State Bank Of India vs Vimoni India Pvt. Ltd. And Ors.

S.N.H. Zaidi, J

Heard parties' Counsel on review application (M.C. No. 343/2012) filed by the appellant - Bank seeking review of the order dated 23.4.2012 passed by this Tribunal, whereby the appeal was disposed of with the direction that the Bank may proceed to sell the properties of Barotiwala and Parwanoo in Himachal Pradesh as per order impugned of the Tribunal below and the respondent borrower was allowed four months' time to bring buyer for its Bhiwadi (Rajasthan) property and till then the Bank was directed to maintain the status quo of that property with a further direction that in case of failure, it may proceed against that property without prejudice to the rights and interest of the parties in the S.A. Mr. Arora submits that while making the said order, this Tribunal had also observed that the appellant Bank had failed to show any sufficient cause for not proceeding against the properties of Himachal Pradesh and allowed the liability of interest to increase, which could have been reduced had those properties been sold. According to him, the said observation was made apparently on the basis of contention of the respondent's Counsel that the respondent had offered for the sale of Parwanoo property itself but the Bank without any cogent reason failed to take any step to sell that property. Mr. Arora points out that there was no default on the part of the Bank in not proceeding with the sale of the Himachal Pradesh properties because it was restrained by an interim order dated 9.12.2011 passed by the DRT, which continued up to 12.3.2012 when the S.A. was finally disposed of by the Tribunal below, which order has been assailed in the appeal by the Bank. Mr. Arora seeks to review the order with the modification that the Bank had not failed to take action to sell the Himachal Pradesh properties. He, however, points out that in pursuance of the order of this Tribunal the Bank had proceeded against those properties and had sold the Parwanoo property whereas Barotiwala property could not be sold as no bid was received. Mr. Arora also submits that if the order dated 23.4.2012 is not reviewed/modified/clarified it would lead to the confusion regarding the action initiated by the Bank qua the secured asset.

Mr. Matta, on the other hand, submits that after the receipt of the demand notice dated 1.1.2011, the respondent, vide letter dated 5.10.2012, had intimated the Bank that it had shifted all its operation from Parwanoo unit to its other unit at Barotiwala in 2007 and since the said property was lying idle it had decided to sell that property so that the funds so received could be utilised for business purposes as well as to reduce the outstanding dues of the Bank and requested the Bank to release the title deed of Parwanoo property. He further submits that thereafter again, vide letter dated 28.10.2010 the respondent had intimated the Bank that it was trying to sell its Parwanoo shed as well as Bhiwadi land and building and it was also brought to the notice of the Bank that it was having confirmed buyers for both the properties and requested the Bank to permit it to sell those properties. He also submits that again on 12.11.2010 the respondent had also shown its willingness to dispose of the assets at Bhiwadi and Parwanoo to reduce the over dues of the Bank and requested for issuing no-objection for the disposal of those properties, but despite respondent's efforts, the Bank did not permit it to sell those properties. It is also submitted that in its application filed under Section 17 of the SARFAESI Act, the respondent had again reiterated those facts in Paras 5.32 to 5.35 and in its reply filed to the S.A., the Bank, in Para 5.34, had specifically stated that the Parwanoo and Bhiwadi properties were not sufficient to clear off the entire dues of the Bank and with a view not to dilute its security, the Bank did not permit the applicant company to sell its property at those places. Mr. Matta contends that in view of the said circumstances, this Tribunal had made the conscious observation that the Bank failed to show any sufficient cause for not proceeding against the Himachal Pradesh properties and allowed the liability of interest to increase, which could have lessened had those properties been sold.

Having considered the submissions of the parties' Counsel, I could not find any good reason to modify the aforesaid observation, which has been sought to be reviewed. It appears that before filing the S.A., the respondent company was asking for the permission of the Bank for initially selling the Parwanoo shed and subsequently the Bhiwadi property, but the Bank did not permit to sell those properties. Had those properties been sold in time when the permission for the same was sought and prospective buyers were also available for those properties, the liabilities of the respondent would have definitely been reduced. It was during the pendency of the S.A. that the interim order dated 9.12.2011 was made by the Tribunal below, directing to maintain the status quo in respect of those properties when the Counsel for the respondent - Bank had asked for time to file reply to the S.A. and the Bank's officer had made a statement that the Bank would not take any action against the Bhiwadi property as well as properties of Himachal Pradesh, and the said order continued until the S.A. was finally disposed of on 12.3.2012. I am also at a loss to appreciate that there was any confusion qua the said order as it was made clear that if the respondent would fail to bring the buyer for Bhiwadi property within four months from that date, the Bank would be at liberty to proceed against that property without prejudice to the rights of the parties and as such there was no confusion qua the default clause of the order.

Though Mr. Arora also points out that only a day before the expiry of the said four months' period, the borrower respondent had filed an application before the DRT intimating about the buyer for the Bhiwadi property, but the said application is still pending disposal. Any development subsequent to the order sought to be reviewed cannot be taken into account for the purposes of the review. In view of above, there is no ground for review/modification/clarification of the order dated 23.4.2012 of this Tribunal. The review application being devoid of any force is accordingly dismissed.