Delhi High Court
Diksha Trading Co. vs General Manager (North Zone), ... on 25 September, 2007
Equivalent citations: IV (2007) BC 466
Author: S R Bhat
Bench: S R Bhat
JUDGMENT
S. Ravindra Bhat, J.
1. Issue notice. Mr. R.P. Aggarwal, Advocate accepts notice. With consent of Counsel for the parties the matter was heard for final disposal.
2. The petitioner seeks a mandatory order to the respondent Bank for setting aside a notice under Section 13(2) of the Sccuritisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereafter referred to as 'the Securitisation Act') dated 20.1.2007.
3. The petitioner, a propriety concern of Shri Sumeet Tandon claims to be engaged in trading in industrial Chemicals, solvents and dyes. It approached the respondent Bank in 2002 for credit facilities. The Bank initially granted a credit limit for Rs. 1.5 crores. The petitioner applied and was granted an additional ad hoc facility of Rs. 20 lacs in February, 2003 which it utilized and other credit facilities were also secured. It is contended that the conduct of the Bank led to a situation whereby credit was frozen in 2004. The petitioner could not fulfill its obligation to repay the amounts. On 17.3.2005 the Bank issued a notice to the petitioners under Section 13(2), it claimed that the account of the petitioner had been declared as a Non Performing Asset (NPA), according to its guidelines, on 27.9.2004. Apparently, this notice was however not acted upon.
4. In the impugned notice the Bank alleged that the total outstanding payable on account of various liabilities and facilities availed of by the petitioners are to the extent of Rs. 1,14,83,541.52. The notice has been questioned; it is contended that the Bank acted in an arbitrary manner in holding to at least three secured assets which ought to have been released to the petitioner to facilitate liquidation of its liabilities. Learned Senior Counsel contended that the petitioner ran into financial difficulties because of the Bank's attitude in not servicing its obligations and allowing lines of credit at appropriate times. It was lastly urged that the petitioner is not disputing its liability and requires reasonable time to repay the dues to the Bank.
5. Learned Counsel for the respondent urged that one of the securities offered by the petitioner is suspect and that the owner namely Ms. Chander Kanta, maternal aunt of Sumeet Tandon filed a writ proceeding being WP (C) No. 671/2007 before this Court. According to her allegation she never consented to the equitable mortgage of that property. This Court has entertained the petition and stayed further action under the Securitisation Act; the matter is listed for consideration on 5.12.2007.
6. In view of the above and having regard to the statement made on behalf of the petitioner I am of the opinion that the respondent ought to suspend further action to enable the petitioner to attempt a compromise. This is subject to the certain conditions which are hereafter outlined. Accordingly, the following directions are used:
(1) The petitioner shall file an undertaking in the form of an affidavit in this Court acknowledging its liability in terms of the impugned notice dated 20.1.2007. The affidavit shall clearly mention the liability in figures as well as in words. The affidavit shall be filed in one week; a copy shall be furnished to the Bank.
(2) The petitioner shall approach the respondent Bank within a week with proposals for settlement. After duly considering the same the Bank shall indicate its response as early as possible and not later than four weeks from today.
(3) Subject to the above respondent Bank is hereby directed not to proceed further in terms of the impugned notice under the Securitisation Act for a period of ten weeks from today. In the event of inability of the parties to arrive at a mutual agreeable settlement it is open to the respondent Bank to proceed further after said expiry of ten weeks. Its actions are subject to further orders as far as property No. B-42, Cosy Home Co-op. Group Housing Society, Plot No. 20, Sector-IX, Rohini, Delhi are concerned. Further action in respect of that property shall be subject to the orders of this Court in WP (C) No. 6171/3007.
(4) The petitioner shall deposit the sum of Rs. 7.5 lacs within three weeks to the respondent. This shall also be stipulated in the affidavit undertaking.
7. The writ petition and pending applications are disposed in the above terms. Order dusty, to the parties.
