Rule.
Mr. Bhatt, learned advocate, waives service of notice of Rule for the respondent No.1 - Bank.
2. The petitioner has preferred present petition seeking below mentioned relief:-
"(A) Your Lordship be pleased to issue writ of certiorari or writ in nature of certiorari or any other writ, order, directions quashing and setting aside the order dated 10/2/2012 Annexure E passed by the Gujarat Co-operative Tribunal in Revision Application No.19/2010 and also the order in summary Lavad Case No.1948/2003 by Board of Nominees, Ahmedabad."
3. In the present petition, the respondent Nos.2 and 3 are formal respondents and were made party in view of the position of parties in the Lavad Suit. The respondent No.1 is the real contesting party.
4. Heard Mr. Patel, learned advocate for the petitioner, and Mr. Bhatt, learned advocate for the respondent No.1.
5. It emerges from the record that on account of present petitioner's default in retaining the amount of loan borrowed by him from the respondent No.1-Bank, the respondent No.1-Bank instituted Lavad Suit No.1948 of 2003 against the present petitioner and respondent Nos.2 and 3.
5.1 Present petitioner is the principal borrower and the respondent Nos.2 and 3 are guarantors and co-defendants in the said Lavad Suit.
5.2 In the said suit proceedings, present petitioner and the respondent Nos.2 and 3 applied for leave to defend. The Board of Nominees was pleased to grant conditional leave under which the petitioner was directed to pay an amount of Rs.2.25 Lacs and the respondent Nos.2 and 3 were directed to pay Rs.50,000/- each. While the respondent Nos.2 and 3 complied with the said direction, the petitioner could not.
5.3 In view of the default by the petitioner, the respondent No.1 -Bank took out independent and separate proceedings under the Securitization And Reconstruction of Financial Assets And Enforcement of Security Interest Act, 2002 [hereinafter referred to as "SARFAESI Act"] and disposed off the secured assets. By disposing off the said secured assets, the respondent No.1-Bank has recovered about Rs.3 Lacs.
5.4 The petitioner now claims that the respondent No.1 - Bank has already recovered and received the amount more than what the learned tribunal had directed the petitioner to pay and that therefore, the petitioner may be permitted to defend the proceedings without further payment.
6. Mr.
Bhatt, learned advocate for the respondent No.1-Bank, would contend that the proceedings taken out by the respondent No.1 under the SARFAESI Act are independent proceedings and the result of such proceedings cannot have any bearing so far as the condition prescribed by the Board of Nominee is concerned. He would also submit that it is the fact that the condition has not been complied with and that therefore, question of allowing the petitioner to defend the proceedings without making any payment would not arise. He also submitted that on account of certain actions by the petitioner, the respondent No.1 - Bank has been compelled to institute criminal proceedings against him.
7. It emerges from the record that in the above mentioned Suit proceedings, there are three defendants, i.e. present petitioner and present respondent Nos.2 and 3. It is not in dispute that the respondent Nos.2 and 3 have complied with the condition prescribed by the Court while granting leave to defend. Under the circumstances, suit proceedings will have to be undertaken on merits so far as respondent Nos.2 and 3 are concerned. Differently put, on account of petitioner's failure situation has arisen whereby the Board of Nominee may not be able to pass final award in the Lavad Suit. Besides this, it is also not in dispute that the respondent No.1 - Bank has recovered and received a sum of about Rs.3 Lacs. Nonetheless the fact remains that out of the total dues of about 10 to 11 Lacs, a sum of Rs.3 Lacs has already been recovered by the respondent No.1-Bank.
8. Having regard to the above mentioned facts and circumstances, the order passed by the Board of Nominee while deciding the application for leave to defend, is modified so as to reduce the amount prescribed by the Board of Nominee from Rs.2.25 Lacs to Rs.75,000/-, which shall be deposited by the petitioner within 3 week from today. Upon such deposit, the application for leave to defend preferred by present petitioner will stand restored and granted. While making present order, the Court has taken into account that out of the total dues for which the respondent Bank has instituted the suit, a sum of Rs.3 Lacs has been recovered by sale of secured assets; the respondent Nos.2 and 3 have already deposited a sum of Rs.1 Lac and now the petitioner will deposit further sum of Rs.75,000/-. Accordingly, total sum secured would be about 50% of the total dues payable to the Bank.
8.1 Upon such deposit, as directed above, the petitioner will be permitted to defend the proceedings and the application preferred by the petitioner, i.e. application for leave to defend, shall be deemed to have been restored and granted.
8.2 The Board of Nominees would endeavor to complete the Lavad Suit proceedings as early as possible preferably within 3 month from service of certified copy of present order.
With the aforesaid observations and direction, present petition stands disposed of. Rule is made absolute to the aforesaid extent.
(K.M.Thaker, J.) kdc Top