SCREEN ENTERTAINMENT Vs. UNION OF INDIA

JUDGEMENT

(1.) IN both the appeals as common order dated 26th Aug. , 2008 passed by learned single Judge is under challenge and common question of law involved and arising out of common facts, they were heard together and disposed of by this common judgment.

(2.) THE appellants approached the writ court by filing two separate writ petitions for mandamus directing the 2nd respondent " Reserve Bank of India to give suitable direction to the respondents 3 to 6, Indian Bank (hereinafter referred to as 'bank') for releasing the documents lying with the Bank pertaining to account of appellant, M/s. Screen Entertainments and M/s. South India Metal Exports respectively. The Court having dismissed the writ petitions, these appeals have been preferred. The writ petition has been filed by the petitioner, M/s. Metro Film Corporation for similar relief as claimed by the appellants in the writ appeals.

(3.) THE case of the appellants in nutshell is that they approached the Bank for financial assistance, which was granted and loan was disbursed on various occasions. For different reasons, the appellants failed to remit the dues and loan amount. The Bank filed original applications before the Debts Recovery Tribunal No. I, Chennai (hereinafter referred to as 'drt' ). During the pendency of the cases, one time settlement (hereinafter referred to as 'ots') was reached on 20th April, 2004 and it was agreed upon that a sum of Rs. 225 Lakhs (Rupees Two Hundred and Twenty Five Lakhs) would be paid by the appellants within a period of twelve months from the date of communication of the sanction and also remit a sum of Rs. 75 Lakhs (Rupees Seventy Five Lakhs) within a period of thirty days. According to the appellants, they have remitted a sum of Rs. 75 Lakhs on 20th May, 2004, within a period of thirty days, but the Bank, instead of adjusting the said amount in Metro Film Corporation account, adjusted Rs. 70 Lakhs in Screen Entertainment Account. The balance Rs. 5 Lakhs was adjusted to Metro Film Corporation account. The grievance of the appellant is that, contrary to the compromise made between the parties, Kottivakkam property was not released in order to sell the said property to third parties and remit the balance OTS amount, the Bank, in fact, agreed to release the document and also requested the purchaser to deposit a sum of Rs. 10 Lakhs in a no lien account. Accordingly, one purchaser had deposited a sum of Rs. 10 Lakhs in no lien account of the Bank. Despite the said fact, the Bank had not given no objection to appellants to deal with the said property. In view of the same, the appellants were unable to pay the respective amount within twelve months. Therefore, they requested the Bank for extending the time to settle the balance amount of Rs. 220 Lakhs (Rupees Two Hundred and Twenty Lakhs) and on 14th July, 2005, the period of OTS was extended by Bank till 20th Oct. , 2005, with same and similar condition, which remained unchanged. The Bank agreed to release the Kottivakkam property on payment of Rs. 100 Lakhs and balance of Rs. 120 Lakhs was to be paid on or before 20th Oct. , 2005. In the said letter, it was agreed by Bank to release the Anna Nagar property on receipt of the balance of Rs. 120 Lakhs. Furthermore, it had been agreed that interest @ 11. 5% would be collected from 1st Jan. , 2004 till the settlement of full OTS amount. Further case of the appellant is that they mobilised fund from third parties and paid Rs. 100 Lakhs on 20th Oct. , 2005. Thereafter, they requested for release of Kottivakkam property. However, even thereafter the Bank has not released the documents pertaining to Kottivakkam property. There being a delay of five months in settling the OTS, the appellant agreed topay further amount apart from Rs. 295 Lakhs. However, the Bank having not accepted, the writ petitions were preferred, which were dismissed.