M.M.KUMAR,J - (1.) THIS petition filed under Article 226 of the Constitution prays for quashing order dated 13.4.2007 (P-14), passed by the Debts Recovery Appellate Tribunal, Delhi (for brevity, 'the Tribunal') to the extent it directs the petitioner bank to settle the case of private respondents under the Reserve Bank of India's guidelines as applicable at the time of declaring the account as Non Performing Assets (NPA) and not to recover the amount as per the judgment and Recovery Certificate, dated 23.11.2006 in O.A. No. 606/2006 (P-1 & P-2), issued by the Debts Recovery Tribunal-II, Chandigarh, in Appeal No. 26 of 2007 (P-11) filed by respondent Nos. 2 to 14. It has further been prayed that order dated 13.4.2007 (P-14) may also be modified allowing Appeal No. 71 of 2007 (P-12), filed by the petitioner bank, entitling it to recover the amount of Rs. 4,16,58,581.62 paise along with 16.5% pendente lite and future interest with quarterly rests from the date of filing of O.A. till its realization from respondent Nos. 2 to 14 jointly and severally.
(2.) FACTS in brief are that respondent Nos. 2 to 14 along with Smt. Darshan Kaur (since deceased) wife of Late S. Sardar Singh and mother of respondent Nos. 3, 4 and 12 approached the petitioner bank for availment of loan facilities for business purposes in the name of M/s Sardar Associates Limited-respondent No. 2 and a loan for an amount of Rs. 3,54,50,000/- was sanctioned and disbursed from time to time. Respondent Nos. 3 to 14 as well as Smt. Darshan Kaur (since deceased) stood as guarantors and in addition thereto respondent Nos. 2, 3, 7 and 9 mortgaged their properties in favour of the petitioner bank as security of the loan amount. However, respondent Nos. 2 to 14 defaulted in making repayment of the loan. On 31.3.2001, their accounts were declared as Non Performing Assets (NPA) as per the guidelines issued by the Reserve Bank of India. On 9.8.2002, a notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity, 'the Act') was issued to respondent Nos. 2 to 14 for payment of an amount of Rs. 3,54,29,168.87 paise along with interest within a period of 60 days. The aforementioned notice was followed by another notice issued under Section 13(4) of the Act as respondent Nos. 2 to 14 failed to make payment within stipulated time. Thereafter the petitioner- bank filed an application before the Debts Recovery Tribunal at Chandigarh (for brevity, 'the DRT') against respondent Nos. 2 to 14 as well as Mrs. Darshan Kaur for recovery of Rs. 4,16,85,443.62 paise inclusive of interest upto 31.7.2003. On 23.11.2006, O.A. No. 606 of 2006 was allowed and a Recovery Certificate of even date, for recovery of Rs. 4,16,58,581.62 paise along with pendente lite and further interest @ 12% p.a. with quarterly rests from the date of filing of O.A. till realization was issued (P-1 and P-2 respectively). Feeling aggrieved, respondent Nos. 2 to 14 filed an appeal under Section 20 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (for brevity, 'the 1993 Act'), before the Tribunal. Alongwith the appeal an application under Section 21 of the 1993 Act, bearing M.A. No. 16 of 2007 was also filed, seeking waiver of deposit of amount (P-3). On 20.3.2006, respondent No. 2 approached the petitioner-bank for settlement of their account as per Reserve Bank of India guidelines and an offer for one time settlement of Rs. 345.31 lacs was made (P-7). However, the petitioner-bank rejected the proposal. Respondent No. 2 then filed C.W.P. No. 16809 of 2006 in this Court challenging Circular No. 176, dated 18.10.2005, issued by the petitioner-bank claiming that it was contrary to the guidelines on One Time Settlement Scheme for SME accounts issued by the Reserve Bank of India, dated 3.9.2005. It was further prayed that the bank be directed to settle the matter as per RBI guidelines. A Division Bench of this Court dismissed the aforementioned writ petition, vide order dated 21.11.2006, inasmuch as, it was not disclosed in the writ petition that the petitioner-bank had already gone to the DRT for recovery of the disputed amount (P-6). Respondent No. 2 further assailed the order dated 21.11.2006 before Hon'ble the Supreme Court and SLP No. 21134 of 2006 was also dismissed on 31.1.2007 (P-9).
(3.) ON 8.2.2007, the Tribunal allowed the application under Section 21 of the 1993 Act and the appeal filed by respondent Nos. 2 to 14 was entertained without pre-deposit of amount (P-10). The writ petition filed by the petitioner-bank against the aforementioned order was dismissed. It is also appropriate to notice here that the petitioner-bank also filed an appeal before the Tribunal against the judgment and recovery certificate dated 23.11.2006 (P-1 and P-2) claiming pendent lite and future interest @ 16.50% with quarterly rests instead of 12% p.a. On 13.4.2007, the Tribunal dismissed the appeal filed by the petitioner-bank and the appeal filed by respondent Nos. 2 to 14 has been allowed directing the petitioner-bank to make one time settlement as per RBI guidelines applicable at the relevant time (P-14). The Tribunal, however, affirmed the judgment and recovery certificate dated 23.11.2006 (P-1 and P-2). The Tribunal, has further permitted respondent Nos. 2 to 14 to sell the secured properties for clearing dues under One Time Settlement. It has also been ordered that the entire exercise be completed within a period of four months and till such time the petitioner-bank shall not take any coercive steps against them.;