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TMI Blog2022 (6) TMI 544X X X X Extracts X X X X X X X X Extracts X X X X ..... Erstwhile Director' of the Corporate Debtor (CD) namely Multiple Hotels Pvt. Ltd. The CD was incorporated on 1998 and was successfully running the business of construction. The Respondent No.1, Kotak Mahindra Bank sanctioned facilities vide sanction letter for amount of Rs. 3 Crores to M/s. Camellia Educate Services Ltd and Rs. 8.5 Crores each to M/s. Multiple Educational and manpower Development Trust (MEMDT) and Camellia Educate Trust (CET) respectively, in the year 2012 for the purpose of furtherance of the objectives of the Trust in development of educational services. The loan amount was disbursed vide its sanction letter dated 05.11.2012 and 27.09.2012 and as such in pursuance to such sanction, an agreement dated 11.11.2012 was executed by and between the said borrowers and the bank to the tune of Rs. 20.80 Crore. On 30.11.2012, the CD had executed a Corporate Guarantee agreement in lieu of the above said loans apart from offering its properties in mortgage. Out of the three borrowers, two of them are 'Trusts' as incorporated under the Indian Trust Act, 1961 namely Multiple Educational and Manpower Development Trust and Camellia Educare Trust while the other borrower is a com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Respondent has with all its malafide intention filed the application under Section 7 of the Code, suppressing the fact, that the said demand notice along with other gross irregularities has been challenged by the Appellant's Company i.e. the CD before the DRT-II Kolkata under Section 17 SARFAESI Act, 2002 being S.A No. 360 of 2017, whereby several orders were passed and the matter is sub judice. The DRT-II Kolkata had passed an order under an instance of an Interim Application moved before the Adjudicating Authority, whereby the Adjudicating Authority by virtue of an order dated 14.12.2018, and directed the borrowers to visit the Head office of the Respondent and to meet the decision making officer and to resolve the same through One Time Settlement (OTS). It is pertinent to mention that the said order direction was also given upon the Respondent that any measures under the SARFAESI Act taken up by the Respondent shall be communicated to the Appellant's company prior to such effect. The borrower visited the head office of the Respondent to settle the issue and also made representation by providing an OTS to the Respondent vide letter dated 14.01.2019 with Demand Draft as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o submit the reply upon the payment of cost of Rs. 10,000/- to the Respondent as fixed by the Adjudicating Authority and the same was further posted for hearing on 05.08.2019. On 05.08.2019, whereby the Adjudicating Authority has granted time to the Appellant to file all their reply and to pay the cost of the Respondent and the same was further posted for consideration on 01.10.2019. It is pertinent to mention that though the entire contention of the CD were submitted before the Adjudicating Authority below by the erstwhile advocate but the same was neither recorded nor heard. The Appellant has also stated that being dissatisfied with the erstwhile conducting advocate, the Appellant changed the advocate and appointed Mr.Joydip Mukherjee, Advocate, to look after the same and the matter stood thus, without any knowledge neither to the Appellant nor to the erstwhile advocate, the said matter was listed on 27.08.2019, despite of recording that the said matter shall appear next on 01.10.2019. It is pertinent to mention that the said matter was listed as Ex parte vide order dated 27.08.2019 without any knowledge or intimation upon the Appellant neither to the Advocate. It is further stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han the entire loan amount or the outstanding amount at any given point of time which has been admitted by the Respondent Bank in its several correspondences, while rejecting the OTS proposal offered by the borrowers and / or guarantor. The Appellant craves the kind leave of this Tribunal to refer to such copies of correspondences at the time of hearing, if necessary. 7. It is stated that the Appellant is only a corporate guarantor in respect of the loans granted to three separate entities and that the Respondent bank without initiating appropriate action against the borrowers and/ or stating the exact amount received from the borrowers till date has in all its mala fide filed the application under Section 7 of the Code against the Appellant company. It is stated that the Respondent bank has totally suppressed that the Appellant company/CD was not required to make payment as long as the borrowers were making payment to the Respondent Bank. It is also stated that although the borrowers were regularly making payment to the Respondent Bank, the Respondent Bank in all its malafide declared those amounts as NPA and issued notice under Section 13(2) of the SARFAESI Act, 2002 vide their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ious judicial hours. It is stated that the Respondent Bank has indulged in reckless spending of public money and has been constantly availing the luxury of initiating frivolous litigations at the costs of public money only in order to satisfy its illegal and insatiably greed which is not permissible in the eyes of law. It is stated that such illegal conduct of the Respondent Bank has immensely prejudiced the Appellant company and has put a huge financial loss on the appellant company which has adversely affected the business of the Appellant company for no valid reason, whatsoever. It