Two-judge bench dismissed a writ appeal arising from the Single Judge's review order. The respondents bank had initiated SARFAESI proceedings treating the appellant's account as non-performing. The draft appeal was allowed to be dismissed for abjection of merit.
Appeal dismissed. No costs.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
THE HON’BLE THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE AND THE HON’BLE SRI JUSTICE VILAS V. AFZULPURKAR
WRIT APPEAL NO.1118 OF 2012
DATED:7.9.2012
Between: Baba Industries Rep. by its Proprietor B.V.N.V. Prasad R/o.D. No.12-17, Xavier Nagar Eluru, West Godavari District … Appellant And The Deputy General Manager Andhra Bank, R.R. Pet Branch Eluru West Godavari District and others … Respondents
THE HON’BLE THE ACTING CHIEF JUSTICE SRI PINAKI CHANDRA GHOSE AND THE HON’BLE SRI JUSTICE VILAS V. AFZULPURKAR
WRIT APPEAL NO.1118 OF 2012
JUDGMENT: (per the Hon’ble the Acting Chief Justice Sri Pinaki Chandra Ghose)
This writ appeal is directed against the order dt.7.8.2012 passed by the Hon’ble Single Judge in Review W.P.M.P. No.28609 of 2012 in W.P. No.900 of 2010.
The appellant – party-in-person filed W.P. No.900 of 2010 to declare the action of respondent No.1, in not disposing of the appellant - petitioner’s representations dt.13.12.2008, 25.3.2009 and 31.7.2009 requesting to release the working capital; and cancelling the previous working capital of Rs.3,00,000/- as well as OCC and term loan interest and in not extending the repayment schedule for two years, as illegal and arbitrary. He also sought directions to respondent No.1 to pay the damages of Rs.15,00,000/- due to pendency of the representations and for not releasing the working capital, and to dispose of the above said representations.
The Hon’ble Single Judge heard the appellant/writ petitioner – party-in-person and the learned counsel for respondent No.1 – bank. His Lordship recorded in the order the facts stated in the writ affidavit filed by the petitioner and the counter affidavit filed by respondent No.1 – bank and reply thereto filed by the petitioner, and came to the conclusion as under:
“The petitioner sought for two reliefs in the writ petition. Firstly, disposal of his representations, dated 13.12.2008, 25.03.2009 and 31.07.2009. Secondly, payment of compensation of Rs.15,00,000/- for not releasing the
additional working capital. Since his representations have been disposed of, the relief of direction to the 1st respondent Bank to consider the representations of the petitioner does not subsists. With regard to the second relief of direction to the 1st respondent Bank to grant additional working capital of Rs.3,00,000/- and to pay compensation of Rs.15,00,000/-, the 1st respondent Bank treated the account of the petitioner as non-performing asset and initiated proceedings under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Indeed the petitioner tried to thwart out the said proceedings by filing writ petition i.e. W.P.No.17385 of 2010. The said writ petition ended in dismissal on 21.07.2010. He also ventilated his grievance before the Banking Ombudsman, which is a statutory body under the provisions of the Banking Ombudsman Scheme, 2006. The Banking Ombudsman considered the complaint of the petitioner and the explanations offered by the 1st respondent Bank and proceeded to close the complaint. Since the proceedings have been initiated under the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, treating the account of the petitioner as non-performing asset, no mandamus can be given to the 1st respondent to grant additional working capital. Even the account extract, which has been filed along with the additional counter affidavit of the 1st respondent Bank, indicates that the account is irregular and payments are not made as per the terms of the loan agreement. Indeed the 1st respondent Bank addressed a letter to the petitioner on 22.12.2009 to submit the application for renewal of OCC with necessary particulars. The copy of the letter finds place at page No.20 of the material papers annexed to the additional counter-affidavit. The text of the letter reads as hereunder:
“Reg: Application for renewal of limits. Ref: Banking Ombudsman Order No.BO(H)/RW/C. No.1724 /2008-09, dated 21.12.2009.
In terms of the orders of Banking Ombudsman, Hyderabad, we are enclosing an application for renewal of your OCC which was due for renewal since 21.04.2009.
In this regard as directed by the Hon’ble Ombudsman you are requried to submit the same along with:
You are requested to submit the enclosed application along with all above information within 30 days to process and communicate our decision.”
