Rajesh Bindal, J. - (1.) THE challenge in the present petition is to order dated August 17, 2005 (Annexure P20) passed by the Recovery Officer, Debts Recovery Tribunal, Chandigarh (for short 'the Tribunal') directing for auction of the properties of the petitioners for recovery of the decretal amount and seeking a direction to the respondent -Bank to settle and honour the compromise dated February 15, 2002, (Annexure PI) arrived at between the parties and tripartite agreement dated May 12, 2005 (Annexure PI 5).
(2.) BRIEFLY , the facts are that petitioner No. 1 -firm (hereinafter referred to as "the petitioner") was running a rice mill through its partners. For the purpose, the petitioner had raised certain loans from the respondent -Bank by mortgaging its properties. On account of default in repayment there of the Bank filed application before the Debts Recovery Tribunal, Chandigarh (for short "the DRT") which was decreed in favour of the respondent -Bank for a sum of Rs. 45.30 lakh with future interest on April 3, 1998. Thereafter, the petitioner approached the Bank for onetime settlement of the account and vide communication received through Counsel for the Bank dated February 20, 2002, the petitioner was informed that the Bank was agreeable to settle the account for a total sum of Rs. 23 lakh along with PLR simple. 25 per cent, of the settlement amount, i.e., Rs. 5.75 lakh was to be paid within two months and rest of the amount within 12 months from the intimation of the settlement. It was specifically mentioned therein that in case of failure, the Bank will be at liberty to pursue action against the petitioner. Part of the amount was deposited by the petitioner toward the settlement. But the entire amount was not deposited within stipulated period as per the terms of the one -time settlement. However, on the request of the petitioner, vide communication dated October 28, 2003, the period for repayment of the balance amount was extended up to December 31, 2003, subject to the condition that the petitioner was required to pay interest at the rate of PLR prevailing at the time of original settlement, compounded quarterly on the settled amount with effect from February 20, 2002, i.e., date of intimation of terms of settlement. As regards the title deeds of the three properties, it was mentioned that the same shall be released immediately on credit of the sale proceeds of the properties and on the party making good the shortfall, if any, in the amount payable to the Bank along with up to date interest. Still the petitioner instead of paying the amount, represented to the Bank for extension of time till March 31, 2004, and further it was requested that the time may be extended further up to June 30, 2004, and then up to March 31, 2005, by raising various pleas. However, the Bank did not accede to the request of the petitioner for extension of time for depositing the amount as per the one -time settlement, which expired on December 31, 2003. A copy of the tripartite agreement dated May 12, 2005, entered into between the petitioner, Mr. Anil Mehra, alleged buyer of the property and the respondent -Bank through its manager has been placed on record by the petitioner to submit that the Bank having failed to adhere to the conditions of the tripartite agreement, the petitioner has suffered on account of the backing out of the Bank. As per Clause (vi) of the tripartite agreement, the same was subject to approval by the head office. As is evident from letter dated August 11, 2005 (Annexure P19), the approval was not accorded as the validity of the one -time settlement had already expired since long, i. e., on December 31, 2003. In the execution petition filed by the Bank, the Recovery Officer vide order dated August 17, 2005, directed for sale of the properties of the petitioner and fixed the schedule therefor. The primary contention raised by learned Counsel for the petitioner is that the Bank was bound by the tripartite agreement entered into between the parties to which the manager of the respondent -Bank was a signatory. Though the factum of any authority with the manager to sign such an agreement has been refuted by the respondent -Bank and still approval in terms of paragraph six of the tripartite agreement dated May 12, 2005, was also declined by the head office vide letter dated August 11, 2005.
(3.) THE petition has been contested by the respondent -Bank by raising preliminary objection about the availability of alternative remedy in terms of Section 30 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. It has further been submitted that the petitioner was a wilful defaulter having not repaid the loan raised from the Bank and the same was not paid even after the decree passed by the DRT on April 3,1998. Still further even after the one -time settlement offer accepted by the respondent -Bank on February 20, 2002, for payment of the amount within one year and its further extension up to December 31, 2003, the petitioner did not repay the amount in terms thereof and had been making one excuse or the other. As regards to the tripartite agreement, it was submitted that the Bank Manager did not have any authority to enter into any such agreement for payment of the amount in terms of one -time settlement, the validity of which had already expired way back on December 31, 2003. Seeing the totality of the circumstances and the conduct of the petitioner, who is a wilful defaulter, it was submitted that he is not entitled to any relief whatsoever.;