THE HON'BLE SRI JUSTICE P.NAVEEN RAO WRIT PETITION Nos.27646 & 27647 OF 2014 DATE: 17-09-2014 W.P.No.27646 of 2014 Between:
Penmatchu Sarath Babu --PETITIONER AND State Bank of India, Industrial Estate Branch, Guntur, Rep.by its Chief Manager.
--RESPONDENT AND W.P.No.27647 of 2014 Between:
Penmatchu Linga Rao and others --PETITIONERS And State Bank of India, Industrial Estate Branch, Guntur, Rep.by its Chief Manager.
--RESPONDENT The Court made the following:
THE HON'BLE SRI JUSTICE P.NAVEEN RAO WRIT PETITION Nos. 27646 And 27647 OF 2014 COMMON ORDER:
The petitioners are the farmers and they have produced red chilly by cultivating their lands. The petitioners obtained loans from the respondent bank on the stocks of chilly produced by them by keeping the produce in the cold storage. As the loans are not repaid within the specified time inspite of the notice issued to the petitioners, on 10-09-2014 auction notice was published in newspapers proposing to conduct auction on their stock on 18-09-2014. Aggrieved thereby, these writ petitions are instituted.
Learned counsel for the petitioners submits that as on 11-07-2014 these (28) petitioners put together owe an amount approximately Rs.2.7 crores to the respondent-bank, and as against this outstanding amount, the petitioners have paid Rs.30.00 lakhs on 16-09-2014. Learned counsel further submits that due to bad monsoon and various other factors leading to bifurcation of the State and lesser market value for the red chilly than what was expected by the petitioners, stocks were not disposed of immediately to repay the loan. The petitioners expect that during festival season, they would get better price for their product. The petitioners are willing to clear the outstanding amounts but as they have no other means to pay the loans, they only request for some more time for clearance of their dues on loans obtained from the respondent bank.
Learned Standing Counsel for the respondent-bank opposed the said plea and submits that inspite of affording sufficient time, the petitioners have not chosen to clear the loan amount and huge amount of loan was outstanding and the respondent-bank had no option but to take steps to conduct auction to recover the money payable by the petitioners.
Having regard to the fact that the petitioners are farmers and they are bonafidely seeking to repay the entire loan amount but only seek for some more time, in the facts of this case, subject to the petitioners paying Rs.50.00 lakihs within four weeks from today, the respondent- bank is directed not to proceed to conduct auction on 18-09-2014 as proposed. The balance amount shall be paid in two installments thereafter i.e. 50% amount within four (04) weeks from the date of payment of Rs.50.00 lakhs as directed above and the remaining outstanding amount within further four weeks from the date of payment of first installment. If the petitioners fail to pay the amount as per the above schedule, the respondent-bank is entitled to proceed to conduct auction. The respondent-bank is also entitled to demand additional amount that is due by way of interest in the mean time and also to recoup costs incurred by the respondent-bank for proceeding to conduct auction, and the same shall be paid along with final installment.
The Writ Petition is accordingly disposed of. Pending W.P.M.Ps in these writ petitions shall stand closed in the light of this final order. No order as to costs.
P.NAVEEN RAO,J Date: 17-09-2014 Nvl THE HON'BLE SRI JUSTICE P.NAVEEN RAO WRIT PETITION Nos.27646 & 27647 OF 2014 DATE: 17-09-2014 nvl