Rakesh Garg, J. - (1.) THE petitioner, herein is a body corporate, having been incorporated under the Companies Act as per the certificate of Incorporation No. 16 -10719 of 1990 issued by the Registrar of Companies, Jalandhar. During the year 1993, the promoters of the petitioner -Company had set up a unit for the manufacture of woollen yarn at its works situated at village Jugiana, Distt. Ludhiana. Both the respondents i.e., Punjab Financial Corporation (for short 'PFC') and Punjab State Industrial Development Corporation (for short 'PSIDC') granted term loan viz. PFC had sanctioned loan of Rs. 67 lacs on 5.3.1993 and PSIDC had sanctioned term loan of Rs. 33 lacs on 19.3.1993. The said loans were disbursed to the petitioner and further vide deed of mortgage/memorandum of entry, petitioner had created the security of the loan as mentioned hereinafter: Factory Building built on Land measuring 0B -18B -4B(2723 - 1/3 Sq. Yards) comprised in Khata No. 175/330, Khasra No. 397, Khata No. 254/478, 479, Khasra No. 396, Khata No. 251/473, Khasra No. 109, situated in village Jugiana, Tehsil and District Ludhiana together with building constructed thereon and machinery installed thereon.
(2.) THE petitioner defaulted in repayment of the above said loans of the respondents and approximately a sum of Rs. 71.20 lacs was due towards both the respondents. As per the case of the petitioner, with the intention to pay the above said dues to respondent -Corporation, the petitioner -company vide separate letters dated 20.6.2003 and 25.6.2003 had approached both the respondents for one time settlement for a sum of Rs. 65 lacs which constitutes 91% of the aggregate outstanding principal sum of Rs. 71.20 lacs towards both the respondents. Further, it is the case of the petitioner that respondent No. 2 vide its letter dated 1.7.2003 insisted upon the proposal for 100% of the said outstanding amount instead of the proposal of petitioner -Company to the extent of 91% and that the petitioner had enhanced the offer to cover 100% of the outstanding amount and deposited a sum of Rs. 25,000/ - as token money. However, the respondents had shown no genuine desire to settle the matter. The petitioner has further referred to a letter dated 7.10.2004 written by respondent No. 2 whereby he was again asked to submit a suitable proposal mutually acceptable to all concerned and in pursuance of this letter, the petitioner vide letter dated 19.10.2004 (Annexure P -4) offered to pay a sum of Rs. 1,00,000/ -as token money and also offered to pay a sum of Rs. 4.20 lacs by way of three monthly instalments of Rs. 1,40,000/ - after receipt of sanction of one time settlement. Thereafter, the petitioner -Company was called for a meeting on 31.1.200.5 by respondent No. 2 and after that petitioner vide its letter dated 23.2.2005 deposited a sum of Rs. 1,00,000/ - by way of two cheques and also deposited another sum of Rs. 50,000/ - on that very date to cover up the sum of 5% of the OTS amount and vide its letter dated 12.4.2005 informed respondent No. 2 that condition of deposit of 5% of OTS sum stood fulfilled. However, the respondents delayed the matter of sanction of OTS. The petitioner, further alleged that instead of sanctioning the OTS scheme, the respondents vide their letter dated 12/13.12.2006, without assigning any reasons, intimated that the OTS proposal was not acceptable. It is further the case of the petitioner that the unit set up by the petitioner had suffered losses and had become sick and, therefore, a reference was filed by the petitioner -company with BIFR under Section 15(1) of the Sick Industrial Companies Act, 1985 (hereinafter referred to as "SICA Act" ) which was registered with Board for Industrial and Financial Reconstruction (hereinafter referred to as "BIFR"), New Delhi vide case No. 25/2003 M/s Triveni Yarns Ltd., and, thereafter, vide order dated 28.11.2005 (Annexure P -10) the petitioner -Company was declared as Sick Industrial Company and, therefore, in order to explore the viability of its rehabilitation BIFR had appointed respondent No. 1 -PFC as the operating agency and the matter before the BIFR is still pending. The petitioner has also placed on record a copy of letter dated 12.9.2006 Annexure P -7, whereby it had requested respondent No. 1 for rehabilitation of the unit. Vide Annexure P -9 dated 27.12.2006, the petitioner also requested respondent No. 1 to accept the OTS proposal. The petitioner has further stated that respondent No. 1 issued a demand notice dated 9.1.2007 under Section 13(2) of The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 (hereinafter referred to as "Securitization Act"), requiring him to discharge his liabilities towards the respondents and advised him to pay the entire outstanding dues to respondent No. 1 amounting to Rs. 257.33 lacs with further interest from 31.7.2006 and Rs. 146.25 lacs with further interest from 31.7.2006 to PSIDC within 60 days from the date of the notice. Through this notice, it was also stated that in case the petitioner failed to repay the entire outstanding dues, the Corporation shall be entitled to exercise its rights as provided under Section 13(4) of the Securitization Act. The petitioner vide Annexure P -13 dated 2.3.2007 filed objections to the notice dated 9.1.2007 issued by the respondent -Corporation under Section 13(2) of the Act. These objections were disposed of by respondent No. 1 vide its reply dated 7.3.2007 (Annexure P -14) and the petitioner was advised to repay the loan of the Corporation. On the basis of the above stated facts, the petitioner has filed the present writ petition challenging the action of respondent No. 1 for initiating proceedings under Section 13(2) of the Act for quashing (Annexure P -II) i.e. notice dated 9.1.2007 and further restraining the respondents from proceeding under Section 13(4) of the Act. At the time of motion hearing, learned Counsel for the petitioner referred to the order passed by the BIFR (Annexure P -10) dated 28.11.2005 and contended that no notice under Section 13(4) of the Securitization Act has been issued and matter is pending before BIFR, therefore, all the recoveries of dues are to remain stayed in pursuance of Section 22(1) of the SICA Act. Upon issuance of notice of motion, the respondents appeared and contested the claim of the petitioner by filing separate replies, stating therein that the writ petition for quashing notice under Section 13(2) of the Act is not maintainable and the respondents who are secured creditors, who have granted financial assistance to the borrower and has created such interest, has the right to enforce such security for repayment of the loan amount without the intervention of the Court subject to the provisions contained in the Act and since the petitioner had defaulted in the repayment of the loan amount, therefore, notice under Section 13(2) of the Act was issued to the petitioner to secure its dues. Counsel for the petitioner has argued that in view of the unit of the petitioner having been declared sick by the BIFR and that the proceedings are pending before the BIFR therefore, no action can be taken by the respondent - Corporation under the provisions of Securitization 'Act. All the recoveries or dues are to remain stayed in pursuance of Section 22 of the SICA Act. Learned counsel has further argued that the permission of BIFR before proceedings against the petitioner would be necessary once the reference is pending before it. He has further stated that the respondents have failed to communicate the reasons for non -acceptance of the objections filed by the petitioner within a period of one week on the receipt of objection and, therefore, the respondents are further precluded from taking any action against the petitioner under Section 13(4) of the Securitization Act.
(3.) IN support of his contention, learned Counsel for the petitioner has relied upon the judgment cited as Rishab Agro Industries Ltd. v. PNB Capital Services Ltd. 2001 (Banking) I.S.J. 81 and Harminder Singh and Anr. v. State Bank of India Amritsar, (2007) 148 P.L.R. 746.;