VYSALI PHARMACEUTICALS LTD Vs. FEDERAL BANK LTD

JUDGEMENT

(1.) THE respondent Bank filed the Original Application (OA) before the Presiding Officer, DRT, Ernakulam, for recovery of the amount due to the Bank. THEn the case was taken up for evidence, the defendants urged with regard to the maintainability of the OA due to the fact that the loans were availed by the defendants from the consortium Bank and also in view of the counter-claim raised in the Reply statement. THE issue with regard to the maintainability of the OA was argued before the Presiding Officer, DRT, by both parties and the Presiding Officer, DRT, by her order dated 27.2,2002 held that the OA is perfectly maintainable subject to the merits of the case and the plea with regard to the counter-claim can be decided only after recording evidence in the case and posted the matter for evidence. Aggrieved against that order the appellant-Ist defendant has filed this appeal.

(2.) The appellant contends that the appellant availed the loan facility from consortium Banks and the present OA filed by one of the Banks which is a member of the consortium Banks, is not maintainable and further the appellant has also filed counter-claim and further the appellant also contends that in spite of the movables mentioned in the A-Schedule of the OA there is pari passu charge and in respect of B-Schedule property in respect of Item 1 there is pari passu charge and in respect of Item 2, D-10 KSIDC is having first charge and the 1st respondent Bank is having second charge.

(3.) COUNSEL appearing for the R-2 South Indian Bank submitted that the respondent Bank is the leader Bank and large amount is due to the 1st respondent Bank and the appellant Company is on good terms with the 2nd respondent and 3rd respondent and there is no dispute between them and for the amount due to the 1st respondent, the 1st respondent Bank has filed the OA and as the other Banks are not willing to join with the 1st respondent for filing the OA since they are on good terms with the appellant Company, the 1st respondent Bank has come forward to file the OA adding the other Banks as respondents and the OA filed is maintainable. Mr. Mudhusoodanan, Senior Manager (Legal) of the Federal Bank submitted that there was a default by the appellant Company and it was declared as NPA in the year 1999 and there were no further transactions and for the amount due to the 1st respondent Bank, the Bank has filed the OA for recovery of the amount due to it and as the other Banks are not willing to join as plaintiffs they are added as respondents in the OA and the individual Bank is entitled to file the OA for the amount due to it and the OA filed by the 1st respondent Bank is maintainable. He further submitted that the RBI also has subsequently issued a Circular stating that the mandatory requirement on formation of Consortium for providing working capital finance under multiple Banking arrangement has been withdrawn by RBI in April, 1997 and the 1st respondent Bank can very well file the OA against the appellant and the OA filed is maintainable.