Shambhu Lal Lahoti vs State Bank of India and Another

Ajay Rastogi, J.—Matter has come up on application filed by Respondent under Article 226(3) of the Constitution for vacation of exparte interim order passed by this Court dt.18.05.2009. However, with consent of the parties, the matter has been finally heard.

Instant petition has been filed assailing the proceedings initiated against the Petitioner by Respondent-bank under the Act of 2002. The Petitioner, as alleged, had furnished guarantee for cash credit facility extended to M/s. Samdani Kirana Store, Bhilwara after creating equitable mortgage over his property. However, it appears from the record that borrower committed default in payment of outstanding loan. Taking note thereof, the account of the borrower was made NPA and recovery proceedings were initiated by serving a notice dt.07.02.09 u/s 13(2) of the Act upon borrower/guarantor (Petitioner) to pay outstanding dues which has been assailed by the Petitioner (guarantor) in the instant petition.

It appears from the record that during pendency this Court passed an exparte order on 18.05.2009 directing the Petitioner to pay a sum of Rs. 4.5 lacs in two equal installments and in that event status-quo in regard to mortgaged property was ordered to be maintained by the parties. It has been informed to this Court that pursuant to exparte order dt.18.05.2009 the Petitioner has deposited a sum of Rs. 4.5 lacs which has not been controverted by the Respondent as well. It appears from the document placed by Respondent on record as Annx.R/2 dt.16.09.09 that a total sum outstanding was Rs. 9 lacs and the last installment was payable on or before 31.03.2010.

Counsel for Petitioner on instructions submits and also filed affidavit in support thereof that his client is ready to pay the balance sum of Rs. 4.5 lacs against the outstanding dues reflected in the order dt.16.09.09-Annx.R/2 in two equal installments along with simple interest @ 6% per annum on the outstanding due of Rs. 4.5 lacs at the time of making payment of second final installment.

Counsel for Respondent on the other hand submits that if the balance amount along with interest to be charged as per notice dt.16.09.09-Annx.R/2 is paid by the Petitioner in terms referred to supra, the Bank shall not proceed further and the proceedings pending in other respective courts will also be dropped and the papers of the mortgaged property shall also be handed over to the Petitioner.

Taking note thereof, present petition stands disposed of with direction to the Petitioner to pay a sum of Rs. 2.5 lacs as first installment by the end of March,2011 and the remaining Rs. 2.0 lacs through second installment by the end of May,2011 along with simple interest @ 6% which the Respondent-Bank is directed to accept and it will be final settlement of outstanding dues and on payment of second installment the Respondent shall handover the papers of the mortgaged property within a week thereafter along with No Dues Certificate. However, it is made clear that if the Petitioner fails to comply this order, the Respondent-bank will be at liberty to proceed further in accordance with law.