SIVAKUMAR ENTERPRISES PVT. LTD., REPRESENTED BY ITS MANAGING DIRECTOR, D.S. SIVAKUMAR Vs. THE AUTHORISED OFFICER/ASSISTANT GENERAL MANAGER, DIVISIONAL OFFICE, DOOR NO. 15, I FLOOR, G.V. FARMS BUILDING, MAMPAZHAPATTU ROAD, VILLUPURAM, TAMIL NADU, 605602

JUDGEMENT

(1.) Sivakumar Enterprises Private Limited, Villupuram has availed (1) Cash Credit Open Loan of Rs. 3 Crores on 23.10.2014, (2) HPL for Rs. 85,00,000/- on 23.10.2014 and Machinery for value of Rs. 2.15 Crores on 23.10.2014. According to the Company, a sum of Rs. 2.50 Crores has been paid towards the credit facilities. Petitioner has also stated that a sum of Rs. 25 Lakhs was paid on 26.04.2017. Due to demonitization and natural calamity, petitioner company could not repay the loan amount. While that be so, Karur Vysya Bank, Villupuram, issued a notice dated 05.08.2017, under Section 13(2) of SARFAESI Act, 2002. It is the contention of the petitioner that loan agreement has been violated, by exceeding the sanctioned limit of Rs. 3 Crores into Rs. 4.5 Crores for closure of buyers credit limit (Raw material procurement) without the consent of the company. Petitioner has also contended that bank had breached its promise. Bank initiated proceedings without considering prospective buyers, for selling the hypothecated machineries. Coming to know of the same, petitioner submitted a letter dated 27.11.2017 of the proposed purchaser willing to purchase all the hypothecated machineries for a spot price of Rs. 50 Lakhs. Petitioner company also preferred a petition dated 02.12.2017 to the bank seeking approval of sale of the hypothecated machineries for the abovesaid sum. The said request has not been considered. Hence, left with no other alternate, petitioner has filed the instant writ petition for a mandamus directing the bank to grant approval for sale of all hypothecated machineries installed in the business premises of the petitioner's company for a sum of Rs. 50 Lakhs, discharge their liability towards buyers credit machinery loan and for further orders.

(2.) On 17.01.2018, when the matter came up for hearing, representation has been made on behalf of the bank that bank has received a proposal from a prospective buyer, quoting Rs. 1 Crore to purchase the hypothecated machineries.

(3.) Responding to the above, Mr. M. Vijayakumar, learned counsel for the petitioner submitted that if there is a higher offer for purchase of hypothecated machineries, he would not press the prayer sought for. Having regard to the above submissions, we directed the bank to file an affidavit with supporting material to prove the higher quotation.