P.S.SIVAPERUMAL Vs. AUTHORIZED OFFICER UCO BANK

JUDGEMENT

(1.) The Companies / Firms namely, M/s.Rathna Stores Private Limited, M/s.Rathna Stores (Firm) and M/s.Rathna Stores (Proprietorship) had approached the respondent Bank for availing loan / credit facilities and subsequently all their accounts became Non-Performing Assets. Since M/s.Rathna Stores Private Limited, M/s.Rathna Stores (Firm) defaulted in payment of dues, the respondent Bank had initiated proceedings by filing an Original Application under Section 19 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 (hereinafter referred in short as 'RDDBFI Act') in O.A.No.649 of 2015 and the Recovery Certificate was issued against M/s.Rathna Store Private Limited for a sum of Rs.30,64,81,519.98.

(2.) After adjusting a sum of Rs.26 Crores, a direction that they have jointly and severally liable to pay principal with simple interest at the rate of 7.5% per annum from the date of Original Application till the date of realization and recovery certificate, was also issued by Debts Recovery Tribunal-2 vide order dated 14.09.2017. Accordingly the Debt Recovery Tribunal issued the Debt Recovery Certificate in DRC.No.73/2019 on 27.02.2019 for a sum of Rs.7,66,13,764.29. In O.A.No.380 of 2018, filed by the respondent Bank by invoking Section 19 of the RDDBFI Act against the M/s.Rathna Stores (firm), the Debt Recovery Tribunal at Chennai-II, vide order dated 23.10.2017 has passed an order for recovering a sum of Rs.18,38,36,049.06/- together with simple interest at the rate of 9% from the date of filing of original Application till the date of realization and also directed the issuance of the Recovery Certificate. To that effect, the Recovery Certificate in DRC NO.7 of 2018 dated 04.01.2018 was issued for a sum of Rs.21,10,12,456.98/-. It is to be noted at this juncture that the immovable properties at Chennai as well as in Kodaikanal were given as security in respect of the loan availed by M/s.Rathna Stores Private Limited, M/s.Rathna Stores (Firm), M/s.Rathna Stores (Proprietorship).

(3.) The respondent Bank choses to invoke the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (in short 'SARFAESI Act') and after issuing notice under Section 13 (2) and 13(4) of the Act, had issued e-auction sale notice under SARFAESI Act on 15.10.2018 and the said notice is available at page no.46 of the typed set of documents filed in support of this Writ Petition and as per the contents of the said notice, the amount outstanding in respect of M/s.Rathna Stores Private Limited was Rs.32,32,35,133.27; in respect of M/s.Rathna Stores (Firm), an amount was Rs.16,75,50,314.01 and in respect of M/s.Rathna Stores (Proprietorship), it was Rs.61,26,046.74 as on 19.04.2015. Challenging the legality of the impugned Sale Notice dated 15.10.2018 (wrongly stated as 16.10.2018), the guarantor namely Mr.P.S.Sivaperumal and Mrs.Periyaperatti had filed SARFAESI Application No.287 of 2018 before the Debt Recovery Tribunal -II by invoking Section 17 of the SARFAESI Act and pending disposal of the same prayed for stay of all further proceedings in pursuant to the said notice.