Advocate Jonathan Mitchell QC told judge Lady Wolffe that there isn’t enough evidence to show Mr King breached an order made at the Court of Session in December 2017.
A judge at that point in time ordered him to make an £11 million offer to the club’s shareholders to buy shares from them.
The order arose after proceedings which were brought to the Edinburgh based court by the Panel on Takeovers and Mergers.
The organisation took the South African resident to court because it believed Mr King didn’t comply with the terms of the 2006 Companies Act.
The legislation dictates that entrepreneurs who hold a 30 per cent stake in businesses are compelled to make an offer to investors to buy remaining shares.
However, Mr King hasn’t made the offer prompting the Panel on Takeovers and Mergers to try to have Mr King found in contempt of court.
If Mr King is found in contempt then a judge may choose to punish him by imposing a fine, jail time or some other penalty.
But on Wednesday, Mr Mitchell told Lady Wolffe that attempts to have his client found in contempt were incompetent.
He said that the laws on contempt of court stated that Panel on Takeovers and Mergers had to prove that Mr King had deliberately chosen not to comply with the December 2017 order.
The court heard that such evidence was not available.
He added: “It must be proven beyond a reasonable doubt. It must be a wilful defiance of the court. It must be a contemptuous defiance of this court.
“It is not sufficient on the part of the petitioner to say to the court here is an order that hasn’t been complied with.”
The case was originally brought to court over the actions of Mr King and the so called “three bears” - businessmen George Letham, George Taylor and Douglas Park - during their takeover of Rangers in late 2014.
Investigators for the panel concluded that the quartet acted in concert to acquire 30 per cent of the shares.
The money for the shares came from offshore trusts which were in the name of Mr King’s family.
Lawyers acting for King said he didn’t have the money needed to buy back shares at 20 pence.
Mr King’s legal team argued that the shares were acquired from shares which came from his family’s trusts.
The businessman claimed he didn’t have direct control over these trusts.
He said that a company registered in the British Virgin Islands had control over some of the shares.
His lawyers argued that their client didn’t have the money to make the £11 million offer.
His then advocate Lord Davidson of Glen Clova QC said Mr King was “penniless”.
However, Lord Bannatyne ruled that Mr King had control over the family trusts and could make the offer to buy the remaining shares.
In July 2018, lawyers acting for the Panel on Takeovers and Mergers returned to the Court of Session and told Lord Bannatyne that Mr King hadn’t complied with the order.
This prompted Lord Bannatyne to urge Mr King to comply with the order.
On Wednesday, Mr Mitchell said the procedure needed to try Mr King for contempt would be the same one used in the criminal courts.
The hearing continues.