MOHIT PRATAP SINGH Vs. ORIENTAL BANK OF COMMERCE

JUDGEMENT

(1.) THE petitioner has filed this writ petition for quashing the settlement arrived at between respondent No. 3 and respondent No. 1 (hereinafter referred to as 'the respondent bank') as contained in the joint application dated 20.9.2007; and the order dated 4.10.2007 passed by the Debt Recovery Appellate Tribunal, Delhi (hereinafter referred to as 'the Appellate Tribunal') accepting the said settlement.

(2.) IN this case, respondent No. 3 Company had obtained Credit and Loan facility from respondent No. 1. It defaulted in re-payment of the said loan/credit facility. Consequently, the respondent bank initiated proceedings for recovery by filing an original application before the Debt Recovery Tribunal, Chandigarh. Thereupon, respondent No. 3 filed a reference under Section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 before the BIFR. In the meantime, the Debt Recovery Tribunal passed ex parte decree against respondent No. 3 for the amount claimed and issued a recovery certificate. Subsequently, respondent No. 3 filed an application before the Debt Recovery Tribunal, Chandigarh for setting aside the ex parte judgment and decree. The said application was dismissed by the Debt Recovery Tribunal vide order dated 18.10.2005. Against the said order, respondent No. 3 filed an appeal before the Appellate Tribunal. In the meantime, in execution of the judgment and decree, the mortgaged property of respondent No. 3 was auctioned on 22.10.2005 and the petitioner gave the highest bid for Rs. 1.76 crores against the reserve price of Rs. 60.00 lacs. He also deposited 25% of the bid amount as per the requirement of the auction notice.

(3.) DURING the pendency of the appeal before the Appellate Tribunal respondent bank and respondent No. 3 entered into a settlement, according to which, respondent No. 3 shall pay to the respondent bank an amount of Rs. 3,41,61,411.36 as on 30.6.2006 along with 13.25% interest p.a. w.e.f. 30.6.2006 till the adjustment of the account. The said settlement was approved by the Appellate Tribunal.