IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE GOPINATH P.
WEDNESDAY, THE 10TH DAY OF AUGUST 2022 / 19TH SRAVANA, 1944
WP(C) NO. 22897 OF 2021
PETITIONERS:
1 FL EXPORTS
REPRESENTED BY ITS PROPRIETOR, MR. BASHEER MOHAMMED
PERUMBULLY, XX/382 TO 385, PAKKULAM THAVVALAM,
ATTAPADI, MANNARKKAD, PALAKKAD - 678 589, RESIDING AT
PERUMUPULLIYIL, THENKARA P. O., MANNARKKAD, PALAKKAD -
678 582.
2 BASHEER MOHAMMED PERUMBULLY
AGED 43 YEARS
S/O. MUHAMMED, PROPRIETOR, M/S FL EXPRTS, RESIDING AT
PERUMUPULLIYIL, THENKARA P. O., MANNARKKAD, PALAKKAD -
678 582.
3 ASEENA BASHEER
AGED 40 YEARS
W/O. BASHEER M. P., RESIDING AT PERUMUPULLIYIL,
THENKARA P. O., MANNARKKAD, PALAKKAD - 678 582.
4 HAMSA
AGED 60 YEARS
S/O. SAIDALI, ALINGAL HOUSE, CHIRATTAKULAM,
EDATHANATTUKARA, PALAKKAD - 678 601.
5 MARIYA
AGED 57 YEARS
W/O. HAMSA, ALINGAL HOUSE, CHIRATTAKULAM,
EDATHANATTUKARA, PALAKKAD - 678 601.
6 HAFSATH SALAM
AGED 33 YEARS
W/O. SALAM, PERUMUPULLIYIL HOUSE, TRIKALLUR P. O.,
MANNARKKAD, PALAKKAD - 678 593.
BY ADVS.
K.S.BHARATHAN
ALPHIN ANTONY
AADITHYAN S.MANNALI
VISAKH ANTONY
ABEL ANTONY
CHRISTINE MATHEW
W.P (C) No.22897/2021 -2-
RESPONDENTS:
1 THE SOUTH INDIAN BANK
REGIONAL OFFICE, PALAKKAD, FIRST FLOOR, D & D ARCADE,
CHITTUR ROAD, MANAPULLIKAVU, KUNNATHURMEDU P. O.,
PALAKKAD - 678 013, REPRESENTED BY ITS CHIEF MANAGER.
2 ECGC LTD.
FORMERLY KNOWN AS EXPORT CREDIT GUARANTEE CORPORATION
INDIA LIMITED, HDFC HOUSE, 2ND FLOOR, RAVIPURAM JN., M.
G. ROAD, KOCHI - 682 015, REPRESENTED BY ITS BRANCH
MANAGER.
3 THE MINISTRY OF COMMERCE & INDUSTRY
REPRESENTED BY ITS JOINT SECRETARY, UDYOG BHAWAN, NEW
DELHI - 110 011.
BY ADVS.
SUNIL SHANKER
MATHEW B. KURIAN
KARTHIK S.A., CGC
VIDYA GANGADHARAN
K.T.THOMAS
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
10.08.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
W.P (C) No.22897/2021 -3-
JUDGMENT
The petitioners have approached this Court being aggrieved by the fact that the proceedings initiated to recover the amounts due under pre-shipment and post- shipment facilities availed by the petitioner from the respondent bank. The learned counsel for the petitioner states that the bank has illegally proceeded when recovery proceedings notwithstanding the fact that it was entitled to receive substantial amounts under the ECGC scheme from the 2 nd respondent corporation. It is submitted that the bank had already submitted a claim to the ECGC of the amounts payable under the scheme and after the filing of the writ petition certain amounts have already been released by ECGC to the bank. It is submitted that taking into consideration the provisions of Ext.R1 (a), the recovery proceedings by the bank can only be initiated after the amount is disbursed by the ECGC. It is submitted that in the facts of the present case the recovery proceedings were initiated much before the claim of the bank released by the ECGC.
2. The learned counsel appearing for the respondent bank and the learned counsel appearing for the 2nd respondent corporation states that the contention taken by the learned counsel for the petitioner is not tenable. It is submitted that the ECGC scheme covers the risk taken by the 1 st respondent bank and does not reduce the liability of the petitioner in any manner. It is submitted that even if amounts are disbursed by the 2 nd respondent corporation under the ECGC scheme, the liability of the bank to recover the entire amounts due from the petitioner continues. It is submitted that the provisions of the scheme make it clear that the bank must proceed to recover the entire amounts from the borrower and make over W.P (C) No.22897/2021 -4- the amounts paid by ECGC in the proportion of recovery. It is submitted that the petitioner is therefore not entitled to contend that recovery proceedings by the 1 st respondent bank should have been initiated and continued only after the payment made by the ECGC.
3. I have considered the contentions raised and also gone through the provisions of Ext.R1 (a) which is the covering letter issued by the ECGC to the 1 st respondent bank regarding renewal of export credit insurance for banks under the whole turnover banking credit scheme. It is clear from the reading of Clause 14 of Ext.R1 (a) that there is nothing in Ext.R1 (a) to suggest that the recovery proceedings by the bank must await disbursal of the amounts payable by ECGC under the scheme. The provisions of Clause 14 clearly indicate that the responsibility of the bank to recover the amounts due from the borrower continues notwithstanding the disbursal of any amount by ECGC. It is also clear from a reading of Ext.R1 (a) that on amount being recovered certain amounts are also to be paid over to the ECGC in proportion to the recovery made. I therefore find that there is no merit in the contention taken by the learned counsel of the petitioners that the recovery proceedings initiated even prior to the disbursal of amounts by ECGC must held to be bad. No other point has been raised. In the light of the above finding, the petitioner is clearly not entitled to any relief in the present writ petition and it is accordingly dismissed.
Sd/-
GOPINATH P.
JUDGE AMG W.P (C) No.22897/2021 -5- APPENDIX OF WP(C) 22897/2021 PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE STATEMENT OF ACCOUNTS DATED 28.02.2019 SHOWING THE DEBIT OF AMOUNTS TOWARDS PREMIUM OF ECGC ALONG WITH A CONSOLIDATED EXCEL SHEET OF DEBIT.
Exhibit P2 TRUE COPY OF THE NOTICE DATED 11.06.2021 FROM THE 1ST RESPONDENT ISSUED UNDER SECTION 13(2) OF THE SARFAESI ACT, 2002.
Exhibit P3 TRUE COPY OF THE POSSESSION NOTICE DATED 21.10.2021 ISSUED UNDER RULE 8(1) OF THE SECURITY INTEREST (ENFORCEMENT) RULES, 2002.