Judgments
Judgments
  1. Home
  2. /
  3. High Court Of Judicature at Allahabad
  4. /
  5. 1990
  6. /
  7. January

M/S. Govardhan Kagaj Udyog ... vs U.P. Financial Corporation, ...

High Court Of Judicature at Allahabad|18 December, 1990

JUDGMENT / ORDER

ORDER D. S. Sinha, J.
1. By means of this petition under Art. 226 of the Constitution of India an industrial concern M/s Goverdhan Kagaj Udyog, Agra-Mathura Road, Village Runkuta, Agra, the petitioner, beseeches this court to command the U.P. Financial Corporation through its Regional Manager, Shiv Hare Marg, Agra and U.P, Financial Corporation through its Managing Director, Civil Lines, Kanpur, the respondents Nos. 1 and 2 respectively, to hand over the possession of its firm and to disburse the balance of loan sanctioned to it and also to make fresh schedule for re-payment. The petitioner, besides the usual ritualistic prayers for any other and further writ, order or direction and award of costs, prays that a writ of certioran quashing the auction sale, if any, may also be issued.
2. The case of the petitioner, as pleaded in the petition, is that it applied to the respondent No. 1 for a loan of Rs. 15,00,000/-(Rupees fifteen lacs) which was ultimately sanctioned and in that connection an agreement of hypothecation was entered into on 23rd July, 1980 creating charge on the property of the petitioner. It is pleaded that according to the agreement between the petitioner and respondent No. 1, the loan was to be disbursed in periodical instalments and after disbursement of the loan a period of two years was contemplated as gestation period. After the gestation period the re-payment of loan was to commence with the payment of Rs. 70,000/- (Rupees sevently thousand) as first instalment. Thereafter, two half yearly instalments of Rs. 85,000/- (Rupees eighty five thousand) each were to be paid. Subsequent thereto six half yearly instalments of Rs. 1,30,000/- (Rupees one lac and thirty thousand) and eventually in the end six half yearly instalments of Rs. 80,000/- (Rupees eighty thousand) were stipulated to be paid. It is asserted that the respondent No. I did not disburse the loan as agreed upon and on account of the failure of the respondent No. I to disburse the loan in the manner agreed the petitioner-firm became a sick firm. Further averment is that the respondent No. 1 ignoring its own lapse in disbursing the entire loan sanctioned to the petitioner started proceedings u/S. 29 of the State Financial Corporation Act, 1951, hereinafter called the 'Act' and took over the possession of the petitioner-firm in the year 1985. The petitioner objected the taking over the firm as being illegal. The objection of the petitioner was found to be correct and the possession of the firm was handed over back to the petitioner. However, on 29th Sept. 1989, the respondent No. 1 took over the possession of the petitioner-firm again, u/S. 29 of the Act, without giving any notice and locked its properly lying in the premises. Thus, the petitioner is deprived of its property and is further prevented to carry on the business.
3. An application dated 16th May, 1990. Supported by the affidavit of Sri Shrawan Kumar, Deputy Senior Manager (Law), U.P. Financial Corporation, Regional Officer, 5-Ashok Marg, Allahabad, on behalf of the U.P. Financial Corporation, praying for dismissal of the writ petition, was moved on 16th May, 1990. Affidavit discloses that pursuant to the proceedings u/S. 29 of the Act, the possession of the petitioner-industrial concern had already been taken as long back as on I8th November, 1989. It also reveals that the proceedings u/S. 29 of the Act against the petitioner had been challenged in this court by means of Civil Misc. Writ Petition No. 18005 of 1987, M/s Govardhan Kagaj Udyog v. U.P. Financial Corporation and others. In the said writ petition as order dated 17th December, 1987 was passed by a Division Court consisting of Hon'ble Mr. Justice A. N. Verma and Hon'ble Mr. Justice Palok Basu in the following terms :
"We have heard the learned counsel for the parties at some length. Having given the matter our anxious consideration, we are of the opinion that in the totality of the facts and circumstances of the case the petitioner may be given one more opportunity as prayed by its learned counsel to demonstrate its bona fides, i.e. to establish that it is making a genuine effort to restart the factory and pay up it dues. We accordingly direct this petition be listed for admission as part heard on 1-3-88. Meanwhile the interim orders granted by this Court shall continue in operation subject to the condition that the petitioners deposits a sum of Rs. two lacs within a month from today and another sum of Rs. two lacs-by 29-2-88 failing which the interim orders granted by this Court shall stand automatically discharged. A copy of this order may be given to the learned counsel for the parties on payment of usual charges today.
Sd. A. N. V.
Sd/- P. B.
17-12-1987."
The order of the Court dated 17th December, 1987 was not complied with by the petitioner. The matter was considered on 21st March, 1988 by the Bench which passed the order dated 17th December, 1987 and following order was passed.
