BHARAT BHUSHAN Vs. STATE BANK OF INDIA

JUDGEMENT

(1.) BY filing the present petition under Articles 226 and 227 of the Constitution of India, the petitioner has prayed for issuance of a direction to the respondents for consideration and approval of offer for one -time settlement made by him as per policy framed by the Reserve Bank of India.

(2.) BRIEFLY the facts, as noticed in the petition, are that against a cash credit facility availed by Anmol Agro India Ltd. (for short "the loanee") from State Bank of India (for short "the Bank") on January 27, 1988, the petitioner stood as guarantor to secure the loan. The petitioner mortgaged his immovable property situated at Kaithal. The initial cash credit facility allowed to the loanee was Rs. 50 lakh. However, it was later on extended to Rs. 2.60 crores. The petitioner was a guarantor to the extent of original limit granted to the loanee. Due to non -payment of the loan raised by the loanee, the Bank filed an application before the Debts Recovery Tribunal (for short "the DRT") for recovery of Rs. 3,64,08,131.92. Keeping in view the terms of the guarantee deed signed by the petitioner, a decree of Rs. 58,00,350.92 was passed against the petitioner as guarantor. In pursuance to recovery certificate; the mortgaged property of the petitioner was auctioned for Rs. 30,12,000/ -:

(3.) IN response to the petition, learned Counsel for the Bank submitted that both the policies, as are sought to be relied upon by the petitioner for one -time settlement of the dues against the petitioner are not applicable. He submitted that in terms of paragraph 2 of the guidelines issued by the Reserve Bank of India on September 3, 2005, it is categorically provided that the same are not applicable in case of wilful default, fraud and malfeasance. Relevant part thereof is extracted below: