Madhya Pradesh High Court
M/S. Shri Krishnan Tradings Through Its ... vs Union Bank Of India on 11 November, 2020
Author: S. C. Sharma
Bench: Shailendra Shukla, S. C. Sharma
Writ Petition No.17590/2020 (O)
-1-
HIGH COURT OF MADHYA PRADESH, BENCH AT INDORE
Division Bench : HON'BLE MR. JUSTICE S. C. SHARMA AND
HON'BLE MR. JUSTICE SHAILENDRA SHUKLA
Writ Petition No.17590/2020 (O)
M/s. Shri Krishnan Tradings and Others
Versus
Union Bank of India and Others
Shri Ajay Bagadia, learned counsel for the
petitioner.
Shri Anand Singh Bahrawat, learned counsel for
the respondent No.1.
O R D E R
(Delivered on this 11th November, 2020) Per S. C. Sharma, J.:
The petitioners before this Court have filed this present petition being aggrieved by notice published by Union Bank of India in daily news paper dated 19/10/2020 in respect of sale of immovable properties in exercise of powers conferred under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as "SARFAESI Act, 2002").
02- The facts of the case reveals that the petitioner No.1 is a proprietorship concern and the petitioner No.2 is the Proprietor of the firm. The petitioner No.2 has availed financial assistance from the Union Bank of India to the tune of Rs.750.00 Lakhs, Secured Overdraft limit of Rs.450.00 Lakhs and Bank Guarantee of Rs.300.00 Lakhs. The Writ Petition No.17590/2020 (O) -2- petitioners mortgaged their property with respondent No.1 and as the account became NPA the petitioners were served with a notice under under Section 13(2) of the SARFAESI Act, 2002 on 02/05/2019. The outstanding dues were wroth Rs.6,04,62,508.69.
03- Various grounds have been raised in the present writ petition, however, inspite of the fact that there was alternative remedy available to the petitioners, the petitioners preferred a writ petition i.e. Writ Petition No.14268/2019 and another notice was issued under Section 13(4) of the SARFAESI Act, 2002 on 18/07/2019. The petitioners withdrew the writ petition on 04/10/2019 with a liberty to approach the Debt Recovery Tribunal.
04- Notices were issued by the Debt Recovery Tribunal and on 04/03/2020 as a assurance was given by the petitioners that they will be depositing the outstanding dues, an order was passed on 04/03/2020 in S.A.No.703/2019. The relevant paragraphs of the order passed by the Debt Recovery Tribunal on 04/03/2019 in S.A.No.703/2019 reads as under:-
"At this stage, Counsel for the applicant submits that the applicants suffered business losses but are willing to clear the entire dues of the bank for which purpose he prays for some time. He further submits that the applicants are willing to deposit an amount of Rs.10 Lacs within this month and shall further deposit Rs.10 Lacs in Apr'20 and shall continue to deposit Rs.20 Lacs every month till the entire dues of the bank are cleared.
On being queried, counsel for the bank submits that as on date, the total outstanding against the applicant is Rs.06,26,85,717/-.
I am inclined to take a lenient view in the circumstances being narrated by the applicant and therefore without going into merits, it is hereby directed that in case the applicant deposits a Writ Petition No.17590/2020 (O) -3- minimum amount of Rs.10 Lacs on or before 31-03-2020 and further deposits a minimum amount of Rs.15 Lac on or before 30-04-2020 and thereafter deposits a minimum of Rs.20 Lacs by the end of every month and clears the entire outstanding on or before 30-06-2022 alongwith interest on reducing balance and expenses, the execution of the order dtd.12-02-2020 passed by DM, Indore shall be kept in abeyance and the Respondents shall not proceed further with any action under the SARFAESI Act.
However, in case of failure to deposit the amount in the manner as directed above, the interim protection granted to the applicant shall be deemed to be automatically vacated and the Respondents shall be at liberty to proceed in accordance with law.
With these directions, the present SA stands finally disposed of."
