Delhi High Court
Amit Goel And Ors vs State Bank Of India on 15 September, 2016
Author: Rajiv Sahai Endlaw
Bench: Rajiv Sahai Endlaw
*IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision: 15th September, 2016
+ W.P.(C) No.12138/2015, CM No.32241/2015 (for stay) & CM
No.5771/2016 (of the petitioners for directions).
AMIT GOEL AND ORS ..... Petitioners
Through: Mr. Rakesh Tiku, Sr. Adv. with Mr.
Sandeep Kumar and Mr. Sagar
Agarwal, Advs.
Versus
STATE BANK OF INDIA ..... Respondent
Through: Mr. Rajiv P. Kapur, Adv.
CORAM:-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1. On 11th May, 2016, after hearing the counsels, the following order
was passed:
"1. The petition seeks mandamus to the respondent bank to consider
the proposal dated 31st May, 2014 of the petitioners for settlement
of Non-Performing Assets (NPA) /Assets Under Collection
Accounts (AUCA) accounts of the petitioners bearing
Nos.30107285233, 31685970897, 30513991959 & 30513990309
with the Pushpa Bhawan branch of the respondent bank.
2. Notice of the petition was issued and counter affidavit has been
filed to which a rejoinder has been filed by the petitioners.
3. The counsels have been heard.
W.P.(C) No.12138/2015 Page 1 of 14
4. It is the contention of the senior counsel for the petitioners that i)
the petitioners had 12 accounts with the respondent bank, ii) that
the petitioners in accordance with the One Time Settlement (OTS)
Scheme dated 5th March, 2014 of the respondent bank, on 30th
May, 2015 (sic 30th May, 2014) made applications for settlement
of the five of the accounts and which accounts have been settled;
iii) that the petitioners on 31st May, 2014 made applications for
settlement of four accounts and with respect to which this petition
has been filed; iv) that the respondent bank on 5th July, 2014 came
out with another OTS Scheme and under which the petitioners
made applications for settlement of the remaining three accounts
and which have also been settled; v) that the only reason given by
the respondent bank in its counter affidavit for not considering the
applications dated 31st May, 2014 is that the said applications
were filed at the wrong branch of the respondent bank; vi) that the
filing of the applications with the wrong branch of the respondent
bank ought not to be a ground for not considering the applications
of the petitioners as it is a matter of internal management of the
respondent bank and the branch of the respondent bank with
which the applications were filed either ought to have forwarded
it to the correct branch with which applications according to the
respondent bank were to be filed or immediately informed the
petitioners so that the petitioners could have moved the
applications at the correct branch.
5. Per contra, it is the contention of the counsel for the respondent
bank that the dues under the eight accounts which were settled
were less than Rs.10,00,000/- in each account and which the
Manager of the respondent bank was empowered to settle and the
dues under each of the subject four accounts were more than what
W.P.(C) No.12138/2015 Page 2 of 14
was within the power of the Manager of the respondent bank at
Pushpa Bhawan branch to settle.
6. It is further contended that the said four accounts had been
forwarded to the Stressed Assets Recovery Centre (SARC) of the
respondent bank at Najafgarh, New Delhi and the petitioners were
informed of the same as far back as on 16th January, 2008 and the
applications filed by the petitioners on 31st May, 2014 not at the
SARC, Najafgarh branch of the respondent bank but at Pushpa
Bhawan branch could not have been considered.
7. It is yet further contended that as per the scheme, the petitioners
were to deposit 5% of the outstanding amount by 31st May, 2014
which was the last date for submitting the application and though
the petitioners submitted the applications at Pushpa Bhawan
branch of the respondent bank along with bank drafts for 5% of
the amount but they were advised on 31st May, 2014 itself that the
said applications could not be considered at the Pushpa Bhawan
branch of the respondent bank and they should approach the
SARC branch of the respondent bank and the four bank drafts for
Rs.70,000/- each accompanying the applications were returned on
31st May, 2014 itself to the petitioners and not encahsed and the
petitioners after having the said drafts re-validated, on 4th
September, 2015 deposited the same in settlement of their dues.
