- (1.) The present application under Article 227 of the Constitution is directed against two orders being Order No. 14 dated 26-12-97 and Order No. 15 dated 15-1-98 passed by the learned Debts Recovery Tribunal in case No. T.A. 60/96 The said case arose out of a suit which was filed in this High Court on its Original Side and which subsequently stood transferred to the Tribunal under the provisions of the Recovery of debts Due to Banks and Financial Institution Act, 199 3A consortium of Financial Institutions comprising the respondents Nos. 2 and 3 and another viz. Industrial Reconstruction Bank of India (IRBI) advanced a loan to the respondent No. 4 company and the petitioner No. 1 company (of which the petitioner No. 2 was an Executive Director and a shareholder) stood as guarantor in relation to the said loan transaction and the suit was filed by the respondent Nos. 2 and 3 for recovery of that loan.
(2.) According to the petitioners, a compromise relating to the petitioner No. 1's liability as guarantor was arrived at between the petitioner No. 1 on the one hand and the consortium referred to above on the other, in terms of which the petitioner No. 1 would be required to make payment of Rupees 135 lacs and to place the plant and machineries belonging to the petitioner No. 1 and lying installed at the premises of the respondent No. 4 as security for repayment of the said amount agreed to be paid by the petitioner No. 1 in full and final settlement of the petitioner No. 1's liability as a guarantor and in the event of such payment being made, the petitioner No. 1's liability as guarantor would stand fully discharged and the suit would be withdrawn as against the petitioner No. 1.
(3.) It is the further case of the petitioners that the payment of the stipulated amount has already been made in terms of the settlement but despite such payment the suit was not withdrawn and is being proceeded with at the instance of the respondent Nos. 2 and 3 before the Tribunal. The petitioner No. 1 on being summoned by the Tribunal entered appearance before the Tribunal and approached the tribunal with a prayer for dismissing the suit as against the No. 1 petitioner on the ground that it was liable to be withdrawn against the petitioner No. 1 in terms of the settlement referred to above. The plaintiff/respondents opposed the prayer and contended before the Tribunal that mere payment of the stipulated amount did not constitute fulfilment of theterms of the settlement nor did it make it obligatory for the plaintiffs to withdraw the suit. It was urged on behalf of the respondents before the Tribunal and the petitioner No. 1 did not fully comply with the terms of the settlement and as such, it was not entitled to withdrawal of the suit.;