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2021 DIGILAW 547 (JK)

Rameshwar Kumar v. State of J&K

2021-10-13

RAJNESH OSWAL

body2021
JUDGMENT : RAJNESH OSWAL, J. 1. The petitioners, being the partners of the M/s Natraj Hotel and Restaurant situated at National Highway, Tikri, Udhampur, have filed the present petition for quashing Notice bearing No. SFC/DOU/15/192 dated 31.12.2015 issued by the office of respondent No. 3 by virtue of which, the petitioners have been asked to deposit the balance amount of Rs. 11.04 lacs within a period of 07 days. The petitioners also seek a direction to the respondents to settle their loan case under the Settlement Scheme for Sick Unit (SSSU) as has been done in other loan cases. 2. It is stated in the petition that the petitioners were sanctioned an amount of Rs. 36.87 lacs under two loan accounts out of which an amount of Rs. 34,97,708/- was disbursed in favour of the petitioners and the petitioners after availing the loan facility set up the said hotel and started paying the required installments towards liquidation of the loan liabilities. However, after some time, due to widening of the roads, the unit of the petitioners was closed. The petitioners opted for loan settlement under One Time Settlement Scheme and the respondent Nos. 2 and 3 settled the loan on 24.07.2014 on the basis of distress value of assets determined as on 30.11.2012 by approved valuer of the respondents. Aggrieved by the settlement, the petitioners requested the respondents to reconsider their case for the settlement. A committee was constituted by the respondents, which has examined, considered and approved the settlement of the distress value of the unit-hotel of the petitioners valued as Rs. 46.04 lacs. It is further stated that the respondents again placed the case of the petitioners before the committee in its meeting held on 07.02.2015 and it was decided not to entertain the case of the petitioners and they were required to deposit the amount up to 31.03.2015. While the petitioners were in process of depositing the amount after arranging the funds, another scheme known as Settlement Scheme for Sick Units (SSSU) was announced on 14.10.2015. While the petitioners were in process of depositing the amount after arranging the funds, another scheme known as Settlement Scheme for Sick Units (SSSU) was announced on 14.10.2015. After coming to know about the said scheme, the petitioners applied and requested the respondents vide notice dated 15.01.2016 and thereafter vide reminder dated 22.01.2016 to process the case de novo for the settlement of the loan account under the said scheme as the case of the petitioners fell within the ambit and purview of clause 6 proviso (ii) and (iii) of the aforesaid SSSU. 3. It is further stated that as per the information provided by the respondents to the petitioners under Right to Information Act, the loan liabilities have been shown in both the loan amount i.e. account No. 1 and account No. 2 as nil and the unit has been classified as non functional and it shows the mala-fide on the part of the respondents while demanding as Rs. 11.04 lacs from the petitioners vide letter dated 30.12.2015. The respondents vide letter dated 04.02.2016 addressed to the counsel for the petitioners conveyed that the hotels do not fall within the purview of so called scheme. The petitioners have impugned the letter dated 30.12.2015 on the ground that the petitioners are entitled to the benefit of SSSU and further that the respondents have willfully avoided to redress the grievances of the petitioners with regard to their claim of wrong calculations by not giving the benefits of the money already deposited in the principal amount for which the respondents have not responded with any affirmative reason but the petitioners could only come to know through the information sought under the RTI Act. 4. Response stands filed by the respondents, in which it is stated that disputed question of facts have been raised by the petitioners those cannot be decided in a writ petition and it is further stated that a total loan amount of Rs. 36.87 lacs was sanctioned in favour of the petitioners-unit and an amount of Rs. 34.98 lacs has been disbursed to the petitioners. 36.87 lacs was sanctioned in favour of the petitioners-unit and an amount of Rs. 34.98 lacs has been disbursed to the petitioners. It is further stated that on the request of the petitioners, the respondent-Corporation, placed the matter before the Recovery Settlement Committee it its meeting held on 08.09.2015 for resettlement of the loan and the Recovery Settlement Committee in its decision dated 08.09.2015 considered the request of the petitioners and approved the adjustment of the token of Rs. 7.80 lacs towards the already settled amount of Rs. 46.04 lacs. The net payable amount thus worked out to Rs. 38.24 lacs out of which the petitioners have already deposited Rs. 27.20 lacs leaving a balance of Rs. 11.04 lacs. Accordingly, the decision of the committee was conveyed to the petitioners on 29.09.2015. It is also stated that the hotel of the petitioners does not fall within the ambit/purview of the SSSU launched by the Corporation vide order dated 14.10.2015 and more so, the case of petitioners had already been settled, as such, their case cannot be reopened after launch of the new scheme. It is also stated by the respondents that the petitioners cannot dictate the terms to the Corporation with regard to the appropriation of the money for adjustment under a particular head. It is the prerogative of the Corporation to make adjustment of the amount deposited by the borrower as per their accounting standard norms. 5. Mr. C.M. Koul, learned senior counsel appearing for the petitioners has vehemently argued that as per section 2(c) of the State Financial Corporations Act, 1951 (for short the Act) Industrial Concern means any concern engaged or be engaged in hotel industry as well, therefore, the contention of the respondents that the scheme does not cover the hotel industry is not tenable in the eyes of law. He further argued that the respondents have resorted to the wrong accounting procedure. Therefore, they are under obligation to consider the claim of the petitioners for settlement of their case under the scheme. 