Birla Tyres Limited vs Reserve Bank Of India & Ors
2021 Latest Caselaw 3680 Cal

09.07.2021
 Ct. No.13
  Sl. No.67
  pk/akd
                                          W.P.A. 10637 of 2021         [via video conference]

                            [Birla Tyres Limited -Vs- Reserve Bank of India & Ors.]



                                Mr. Sabyasachi Chowdhury
                                Mr. Reetobroto Mitra
                                Mr. Rajarshi Dutta
                                Mr. Vishwarup Acharyya
                                                    ... ... for the petitioner
                                Mr. Ratnanko Banerjee
                                Mr. Soorjya Ganguli
                                Ms. Pooja Chakrabarti
                                Ms. Radhika Mishra
                                Mr. Prithwish Chowdhury
                                Mr. Atreyo Banerjee
                                Mr. Kanisk Kejriwal
                                                    ... ... for respondent no.2

The writ petition is moved challenging a recall notice

issued by the ICICI Bank on 4th May, 2021.

Learned counsel for the respondent Bank takes a

preliminary objection as regards maintainability of the writ

petition, inter alia, on the ground that there are disputed

questions of fact in the matter which cannot be gone into by the

writ court.

It is also argued that the bank has initiated proceedings

under Section 7 of the Insolvency and Bankruptcy Code. It is,

therefore, submitted that the writ petition should not be

entertained by this court. Reference is made to a recent

judgment dated 2nd July, 2021 delivered in WPA 10679 of 2021

(Hiranmaye Energy Limited & Anr. vs. West Bengal Electricity

Regulatory Commission & Ors.).

Learned counsel appearing for the petitioner, however,

has submitted that the writ court is not barred from entertaining

the writ petition, in view of the following facts.

The writ petitioner was earlier a division of one Kesoram

Industries Limited (KIL). Pursuant to an arrangement the writ

petitioner was demerged out and a part of the liabilities of the

Kesoram Industries Limited were apportioned to the writ

petitioner. It is submitted that Kesoram Industries Limited may

have paid off the entire debt of the petitioner. Therefore, the

recall notice is thoroughly misplaced.

However, the principal thrust of argument by the learned

counsel for the petitioner is based on a decision of the Hon'ble

Supreme Court of India in WP (C) No. 476 of 2020 (Small Scale

Industries Manufacturing Association vs. UOI & Ors.). It is

submitted that by reason of orders passed in the said

proceedings and the moratorium declared by the Supreme Court

of India, the ICICI Bank could not have treated the loan accounts

of the petitioner, non-performing assets. The question of

recalling any advance made to the petitioner, therefore, does not

and cannot arise. It is also argued that the recall is motivated. It

was done to enable the ICICI Bank to wrongfully adjust and

appropriate an incoming receipt of 5 lakhs US dollars.

This Court has been taken through the documents

annexed to the writ application. Counsel for the parties have

been heard. The entirety of the cause of action of the petitioner

is against the ICICI Bank. No proceedings against the ICICI

Bank can be filed under Article 226 of the Constitution of India.

There are a large number of disputed questions of fact in the writ

petition. A writ court under Article 226 of the Constitution of India

cannot enter into such facts. The disputes between the petitioner

and the respondent no.2 are private loan contracts. This Court

also does not see any public element attached to the disputes

between the petitioner and the respondent no.2 except to a very

limited extent i.e. moratorium imposed by the Hon'ble Supreme

Court of India.

This Court is, therefore, of the view that since the bank

has already instituted proceedings under the Insolvency and

Bankruptcy Code, 2016, the authorities and fora thereunder are

better equipped to adjudicate the defence of the petitioner

against any action of the ICICI Bank.

The authorities under the Insolvency and Bankruptcy

Code are equally competent to assess the propriety of the

decision of the Bank to treat its accounts as NPAs and recall the

advances to the petitioner, in the light of the decision in the case

of Small Scale Industries Manufacturing Association

(Supra).

For the reasons stated hereinabove and those discussed

in the Hiranmaye Energy Limited decision (supra), this Court

is not inclined to entertain the writ application.

The writ petition shall stand dismissed with liberty

however, reserved to the petitioner to take all the points urged in

the instant proceeding before the fora under Insolvency and

Bankruptcy Code, 2016.

There will be no order as to costs.

All parties are to act on a server copy of this order duly

downloaded from the official website of this court.

(Rajasekhar Mantha, J.)