SURESH CHANDRA GUPTA Vs. COLLECTOR KANPUR NAGAR

JUDGEMENT

(1.) The mam question involved in this writ petition is, whether the recovery under the UP Public Moneys (Recovery of Dues) Act, 1972 (the 172 Act) can proceed after insertion of Section 32-G in the State Financial Corporation Act, 1951 (the 1951 Act) and the enactment of the Recovery of Debt Due to Bank and Financial Institution Act, 1993 (the 1993 Act). THE FACTS

(2.) M/s J S Patel Private Limited (the Company) applied for grant of loan from the U P Financial Corporation (the Corporation) on 18-10-1996. The Corporation sanctioned a term loan of Rs 17 crores however, only a sum of Rs 1,42,48,000/- was disbursed to the company on instalments This loan was to be paid in five years The company premises was also mortgaged with the Corporation and the entire machinery, goods (finished and unfinished) were hypothecated.

(3.) The Company could not pay the loan The Corporation issued letter dated 23-11-2000 asking the Company to repay the dues failng which it threatened to take action under Section 2 of the 1951 Act The Company filed original Suit No 638 of 2000 beiore the Civil Judge (Senior Division), Allahabad for injunction against (he recovery along with application for temporary injunction The temporary injunction was granted on 16-2-2001 The Corporation filed an FAFO No 374 of 2001 before this Court against his order and obtained an interim order on 27-3-2001 The Corporation took possession of the factory premises of the Company on 2-3-2001 and advertised for auction of the factory premises on 9 3-2002 We are informed that the auction has been held and possession has been handed over to the purchaser