PUNJAB NATIONAL BANK Vs. P. VASANTHA AND ORS.

JUDGEMENT

(1.) THESE two writ petitions are directed against the common order dated 30 August 2006 in R.A. Nos. 6 and 7 of 2006, whereby and whereunder the Debts Recovery Appellate Tribunal, Chennai modified the order dated 4 October 2004 passed separately in T.A. Nos. 355 and 393 of 2001 by directing the petitioner to accept the one time settlement amount with simple interest at 12% per annum.

(2.) THE first respondent in W.P. No. 14718 of 2007 availed financial assistance from the petitioner for construction of a commercial complex. Since repayment was not made as per schedule, the Bank filed a Civil Suit in C.S. No. 1193 of 1993 before the original side of the High Court. Subsequently the suit was transferred to the Debts Recovery Tribunal (hereinafter referred to as "DRT") and re -numbered as T.A. No. 393 of 2001. The DRT after contest issued a Recovery Certificate for a sum of Rs. 17,12,922.15 with future interest at the rate of 24.75% per annum till realisation. The order dated 4 October 2004 was challenged before the Debts Recovery Appellate Tribunal (hereinafter referred to as "DRAT"), in R.A. No. 7 of 2006. The DRAT was of the view that the first respondent is entitled to the benefits of one time settlement ("OTS" in short) approved by the petitioner earlier and held that the liability is to pay only a sum of Rs. 12.50 lakhs with interest at 12.5% from 31 March 2001. The order passed by the DRAT is challenged in W.P. No. 14718 of 2007.

(3.) THE learned counsel for the petitioner contended that the DRAT exceeded its brief by extending the benefits of OTS of the year 2001 to the borrowers without there being a prayer for the same in the concerned appeals. The prayer was to consider their case under the OTS of 2005. The borrowers are not entitled to the benefits of even the OTS of 2005. It was contended that the borrowers failed to adhere to the terms of OTS 2001 and as such the DRAT erred in granting the benefits on the basis of lapsed OTS.