G.S.N.TRIPATHI, J. - (1.) This is a petition under Art. 226 of the Constitution for the following reliefs:- (a) to issue appropriate writ, order or direction in the nature of certiorari quashing and/setting aside the notice dated 4-11-1992 issued by the respondent No. 1 (Annexure 8 to the writ petition). (b) to issue appropriate writ, order or direction in the nature of certiorari quashing/ setting aside the letter dated 9-11-1992 (Annexure 10 to the writ petition. (c) to issue an appropriate writ, order or direction in the nature of mandamus directing the respondent No. 1 to create Pari-Passu charge in favour of the other Financial Institutions vis-a-vis the petitioner. (d) to issue an appropriate writ, order or direction in the nature of mandamus directing the respondent No. 1 to disburse the balance amount of loan to the petitioner in terms of the agreements. (e) to issue a writ, order or direction restraining the respondents, their officers and agents from taking any action pursuant to the notice dated 4-11-1992 and letter dated 9-11-1992. (f) to pass such other and further orders as this Hon'ble Court may deem fit and proper in the circumstances of the present case. (g) to award costs of this petition to the petitioner as against the opposite parties.
(2.) The petitioner is a limited company engaged inter alia in the manufacture and sale of explosives (Nitro Glycerine based Industrial explosives). Prior to 1986, the petitioner company was known as Narendra Explosives Ltd. On 27-12-82 the respondent No. 1 (which is Uttar Pradesh State Financial Institution established to advance loans etc. for industrialization of the State) entered into an agreement with Narendra Explosives Ltd. (Predecessors of the petitioner) to advance a term loan of Rs. 24 lakhs. Out of it, Rs. 22.5 lakhs have already been advanced by respondent No. 1 as per agreement of the said date (Annexure 1). Thereafter, another additional supplementary loan agreement was entered into between the respondent No. 2 and the petitioner on 29-6-89 whereby, respondent No. 1 agreed to advance an additional term loan of Rs. 7 lakhs for the aforesaid manufacturing purpose (Annexure 2). The said loan was repayable in 32 quarterly instalments from 31-8-89 to 31-5-97 as per schedule given in Annexure 1 supra. Further the respondent No. 1 had agreed that the charge would rank Pari Passu with the charge created/to be created in favour of PICUP, IDBI, ICICI, IFCI, LTD. and IRBI (other financial institutions established by the Government of India for the loans obtained/ to be obtained from these Financial Institutions.
(3.) After 1986 the petitioner decided to go in for an expansion of the project and for that he required financial assistance from other institutions as well. He first approached Industrial Finance Corporation of India (IFCI) to lead financial insatitution. The said institution agreed on 9-10-90 to grant term loan to the petitioner not exceeding Rs. 295 lakhs in aggregate under the Project Finance Participation Scheme in participation with other financial institutions. The IFCI further agreed to subscribe 15% of redeemable cumulative preference shares of the aggregate face value of Rs. 100 lakhs. It further agreed to extend foreign currency loan equivalent to U.S. Dollar 1319,790. Other financial institutions also agreed to participate in this expedition of the petitioner. The IFCI disbursed part of its loan for the first time in the first quarter of 1991 but due to extremely stringent foreign exchange conditions prevailing in the country, no disbursement of foreign currency loan could be effected by the financial institutions in 1990-91. The respondent No. 1 as per its letter dated 8-1-91 agreed in principle to the IFCI letter dated 9-10-90 supra and decided to grant concessions/reliefs as per its letter dated 8-1-91 inter alia, to fix the repayment of the funded interest over a period of 8 years between 1993-94 and 1996-97, to reschedule the repayment of term loan to be paid over a period of 8 years between 1993-94 and 2000-01 to grant pari passu charge over the fixed assets to secure the additional rupee loan of Rs. 295 lakhs and foreign currency loan equivalent to Rs. 205 lakhs from CFI (Central Financial Institution) vide Annexures 3 and 4.;