.

In the letter to the RBI, the BoR had written that it has received notices from shareholders under section 257 of the Companies Act 1956 proposing the names of Shiv Kumar Mansinghka, GL Saraf, DL Srivastava, Sushil Maheshwari, Om Prakash Agarwal, JS Bhatnagar, Vivek Chaturvedi, CR Biyani and Sanjiv Kumar--all reportedly belonging to the Bangur group.