- (1.) The instant petition has initially sought the relief setting aside the notice dated 04.09.1990 issued by Haryana Financial Corporation-respondent No.1 under Section 29 of the State Financial Act, 1951 (for brevity 'the Act'). A further prayer for quashing order dated 12.11.1992 (P-19) passed by respondent No.1 has also been made and sought directions to respondent No.1 to grant the petitioner same concessions/ benefits as have been accorded to the other small scale units in accordance with the order passed by this Court on 16.07.1992 in CWP No. 12804 of 1990.
(2.) It is appropriate to mention that in 1983, the petitioner-company had secured a sum of loan amounting to Rs. 5,42,000/- from the Corporation on the terms and conditions contained in the agreement executed between them. As per terms of the agreement, interest was to be paid @ 14.5% with quarterly rests. The petitioner-company did not adhere to the payment of instalments on due dates. According to the company, it had paid a sum of Rs. 9,73,509.19 till 27.07.2000 and the last payment was made on 17.12.1992. The loan payment account of the company was re-scheduled from time to time but it again committed default. On the request made by the petitioner-company, a proposal was made by the respondent-Corporation to settle the loan account subject to its depositing a sum of Rs. 14,54,842/- with further interest @ 17.5% from 01.06.1999 as per following terms and conditions: "1. Rs. 3,63,710/- to be paid within 15 days of the date of this letter. However, the balance amount is paid in full but not later than 15.05.2000." 2. This settlement proposal/ letter, however, will not in any way absolve the original borrowers/ guarantors from their personal liabilities as per the agreement/ guarantee bonds already executed in favour of the Corporation till the payment is made as above. Other terms and conditions for settlement are as under:- (i) The Corporation will not be responsible for recall or repayment of any type of subsidy/ Seed Money availed by the concern. The documents will be returned to you only after receipt of No dues Certificate from the institutions holding pari-passu, 2 nd or 3 rd charge. (ii) You will not dispose of any asset without the prior approval of the Corporation. Further in case of default as per settlement, you will hand over the possession of the unit, collateral security to the Corporation immediately. (iii) In case of default / non adherence to the terms of settlement, you will be liable to pay the entire outstanding dues of the Corporation in terms of mortgage Deed/ Hypothecation/ Supplementary Mortgage Deed or Agreement deed already executed and settlement as mentioned above will be automatically cancelled."
(3.) However, in order dated 27.07.2000, it has been recorded that the aforesaid proposal could not fructify into final settlement. However, the Court had accepted the offer made by the petitioner-company to be fair and reasonable. According to offer made, the principal amount was to be freezed at Rs. 15 lacs as on 01.07.2000 and the whole determined amount was to be paid along with interest @ 17.5 till the amount settled is paid in full. The first installment of Rs. 3,75,000/- were to be paid every three months commencing from payment of first installment on or before 30.10.2000 and the fourth installment of the same amount was payable on 31.1.2001. The remaining outstanding amount was to be paid on 31.10.2001. It was also submitted that in case of default in payment of any of the instalments, the petitioner-company was liable to pay the entire outstanding dues of the Corporation in terms of mortgage deed or agreement deed already executed and in case of failure, it was further undertaken that the settlement was to be considered automatically cancelled. On the offer made by the petitioner company, learned Single Judge observed as under: "Considering that the industry as a whole, particularly that of the petitioner, is facing problem for various reasons, the proposal put by the petitioner seems to be quite reasonable. However, before a final decision is taken on the proposal made by the petitioner, it would be appropriate to put this proposal before the Corporation so that it may take favourable decision thereon. Mr. Manchanda, learned counsel appearing on behalf of Corporation, has submitted that he shall place a copy of this order before the Managing Director of the Corporation for favourable consideration by the Corporation. I have no manner of doubt that the proposal put forth shall receive favourable consideration by the Corporation.";