Karnataka High Court
U Narasimha Murthy vs Hdfc Bank Limited on 27 January, 2021
Equivalent citations: AIRONLINE 2021 KAR 34, 2021 (2) AKR 116
Author: P.S.Dinesh Kumar
Bench: P.S. Dinesh Kumar
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 27TH DAY OF JANUARY, 2021
BEFORE
THE HON'BLE MR. JUSTICE P.S. DINESH KUMAR
WRIT PETITION No.50446 OF 2019 (GM-RES)
BETWEEN :
U. NARASIMHA MURTHY
S/O LATE UGRAIAH
AGED ABOUT 58 YEARS
RESIDING AT NO.13, 8TH CROSS
PRASHANTHNAGAR
MAGADI ROAD
BANGALORE-560 079 ... PETITIONER
(BY SHRI. VIVEK REDDY, SENIOR ADVOCATE FOR
SHRI. M. VINAYA KEERTY, ADVOCATE)
AND :
1. HDFC BANK LIMITED
REPRESENTED BY ITS
AUTHORIZED OFFICER
REMEDIAL MANAGEMENT UNIT
NO. 268, 1ST FLOOR
4TH MAIN ROAD, 5TH 'C' CROSS
THIPPASANDRA
BANGALORE-560 075
2. NARAYANA ELECTRICAL SOLUTIONS (P) LTD
REPRESENTED BY ITS PROPRIETOR
REGISTERED OFFICE AT
NO.69, 1ST FLOOR
4TH MAIN, 4TH BLOCK
3RD STAGE, S.G.NAGAR
2
BASAVESHWARANAGAR
BANGALORE-560 003 ... RESPONDENTS
(BY SHRI. G.C. MAHABALLESHWAR, ADVOCATE FOR R1)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227
OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE ORDER TO THE
R-1 BANK TO CONSIDER REQUISITION DATE 29.07.2019 AND
24.10.2019, AS CITED IN ANNEXURE-A AND D RESPECTIVELY OF THE
PETITIONER IN PAYING THE 50 PERCENT OF THE ONE TIME
SETTLEMENT (OTS) AMOUNT OF RS.3.5 CRORE TOWARDS THE LOAN
AMOUNT OF THE R-2 COMPANY TO WHICH HE IS LIABLE AND
DISCHARGE THE PETITIONER AS GUARANTOR AND RELEASE HIS TWO
INDIVIDUAL IMMOVABLE PROPERTIES.
THIS WRIT PETITION, HAVING BEEN HEARD AND RESERVED
FOR ORDERS ON 18.01.2021, COMING ON FOR PRONOUNCEMENT OF
ORDERS THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:-
ORDER
This petition is filed by one of the promoters of second respondent-Private Limited Company. The said Company has availed financial assistance from HDFC Bank. In the year 2013, a proposal for one time settlement was given offering to pay Rs.7.50 Crores towards full and final settlement of the debt.
2. In the year 2014, second respondent -Company herein filed W.P.No.45306-307/2014 pleading inter alia that a sum of Rs.50 Lakhs was paid towards processing the OTS proposal. HDFC Bank had accepted the proposal and called 3 upon the second respondent bank to pay Rs.7 Crores on or before 31.03.2013. On 28.03.2013, second respondent company sought for extension of time. On 01.04.2013, bank communicated that request for extension of time was declined and OTS offer was withdrawn. With the said averments, second respondent prayed for a direction against the bank to consider their request for payment of balance amount towards OTS or in the alternative for a direction to refund the sum of Rs.50 Lakhs. The said writ petition was disposed of on 13.09.2019 with a direction to the second respondent to pay Rs.7 Crores with interest at 10% within a period of 40 days from the date of permission given by the bank. The bank was directed to give permission within two weeks from the date of disposal of writ petition. Petitioner filed I.A.No.3/2020 for further extension of time. On 08.05.2020, this Court extended time for a further period of sixty days. Thereafter, several applications were filed. Suffice to note that this Court vide order dated 28.09.2020 has recorded as follows: 4
"13. Making it clear that in the event there is any default as regards the adherence put forth in the undertaking affidavit, deponent would be construed to be in willful disobedience of the order of this Court which would be the understanding on the basis of the orders earlier passed which had imposed obligations on the petitioner for adherence with conditions imposed and also the indulgence being given by this Court in this order by taking note of the undertaking.
16. Though the learned counsel for the respondent - Bank has submitted that the interests of the Bank would be prejudiced if the auction proceedings are not permitted go ahead, taking note of the order dated 08.05.2020 in the fitness of things, it would be appropriate that the auction proceedings initiated could be deferred till the conclusion of the period being granted to the petitioner i.e., till 01.01.2021."
(Emphasis Supplied)
3. Shri Vivek Reddy, learned Senior Advocate submitted that petitioner is facing financial difficulties and therefore, this writ petitioner may be permitted to pay 50% of the amount and bank may be directed to release him as guarantor and also two immovable properties mortgaged to the bank be released. He submitted that extension of OTS 5 is permissible and relied upon Anu Bhalla and another Vs. District Magistrate, Pathankot and another1.
4. Shri. Mahaballeshwar argued opposing the petition.
5. I have carefully considered rival contentions and perused the records.
6. Undisputed facts of the case are, second respondent is the borrower company. OTS was offered in the year 2013. The second respondent company has been litigating in this Court seeking extension of time by filing several applications even after disposal of the writ petition. As recorded hereinabove, this Court has made it clear that any default on the part of second respondent would be construed as willful disobedience.
7. It is relevant to note that W.P.No.45306- 307/2014 filed by the second respondent company was disposed of on 13.09.2019. Within less than two months, 1 (Civil Writ Petition No.5518/2020 decided on 22.09.2020 by High Court of Punjab and Haryana) 6 petitioner who is one of the promoters of second respondent has approached this Court with this writ petition. Parallelly, second respondent has been filing interlocutory applications seeking extension of time in W.P.No.45306-307/2014. In paragraph No.15 of the order passed on an interlocutory application, this Court has recorded that there would be no extension of time.
8. Thus, the second respondent is represented by one brother in the earlier writ petition and this petition is filed by another brother in individual capacity. In the result, the promoters have been successful in frustrating recovery of debt. This is nothing but abuse of process of law and requires to be dealt with firmly.
9. In the result, this petition is dismissed with cost of Rs.1,00,000/- payable by petitioner to the first respondent - Bank.
7
10. In view of dismissal of this petition, all pending interlocutary applications do not survive for consideration and they stand disposed of.
Sd/-
JUDGE Yn