Delhi High Court
Shri Dinesh Kumar vs Delhi Financial Corporation on 31 July, 2002
Equivalent citations: 99 (2002) DLT 584
Author: M Sarin
Bench: M Sarin
JUDGMENT
Manmohan Sarin, J.
1. Rule.
With the consent of the parties, writ
petition is taken up for disposal.
The petitioner has filed this writ petition
seeking a writ of prohibition to restrain the
respondents from auctioning the petitioner's
residential house bearing No. 8115, Kharia Mohalla,
Roshnara Road, Sabji Mandi, Delhi and restrain them
from taking possession of the said property. The
petitioner inter alia also sought quashing of the
proceedings initiated under Section 29 as well as a
writ restraining the respondents from recovering the
amounts from the petitioner in respect of the loan
advanced and from taking any other coercive steps
pursuant to the notice dated 13.12.1997 and 17.4.1998
issued by the respondents.
2. Counsel for the parties have been heard.
The relevant facts as also the respective
submissions are noted:-
Petitioner claims to have applied for a loan
of Rs. 8.60 lacs. in October, 1996. Respondents
sanctioned the same and Rs. 7.60 lacs was disbursed to
the petitioner. The respondents contend that the
petitioner without taking their permission
unauthorizedly sold the machinery for the purchase of
which loan was taken. Machinery was hypothecated with
the respondents, yet the petitioner sold the same
without their knowledge at an absurdly low price of
Rs. 1.85 lacs. Petitioner claims to have deposited the
said amount. Counsel for the petitioner submits that
it was on account of non-disbursement of full amount of
loan that petitioner faced these difficulties, which
led to a cash bottle-neck.
3. Learned counsel submits that petitioner was
unable to carry on the business at Naraina on account
of high rent and was thus compelled to sell the
equipment as a distress sale. Whatever proceeds
petitioner got, he deposited with the respondent. Not
only this counsel for the petitioner submits that
residential house of the petitioner was sold for a sum
of Rs. 4,25,000/-, which proceeds have also deposited
with the respondent.
4. Respondent has produced on record the
statement of account Learned counsel for the petitioner
submits that the petitioner has already remitted
Rs. 7.90 lacs against the loan of Rs. 7.60 lacs and
petitioner is a sick Company and should be allowed the
benefit under the policy of 7.6.1996. This is of
course disputed by the respondent, who submits that the
policy is applicable on merit and the petitioner by its
conduct is disentitled to claim the benefit under the
policy.
5. On a consideration of the entire matter it
prima facie appears to the undersigned that even though
the petitioner had violated the terms in selling the
equipment without the permission and consent of the
respondents, petitioner thereafter had been making
efforts to pay the proceeds which he had received from
the sale of the equipment. Petitioner thereafter had been making
efforts to pay the proceeds which he had received from
the sale of the equipment. Petitioner claims that sum
of Rs. 1,85,000/- was duly paid, though in Installments.
Petitioner also after selling the house for a sum of
Rs. 4,25,000/- under the supervision of respondents,
deposited the same with the respondents.
6. Learned counsel for the petitioner submits
that in these circumstances petitioner is entitled to
be given the benefit under the recovery policy dated
7.6.1996. Let the petitioner make a representation to
the respondents within two weeks, who would
sympathetically consider the same taking into account
the factors enumerated earlier and take a decision on
the same giving the benefit to which the petitioner may
be legitimate entitled. Till the disposal of the
petitioner's representation no further coercive steps
be taken.
