Sulake Plastocom Private Limited and Another vs State Bank of Patiala and Another

Sanjib Banerjee, J.—Following a notice u/s 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the steps taken by the respondent bank u/s 13(4) of the said Act, the writ petitioners instituted proceedings u/s 17 of the Act before the appropriate Debts Recovery Tribunal. An order was passed in such proceedings on October 9, 2007 by which the parties were directed to maintain status quo till the adjourned date. The petitioners say that such order continued till the proceedings were disposed of.

It is the petitioners'' contention that during the proceedings before the Debts Recovery Tribunal, the petitioners and the bank entered into a settlement which resulted in the bank issuing a letter dated April 12, 2008 to the petitioners. The bank apparently sanctioned a fresh loan. In pursuance of the settlement and the bank''s letter of April 12, 2008, the petitioners withdrew the proceedings u/s 17 of the 2002 Act. It is the petitioners'' grievance that thereafter the bank has refused to release the payment and the bank has issued a subsequent notice u/s 13(2) of the Act.

On this petition being received, an order was made on May 9, 2009 when the bank was not represented, despite being served, restraining the bank from taking any further steps in pursuance of the bank''s demand contained in the letter of March 5, 2009.

The bank subsequently appeared and it was submitted that the parties were attempting to settle the matter. The bank represented on July 22, 2009 that it was not likely to take any coercive steps in respect of its claim. The matter was subsequently adjourned at the behest of the bank on a number of occasions.

The petitioners have responded to the bank''s demand of March 5, 2009 by a letter dated April 2, 2009. It is the admitted position that the bank has not disposed of the petitioner''s objection.

Accordingly, W.P. No. 390 of 2009 is disposed of by directing the bank to dispose of the petitioners'' objection of April 2, 2009 within a fortnight from date. The bank will be entitled to take further steps under the said Act of 2002 only after responding to the petitioners'' objection of April 2, 2009.

There will be no order as to costs.

Urgent certified photostat copy of this order, if applied for, be supplied to the parties subject to compliance with all requisite formalities.