FINANCE CORPORATION LIMITED Vs. UCO BANK

JUDGEMENT

(1.) The instant application is filed by the plaintiff / petitioner for final judgment and decree against the defendant / respondent for a sum of Rs. 1,24,77,15,252.03 together with the interest at the rate of 18% per annum. Admittedly, the defendants have not filed the written statement as on the date of the filing of the instant application and the reliefs claimed in the instant application is in the nature of summary judgment.

(2.) The fact emerged from the application is that the petitioner is a registered non banking financial company for providing loans for infrastructure projects in the State of West Bengal. For smooth running of the business, the petitioner raises money from the public upon issuance of the Government guaranteed bonds. Some of the bonds so issued have been rated by approved rating agencies and during the year 2005 to 2008 and 2010/2011 the petitioner issued the bond series of Rs. 1000 Crores, which were approved by a rating agency like Credit Analysis and Research Limited, India Rating and Research Pvt. Ltd. and Brickwork Rating India Pvt. Ltd. The salient conditions of those bonds as imposed by the rating agencies was that a sinking fund ought to be created for the purpose of securing the redemption of bonds. Such sinking fund are required to be kept with the lying under bond trusties accumulating to full or partial redemption value of the relevant bond series as per the terms and conditions of the approved rating agencies. Axis Bank Ltd. and Axis Trustee Services Ltd. are the bond trusties in respect of the aforesaid bond series.

(3.) In compliance of those conditions, the petitioner created various term deposits and recurring deposits in various banks for maintaining sinking funds and during the financial year 2011-2012 several deposits were made in different banks to the tune of 3,872.82 Crores having maturity value as on 31st March, 2012. For the next Financial Year 2012-2013, the deposits to the tune of 2,563 Crores maturity value were also made in various banks.