"We have heard the learned counsel for the petitioner but are not satisfied that any ground for further accommodation has been made out. The order passed by us on 17-12-87 was a self-contained order, in that there was a default clause to the effect that if the petitioner did not make the deposits within the time schedule indicated by us, the interim order shall stand automatically discharged. The accommodation was granted to enable the petitioner to demonstrate that it has the requisite financial capacity and potential to run the unit. By its failure to make the deposits within time, it has proved that it is not in a position to run the unit. The interim order passed by this court on 17-12-87, therefore, stands discharged. The previous orders also stand similarly vacated.
Sd/-A. N. V.
Sd/- P. B.
21-3-1988."
After taking the possession on 18th Nov. 1989 the unit of the petitioner was notified for sale inviting offers. The offer of M/s. Tirupati Enterprises, 29-Gopi Chand Shiv Hare Marg, Sadar Bazar, Agra was accepted for a consideration of Rs. 22.50 lacs and the said purchaser paid up 33% of the sale consideration. According to the respondents Nos. 1 and 2, the instant writ petition is liable to be dismissed as barred by principles of res judicata. It is asserted that, in any case, the petitioner is guilty of misrepresentation and suppression of material facts and as such it is not entitled to any relief from this Court in exercise of its discretionary jurisdiction under Art. 226 of the Constitution of India.
4. It cannot be gainsaid that the facts that pursuant to the proceedings u/S. 29 of the Act the possession of the petitioner-firm had already been taken over on 18th November, 1989, that the proceedings u/S. 29 of the Act were challenged by the petitioner by means of writ petition No. 18005 of 1987, M/s. Goverdhan Kagaj Udyog v. U.P. Financial Corporation and others that this Court passed an interim order dated 17th December, 1987 subject to condition of petitioner's depositing rupees two lacs within a month and a sum of another two lacs by 29th February, 1988, that the petitioner failed to comply the order of the Court dated 17th December, 1987, that on 21st March, 1988 this Court passed an order noticing the non-compliance of the conditions of the order dated 17th December, 1987, by the petitioner leading to discharge of the interim order and that the petitioner-unit was sold out to M/s. Tirupati Enterprises for a consideration of rupees 22.50 lacs and the purchaser paid up 33% of the sale consideration, were material for the purposes of determining the controversy sought to be raised in the instant petition. These facts, we have no doubt, were deliberately suppressed by the petitioner, presumably, with a view to secure the reliefs prayed for herein. Not only that the petitioner suppressed the aforesaid facts, it also attempted to misrepresent to this Court that the respondents after taking possession of the petitioner-unit u/S. 29 of the Act handed over the possession back to the petitioner. The bald averment in this regard, without any evidence, is to be found in para 22 of the petition.
5. It has been repeatedly held that proceedings under Art. 226 of the Constitution of India are discretionary and that a petitioner who does not approach the Court with clean hands or is guilty of suppression and misrepresentation of material facts or attempts to fudge forfeits every claim for the grant of discretionary relief. In the instant case, we are clearly of the opinion that the petitioner has indulged in chicanery and is guilty of suppression and mis-representation of material facts, as noticed earlier. This apart, instant petition is second petition on substantially the same facts. Second petition on the same facts is, surely, barred by the principles of res judicata.
6. The arguments of Sri. Y. S. Saxena and Sri Ram Prakash Mishra, learned counsel appearing for the petitioner and the respondents Nos. 1 and 2 respectively, were heard and concluded on 29-11-1990. But the judgment was reserved. On 3rd December, 1990 an application was moved praying for listing of the case for further hearing, in substance, on the ground that the counsel of the petitioner had not concluded his arguments before the judgment was reserved. We are constrained to observe that the suggestion of incomplete hearing is rather irresponsible. It appears wisdom dawned and nobody appeared to press the application when it was taken up on 5-12-1990 and had to be rejected in default of appearance.
7. In the result, this petition fails and is hereby dismissed. There shall be no order as to costs.
8. Petition dismissed.
Disclaimer: Above Judgment displayed here are taken straight from the court; Vakilsearch has no ownership interest in, reservation over, or other connection to them.
Title

M/S. Govardhan Kagaj Udyog ... vs U.P. Financial Corporation, ...

Court

High Court Of Judicature at Allahabad

JudgmentDate
18 December, 1990
Judges
  • S Dhaon
  • D Sinha