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Smt. Dipika Loiwal v. State Of U.P. And Others - WRIT - C No. 9907 of 2006 [2006] RD-AH 3861 (17 February 2006)


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Court No. 37

Civil Misc. Writ Petition No. 9907 of 2006

Smt. Dipika Loiwal Versus State of U.P. and others


Hon. R.K. Agrawal, J.

Hon. (Mrs.) Saroj Bala, J.

According to the petitioner she was sanctioned a cash credit limit facility of Rs.5,00,000/- and a sum of Rs. 2,00,000/- was sanctioned  towards term loan by the State Bank of India, Shivpur Branch, Varanasi. There has been some default in the payment of the amount outstanding under the two facilities, whereupon the respondent State Bank of India, Shivpur Branch, Varanasi, issued notice through its lawyer calling upon the petitioner to pay the outstanding amount of the cash credit limit facility and term loan. The petitioner did not pay the amount whereupon certificate of recovery was sent by the Bank to the Collector, Varanasi for the recovery of the loan amount under the U.P. Public Moneys (Recovery of Dues) Act, 1972, hereinafter referred to as the Act. In compliance thereof the Tahsildar had issued citation dated 20.11.2005, copy of which has been filed as Annexure-4 to the writ petition, calling upon the petitioner to appear on 4.12.2005 and to deposit the entire amount failing which action will be taken against her. The property standing in the name of the petitioner has also been attached on 14.12.2005, as per Annexure-5 to the writ petition. The submission is that in view of the Full Bench decision of this Court in the case of   Smt. Sharda Devi Versus State of U.P. and others, reported in AIR 2002 Allahabad 1, the recovery of the amount advanced by the Bank under the cash credit limit facility or under the terms loan cannot be recovered from the petitioner as arrears of land revenue under the provisions of the aforesaid Act.

The law having been settled in the year 2001 since reported in January Part of AIR of 2002, which is binding on all the authorities within the State of Uttar Pradesh, it is really very unfortunate and surprising that the Bank authorities have closed their eyes and have no respect to the aforesaid Full Bench decision and are not following it and are harassing the petitioner by taking recourse to coercive measures provided under the Act. Recently the Apex Court in the case of Iqbal Nasar Usmani Vs. Central Bank of India and others, reported in JT 2006 (1) SC 380, has held that where the loan taken by the appellant was not under or in relation to a "State Sponsored Scheme" within the meaning of Section 2(g) of the U.P. Public Moneys (Recovery of Dues) Act, 1972 whatever else it may be, it would not be recoverable by recourse to the machinery under Section 3 of the said Act.

This Court is flooded with writ petitions challenging the action of the Banks in seeking to realise the outstanding amount of loan by coercive process under the provisions of the Act which have been advanced by them not under any State Sponsored Scheme but by way of purely commercial transaction.

Issue notice.

Notice on behalf of the respondent nos. 1 to 4 has been accepted by the learned Standing Counsel and notice on behalf of the respondent no. 5  has been accepted by Sri  Vipin Sinha, Advocate. However, notice be sent to the respondent no. 5 fixing 10.3.2006. Steps to be taken within a week.

List on 10.3.2006.

Apart from sending the notice to the respondent no. 5 let notice be also issued to the Chief General Manager, Local Head Office of State Bank of India, Lucknow, which is the controlling office of all the branches of State Bank of India in the State of Uttar Pradesh, to appear personally before the Court on the date fixed, i.e. 10.3.2006 and explain as to why and under what circumstances the amount is being recovered by taking recourse of coercive measure from the petitioner under the provisions of the Act in utter disregard and complete violation of law laid down by the Full Bench of this Court in the case of  Smt. Sharda Devi (supra) and as to why the amount of 10% towards the  recovery  charges which the district authority under law are   realizing from the defaulter be not saddled upon the bank. This order has been passed in the presence of Sri Vipin Sinha, appearing on behalf of the respondent no.5.

As an interim measure, recovery proceeding pursuant to the citation dated 20.11.2005 and  recovery certificate dated 17.9.2005 shall remain stayed and the attachment of the house shall be lifted.




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