ANIK INDUSTRIES LTD Vs. IDBI BANK

JUDGEMENT

(1.) The petitioner before this Court, a Company incorporated under the Companies Act, 1956, is having a Current Account No. 01420020338000 and the same has been marked as 'General Lien' by the IDBI Bank. The contention of the petitioner is that the petitioner Company had given a Corporate Guarantee in favour of M/s. Suman Agritech Ltd., and M/s. Suman Agritech Ltd., defaulted in making payment to the Bank. It has been further stated that as per the terms and conditions of the Corporate Guarantee it was valid till M/s. Suman Agritech Ltd., starts its commercial production. The contention of the petitioner is that the commercial production started on 23/3/2012 and on account of the commercial production which started in the year 2012, the Corporate Guarantee came to an end. The petitioner's grievance is that inspite of the aforesaid the Bank Account of the petitioner has been marked 'Lien' and the respondent Bank is not releasing the amount which is available in the account of the petitioner.

(2.) Mr. S. C. Bagadia, learned senior counsel has argued before this Court that on 15/11/2010 the petitioner Company gave a Corporate Guarantee for financial assistance availed by M/s. Suman Agritech Ltd., in terms of the sanction letter dated 13/7/2010 and as per the letter of sanction as well as Corporate Guarantee, it was valid till commencement of commercial production. The petitioner has further stated that subsequently the Bank modified the sanction letter on 13/7/2010 and the petitioner Company passed a resolution on 15/11/2010 to sign the Corporate Guarantee in terms of the sanction letter dated 13/7/2010. A resolution to that effect was passed by the petitioner Company on 15/11/2010. It has been further stated that subsequently a facility agreement dated 15/11/2010 was executed between M/s. Suman Agritech Ltd., and IDBI Bank and again as per clause 3.1(A) (iv) the guarantee was valid upto the time of commencement of commercial production. It has been further stated that on 19/1/2012 the respondent Bank renewed the financial assistance sanctioned on 13/7/2010 and modified on 9/11/2010, however, the terms and conditions of the corporate guarantee were not changed. The petitioner has also filed a certificate dated 23/3/2012 in support of the averments that the commercial production has commenced in respect of M/s. Suman Agritech Ltd., After 2012 ie., after the commencement of the commercial production the Bank on 3/4/2013 renewed the financial assistance sanction dated 13/7/2010 and no resolution was passed by the petitioner Company pursuant to the renewal dated 3/4/2013 and no corporate guarantee was signed by the petitioner Company.

(3.) On 5/6/2013 the petitioner Company submitted its representation to the respondent Bank requesting the Bank that the Company cannot provide corporate guarantee beyond a certain limit and as the production started in respect of the Unit in question, the account cannot be kept in lien. It has been further stated that the Bank kept silent over the matter and on 17-2-2015 / 17-2-2016 a letter was issued to the petitioner reflecting that M/s. Suman Agritech Ltd., has defaulted in making the payment and the petitioner was directed to regularise the default in terms of the corporate guarantee.