6. Per contra, Mr. Vijay Gutpta, learned counsel for the respondents has vehemently argued that the scheme is not meant for the hotel industry but for the sick industrial units and further that once the petitioners had already settled their case, so they are not entitled to be considered under the scheme on this ground as well. 7. Heard and perused the record. Vijay Gutpta, learned counsel for the respondents has vehemently argued that the scheme is not meant for the hotel industry but for the sick industrial units and further that once the petitioners had already settled their case, so they are not entitled to be considered under the scheme on this ground as well. 7. Heard and perused the record. 8. The issues those arise for consideration by this Court are as under: (i) whether the Settlement Scheme for Sick Units (SSSU) launched by the respondents is comprehensive enough, so as to include all the activities mentioned in the definition of Industrial concern within its purview? (ii) whether the respondents have resorted to wrong calculations by not giving the benefits of the amount already deposited as principal by the petitioners? Issue No. 1 9. The eligibility criteria as prescribed under the SSSU is reproduced as under: “All units under MSME sector declared/identified sick by or before December 31st 2015 by the respective General Managers of concerned District Industries Centres and countersigned by Directorate of Industries and Commerce and the units which have not been able to commence production and are not formally registered with respective DICs or have left the scheme halfway/abandoned or the unit has remained non-functional for a period of more than ‘10’ years to be certified as such, by the concerned General Manager, DIC/District In-charge, JKSFC.” 10. A perusal of the eligibility criteria reveals that the following units fall within the ambit of scheme: (a) MSME sector declared/identified sick by or before 31.12.2015 by the respective General Managers and counter signed by the Director of Industries and Commerce. (b) The units which have not been able to commence production and are not formally registered with the respective DICs or have left the scheme halfway or abandoned or the unit has remained non-functional for a period of more than 10 years to be certified as such by the concerned General Manager, DIC/District In-charge. 11. Section 2 (c) of the State Financial Corporations Act, 1951 defines Industrial Concern and the same reads as under: “2. Definitions: In this Act, unless the context otherwise requires: (c) “Industrial concern” means any concern engaged or to be engaged in: (i) the manufacture, preservation or processing of goods. (ii) mining or development of mines. (iii) the hotel industry. (iv) the transport of passengers or goods by road or by water or by air. (v)........... Definitions: In this Act, unless the context otherwise requires: (c) “Industrial concern” means any concern engaged or to be engaged in: (i) the manufacture, preservation or processing of goods. (ii) mining or development of mines. (iii) the hotel industry. (iv) the transport of passengers or goods by road or by water or by air. (v)........... (vi)..........” 12. A perusal of the ‘Industrial Concern’ as defined under section 2(c) provides that it includes various activities including the hotel industry and the transport of passengers or goods by road or by water or by air. In order to properly adjudicate the controversy, it would be profitable to take note of the serial No. 10 of scheme, which is reproduced as under: “10. It is also proposed to bring plus ‘15’ years old vehicles within the ambit of the scheme.” 13. Though the said stipulation is loosely worded, it is not forthcoming as to whether this scheme is applicable to the vehicles, which are more than 15 years old or this scheme is proposed to be made applicable to these vehicles but nonetheless the fact remains that there is a separate provision for applicability of the scheme to the vehicles those are more than 15 years old. If the contention of the petitioners is to be accepted that hotel industry was also entitled for the benefit of the scheme, then the respondents would not have referred the details of the units, those are entitled to the benefits of the scheme in the eligibility criteria of the scheme. The intention of the respondents for granting the benefits to some of the units involved in a particular activity and not to the units involved in all of the activities as mentioned in the definition of industrial concern as per section (2) of the Act (supra) gets substantiated by the stipulation at Serial No. 10 of the scheme. Had it been the intention of the respondents to bring in the ambit of the scheme, all the industrial concerns, they would not have incorporated a separate stipulation at Serial No. 10 of the scheme. The scheme was target specific and had no universal applicability for all the units indulging in activities as defined by section 2 (c) of the Act. Thus, the scheme was meant for the benefit of the units those were involved in the production activity. The scheme was target specific and had no universal applicability for all the units indulging in activities as defined by section 2 (c) of the Act. Thus, the scheme was meant for the benefit of the units those were involved in the production activity. As such, the respondents have rightly rejected the claim of the petitioners on the ground that the scheme was meant for industrial sick units and not for hotels. Issue No. 2 14. Whether the respondents have resorted to wrong calculations by not giving the benefits of the amount already deposited as principal by the petitioners. This is a disputed question of fact that cannot be adjudicated upon while exercising writ jurisdiction. 15. In view of what has been discussed above, there is no merit in the petition, as such, the same is dismissed.