SUNIL MITTAL Vs. UNION OF INDIA & ANOTHER

JUDGEMENT

(1.) This order shall dispose of aforesaid two writ petitions raising identical question of law and facts i.e. the Punjab State Industrial Development Corporation (PSIDC) (for short 'the Corporation') is not a financial institution competent to initiate proceedings against the borrower under the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (for short 'the Act').

(2.) Since the issue is legal, the facts for the present decision are not relevant. However, for the sake of brevity, it may be mentioned that the petitioners have availed financial assistance from the Corporation. Since the petitioners have failed to pay the amount of financial assistance, proceedings as contemplated under the Act or under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 against the petitioners were initiated. It is the said proceedings, which are sought to be disputed by the petitioners by way of present petitions.

(3.) The argument of learned counsel for the petitioners is based upon the fact that the respondent-Corporation has been declared to be a 'public financial institution' by way of notification dated 25.10.2005 (Annexure P-3) in terms of Section 4A of the Companies Act, 1956 (for short 'the Companies Act') by amending the notification dated 13.05.1978.