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Issues Involved:
1. Quashing of recovery certificate dated 4.10.1994. 2. Direction for preparation and submission of a rehabilitation package for the petitioner. 3. Alleged delay in loan disbursement by U.P. Financial Corporation. 4. Petitioner's declaration as a sick unit and applicability of RBI guidelines for rehabilitation. 5. Alleged malafide actions by the U.P. Financial Corporation. 6. Dispute over the amount of interest charged. 7. Petitioner's entitlement to one-time settlement or rehabilitation. Issue-wise Detailed Analysis: 1. Quashing of Recovery Certificate: The petitioner sought to quash the recovery certificate dated 4.10.1994 issued by U.P. Financial Corporation. The court noted that the petitioner had defaulted on loan repayments and provided cheques that bounced. The recovery certificate was issued after multiple notices and opportunities for the petitioner to settle dues. Consequently, the court found no merit in quashing the recovery certificate. 2. Direction for Preparation and Submission of Rehabilitation Package: The petitioner requested a mandamus directing U.P. Financial Corporation to prepare a rehabilitation package. The court observed that several meetings and communications had taken place between the petitioner and the Corporation regarding the rehabilitation package. However, due to the petitioner's failure to comply with agreed terms and provide necessary security, the rehabilitation package was not finalized. The court held that it could not direct the preparation of a rehabilitation package as it would amount to rescheduling the loan, which is within the discretion of the financial institution. 3. Alleged Delay in Loan Disbursement: The petitioner alleged that U.P. Financial Corporation delayed the disbursement of the loan, causing financial loss. The court found that the Corporation disbursed the loan as and when the petitioner provided the required security and completed formalities. The delay was attributed to the petitioner's failure to meet the conditions for disbursement. Therefore, the court dismissed the allegation of delay by the Corporation. 4. Petitioner's Declaration as a Sick Unit and Applicability of RBI Guidelines: The petitioner claimed to be a sick unit and sought rehabilitation under RBI guidelines. The court noted that the guidelines and government orders cited by the petitioner were administrative and not statutory, thus conferring no legal right enforceable in court. The court reiterated that purely administrative orders do not have the force of law and cannot be enforced through a writ petition. 5. Alleged Malafide Actions by U.P. Financial Corporation: The petitioner accused the Corporation of acting malafide in not finalizing the one-time settlement or rehabilitation package. The court found no evidence of malafide actions by the Corporation. It emphasized that the decision to grant rehabilitation or one-time settlement lies within the discretion of the financial institution, and the court cannot interfere unless there is a clear violation of law or malafide intent, which was not established in this case. 6. Dispute Over the Amount of Interest Charged: The petitioner disputed the interest charged by the Corporation. The court noted that the interest rate and terms were clearly outlined in the loan agreement executed by the petitioner. The Corporation charged interest as per the agreed terms, and there was no evidence of arbitrary or excessive interest charges. Therefore, the court dismissed the petitioner's claim regarding the interest amount. 7. Petitioner's Entitlement to One-time Settlement or Rehabilitation: The petitioner argued for entitlement to a one-time settlement or rehabilitation. The court held that no one has a right to such settlements or rehabilitation, as these are discretionary decisions of the financial institution. The court cited previous judgments affirming that rescheduling of loans or granting rehabilitation can only be done by mutual consent of the parties involved and not by court directive. The court emphasized the importance of judicial restraint in financial matters to avoid adverse impacts on the economy and prevent misuse of financial resources. Conclusion: The court dismissed the petition, stating that the petitioner had not come with clean hands due to the bounced cheques and failure to meet loan repayment obligations. The court reiterated that administrative guidelines and government orders do not confer enforceable legal rights, and the discretion to grant rehabilitation or one-time settlement lies with the financial institution, not the court.
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