OM TIMBER MART Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) This writ petition has been filed, praying that this Court may be pleased to issue a Writ of Certiorari to call for the records and quash the impugned possession notices issued by the respondent bank, dated 10.07.2013 and 11.07.2013, under Rule 8(1) of the Security Interest (Enforcement) Rules, 2002.

(2.) It has been stated that the petitioner industry is a partnership firm and registered under the Factories Act,1948. The petitioner industry is running saw mills dealing in various kinds of wood and its by-products for the last 12 years. For running the business, the petitioner industry had approached the respondent bank for financial assistance. The respondent bank had sanctioned a Cash Credit (hypn) to an extent of Rs.12.50 Crores. It has also issued a Letter of Credit(WC) for Rs.17 Crores and Credit Exposure LT for Rs.0.20 Crores.

(3.) It has been further stated that, at the time of the sanctioning of the loan, certain moveable and immoveable properties have been furnished as equitable mortgage. Even though the business was running successfully, for a period of about 20 months, it had run into financial problems, due to the power cuts in the State of Tamil Nadu and also due to adverse business conditions. In such circumstances, the petitioner industry could not pay the installments, as per the agreement entered into with the respondent bank. Inspite of the representations made to the respondent bank, notices, under Sections 13(2) and 13(4) had been issued, under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Enforcement), Rules,2002. In such circumstances, the petitioner has preferred the present Writ Petition, before this Court, under Article 226 of the Constitution of India.