- (1.) The petitioner applied for a term loan for establishing a small scale industry from the respondent U.P. Financial Corporation in the year 1981. The aforesaid loan was sanctioned in favour of the petitioner and it has not been disputed that the entire grant of loan has been received by the petitioner. An agreement was also executed at the time of advancement of the loan laying down conditions of .repayment and interest which will be payable by the petitioner. As there was default in the repayment of the instalments, the U.P. Financial Corporation took recourse for realizing the aforesaid amount by invoking their powers under Section 29 of the State Financial Corporation Act. It is at this stage that the present writ petition has been filed challenging the action of the U.P. Financial Corporation on the ground that the action of the Corporation is arbitrary and is violative of Articles 14 and 19 of the Constitution being against the principles of natural justice.
(2.) At the admission stage the contesting respondent the U.P. Financial Corporation put in appearance and the parties have exchanged counter anti rejoinder affidavits. The present writ petition is thus being disposed of finally in accordance with the Rules of the court.
(3.) After hearing learned counsel for the parties at some length, we are of the opinion that this is not a fit case for quashing the proceedings under Section 29 of the State Financial Corporation Act inasmuch as only notice has been issued and the final possession of the petitioner's factory has not been taken. We have looked into the correspondence which has taken place between the petitioner and the Financial Corporation for repayment of the loan and from Annexure R.A.2 it is clear that the re-scheduling of repayment of loan was not being done as the Regional Manager, U.P. Financial Corporation showed his inability tore- schedule the repayment of the loan unless 25%of the total out-standing demand had not been cleared by the petitioner.The out-standing demand against the petitioner is approximately Rupees Three Lakh's (it is being made clear that this figure is only tentative as final calculation will be done by the Corporation). If that be so, we are of the opinion that in case the petitioner pays an amount of Rs. 25,000/- by 10th of March, 1990 to the respondent No. 1 and pays the second instalment of Rs. 25,000/- by 10th of April, 1990 and the third instalment of another Rs. 25,000/- by 10th of May, 1990, the Financial Corporation in that case will consider the application of the petitioner for re-scheduling the repayment of the loan subject to the condition that the petition will again submit an up to date audited balance sheet starting from the year 1986, In case the aforesaid three deposits are made within the time allowed by this. court, further action under Section 29 of the State Financial Corporation Act against the petitioner shall remain stayed. However, it is being made clear that in case of default, the respondent -Financial Corporation will be entitled to recover the out-standing dues forthwith in accordance with law. Subject to the aforesaid observations, the present writ petition is finally disposed of. The interim order granted by this Court is discharged. A certified copy of this order shall be given to the learned counsel for the parties within 24 hours on payment of usual charges.;