Union Bank Of India & Another vs M/s Shri Gurunanak Seeds Basenga Farm & Others

Ramesh Ranganathan, CJ

Heard Mr. T.A. Khan, learned Senior Counsel appearing on behalf of the appellants-Bank and Mr. Ramji Srivastava, learned counsel appearing on behalf of the respondents-writ petitioner/borrowers and, with their consent, the appeal is disposed of at the stage of admission.

The appellant herein is the Union Bank of India. The respondents herein filed Writ Petition (M/S) No.1155 of 201 seeking a writ of certiorari to quash the possession notice dated 22.02.2019, as well as the sale notice dated 05.04.2019; for an order directing the respondents not to sell the property pursuant to the sale notice dated 05.04.2019; and for an order directing the respondents to regularize the loan account of the petitioners.

Even before the appellants herein could file their counter-affidavit in the Writ Petition, the order under appeal dated 30.04.2019 came to be passed.

In the order under appeal dated 30.04.2019, the learned Single Judge noted the submission, urged on behalf of the petitioners, that they were unable to pay the outstanding amounts; they were ready to pay the said amount in easy installments; and the counsel for the respondents-Bank, had objected to the said submission, and had contended that, in order to show their bonafides, the petitioners should deposit 25% of the outstanding amount within one month from the date of the order.

After considering the submissions of learned counsel for either parties, and keeping in view the financial condition of the petitioners, the learned Single Judge disposed of the Writ Petition directing the petitioners to pay 20% of the outstanding loan amount to the appellant-Bank within two months from the date of the order i.e. by 30.06.2019; the rest of the amount i.e. 80% should be paid to the respondents within one and a half year in six equal quarterly installments; and, till then, the impugned notices shall be kept in abeyance. The learned Single Judge made it clear that, if the petitioners made any default in payment of any of the installments within the stipulated time, the respondents-Bank was at liberty to proceed further, pursuant to the possession notice dated 22.02.2019 and the sale notice dated 05.04.2019.

In proceedings under Article 226 of the Constitution of India, this Court would not, ordinarily, regulate the manner in which the borrower should repay the amount due and payable by him to the Bank, for these are all matters for the Bank to regulate, and not for this Court to determine or adjudicate.

Any grievance which the borrower may have, with the action taken against them by the Bank under Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (for short "the Act"), should, ordinarily, be agitated only by way of proceedings instituted under Section 17 of the Act.

We are satisfied, therefore, that the learned Single Judge was not justified in granted the respondents-writ petitioners the relief, more so in the absence of any counter-affidavit being filed by the appellant-Bank. While we would, ordinarily, have set-aside the order under appeal, it must be noted that Mr. T.A. Khan, learned Senior Counsel appearing on behalf of the appellant-Bank, does not dispute the submission urged on behalf of the Bank, recorded by the learned Single Judge in the order under appeal, that, in order to show their bonafides, the respondents-writ petitioners should deposit 25% of the outstanding amount within one month from the date of the order. While the learned Single Judge has, in the order under appeal, reduced even this requirement from 25% to 20%, and has extended the period of payment from one month to two months, Mr. Ramji Srivastava, learned counsel for the respondents-writ petitioners, would submit that the respondents-writ petitioners would make payment of 25% of the outstanding amount, as sought by the learned counsel appearing on behalf of the Bank before the learned Single Judge, within one month from the date of the order i.e. on or before 30.05.2019.

We consider it appropriate, in such circumstances, to set-aside the order under appeal; and, instead, permit the respondents-writ petitioners to make payment, as agreed by the learned counsel appearing on behalf of the Bank before the learned Single Judge, of 25% of the amount due on or before 30.05.2019. In case, the respondents-writ petitioners make such payment within the time aforementioned, the appellant-Bank shall consider any request made by them, for deferment of payment of the balance amount, in accordance with law. The respondents-writ petitioners are permitted to make a representation, enclosing proof of payment of 25% of the amount due on or before 30.05.2019, by 05.06.2019. In case such a representation, enclosing thereto proof of payment, is made, the Bank shall consider the representation in accordance with law and pass appropriate order at the earliest and, in any event, not later than two weeks from the date of receipt of the representation. In case, the respondents-writ petitioners make payment of 25% on or before 30.05.2019, and submit a representation as afore-directed on or before 05.06.2019, no coercive steps shall be taken by the appellants-Bank, to recover the balance amount due, till it passes a reasoned order in accordance with law. In case, the respondents-writ petitioners fail to make payment as afore-directed, or to submit a representation enclosing proof of payment on or before 05.06.2019, it is open to the appellants-Bank to give effect to the orders impugned in the Writ Petition.

The appeals are allowed. No costs.