Ashoka Mercantile vs Punjab National Bank And Ors.

S.N.H. Zaidi, J

Heard parties' Counsel on admission. The instant appeal has been directed against the identical orders dated 23.10.2012 passed in S.A. No. 53/2008 as well as in S.A. No. 35/2008, whereby I.A. No. 683/2012 filed in S.A. No. 53/2008 and I.A. No. 794/2012 filed in S.A. No. 35/2008 for restraining the respondent Bank from proceeding with the valuation and sale of the secured asset of the borrower company (M/s. Modipon Ltd.) without consulting the applicants, have been dismissed. The contention of Mr. Bughani is that the appellant had entered into an agreement with the borrower company to pay the loan advance to it by IFCI and in pursuance thereof the borrower company had agreed to let the first charge of the appellant created over its properties and the appellant accordingly paid the amount of outstanding dues to the IFCI on behalf of the borrower company. He further submits that the charge created on the properties of the borrower company was accordingly registered with the Registrar of Companies. He also contends that Punjab National Bank and Bank of Baroda are also claiming to have charge over the properties of the borrower company qua the outstanding amount of debts as secured creditors and are proceeding to sell the secured assets and had obtained the valuation report. According to Mr. Bughani, since the appellant was having first charge over the secured assets of the borrower company, the Banks ought not to have proceeded to sell the assets without consulting the appellant or keeping it aside.

The above contentions have been disputed by the learned Counsel for the respondent Banks on the ground that sufficient opportunity was given to the appellant to file reply to the valuation report or to file its own valuation report qua those assets, but, despite taking several opportunities, the appellant did not come forward with any objection/valuation report of its own. Mr. Aggarwal points out that after hearing the parties, including the appellant, the Tribunal below had itself fixed the reserve price of the properties, vide the order impugned dated 23.10.2012. He further submits that at present the outstanding dues of Bank of Baroda are about Rs. 13 crores whereas according to Mr. Bajaj, Punjab National Bank is having outstanding dues of about Rs. 25 crores and the valuation fixed by the Tribunal is Rs. 47.18 crores. Both the Counsel for the Bank submit that their Banks are ready to file the undertakings that the entire sale proceeds will be deposited with DRT-II, Delhi and since the S.As. filed by the appellant as well as the borrower company are pending wherein the Tribunal may decide the question of priority of charge of the parties over the said sale consideration.

The submission appears to be reasonable. Moreover, this contention of the appellant that it was not consulted before fixing the reserve price does not appear to be tenable as reserve price of the property has been fixed by the DRT itself after hearing the parties.

Considering the above circumstances, the order impugned does not appear to be suffering with any infirmity or illegality and as such the appeal against the same cannot be admitted and the same is dismissed in limine. It is, however, directed that the sale consideration of the secured assets shall be deposited with the DRT concerned which shall pass appropriate orders as to its distribution.

Copy of this order be furnished to the parties as per law and be also sent to the DRT concerned.