The petitioner company through its Director, sought financial assistance through SIPCOT, for construction of a hotel and availed a sum of Rs.135 lakhs on 15.02.1996 and an additional loan of Rs.60 lakhs on 07.04.98. The company could not repay the amount in full. Therefore, a onetime settlement scheme was arrived at. The SIPCOT by its communication, dated 11.04.2005 accepted for onetime settlement, with a condition that the petitioner should pay 25% of the onetime settlement within a period of 15 days from the date of communication of the said letter and to pay the balance amount within a period of 90 days from the date of the said letter. However, the petitioner instead of complying with the above condition, has only requested for further time of three months for settlement of dues. That was not accepted by the SIPCOT and by the impugned communication, dated 05.05.2005, the petitioner was advised to pay only 25% of OTS amount of Rs.138.02 lakhs on or before 23.05.2005, failing which, the OTS proposal will be cancelled. The petitioner was also advised that the balance amount to be paid within 90 days as informed in their letter, dated 11.04.2005. This order is in question in this Writ Petition, mainly on the ground that though the petitioner has requested the SIPCOT in their letter, dated 16.03.2005 to waive the interest on interest charged on the loan and the penal interest charged so far in full, the same was not considered.
2. I have considered the submissions made by the learned counsel for the petitioner and the learned counsel for the respondents.
3. It is now well settled law that this Court is not justified in issuing a direction to the bank or the finacial institution for onetime settlement as has been held by the Division Bench of this Court in Tamil Nadu Industrial Invest Corporation Limited., represented by its Managing Director, No.473, Anna Salai, Nandanam, Chennai - 600 035 .vs. Millenium Business Solutions Private Limited, represented by its Managing Director, No.1/9, Padmam Flats, P.P.Rao Road, Balaji Nagar, Royapettah, Chennai-14 and another reported in 2004 (5) CTC
689. That judgement of the Division Bench was followed subsequently in W.P.No.19707 of 2005 by another Division Bench, dated 19.07.2005. Recently, another Division Bench also followed the said judgment in W.P.No.12654 of 2009, dated 03.12.2009.
4. That apart, when the advise for onetime settlement was mooted out, the petitioner had only prayed for three months time and did not raise any dispute as regards the quantum. Though the respondent SIPCOT did not agree for extension of three months time, nevertheless, had given further advise to pay at least 25% of the amount on or before 23.05.2005 and the balance amount in three months as directed in letter, dated 11.04.2005. These orders have not been complied with and any interference of the impugned order would amount to directing the respondents to accept the onetime settlement, which this Court cannot do.
5. Hence, I find no merit to interfere with the order. Neveretheless, as the petitioner has brought to the notice of this Court, a communication, dated 16.03.2005, seeking for waiver of interest on interest and the penal interest in full, it is for the respondent bank to consider the same and in this regard, the petitioner can approach the bank.
6. The Writ Petition is dismissed, with the above observations. Consequently, connected Miscellaneous Petitions are dismissed. No costs.
vsn To
1. The Chairman and Managing Director, State Industries Promotion Corporation of Tamil Nadu Limited, 19-A, Rukmani lakshmipathy Road, Post Box No.7223, Egmore, Chennai - 600 008.
2. The Deputy General Manager(F and R-I) State Industries Promotion Corporation of Tamil Nadu Limited, 19-A, Rukmani lakshmipathy Road, Post Box No.7223, Egmore, Chennai - 600 008.