Dismissed

M/S S.a.Steels P.Ltd. v. Punjab Financial Corp.Etc.

Punjab & Haryana HC14 Nov 2008CWP/5731/2004

Case brief

AI extract

What is this about?

The High Court held that a writ petition is not the appropriate forum to adjudicate seriously disputed questions justifying a recovery certificate and subsequent sale under the State Financial Corporations Act, thereby relegating the petitioners to seek alternative remedies.

What did the court decide?

The petition was disposed of, and the petitioners were relegated to any other alternative remedy.

M/S S.a.Steels P.Ltd. Vs Punjab Financial… — Banking and Recovery | Punjab & Haryana HC (2008)

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IN THE HIGH COURT OF PUNJAB AND HARYANA AT

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CHANDIGARH.

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C.W.P. No.5731 of 2004 Date of decision: 14.11.2008

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M/s S.A. Steels (P) Ltd. & others.

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-----Petitioners

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Vs.

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Punjab Financial Corporation and others.

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-----Respondents

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CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOEL HON'BLE MR JUSTICE L.N. MITTAL

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Present:Mr. Kamal Sehgal, Advocate for the petitioners.

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Mr. S.K. Pruthi, Advocate for Mr. G.S. Sandhawalia, Advocate for respondents No.1 and 2.

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Ms. Sudeepti Sharma, DAG, Punjab for respondents No.3 and 4.

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ORDER :

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This petition seeks quashing of proceedings under

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Section 32(G) of the State Financial Corporations Act, 1951 (for short, “the Act”) and recovery certificate (Annexure P-14).

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Case of the petitioners is that loan of Rs.47.20 lac was taken in the year 1987, but there was default in repayment. The petitioners made a proposal to settle the dues as per One Time Settlement scheme, but the same could not be worked out.

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C.W.P. No.5731 of 2004

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Finally, the unit of the petitioners was taken over by the Financial Corporation under Section 29 of the Act on 2.5.1997. The petitioners filed a suit against the said order, which was withdrawn. Thereafter, the impugned recovery certificate was issued. The petitioners filed the present writ petition in the year 2004. During the pendency of the writ petition, the entire unit of the petitioners was sold to respondent No.5, in pursuance of notice dated 8.9.2006. Sale has been confirmed. Respondent No.5, the auction purchaser, has sold the machinery also, though the land is still with it.

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Though learned counsel for the petitioners submits that all actions of the respondents are liable to be set-aside, main question may only be whether the petitioners are entitled to damages, if the contention of the petitioners that no notice was served and there was no justification for sale, is to be accepted.

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In the reply filed, the Financial Corporation has contested the writ petition and justified the action of issuing the recovery certificate and thereafter, the sale. Auction purchaser respondent No.5 has also filed reply, contesting the writ petition.

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It is patent from the above that there are seriously disputed questions about justification or otherwise of recovery certificate or sale or other steps taken by the Financial Corporation. Writ petition will not be the appropriate forum for adjudication of such disputes.

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C.W.P. No.5731 of 2004

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In view of above, we relegate the petitioners to any other alternative remedy, if the petitioners are so advised.

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The petition is disposed of.

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( ADARSH KUMAR GOEL ) JUDGE

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November 14, 2008 ( L. N. MITTAL ) ashwani JUDGE

M/S S.a.Steels P.Ltd. v. Punjab Financial Corp.Etc.

Case brief

What is this about?

What did the court decide?

M/S S.a.Steels P.Ltd. v. Punjab Financial Corp.Etc.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

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