8. I have enquired from the senior counsel for the petitioners as to
what is there to show that the petitioners after 16th January, 2008
and till 31st May, 2014 were dealing with respect to the subject
four accounts with the Pushpa Bhawan branch of the respondent
bank. It is felt that unless the petitioners are able to show the
same, the submission of the applications, on the last date provided
W.P.(C) No.12138/2015 Page 3 of 14
under the Scheme for applying, at the wrong branch may not
entitle the petitioners to the relief.
9. The senior counsel for the petitioners draws attention to page 59
to 70 of the paper book to show the stamp of the Pushpa Bhawan
branch of the respondent bank in acknowledgment of the receipt
of the four applications dated 31st May, 2014 but contends that the
petitioners were informed to keep the original of the bank drafts
of Rs.70,000/- each with themselves and to submit only a
photocopy thereof and further admits that the original bank drafts
after re-validation were submitted to the respondent bank on 4th
September, 2015.
10. I have further enquired from the senior counsel for the petitioners
what steps the petitioners took between 31st May, 2014 and 4th
September, 2015 and whether they wrote to the respondent bank
confirming that the original demand drafts have been returned to
them on representation as aforesaid. Ordinarily, a person who has
applied under an OTS Scheme and who is desirous of settling at
merely 25% of the outstanding amount ought to diligently pursue
his application and if does not receive any response ought to
enquire about the same and is not expected to keep quiet.
11. The senior counsel seeks time to respond.
12. Last opportunity is given to the petitioners to file affidavits along
with documents on all the aforesaid aspects within 10 days.
13. List on 27th May, 2016."
W.P.(C) No.12138/2015 Page 4 of 14
2. The petitioners in the additional affidavit filed in pursuance to the
order set out hereinabove have stated i) that the petitioner no.1 kept visiting
the Pushpa Bhawan branch of the respondent bank "several times to inquire
about the status" of the pending applications and was being repeatedly
informed that a formal decision was yet to be taken by the SARC; ii) that an
RTI application dated 25th May, 2015 was filed seeking status of the
application; iii) that no reply was received; iv) that the petitioners were thus
compelled to file an appeal under the Right to Information Act, 2005; v) that
the petitioners were telephonically called to the Pushpa Bhawan branch and
asked to get the bank drafts re-validated and the re-validated drafts were
duly received by the Pushpa Bhawan branch of the respondent Bank on 4th
September, 2015; vi) that on enquiry of the exact amount payable, the
petitioners were informed by the Pushpa Bhawan branch that after
encashment of the said drafts, the total outstanding in the AUCA amount
was Rs.9,77,358/- and a status report was also handed over; vii) that as no
reply to the RTI application was being received and no formal response to
the OTS application also had been received, the present petition was filed;
and, viii) that after the filing of the present petition, the petitioner had
deposited a sum of Rs.1,80,000/- in the loan account towards balance
W.P.(C) No.12138/2015 Page 5 of 14
payment against the OTS settlement amount before the Debt Recovery
Tribunal (DRT) on 9th March, 2016.
3. The counsel for the respondent Bank on 27th May, 2016 stated that no
response was required to be filed to the additional affidavit aforesaid as the
petitioners in the affidavit had not answered the two queries qua which the
additional affidavit was permitted to be filed. The counsels were heard
further on 27th May, 2016 and order / judgment reserved.
4. The senior counsel for the petitioners contended; i) that the respondent
Bank in reply to the RTI query "ducked the issue"; ii) that four re-validated
bank drafts of Rs.70,000/- each were collected by the Pushpa Bhawan
branch and encashed; iii) that if the Pushpa Bhawan branch was not
competent, why should it have collected the bank drafts; iv) that the
petitioners as citizens have a right to be considered under the Scheme and
cannot be denied the said consideration; and, v) that the delay is entirely on
the part of the respondent bank.
