LexM/S KUT ENERGY PVT. LTD. & ORS. versus THE AUTHORIZED OFFICER, PUNJAB NATIONAL BANK, LARGE CORPORATE BRANCH, LUDHIANA & ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A B C D E F G H 736 SUPREME COURT REPORTS [2019] 10 S.C.R. M/S KUT ENERGY PVT. LTD. & ORS. v. THE AUTHORIZED OFFICER, PUNJAB NATIONAL BANK, LARGE CORPORATE BRANCH, LUDHIANA & ORS. (Civil Appeal Nos. 6016-6017 of 2019) AUGUST 20, 2019 [UDAY UMESH LALIT AND VINEET SARAN, JJ.] Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002: s. 13(2) – Security interest – Enforcement of, in favour of secured creditor – Held: ‘Secured creditor’ would be entitled to proceed only against the ‘secured assets’ mentioned in the notice u/s. 13(2) – On facts, in loan settlement, debtor deposited Rs.40 crores in terms of the order of the High Court only to show his bona fides when a revised offer was made by them – Deposit was not towards satisfaction of the debt in question and that is why the High Court had directed that the deposit would be treated to be a deposit in the Registry of the High Court – Thus, the debtor entitled to withdraw the sum deposited by them in terms of said order – Claim of the debtor cannot be negated by any direction that the money may continue to be in deposit with the Bank – Thus, the amount deposited by debtor to be returned to them. Allowing the appeals, the Court HELD: 1.1 In the instant case the deposit of Rs.40 crores in terms of the order of the High Court on 11.10.2017 was only to show the bona fides of the appellants when a revised offer was made by them. The deposit was not towards satisfaction of the debt in question and that is precisely why the High Court had directed that the deposit would be treated to be a deposit in the Registry of the High Court. [Para 11] [744-H; 745-A] 1.2 Going by the law laid down by this Court in Axis Bank’s case, the ‘secured creditor’ would be entitled to proceed only against the ‘secured assets’ mentioned in the notice under Section 13(2) of the Securitisation and Reconstruction of Financial Assets [2019] 10 S.C.R. 736 736 A B C D E F G H 737 and Enforcement of Securities Interest Act, 2002. On the strength of the law laid down, the appellants are entitled to withdraw the sum deposited by them in terms of said order dated 11.10.2017. Their entitlement having been established, the claim of the appellants cannot be negated by any direction that the money may continue to be in deposit with the Bank. The judgment and order passed by the High Court is set aside, and CMP No.5386 of 2018 preferred by the appellants is allowed and the amount deposited by the appellants in terms of the order dated 11.10.2017 is directed be returned to them within two weeks along with interest, if any, accrued thereon. [Para 11, 12] [745-B; D-E] Axis Bank v. SBS Organics (P) Ltd. (2016) 12 SCC 18 : [2016] 2 SCR 920 - referred to. Case Law Reference [2016] 2 SCR 920 referred to. Para 9 CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 6016- 6017 of 2019. From the Judgment and Order dated 19.03.2019 of the High Court of Himachal Pradesh at Shimla in CMP No. 4761 of 2018 and CMP No. 5386 of 2018 in CWP No. 2274 of 2017. P. S. Patwalia, Sr. Adv., Yashraj Singh Deora, Ms. Sonal Mashankar (for M/s. Mitter & Mitter Co.), Advs. for the Appellants. S. Guru Krishna Kumar, Sr. Adv., P. B. Suresh, Vipin Nair, Prithu Garg, Karthik Jayashankar, Kishore Kunal, Alok Kumar, Ms. Somya Yadava, Ms. Snigdha Singh, Chirag Babbar, Ashutosh Jain, Ketul Hansraj, Balaji Srinivasan, P. B. Suresh, Karthik Jayashankar, Advs. for the Respondents. The Judgment of the Court was delivered by UDAY UMESH LALIT, J. 1. These appeals arise out of the judgment and order dated 19.03.2019 passed by the High Court of Himachal Pradesh at Shimla in CMP Nos.4761 and 5386 of 2018 in CWP No.2274 of 2017. 2. An agreement was entered into between the appellants and the Government of Himachal Pradesh on 26.05.2008 for setting up 24 MW “Kut Hydro Electric Project” in District Shimla. For commissioning M/S KUT ENERGY PVT. LTD. & ORS. v. THE AUTHORIZED OFFICER, PNB, LARGE CORP. BRANCH, LUDHIANA A B C D E F G H 738 SUPREME COURT REPORTS [2019] 10 S.C.R. said Project, the appellants availed loan from the consortium of Punjab National Bank (‘the Bank’, for short), Corporation Bank and Central Bank of India. On 29.09.2015 the account of the appellant was declared NPA1 by the Bank. A demand notice was thereafter issued by the Bank under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act, 2002 (“SARFAESI Act”, for short) on 15.03.20
Excerpt shown. Read the full judgment & AI analysis in Lexace.