is stated that as per the notice under Section 13(2) of the SARFAESI as sent by the R1 bank the total outstanding dues as on 29th December, 2016 was Rs. 14,73,14,456/- astonishing the same total amount due and payable as on 30.11.2018 as per the claim of the R1 bank in its application under Section 7 of the Code has leaped to Rs. 21,60,18,331/- although a hefty amount of Rs. 5.5 Crores has been paid to the Respondent bank post the issuance of notice under Section 13(2) of the said Act, 2002. More shockingly, the R1 bank did not disclose the amount received by them during the period from 2016 to 2018 f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ah & building at Ghola Barasat, Kolkata (owned by Camellia Educare Trust). Simultaneously on 05.11.2012, on request of CET, the Applicant Bank has sanctioned a Term Loan of Rs. 850 Lakhs. The said loan facility is also secured apart from other security/ collaterals by mortgage qua property being land measure 341 Cottah & building at Ghola Barasat, Kolkata. The said loan facilities of (i) Rs.300 lakhs to CESL, (ii) Rs. 850 lakhs to MEMDT, and (iii) Rs. 850 lakhs to CET is duly secured by way of Corporate Guarantee by the CD vide Deed of Guarantee dated 30.11.2012. It is pertinent to mention that the said loan facility was disbursed, availed and utilized by (i) CESL availed Rs. 300 lakhs, (ii) MEMDT availed Rs. 840 Lakhs and (iii) CET Rs. 850 lakhs. However, (i) CESL, (ii)MEMDT, and (iii) CET failed to pay the principal amount of loan, interest and other dues and have defaulted. Further, they also failed to observe and perform other terms and conditions of the said agreement, the Applicant as per guideline of RBI declared loan accounts of the CD as NPA, as (i) CESL on 29.09.2015, (ii) MEMDT on 28.09.2015 and (iii) CET on 28.09.2015. Therefore, the Appellant had issued a Recall Notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt appellant had never submitted before the Adjudicating Authority about the intention of settling the matter, by returning the public money, which CD had utilized and enjoyed before defaulting in the repayment of the same. The Appellant do not deserve any relief from this Tribunal and is prayed to dismiss the present appeal. The R1 Bank has already given the credit of all the payments made by the borrowers/ CD and proof of the fact is that the Appellant herein in hearing dated 04.12.2019 had submitted that they want to pay the outstanding dues minus the contractual penal interest charged by the R1/ Bank. However, it is submitted that till date no relief has been granted by the DRT, Kolkata to the borrowers/CD. The option for settlement given to the borrower, since the borrower never had intention to make any payment, was gone in-vein as well. The Borrower/CD had never got any relief to their I.As, thereby challenging the action initiated by the R1 Bank from DRT, Kolkata. It is submitted that the R1 bank has and is exercising the legal remedies available in the law, in order to recover the outstanding dues, which is the public money. The order dated 16.08.2018 and 03.12.2018 are ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted below for ease of reference: The Bank has also used the same for removal of Trustee apart from the chasing of payment at the Hon'ble High Court of Calcutta as it is evident from the above order. a. It is very much evident from the order of the Hon'ble High Court of Calcutta that the Respondent Bank is chasing for payment, which the Hon'ble High Court has categorically mentioned in the Judgment as above. b. It is also observed that the R1/Bank also issued 'demand notice' on 29.12.2016 under the provisions of SARFAESI Act, 2002 to the Appellant demanding further Rs. 14 Crore from the Appellant being the Corporate Guarantor. It is also observed from the pleadings that the Appellant has given reply of the said 'demand notice' as per provisions laid in SARFAESI Act, 2002 vide their letter dated 13.02.2017 denying and disputing the said 'demand notice' and the quantum. It has also been mentioned in the pleadings that the borrower was continuously making payment inspite of receiving 'demand notice' under the relevant provisions of SARFAESI Act, 2002. As per the pleadings, it is also mentioned that the 'original borrower' has paid an amount of Rs. 92 lakhs during the time of pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a means for chasing of payment or building pressure for releasing the payments. f. Reliance is placed on the celebrated case of Swadeshi Cotton Mills Vs. UOI (1981) I SCC 664 (paras 26-30). The Hon'ble Madras High Court has also in Shree Krishna Educational Trust Vs. Government of TN 2016 SCC Online Mad 20115 (para 6.12 to 6.17) succinctly laid down the components of a fair hearing which have not been complied with in the present case. The principles of natural justice are embedded in the Indian Legal jurisprudence. In Meneka Gandhi Vs. Union of India (1978) 1 SCC 248, the Hon'ble Supreme Court has held: "....The court must make every effort to salvage this cardinal rule to the maximum extent permissible in a given case. It must not be forgotten that "natural justice is pragmatically flexible and is amenable to capsulation under the compulsive pressure of circumstances". The audi alteram partem rule is not cast in a rigid mould and judicial decisions establish that it may suffer situational modifications. The core of it must, however, remain, namely, that the person affected must have a reasonable opportunity of being heard and the hearing must be a genuine hearing and not an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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