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2018 (5) TMI 2110 - HC - Indian LawsSeeking Injunction restraining the respondent authorities - breach on the part of the petitioners of the terms of the loan covenants entered with the State Bank of India - threatening to publish photographs, names and addresses of the petitioners in leading newspapers - HELD THAT:- From the documents annexed to the writ petition there is no doubt that the Company of which the petitioners are directors and guarantors (for the financial assistance availed of by the Company), have acknowledged and admitted their liability in respect of the credit facilities obtained from the respondent bank. The response of the Company to the notice under Section 13(2) of the SARFAESI does not dispute this liability. It is also clear from the impugned letter dated 19th November 2014, which is under challenge in this proceeding, that the Company had been advised to repay the loan amount by 10th December 2014 and that admittedly no steps have been taken by the Company thereafter to honour its financial obligations to the respondent bank. The company has instead filed a suit and an application before the Debts Recovery Tribunal in an attempt to push back their obligations to the bank. The judgement of this Court provides a window of "Special Circumstances" when the bank can proceed with such coercive measures against borrowers who have committed deliberate default of the RBI Guidelines with mala-fide intention. This window cannot, however, be applied in the present case since, it cannot be from the material on record said that the Company has wilfully defaulted in its financial obligation to the respondents Bank or that the petitioner as Directors and Guarantors of the Company can be held liable for the conduct complained of on the part of the Company. The decisions relied on by the Bank with regard to the limited sphere of interference of a Court in relation to show-cause notices are not applicable since the impugned letter dated 19th November, 2014 cannot be construed as a show-cause notice per-se. The interim order passed by this Court on 20th January, 2015 is confirmed.
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