KALYANMAL Vs. M P FINANCIAL CORPN

JUDGEMENT

(1.) THE short question that arises for consideration in the present writ petition is, whether the right conferred to the Financial Corporation under Section 29 of the State Financial Corporation Act (for short called "the Act") extends over the property mortgaged with the Corporation by a guarantor or not? To appreciate the issue, few facts need to be taken note of.

(2.) THE petitioner had mortgaged his property for securing a term loan that had been granted by the Corporation (Respondent No. 1) in favour of respondent No. 2 for setting up of some Industrial Unit. As the loanee did not pay up the instalment dues, the Corporation served the notice on the petitioner (Annexure-E) calling upon him to clear the demanded dues with interest failing which the properties mortgaged by the petitioner in favour of Corporation should be taken over, it is against this action of the Corporation, the petitioner has felt aggrieved and filed this writ. Notice of the writ was issued to respondents. They are served and represented so far as respondent No. 1 is concerned. As far as respondent No. 2 is concerned, they are principal borrower and happens to be the son of petitioner.

(3.) HEARD Shri P. V. Bhagwat, learned Counsel for the petitioner and Smt. Ritu Bhargav, learned Counsel for the respondent No. 1.