5. Per contra, the counsel for the respondent bank argued i) that the
petitioners had re-validated the four bank drafts of Rs.70,000/- each and had
deposited the same on 4th September, 2015 at Pushpa Bhawan branch for
W.P.(C) No.12138/2015 Page 6 of 14
AUCA recovery account maintained with the SARC branch and the said
amount has been credited in the AUCA recovery account of the petitioners
as per the instructions of the petitioners; ii) that the suit for recovery of
money had also been filed by the SARC branch of the respondent Bank and
the petitioners therefrom also should have been aware; and, iii) that the writ
petition has been filed after more than one year of the closure of the Scheme.
6. The senior counsel for the petitioners in rejoinder argued that the
petitioners cannot be expected to remember from the memorandum of
parties of the suit that which branch of the respondent bank had filed the
suit.
7. I have considered the rival contentions and am of the view that the
petitioners, for the reasons here after given, are not entitled to the writ of
mandamus directing the respondent Bank to consider the proposal dated 31 st
May, 2014 for settlement of the NPA / AUCA accounts of the petitioners:
A. Admittedly, the proceedings before the DRT initiated by the
respondent Bank against the petitioners are pending since prior
to the institution of the present petition. The writ petition itself
is accompanied with CM No.32241/2015 for stay of the said
W.P.(C) No.12138/2015 Page 7 of 14
proceedings. Though no stay was granted but vide orders dated
22nd December, 2015 (when the petition had come up first
before this Court) and 8th January, 2016, liberty was granted to
the petitioners to apply to the DRT for adjournment of the
proceedings owing to pendency of this petition. It was the
contention of the counsel for the respondent Bank on 1 st March,
2016 and not controverted by the counsel for the petitioners
(and as recorded in order sheet) that this writ petition was filed
only when proceedings for attachment of assets of the
petitioners were taken by the DRT. In my opinion, once DRT
is seized of the matter, it was open for the petitioners to, before
the DRT, raise grievance of being entitled to the benefit of any
OTS Scheme of the respondent Bank or for settlement of the
claims of the respondent Bank against the petitioners before the
DRT in terms of the said OTS Scheme. The very fact that the
petitioners did not, res ipsa loquitur speaks of the petitioners
being not genuinely and bona fidely interested in availing of the
OTS Scheme and using the same only as a guise to defeat /
W.P.(C) No.12138/2015 Page 8 of 14
delay the recovery from them of the dues of the respondent
Bank.
B. Disputed questions of fact arise from the respective contentions
of the parties. While it is the plea of the petitioners that their
applications dated 31st May, 2014 under the OTS Scheme were
accepted by the Pushpa Bhawan branch but the monies required
to be tendered as per the OTS Scheme along with the said
applications, tendered by way of pay orders not accepted, it is
the contention of the respondent Bank that the applications
were required to be submitted to the SARC branch and the
petitioners though were guided to the said branch did not and
thus failed to make the application under the OTS Scheme and
are not entitled to the benefit thereof. The said disputed
questions also could at best have been agitated and adjudicated
before the DRT and not in this writ petition.
C. It is even otherwise unbelievable that when the OTS Scheme
itself required payments in terms thereof to be tendered, the
same would not be accepted along with the application. If that
W.P.(C) No.12138/2015 Page 9 of 14
was the case, the petitioners should have realized so on 31 st
May, 2014 itself and ought to have taken steps for being
considered under the said Scheme. The version of the
respondent Bank, of the petitioners inspite of having been
informed not approaching the SARC branch and not having
submitted the application with the monies required to be
deposited in terms thereof, is more believable than the version
of the petitioners.