Inspite of the fact that time was granted to the petitioners to clear the outstanding dues, nothing was done in the matter and a miscellaneous appeal was preferred i.e. M.A.No.52/2020 before the Debt Recovery Tribunal again for modification of the order passed on 04/03/2020. The Debt Recovery Tribunal by taking into account various factors has passed the following order on 14/08/2020:-
"The present M.A. is filed for extension of time of first installment of Rs.10.00 Lakhs w.e.f. 01.01.2021 and further deposit of Rs.15.00 lakhs by 31.01.2021 and thereafter shall keep for depositing the minimum of Rs.15.00 lakhs by the end of every month and clear the entire outstanding dues on or before 30.12.2022.
The Counsel for Respondent Bank vehemently opposed and submitted that this Tribunal took a lenient view without there being any bono fide on the part of Applicant to deposit minimum amount of Rs.10.00 lakhs on or before 31.03.2020 and further directed to deposit Rs.15.00 lakhs on or before 30.04.2020 and thereafter to deposit minimum of Rs.20.00 lakhs by the end of every month and clears the entire due on or before 30.06.2022 alongwith interest on reducing balance and expenses.
This Tribunal passed an order and kept in abeyance of the order passed by District Magistrate, Indore and has further restrained the Bank for taking any coercive action under SARFAESI Act.
The submission of the Respondent Bank is that the relief sought by the applicant is seriously opposed and applicant has not shown any bonafide reason which necessities the relation from Writ Petition No.17590/2020 (O) -4- this Tribunal and prayed this Tribunal to dismiss the petition.
This Tribunal taken into consideration of the Applicant that the total lock down imposed by the Central Government and State Government in the state of Madhya Pradesh and previous condition prevenient in the City of Indore. The applicants are not in a position to pay the amount as agreed by them is taken into consideration and taking principles of natural justice into consideration and as per the decision reported in AIR 1999 SC 3426 between Allahabad Bank Vrs. Radha Krishna Maity and Vol..108 CLT 451 Gobinda Chandra Pattnaik Vrs. PO, DRT & Others wherein it is held that Recovery of Debts Due to Banks and Financial Institutions Act (51 of 1993), Ss 19(6), 22-Interim order- power of Debt Recovery Tribunal to pass-Not limited to stay or injunction enumerated in sub-Cl.(6) of S. 19-Tribunal even has wider powers than Civil P.C.-
However, it has to observe principles of natural justice, the applicants are directed to pay the first installment of Rs.10.00 lakhs as agreed by them from 1 st October, 2020 and continuously to pay the amount as agreed by them in the order dated 04.03.2020 only, the date of first installment, i.e. 31.03.2020 is modified and time is granted upto 01.10.2020 and rest of the order stands as it is and the applicants are directed to clear total outstanding with interest and costs on or before 31.12.2022.
In case the applicants failed to start payment of first installment on or before 01.10.2020, the Respondent Bank is at liberty to take steps for execution of the order of the District Magistrate, Indore after 01.10.2020.
With the above observations, the M.A. No.52 of 2020 is disposed of and each party shall bear their own costs."
The petitioners have not complied the aforesaid order also by which time was further granted to pay outstanding dues. The petitioners have now approached this Court by filing a writ petition as the Bank is proceeding ahead with the auction of the mortgaged assets. 05- In the considered opinion of this Court, the petitioners are certainly having a remedy to approach the Debt Recovery Tribunal again and in case they are aggrieved by the order of Debt Recovery Tribunal, there is an alternative remedy of preferring an appeal before the appellate Tribunal.
Writ Petition No.17590/2020 (O) -5- 06- This Court does not find any reason to interfere with the order passed by the Debt Recovery Tribunal as there is a remedy of preferring an appeal and also keeping in view the facts that petitioners have not honoured their own commitment, made twice, before the Debt Recovery Tribunal. No case for interference is made out. Writ petition is dismissed with a liberty to the petitioners to approach the Debt Recovery Tribunal / Appellate Tribunal.
Certified copy as per rules.
(S. C. SHARMA) (SHAILENDRA SHUKLA)
JUDGE JUDGE
Tej
Digitally signed by
Tej Prakash Vyas
Date: 2020.11.18
11:53:47 +05'30'