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2023 DIGILAW 33 (GUJ)

Gurukrupa Constructions v. State Bank Of India

2023-01-04

SANDEEP N.BHATT, SONIA GOKANI

body2023
ORDER : [Sonia Gokani, J.] 1. The petitioners are before this Court seeking the directions against the respondent-Bank in relation to the One Time Settlement by following prayers: “21… (a) To issue writ of mandamus or any other writ, order or directions, directing the respondent bank to kindly consider the proposal and offer for One Time Settlement to repay the amount of the loan. (b) To pass any order and further orders as may be deemed fit and proper.” 2. The petitioners were declared as nonperforming asset and out of that the respondent has filed the Original Application No.1392 of 2019 before the Debt Recovery Tribunal-II at Ahmedabad on 20.12.2019 for recovery of Rs.3,46,03,878.36/-. 3. During the pendency of the Original Application proceedings, both the parties compromised outside the court. The consent terms were arrived at during the period when the COVID-19 pandemic was on. Because of the financial constrains, the petitioners were not in a position to comply with the consent terms. The recovery certificate had been issued in favour of the respondent-Bank by the DRT-II. 4. The recovery proceedings, RP No.74 of 2021 had been preferred by the respondent- Bank and order came to be passed by the Recovery Officer on 18.06.2021 directing the respondent-Bank to furnish the details for drawing the notice of demand under Rule 2 of the Second Schedule to the Income Tax Act, 1961. The matter was adjourned on 23.08.2021. Thereafter, the respondent-Bank filed the compliance affidavit and the demand notice was drawn. The matter had been adjourned to 23.09.2021. 5. The recovery officer was requested to list the matter on 05.10.2021 by the respondent-Bank and it had put the mortgage property for auction under the SARFAESI Act. The recovery officer had directed to issue Form Nos.16, 52 and 53 i.e. the warrant of attachment of immovable property, order of attachment of the property and notice of settling the terms of the proclamation of the sale and further directed to carry out the valuation of the property and submit the report. 6. The petitioners sent two letters on 08.12.2021 and 18.12.2021 requesting the Bank to settle the matter as one time settlement by offering Rs.1,60,00,000/- and Rs.1,75,00,000/- respectively. However, the same had been rejected. The valuation report also had been fixed and the auction price had been fixed at Rs.4,10,00,000/-. 6. The petitioners sent two letters on 08.12.2021 and 18.12.2021 requesting the Bank to settle the matter as one time settlement by offering Rs.1,60,00,000/- and Rs.1,75,00,000/- respectively. However, the same had been rejected. The valuation report also had been fixed and the auction price had been fixed at Rs.4,10,00,000/-. The petitioners are before this Court with the unavoidable circumstances due to the pandemic, their request for one time settlement could be acceded to. 7. We have heard the learned advocate, Mr.Dhruvin Mehta appearing for the petitioners. He has relied upon the High Court of Judicature at Madras in case of M/s.Ganga Foundations Pvt.Ltd. vs. S.Senthil Kumar. The facts are completely different and the Court has also noted that the Court cannot come to the assistance of the petitioner, however, sympathetic the Court may be in recognizing the plight of business entities in wake of the lock-down imposed pursuant to the second surge of the pandemic. It was the case where One Time Settlement terms were offered to similarly placed constituents and different to the petitioner and yet the court held that cannot be the good ground as to why the terms should be relaxed for one constituent simply because such constituent has come to the court and has the ability to come to the court. It also recognizes that there is no public interest element in a matter since the contract pertains to the credit facilities and the One Time Settlement terms are the private agreements between two parties. The status of Bank as a nationalized Bank would have nothing to do with the terms of the contract. 7.1 Relevant findings and observations of the Court are as follow: “6. At the same time, it must be appreciated that the terms offered by State Bank ought to be similar in respect of the same class of constituents. In other words, if the OTS terms have not been relaxed or the time to make any payment thereunder enlarged for all constituents offered similar OTS terms, a special case cannot be carved out for any constituent; nor does the court have the authority to coerce the secured creditor to alter or vary the OTS terms. 7. In other words, if the OTS terms have not been relaxed or the time to make any payment thereunder enlarged for all constituents offered similar OTS terms, a special case cannot be carved out for any constituent; nor does the court have the authority to coerce the secured creditor to alter or vary the OTS terms. 7. Accordingly, W.P.Nos.14965 and 14967 of 2021 are disposed of by requesting the State Bank to re-consider its stand as to whether the obligation to make further payments in terms of the OTS scheme may be enlarged across the board so that the petitioners and all other similarly placed persons may avail of such benefit. There is no doubt that the pandemic caused complete disruption of normal life and businesses were the hardest hit. 8. The State Bank is, thus, requested to re-consider its stand and communicate its fresh decision on the petitioner’s request within a period of four weeks from date. It is needless to say that if the petitioners are shown any lenience, the similar benefit should be passed on to other similarly placed constituents of State Bank. For a period of six weeks from date, the bank should not take any precipitous action against the petitioners till the petitioners have sufficient time after the receipt of the bank’s decision on re-considering the matter.” 8. This being a case of one time settlement and much water has flown. The petitioners could not fulfill the same, it is not a case even for the Court to issue the notice, however, the disposal of this will not preclude the petitioners to move appropriate application if permissible under the law before the authority concerned. 9. Present petition stands disposed of accordingly.