D. The OTS Scheme under which the petitioners applied and copy
whereof is at page 41 of the paper book was operational from
10th March, 2014 to 31st May, 2014 with the last date for receipt
of applications being 31st May, 2014 and the last date for
conveying the sanction being 15th June, 2014. It was further the
term of the said OTS Scheme that "If the entire settlement
amount is not paid within 3 months from the date of conveying
the approval to the borrower, the OTS will stand automatically
cancelled and the borrower shall be liable to pay the entire
outstanding due." It was yet further the term of the OTS
Scheme that "Borrower has to deposit minimum 5% of the
W.P.(C) No.12138/2015 Page 10 of 14
outstanding as upfront amount along with the OTS offer letter
and the remaining OTS amount to be deposited within 3 months
from the date of conveying the approval." Thus the deposit of
5% of the outstanding amount along with the application and
for which the petitioners claim to have tendered bank drafts of
Rs.70,000/- each and deposit of the balance settlement amount
within three months of the date of conveying the approval and
the last date of which was 15th June, 2014, were the essential
requisites of the OTS Scheme. The petitioners admittedly
neither deposited 5% of the outstanding as upfront amount
along with the OTS offer letter nor the balance settlement
amount within three months of the last date for conveying
sanction i.e. 15th June, 2014 i.e. by 15th September, 2014. The
petitioners themselves claim to have deposited the bank drafts
towards 5% of the amount on 4th September, 2014. This writ
petition has been filed only on 19th December, 2015 i.e. much
after the closure of the OTS Scheme on 31st May, 2014 and
long after the last date for deposit of the entire OTS amount.
W.P.(C) No.12138/2015 Page 11 of 14
E. Once under the OTS Scheme, the last date for conveying the
approval was 15th June, 2014 and approval had not been
conveyed to the petitioners, the petitioners could not have
remained under any impression that their applications dated 31st
May, 2014 were pending consideration. The petitioners, if had
applied under the OTS Scheme and were keen to settle
thereunder, would have taken immediate action after 15th June,
2014. The petitioners however did not do so. Similarly though
the last date for payment of the entire amount as per the OTS
Scheme was 15th September, 2014 but the petitioners by that
date claim to have deposited only 5% of the amount and which
5% was to be deposited along with the application. All this
leaves no manner of doubt that the petitioners were fully aware
that they had not applied for consideration under the Scheme
and are using the Scheme only to defeat and delay the claims of
the respondent Bank.
F. This Court cannot compel the respondent Bank to settle with its
debtors who approach this Court, when the said debtors are not
found to have abided by the OTS Schemes of the respondent
W.P.(C) No.12138/2015 Page 12 of 14
Bank. There is merit in the contention of the counsel for the
respondent Bank that the present petition is but a devise to ward
off the attachment of the properties of the petitioners pursuant
to the orders of the DRT.
G. The writ jurisdiction of this Court entitles this Court only to see
that the State and the bodies / institutions qualifying as State
within the meaning of Article 12 of the Constitution of India
abide by the laws and act within the framework of the law and
does not entitle this Court to, on its own parameters of with
whom the banks as the respondent should settle and on what
terms, direct such settlement.
H. The respondent Bank in the present case is not found to have
violated its OTS Scheme under which the petitioners claim to
have applied and thus the question of issuing any mandamus as
is sought by the petitioners does not arise.
I. A Division Bench of this Court in Chinar Fabrics and
Furnishing Pvt. Ltd. Vs. State Bank of India
MANU/DE/2981/2005, also filed with a prayer to direct the
W.P.(C) No.12138/2015 Page 13 of 14
respondent bank in that case to accept the one time settlement
offered by the petitioners therein, held that the matter was
entirely contractual and no writ could be issued. It was held
that a writ lies if there is violation of law or error of law
apparent on the face of the record and a writ cannot be issued
merely on sympathetic considerations. It was further held that
the Court should observe judicial restraint in matters relating to
loan recoveries and should not embarrass financial institutions
or banks which granted loans, by over activism. A writ of
mandamus, it was held, could be issued only when there is a
legal right with a party asking for the writ to compel the
performance of some statutory duty.
8. There is no merit in the petition.
Dismissed.
RAJIV SAHAI ENDLAW, J.
SEPTEMBER 15, 2016 „gsr‟..
W.P.(C) No.12138/2015 Page 14 of 14