- (1.) WE have heard Shri C.K. Parekh and Shri Raunak Parekh, learned counsels appearing for the petitioner. Learned Standing Counsel appears State respondents. Shri Rohit Agarwal appears for Bijnor Urban Cooperative Bank Ltd, Bijnor -respondent no.4.
(2.) THE petitioner is a partnership firm carrying on business in transport and construction. It is stated that the firm constituted on 1.4.1992 has seven partners. The firm required money for expansion on which it approached Bijnor Urban Cooperative Bank Ltd (in short the Bank) for extending the working capital loan and cash credit limit to the tune of Rs.15 lacs. The loan was sanctioned on 31.3.1999 carrying an interest at 18.5%. The firm suffered losses on account of recession of business on which several of its contracts with leading companies for providing transport were cancelled and the trucks were brought to standstill. The firm could not re -pay the loan on which the loan was treated by the respondent -bank as 'non -performing asset' on 31.10.1999.
(3.) IT is submitted that the working capital loan extended by the bank stood as first charge on the assets of the petitioner firm under Section 39 of the Act, which is enforceable under Section 91 of the Act. Section 91 provides for enforcement of the charge which could only be done after the bank sends a requisition to the District Assistant Registrar and on which the District Assistant Registrar issued notices to the members for payment of such debt. When the member fails to pay such debt, the recovery may be sent under Section 91 for execution to the Collector. In the present case the bank did not initiate recovery proceedings against the petitioner and that the District Assistant Registrar directly sent the notice to recover the amount under Section 92 of the Act. It is further submitted that under second proviso to Section 92 (a) a period of limitation of 12 years has been prescribed and under Article 137 of the Limitation Act the limitation is for three years. In all the cases including the treatment of loan as 'non -performing asset' in the year 1999 and the expiry of limitation, the loan cannot be recovered as arrears of land revenue.;