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Shri Vimal Bahadur And Another v. Uttar Pradesh Financial Corporation Limited Thru' Its M.D. - WRIT - C No. 60806 of 2006 [2006] RD-AH 18833 (7 November 2006)


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Heard learned counsel for the petitioner Sri Bharat Ji Agrawal, Senior Advocate assisted by Sri Nikhil Agrawal and the learned counsel appearing on behalf of respondents Sri Atiq Ahamad.

The petitioners have approached this Court for quashing the recovery certificate dated 8.3.2006, the certificate dated 4.4.2006 and notice dated 9.10.2006 (Annexures- 14,15 & 13 respectively). Further prayer is for issuing a writ in the nature of mandamus directing the respondents not to proceed in any manner against the recovery certificates and to furnish the statement of account.

It has been submitted on behalf of the petitioners that the petitioners are the guarantors and the unit has already been sold by the official liquidator and an amount of Rs.35 lacs was paid to the U.P. Financial Corporation and the rest of the amount was directed to be retained by the official liquidator to meet other expenses. Though before the Delhi High Court in the application moved by the respondents, they claimed an amount to the tune of Rs.89,49,443.63 due from the borrower company-vide its letter dated 25.9.1997. On 8.12.2004 a further sum of Rs.72,675.32 was paid to the Corporation after adjustment of all the expenses by the official liquidator. On 8.12.2004 the Delhi High Court has passed an order dissolving the Company w.e.f. the date of passing the order. The respondents have taken over the assets of the borrower Company on 21.2.1990. At that time the petitioners were never informed about the said take over or regarding the balance amount due against the borrower company, neither any statement of account was supplied to the petitioners. Then suddenly by notice dated 4.3.2006 the respondents have issued a letter asking the petitioners to settle balance dues under the One time settlement policy of the Corporation. The petitioners asked for the details of the account and the balance amount, which is to be paid by the original borrower. Without giving details of account, the recovery certificate has been issued.

We have considered the submissions made on behalf of the parties as the various factual controversies and actual amount to be paid by the original borrower or by the petitioners being guarantors is in dispute, as such we are of opinion that the matter be sent back to the respondents financial corporation for settling the dispute between the parties.

In view of the aforesaid fact, it is open to the petitioners to approach the U.P. Financial Corporation by making an application for one time settlement. If such application is made within two weeks, we direct that the same shall be decided by the Corporation within a period of one month thereafter. It is also made clear that the respondent corporation will give the details of the account of loan and all the relevant papers to the petitioners within a period of one week from the date of making such application.

Till the consideration of the application for one time settlement filed by the petitioners, the recovery against the petitioners shall be kept in abeyance.

With these observations the writ petition is disposed of.



W.P. No. 60806 of 2006


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