HARIKRISHNA ENGINEERING WORKS Vs. SYNDICATE BANK

JUDGEMENT

(1.) This Letters Patent Appeal is directed against the order dated 5.12.2016, by which the learned Single Judge dismissed Special Civil Application No.20209 of 2016 filed by the Petitioners M/s.Harikrishna Engineering Works and others.

(2.) The learned Single Judge dismissed the said writ petition filed by the Petitioners only on the ground of availability of alternative remedy to the Petitioners, the borrowers of the certain loans from the Respondent Syndicate Bank, under Section 17 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ('SARFAESI Act' for short) relying upon several decisions of the Hon'ble Supreme Court in this regard.

(3.) Mr. B.M. Mangukiya, learned counsel for the Appellants urged before us that the main crux of the matter, which does not permit the Appellants to avail such alternative remedy as directed by the learned Single Judge, is that the Respondent Syndicate Bank failed to disburse the working capital loan sanctioned in favour of one of the Appellants M/s.Nilkanth Enterprise, which is a sister concern of M/s.Harikrishna Engineering Works, despite the fact that the said Appellant M/s. Nilkanth Enterprise had made a substantial investment in the said industrial unit on the faith of the promise of the disbursement of such sanctioned loan in favour of the said Appellant M/s. Nilkanth Enterprise to the extent of Rs.14 crore and though the Appellants had invested more than Rs.20 crore, in absence of the timely and punctual disbursement of the said sanctioned working capital loan by the Respondent Syndicate Bank, the entire project came to a standstill and therefore, invoking the principles of promissory estoppel, the writ petition filed by the Appellants seeking disbursement of the said loan in favour of M/s. Nilkanth Enterprise deserved to be allowed. He further submitted that this relief cannot be granted by the Debts Recovery Tribunal under provisions of Section 17 of the SARFAESI Act and consequently, the learned Single Judge has erred in relegating the Appellants to avail such alternative remedy.