G. B. PATNAIK, J. ( 1 ) THE seizure of the industrial unit by the Orissa 'state Financial Corporation in exercise of powers under Section 29 of the State Financial Corporations Act is being challenged in this writ application. ( 2 ) THE petitioner is the entrepreneur and after incorporating, the company as a private limited company in the year 1975, took a term loan from the State Financial Corporation (opp. party No. 1 ). The sanctioned, term loan was to the tune of Rs. 7,20,000/ -. The petitioner had availed a sum of Rs. 5,08,000 / - out of the aforesaid sanctioned amount till 2-12-l977 and had set up its factory by 1978. It was registered as a small scale industry on 17-7-l978. The Bank of India (opp. party No. 3) had sanctioned a loan of Rs. 2,00,000/- towards working capital and the petitioner could start its industry with the said working capital, but with the limited resources, the plant could not run regularly and it became sick by 1983. There was a default in payment of the installment dues to the Corporation for which the Corporation seized the unit in exercise of powers under Section 29 of the State Financial Corporations Act (hereinafter referred to as the 'act' ). A writ application being filed in this court in March, 1983, the same was registered as O. J. C. No. 684 of 1983. That writ application was disposed of on 30-4-1983 on certain terms and conditions. The Corporation was directed to release the unit from seizure on payment of Rs. 50,000 / with a further direction that another sum of Rs. 50,000/- would be paid within. a stipulated period. The Court also observed that the Corporation should rephase the payment schedule. As by that time the petitioner's application to the Bank of India was pending, the Court also observed that the Bank of India should dispose of the application for providing working capital to the petitioner. After the industrial unit was released pursuant to the aforesaid order on compliance of the conditions contained in the order, the case of rehabilitation of the industrial unit was taken up. The rehabilitation package was approved by the State. Level Industries Coordination Committee, but according to the petitioner it could not be implemented on account of lack of co-operation by the State Financial Corporation as well as by the Bank of India. The rehabilitation package was approved by the State. Level Industries Coordination Committee, but according to the petitioner it could not be implemented on account of lack of co-operation by the State Financial Corporation as well as by the Bank of India. After lapse of three years when the unit could not be revived on account of non-implementation of the rehabilitation package, another consultancy firm. ORITCO, was entrusted to prepare a detailed rehabilitation package in the year 1986. On the basis of a report by the ORITCO and on the recommendation of the Director of Industries, the Orissa State Financial Corporation agreed to sanction an additional term loan of Rs. 7,00,000 / - on 2-6-1988 and certain further terms and conditions were imposed by the said Corporation on 26-6-1989 which were accepted by the petitioner, as is apparent from Annexure-2. The O. S. F. C. released a sum of Rs. 3,55,900 / - out of the sanctioned amount of additional loan of Rs. 7,00,000/- in accordance with the rehabilitation package, but the Bank of India only released a sum of Rs. 2,14,000/- as against the sanctioned amount of Rs. 12,43,000 / - under the rehabilitation package. This conduct of the O. S. F. C. and the Bank made the industry to cripple. The question was considered by the NODAL Committee which came to the conclusion that the revival package being an indivisible concept, non-payment of the entire package will lead to automatic closure of the unit. The Chairman of the NODAL Committee called upon the Bank of India on 20-5-1991 to furnish a report on the progress of sanctioning of working capital loan to the petitioner. The O. S. F. C. issued notice under Section 29 of the Act on 17-2-1992, annexed as Annexure-6, and notice under Section 30 of the Act on 4-3-1992, annexed as Annexure-7. The petitioner made a request on 18-3-1992 as per Annexure-8 to the O. S. F. C. to abstain from taking any action under Sections 29 and 30. The petitioner also made a request to the Bank of India on 3-7-1992, annexed as Annexure-9, for release of the balance working capital. The petitioner made a request on 18-3-1992 as per Annexure-8 to the O. S. F. C. to abstain from taking any action under Sections 29 and 30. The petitioner also made a request to the Bank of India on 3-7-1992, annexed as Annexure-9, for release of the balance working capital. On 31-7-1992, the District Industries Centre discussed the case of the petitioner in the context of the revival package agreed to by the O. S. F. C. and the Bank and its non-implementation and it was suggested that the amount agreed under the revival package should be released by the Corporation and the Bank. But before any further release of the Amount by the Corporation and the Bank, the Corporation seized the unit on 14-10-1992 in exercise of power under Section 29 of the Act. The said order has been annexed as Annexure-12. The petitioner filed the writ application on 23-10-1992 and by an interim order this Court had directed that the sale as scheduled may be held, but shall not be confirmed and possession of the unit may not be delivered to the intending purchaser without leave of the Court. ( 3 ) WHEN the Corporation entered appearance and made an application for vacating the interim order, this Court refused to vacate the interim order, but called upon the petitioner to deposit a sum of Rs. 3,00,000 /by order dated 15-3-1994 and the said amount of Rs. 3,00,000/ - has in the meantime been deposited by the petitioner and the interim direction has thus been complied with. In the aforesaid circumstances, the petitioner assails the legality of the seizure in question, inter alia, on the ground that the State Financial Corporation having failed to ensure prompt payment in accordance with the revival package has not acted fairly, honestly and reasonably and has failed to discharge its function on business principles as enunciated by the Supreme Court in the case of Mahesh Chandra v. Regional Manager, U. P. Financial Corporation, AIR 1993 SC 935 , and, therefore, the order of seizure must be struck down. It is also contended that the Bank of India has failed to discharge its obligation by not releasing the entire working capital though agreed to under the rehabilitation package and thereby has caused substantial loss to the petitioner and such act on the part of the Bank notwithstanding unequivocal promise on their part to release the working capital has been detrimental to the petitioner's interest in the industry and accordingly, the Bank should be called upon to fulfil its promise held out. ( 4 ) THE Corporation in its counter affidavit does not dispute the assertions made in the writ application with regard to the revival package, but contends