Punjab-Haryana High Court
Laxmi Devi vs Union Of India And Anr on 3 April, 2024
Author: Lisa Gill
Bench: Lisa Gill
Neutral Citation No:=2024:PHHC:046190-DB
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CWP No. 14351 of 2021(O&M)
2024:PHHC:046190-DB
105+232 IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP No. 14351 of 2021(O&M)
Date of Decision: 03.04.2024
Laxmi Devi ......Petitioner
Versus
Union of India and another ..... Respondents
CORAM : HON'BLE MRS JUSTICE LISA GILL
HON'BLE MRS JUSTICE AMARJOT BHATTI
****
Present: Mr.J.P.Sharma, Advocate for the petitioner.
Mr. D.K.Gupta, Advocate for respondent No.2.
***
LISA GILL, J.(Oral)
1. Prayer in this writ petition is for issuance of direction to respondents
not to terminate/rescind proposal for One Time Settlement (OTS) dated
04.03.2021 (Annexure P-1) which is stated to still be in force and protected by
virtue of Division Bench orders of this Court dated 28.04.2021 and
30.06.2021(Annexures P-2 and P-3 respectively) passed in CWP-PIL-77-2021.
2. It is submitted that petitioner, who is running a factory in the name
and style of Ramesh Food Industries at village Nuni Awal, District
Mahendergarh had taken loan facility from respondent No.2. Proceedings under
Securitisation and Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002 (for short 'SARFAESI Act') were initiated against
petitioner with possession notice dated 15.01.2018 also being issued for deposit
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of a sum of Rs. 55,43,648/- stated to be due as on 30.09.2017. Settlement was,
however, arrived at between the parties which was sanctioned on 04.03.2021 for
a sum of Rs.41,23,000/-. A sum of Rs.6,25,000/- was deposited and it was agreed
that sum of Rs.34 lakhs approximately would be deposited till 20.03.2021.
However, due to outbreak of pandemic COVID-19, loss was suffered by
petitioner and he failed to repay the balance amount in terms of settlement.
Father-in-law of petitioner is also stated to have unfortunately died on
06.05.2021. It is submitted that OTS (Annexure P-1) continues to be in
existence and petitioner was duly protected in terms of orders dated 28.04.2021
and 30.06.2021 passed in CWP-PIL-77-2021. However, respondent-bank, it is
submitted, was bent upon taking action against petitioner under SARFAESI Act,
which is unjustified and in fact illegal. It is, thus, prayed that respondents should
be directed not to terminate or rescind OTS dated 04.03.2021.
3. Learned counsel for respondent-bank has opposed this petition by
submitting that no direction could be issued as is prayed for by petitioner.
Moreover, petitioner has even failed to deposit sum of Rs. 5 lakhs in terms of
order dated 06.12.2021. Sum of approximately more than Rs. 80 lakhs is due
from petitioner as on date.
4. Having heard learned counsel for parties we do not find any ground
for interference in the present writ petition. It is settled position that borrower or
guarantor does not have a vested right for OTS. It has been held by Hon'ble the
Supreme Court in judgment of The Bijnor Urban Cooperative Bank Limited,
Bijnor and others vs. Meenal Aggarwal and others, 2022 AIR (SC) 56 as
under:-
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"9. Even otherwise, as observed hereinabove, no borrower can, as a
matter of right, pray for grant of benefit of One Time Settlement
Scheme. In a given case, it may happen that a person would borrow
a huge amount, for example Rs.100 crores. After availing the loan,
he may deliberately not pay any amount towards installments,
though able to make the payment. He would wait for the OTS
Scheme and then pray for grant of benefit under the OTS Scheme
under which, always a lesser amount than the amount due and
payable under the loan account will have to be paid. This, despite
there being all possibility for recovery of the entire loan amount
which can be realised by selling the mortgaged/secured properties.
If it is held that the borrower can still, as a matter of right, pray for
benefit under the OTS Scheme, in that case, it would be giving a
premium to a dishonest borrower, who, despite the fact that he is
able to make the payment and the fact that the Bank is able to
recover the entire loan amount even by selling the
mortgaged/secured properties, either from the borrower and/or
guarantor. This is because under the OTS Scheme a debtor has to
pay a lesser amount than the actual amount due and payable under
the loan account. Such cannot be the intention of the Bank while
offering OTS Scheme and that cannot be purpose of the Scheme
which may encourage such a dishonesty.
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11. The sum and substance of the aforesaid discussion would be that no
writ of mandamus can be issued by the High Court in exercise of powers
under Article 226 of the Constitution of India, directing a financial
institution/Bank to positively grant the benefit of OTS to a borrower. The
grant of benefit under the OTS is always subject to the eligibility criteria
mentioned under the OTS Scheme and the guidelines issued from time to
time. If the Bank/financial institution is of the opinion that the loanee has
the capacity to make the payment and/or that the Bank/financial
institution is able to recover the entire loan amount even by auctioning
the mortgaged property/secured property, either from the loanee and/or
guarantor, the Bank would be justified in refusing to grant the benefit
under the OTS Scheme. Ultimately, such a decision should be left to the
commercial wisdom of the Bank whose amount is involved and it is
always to be presumed that the financial institution/Bank shall take a
prudent decision whether to grant the benefit or not under the OTS
Scheme, having regard to the public interest involved and having regard
to the factors which are narrated hereinabove."
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5. Even taking into consideration orders dated 28.04.2021 and
30.06.2021 passed in CWP-PIL-77-2021, it is a matter of record that petitioner
has even failed to deposit amount of Rs. 5 lakhs in terms of order dated
06.12.2021 wherein it was directed that subject to petitioner depositing the said
amount within a period of four weeks, her dispossession from property in dispute
shall remain stayed. The said interim order was continued. Thereafter it was
subsequently extended on May 22, 2023 but still petitioner has not come forth to
deposit the amount in question. We do not find any ground to extend the period
of One Time Settlement as is sought by petitioner. Reference in this regard can
be made to judgment of Hon'ble the Supreme Court in the case of State Bank of
India Vs. Arvindra Electronics Pvt. Ltd., 2023(1) SCC 540.
6. Accordingly, present writ petition is dismissed. Needless to say
petitioner is at liberty to avail statutory remedy/remedies available to her in
accordance with law for challenging proceedings under SARFAESI Act initiated
against her, if so advised.
7. Pending application(s), if any, stand(s) disposed of accordingly.
(LISA GILL)
JUDGE
(AMARJOT BHATTI)
JUDGE
03.04.2024
Sunita/rts
Whether Speaking : Yes/No
Whether Reportable :Yes/No
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