VIKRAM SABOO & ORS Vs. SICOM

JUDGEMENT

(1.) By this Appeal, the Appellants challenge the order dated 1 July 2008 passed in Miscellaneous Petition No. 2 of 2007. By that order, the learned Single Judge has granted the Misc. Petition filed by the Respondent under Section 31(1)(aa) of the State Financial Corporation Act, 1951 (for short, the Act) in terms of prayer clause (a) of that Petition. The Petition was filed by the Respondent-SICOM claiming that Marvel Industries Limited which was Respondent No.1 in the Petition, had applied for a loan with SICOM. It was sanctioned a term loan of Rs. 1 crore, additional term loan of Rs. 1 Crore 5 lacs, term loan of Rs. 3 crores 50 lacs, out of which Rs. 2 crores 50 lacs was disbursed and a further term loan of Rs. 1 crore 50 lacs on the terms and conditions which are mentioned in the agreement entered into with Respondent No.1. Respondent No.1 agreed to repay the loan advanced to it on the terms and conditions mentioned in the agreement entered into between SICOM and Respondent No.1. Respondent Nos. 2 to 6, who are present Appellants executed three deeds of personal guarantee dated 16 February 1993 in favour of SICOM whereunder, Respondent Nos. 2 to 6 guaranteed that in the event of default being committed by Respondent No.1-Company in payment of the loan advanced to it on demand being made, Respondent Nos. 2 to 6 guarantors would pay the amount demanded without their demand. According to SICOM Respondent No.1 Company-Principal Debtor, committed default in making the payment of loan therefore, demand notice was served on the Appellants on 27 August 2004 demanding the payment of the defaulted amount and on their failure to pay that amount, Petition under Section 31 (1)(aa) of the Act was moved against them. To this Petition two objections were basically raised on behalf of the Appellants. First objection was that demand notice was served in the year 1999 on the principal debtor company, copy of that notice was forwarded to the Appellants for their information. According to the Appellants the period of limitation is governed by Article 137 of the Schedule to the Limitation Act and therefore, Petition should have been filed under Section 31 within a period of three years from the date of default committed by Respondent No.1 company. The Second objection raised was based on the provisions of Section 22. It was claimed that Respondent No.1 has been declared as a Sick Industry and therefore, in terms of Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 (for short SICA), the Petition could not have been heard and decided by the learned Single Judge.

(2.) The learned counsel appearing for the Appellants in so far as the first objection is concerned relied on two judgments. (i) M/s. Margaret Lalita Samuel Vs. Indo Commercial Bank Ltd., 1979 AIR(SC) 102 (ii) Maharashtra State Financial Corporation Vs. Ashok K. Agarwal & Ors., 2006 9 SCC 617.

(3.) So far as the second objection regarding Section 22 of the SICA is concerned, the learned counsel pointed out that the controversy has been referred to a larger bench by the Supreme Court. He referred two judgments. (i) Zenith Steel Tubes & Industries Ltd. Vs. SICOM Limited, 2008 1 SCC 533 and (ii) Kailash Nath Agarwal Vs. Pradeshiya Industrial & Investment Corporation of U.P. Ltd., 2003 4 SCC 305.