BMW INDUSTRIES LTD Vs. UCO BANK

JUDGEMENT

(1.) The writ petitioner/appellant claims to be a manufacturer of iron and steel products. To run its business from time to time from 2005, it obtained loans and advances from UCO Bank which were sanctioned and disbursed from its flagship corporate branch at 2, India Exchange Place, Kolkata - 700001. In keeping with banking practice several accounts of the appellant relating to this loan and advance were maintained by the respondent bank, namely, term loan account, cash credit account, working capital account, overdraft account and so on. The appellant asserts that its conduct in obtaining and making repayment of loan amounts was so much appreciated by the respondent bank that the Circle Office level, Credit Approval Committee had approved a favourable review of the term loan and cash credit limits. The credit facilities enjoyed by the appellant appear to have been reviewed on 29/9/2014.

(2.) On 24/2/2015 the appellant wrote to the respondent bank that they should not increase their interest rate of BR + 2.25 % i.e. 12.45% to BR + 3.75%. They wanted this concession with retrospective effect. On 22/5/2015, the bank acceded to the appellant's request for reduction of interest rate on the following terms and conditions:-

(3.) Acting in terms of the above representation of the respondent bank, the appellant by their letter dtd. 5/9/2015 sought payment from the respondent bank of the excess interest received by them from the appellant for the period from December, 2014 to May, 2015 in its cash credit account. By November, 2015 according to the appellant this amount was Rs.42,96,330.64. By 31/3/2016 the figure rose to Rs.61,34,431.00. On 25/5/2016 the Chief Manager of the respondent bank made a rather vague reply. It was like this: