A.K. SINHA Vs. CANARA BANK

JUDGEMENT

(1.) Department of telecommunication has invited open fresh tenders for grant of franchise licences for the establishment/installation/commissioning of radio paging services in 27 major cities of India. The bid of Petitioner No. 2-Company was objected, which was impugned through writ petition No. 3774 of 1992 before the High Court of Delhi. The said writ petition was decided in favour of the Petitioner-Company and the Department of the Telecommunication issued letter of intent in favour of the Petitioner-Company. Licence agreements for 8 cities, accordingly, were signed by the Petitioner-company with the Department of Telecommunication. The bank guarantees were also issued for the purpose of grant of licence, which were to be governed in accordance with the specific terms and conditions of the Draft Licence Agreements and Indian Contract Act.

(2.) The grievance of the Petitioner is that the Respondent-Bank released the bank guarantees to the Department of the Telecommunication and simultaneously encashed the deposit receipts deposited with the bank. The litigation ensued between the parties. The company requested the bank to restore the FDRs. Some criminal complaints were also filed. In the meantime, the Respondent-Bank filed original application for recovery where the Debts Recovery Appellate Tribunal has passed an order for recovery of certain dues claimed by the bank. It is stated that the Debts Recovery Appellate Tribunal adjudicated upon the civil as well as the criminal liability.

(3.) The Petitioner-Company filed an appeal against the order passed by the Debts Recovery Appellate Tribunal, where another counsel was engaged. As per the provisions of Section 21 of the Recovery of Debts due to Banks and Financial Institutions Act, 1993 (for short 'the Act'), the appeal filed by the Petitioner can be heard only if 75% of the decretal amount is deposited. The predeposit of decretal amount, however, can be reduced/waived by the Appellate Tribunal.