that it is the inaction on the part of Bank of India in sanctioning the working capital and releasing the same which made the rehabilitation package ineffective and unworkable. It further states that though the Corporation had sanctioned Rupees 7,00,000/- under the rehabilitation package, but as the I. D. B. I. was pleased to sanction only Rs. 5,95,000/ - by way of re-finance, the same was communicated to the petitioner. The re-financing was valid for a period of six months and the petitioner could not avail of the said loan in time, as a result of which it was cancelled and thereafter as the petitioner did not pay up the installments and committed default action was taken under Section 29 of the Act. ( 5 ) THE Bank (opposite party No. 3) has filed an affidavit stating therein that in accordance with the revival proposal, the entrepreneur was supposed to complete the extension work and purchase of machinery within a specified period. But as it failed to complete the same, the Bank did not release the balance working capital on account of such unsatisfactory progress of work. ( 6 ) IN view of the rival stand of the parties, the question that arises for consideration is whether the action of the Corporation in seising the unit in exercise of powers under Section 29 can be said to be reasonable and fair and in the event the Corporation is directed to deliver possession of the unit to the petitioner, what further direction can be given in the matter of revival. ( 7 ) THE State Financial Corporation was constituted to promote industrialisation in the State by encouraging the entrepreneurs to participate in economic growth of the country by giving them financial assistance through such Corporation for setting-up medium and small scale industries. The Financial Corporation and the Bank deal with public money for public benefit and, therefore their approach is required to be public oriented and helpful to the loanee and at the same time without loss to the Corporation or the Bank and both the Corporation and the Bank are required to discharge their functions on business principles due regard being had to the interest of the industry, commerce and general public, as has been indicated by the apex court in Mahesh Chandra's case AIR 1993 SC 935 . If the Corporation or its officers do not come forward with an attitude of extending their co-operation to the entrepreneurs, then the very purpose and object for which such corporation has been incorporated would stand frustrated. Prompt release of the sanctioned amount subject to its proper utilisation is essential particularly when the escalation of prices is rapid. Working capital is also an important element in effecting rapid production and erosion of working capital undoubtedly affects the growth of business. This aspect of the problem has been dealt with by the Supreme Court in Mahesh Chandra's case, (supra) and the Court after giving anxious consideration to the interest of the corporation as well as to the interest of the industry laid down certain guiding principles to be followed by the financial institutions. The question that arises for consideration in the present case is whether the financial corporation as well as the bank had acted in accordance with the said principles. Our answer to the aforesaid question has to be in the negative, inasmuch as notwithstanding the revival proposal and the detailed rehabilitation package given by the consultancy firm ORJTCO and notwithstanding the agreement of the OSFC in sanctioning an additional loan, and the agreement of the Bank to provide for the working capital, there has been inordinate delay both on the part of the financial corporation and the Back, which is the prime cause for non-revival of the unit in question. An already sick unit has become more sick by such delay on the part of the Corporation as well as the Bank in discharging their part of the obligation under the revival package and the conclusion is irresistible that the Corporation and the Bank have not acted on business principles. In the counter affidavits filed some grounds have been advanced by the Corporation and the Bank for non-release of the funds as agreed to by them under the revival package, but those grounds do not appear to us to have any basis and, on the other hand, we are of the considered opinion that both, the corporation authority and the Bank have not come forward with a helping hand towards the entrepreneur. ( 8 ) MR. Misra appearing for the corporation brought to our notice, a later decision of the supreme Court in the case of U. P. Financial Corporation v. M/s. Gem Cap (India) Pvt. Ltd. , AIR 1993 SC 1435 , and contended that the corporation is duty bound to take steps for realisation of its dues and the fairness required of the corporation could not be carried to the extent of disabling it from recovering what is due to it. We have no dispute with the proposition laid down by the apex Court in the aforesaid Gem Cap case, but what is required to be answered by us is, has the Corporation acted with fairness in not releasing the amount of additional loan agreed to under the revival package. On considering the facts and circumstances of the case as narrated by us earlier, there cannot be two opinions that after the revival package was drawn up and the corporation and the Bank agreed to perform their part in accordance with the said revival package, neither the corporation nor the Bank has acted fairly with an attitude of extending cooperative hand to the loanee. On the other hand, inaction on the part of the corporation and the Bank has stood on the way of revival of the industry in question. In the aforesaid premises, and taking into account the fact that the entrepreneur has already deposited a sum of Rs. 3,00,000 / - during the pendency of the writ application which establishes bona fides on the part of the petitioner, we would direct that the possession of the industrial unit be given to the petitioner forthwith. In the aforesaid premises, and taking into account the fact that the entrepreneur has already deposited a sum of Rs. 3,00,000 / - during the pendency of the writ application which establishes bona fides on the part of the petitioner, we would direct that the possession of the industrial unit be given to the petitioner forthwith. We further direct that the corporation and the Bank should take steps for releasing the balance amount as contained in the revival package subject to the scrutiny as to its proper utilisation within two months from the date of receipt of our order and they would also rephase the period of repayment schedule. It would be open for the petitioner to approach both the corporation and the Bank for any additional financial assistance if required in view of the fact that the revival package had been drawn up in 1990 and four years have lapsed in the meantime. The writ application is allowed with the aforesaid direction and observation. There will, however, be no order as to costs. ( 9 ) B. N. PATNAIK, J. I agree. Petition allowed.