SURESH VASWANI Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) THE revision petition is preferred against the order of dismissal dated 01. 09. 2008 passed by the Debts Recovery Appellate Tribunal, Chennai, in m. A. No. 34 of 2007, whereby the order dated 14. 12. 2006 passed by the Debts recovery Tribunal, Bangalore, in I. R. No. 378 of 2001 in O. A. No. 687 of 1999 was confirmed.

(2.) THE revision petitioners are the Directors of M/s. Vandana Electronics private Limited. They availed a loan for their business from the respondent bank in April, 1994 and they stood as guarantors for the said loan. Since the petitioners failed to repay the loan amount, the bank has filed O. A. No. 687 of 1999 under the Recovery of Debts Due to Banks and Financial Institutions, 1993 for recovery of a sum of Rs. 42,88,405. 67. In the said O. A. , an ex parte order was passed against the borrowers/petitioners on 31. 05. 2000. Consequently, an ex parte Recovery Certificate was issued. In the meantime, the Reserve Bank of india announced One Time Settlement (OTS) for the cases below Rs. 10 Crores. Hence, the bank had offered the said Scheme to be availed by the borrowers/revision petitioners on 28. 06. 2001. Pursuant to the offer, OTS was arrived at between the respondent bank and the revision petitioners for a sum of rs. 39,69,000/ -. Further, it was agreed that the said amount should be paid on or before 31. 05. 2004. However, the said time was subsequently extended up to 31st august, 2004. Though it was agreed, the revision petitioners have paid only 50% of OTS amount, namely, 19,84,336/- up to 31. 08. 2004 i. e. the last day of payment as per OTS. Since the amount as per OTS was not paid within the stipulated time, the respondent bank proceeded against the mortgaged property as per the Recovery certificate issued by the Debts Recovery Tribunal (in short "drt") Bangalore. Pursuant to the necessary forms submitted by the bank, the Recovery Officer ordered attachment of the scheduled properties on 13. 09. 2004. Thereafter, the revision petitioners filed necessary applications I. A. No. 253 and 254 of 2005 along with I. R. 378 of 2001 to set aside the ex parte order and filed a memo before the DRT, Bangalore, enclosing demand drafts for the balance amount of rs. 19,85,723. 20 as per OTS, seeking to raise the order of attachment. The DRT, bangalore, by order, dated 24. 03. 2005, directed the bank to accept the balance amount of Rs. 19,84,337/- which is lying with the Recovery Officer, DRT, bangalore, along with the prime lending rate of interest at 10. 5% amounting to rs. 5,39,321/- being the interest calculated on the balance amount payable by the borrowers and further directed the borrowers/revision petitioners to make the said payment within 15 days from the date of order, failing which, the said order shall stand automatically vacated and the bank is at liberty to take action, according to law. In the order, it has been further observed that on payment, the bank has to return all the original title deeds to the borrowers.

(3.) AGGRIEVED over the said order, the bank has filed M. A. 52 of 2005 before the debts Recovery Appellate Tribunal (in short "drat"), Chennai. But, the DRAT, chennai, by an order dated 09. 06. 2005, remitted the matter to the DRT, bangalore, for passing appropriate orders in I. R. 378 of 2001 filed by the borrowers to set aside the ex parte order dated 31. 05. 2000 in O. A. No. 687 of 1999. But, after remand, the DRT, Bangalore, dismissed I. R. 378 of 2001 with exemplary costs of Rs. 10,000/- by order dated 14. 12. 2006. Challenging the same, the borrowers have preferred an appeal in M. A. No. 34 of 2007 before the DRAT, chennai. The appellate Tribunal has dismissed the appeal and confirmed the order passed by the DRT, Bangalore, by order dated 01. 09. 2008. Aggrieved over the said order of dismissal, the present revision petition is filed by the borrowers.