Swastik Cereals Pvt. Ltd. vs Punjab National Bank and Others

Ajay Kumar Tripathi, J.—Petitioner filed the present writ application seeking a direction upon the Respondent Punjab National Bank for extension of time for payment of balance amount under OTS Scheme with interest for delayed payment at the Banks Prime Landing Rate in terms of the understanding reached between the Bank and the Petitioner on 13th August, 2008 which is contained in Annexure-2 to the writ application. This prayer for restraining the Respondent Bank for taking action under the SRFAESI Act has also made.

When the matter came up for admission a detailed order dated 24th October, 2008 was recorded by learned Single Judge. Taking note of the entire background to the dispute the Court directed the Petitioner to deposit 1.40 crores by 22nd November, 2008 with the Respondent Bank. The Bank would accept the same without prejudice. They were further directed that they will not take any steps in the meantime. The matter was adjourned and again taken up subsequently and yet another detailed order dated 17th December, 2008 came to be recorded. It took note of the fact that the Bank was willing to settle the matter for 2.60 crores in terms of the OTS Scheme. Another aspect of the matter recorded in the said order was that the plant, machinery and the property in question had already been taken possession of and sold. The money recovered from the same has also been utilized for settlement of the outstanding dues against the Petitioner.

Despite such development taking cue from the fact that the Petitioner did not pay the amount within time fixed in OTS Scheme, he has been asked to shell out more money because now the calculation is made on the basis of the outstanding loan amount when it was declared NPA in the year 2001 and the corresponding interest charged thereon on quarterly rent on compound basis.

One thing is not disputed that now the Petitioner has paid Rs. 2.60 crores may be taking advantage of the direction of the High Court including the interest for delayed payment on the OTS amount. Contention of learned Senior Counsel therefore is that there is nothing to be paid now in terms of the liability against this amount since the Petitioner went by the wish or the direction of the Court and has complied with the order well within time.

Order of learned Single Judge was challenged in L.P.A. No. 105 of 2009 by the Respondent Bank and the said exercise did not beget any relief to the Bank as would be evident from the order dated 8th April, 2009 passed in the said LPA. The matter is back for adjudication before learned Single Judge.

The question for consideration is whether the Petitioner can be left in the lurch at this stage after he has paid and carried out the direction of the Court well within time and whether the Respondent Bank would be allowed to reopen the whole issue afresh and they can be permitted now to calculate the outstanding dues made on the basis of the loan having been declared NPA in 2001 and charge interest according to their calculation? Details of the stand taken by the Respondent is available not only in the counter affidavit but also in the supplementary affidavit which has come to be filed from time-to-time.

They have a point that the Petitioner did not stick to time under the compromise agreement. Such stand may have merited consideration but for the fact that by Court''s intervention in a decisive manner by way of interim order Petitioner had altered the position and has made repayments of the OTS amount along with interest along with interest calculated on prime lending rate. The Bank cannot be allowed to reopen the whole issue and reagitate the issue in the above noted situation and background.

This writ application is allowed with a direction upon the Respondent to reconcile the account of the Petitioner on the basis of repayment which has been made by him along with the interest for delayed payment on the basis of the order of the High Court.

This writ application is allowed.