It is not the case of the petitioner that he submitted renewal application pursuant to the letter, dated 22.12.2009, issued by the 1st respondent Bank. The petitioner committed default in paying the loan amounts and thereupon the account of the petitioner came to be treated as non-performing asset and proceedings came to be initiated by the 1st respondent Bank by taking recourse to the provisions of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Such is the situation, no mandamus can be issued to the 1st respondent Bank to release the additional working capital. Since there are lapses on the part of the petitioner in making the payments as per the schedule and not submitting the application for renewal by enclosing necessary documents, he is not entitled to seek any compensation from the 1st respondent Bank. Thus, the writ petition is devoid of merits and is liable to be dismissed.”
Accordingly, the Hon’ble Single Judge dismissed the writ
petition.
Seeking review of the said order dt.25.6.2012 passed by the Hon’ble Single Judge in the writ petition, the petitioner filed Review W.P.M.P. No.28609 of 2012 under Order 47 Rule 1 read with Section 151 of the Code of Civil Procedure.
The appellant - review petitioner contended before the Hon’ble Single Judge, in the review petition, that respondent No.1 – bank has not released the working capital within the time and thereby he suffered damages. It was also contended that invocation of provisions of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, ‘the SARFAESI Act’), is wholly illegal, as the petitioner had never committed default in payment of the amount and on the contrary he made excess payment. Per contra, learned counsel for respondent No.1 – bank submitted that there are no grounds to review the order dt.25.6.2012 passed in W.P. No.900 of 2010.
The Hon’ble Single Judge dismissed the review petition holding that it is impermissible for the petitioner to contend that invocation of the provisions of the SARFAESI Act is illegal, since the said
contention was negatived by this Court in the order dt.21.7.2010 passed in W.P. No.17385 of 2010, which was filed by the petitioner. His Lordship also observed that the relief sought by the petitioner with regard to release of certain working capital as well as OCC and term loan facilities and contention thereto was dealt with in the order passed by His Lordship in the Writ Petition. It was also observed that is no error apparent on the face of record to review the order passed in the writ petition.
Being aggrieved and dissatisfied with the said order dt.7.8.2012 passed in the review petition, this appeal is filed by the appellant/writ petitioner/review petitioner.
The appellant, who appeared in person, contends before us that since respondent No.1 – bank has not released the working capital within the time, he suffered damage. He also contends that no notice under Section 13(2) of the SARFAESI Act was served on him. But, it is revealed from the order dt.21.7.2010 passed in W.P. No.17385 of 2010, that the appellant - writ petitioner filed the said writ petition questioning the proceedings initiated by respondent No.1 – bank under the provisions of the SARFAESI Act and the same was ended in dismissal, rejecting the contention of the petitioner. The same was also observed in the orders passed in the writ petition as well as in the review petition. Therefore, the same contentions as tried to be raised before us by the appellant again, have no substance.
The other point which we have noted is that before filing the writ petition, the appellant – writ petitioner applied before the ombudsmen who declined to pass any order in favour of the petitioner. In these circumstances, the appellant filed the writ petition, which was also resulted in dismissal and subsequently the review petition also met the same fate.
It is not the case of the appellant – petitioner that there is a new ground which was missed to raise in the writ petition or certain facts or material were not placed on record at the time of filing the writ petition
or hearing of the writ petition, because of circumstances which beyond the control of the petitioner to produce the same before the Writ Court, so as to seek review of the order passed in the writ petition. In the circumstances, we do not find any reason to interfere with the order so passed by the Hon’ble Single Judge.
The writ appeal is devoid of merit and is accordingly dismissed. No costs.
__________________________ PINAKI CHANDRA GHOSE, ACJ
______________________ VILAS V. AFZULPURKAR, J 7.9.2012 bnr
2 issues framed by the court
Whether the single judge's order dismissing writ petitions seeking working capital release and compensation against a bank should be set aside in review.
Whether the appeal should succeed given prior dismissal of similar contentions and lack of new grounds.
Baba Industries Rep. by its Proprietor B.V.N.V. Prasad
Andhra Bank
Pinaki Chandra Ghose
Vilas V. Afzulpurkar
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
