TMI Blog2005 (10) TMI 291X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 96 lakhs made by the company to the appellants towards the advance amount for the purchase of 35.60 acres of land situate at Idayakodumanthangal village, Chengalpet taluk, Kancheepuram district. In the said proceedings, the first appellant appeared before the company court on 29-6-2000 and admitted the receipt of the said sum of Rs. 96 lakhs by him and his wife. The first appellant also represented that he has no objection to bring the properties into sale and the sale proceeds could be distributed towards the amounts due to the company as well as the Indian Bank from whom he borrowed the money for the development of the said lands. The company court, by order dated 29-6-2000, has attached the property in question and also issued notice to the Indian Bank, Chengalpet Branch, viz., the first respondent herein. 4. The Indian Bank, viz., the first respondent has filed an application in C.A. No. 150 of 2001 before the company court seeking permission to conduct the auction to sell the property of the appellant after due publication and permission was granted on 30-4-2001. The Indian Bank has also obtained a valuation report dated 28-4-2001, which indicates that the value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. In the meanwhile, the company court has passed orders permitting the Official Liquidator to initiate further steps to conduct the survey of the lands and also for the submission of the valuation report. By order dated 31-3-2005, the company court fixed the value of the land and building as Rs. 86,16,000 on the basis of the valuation report, surveyor report as well as the submissions made by all the parties concerned and directed the appellant to make a substantial payment within a period of two weeks. Subsequently, the Official Liquidator has caused publication of the same, inviting tenders and last date of the submission of the tenders was fixed as 25-4-2005. 8. Subsequently, the appellants filed the Company Application Nos. 272 and 273 of 2005 challenging the procedure adopted by the company court in effecting the sale. The said applications were listed on 31-3-2005, and learned Single Judge has adjourned the matter to 15-4-2005, by directing the appellants to make a substantial payment against which order, the present appeals are filed. 9. The present appeals are filed by raising the main grievances to the effect that the value as fixed by the company court in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain, the highest bidder deposited the balance amount of Rs. 2.43 crores by means of a pay order. In view of the entire payment made by the highest bidder, the sale was provisionally confirmed. 13. In the light of the narration of facts as set out above, it is to be seen that due to the persistent effort made by the appellants herein the property which was sold in the auction by the company court for a sum of Rs. 1.32 crores has fetched a higher amount, viz., 2.70 crores. Since the additional amount is realised at the instance of the appellants and admittedly, the secured creditor, viz., the Indian Bank having chosen to remain content with the amount of Rs. 1.32 crores which offer was provisionally confirmed by the company court and which order was not challenged by the Indian Bank, we have considered the plea of learned senior counsel for the appellants as well as the administrator to apportion the higher amount among themselves in exclusion of the Indian Bank. 14. Accordingly, the matter was heard on various dates and we have directed the Indian Bank as to whether the amounts payable by the appellants could be reduced in terms of the Reserve Bank of India guidelines un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 56,19,555 and if the same is calculated at the rate of 12 per cent, it works out to Rs. 66,95,640. Learned senior counsel further contended that the Indian Bank has chosen to calculate the interest with half-yearly rests along with penal rate of interest with the minimum rate of interest as 12.5 per cent which is not permissible in law as per the decision of the Apex Court in Corporation Bank v. D.S. Gowda [1994] 5 SCC 213, the bank is entitled to charge interest with half-yearly rests since the present loan is for agricultural purposes. It is further contended that if the rate of interest is calculated with annual rests from the date of non-performing account, viz., 31-3-1996, the total amount payable by the appellants works out to only Rs. 81,90,138. According to learned senior counsel, a further income which was accrued in pursuance of two investments made by the appellants, viz., Rs. 82,50,000 in "Swarna Pushpa" and Rs. 2,10,000 in "Ind Jyothi" ought to have been credited to the abovesaid sum. Learned senior counsel further contended that inasmuch as the Indian Bank has chosen to remain content with the highest offer of Rs. 1.32 crores, which money would again be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e perused the details furnished by the State Legal Services Authority in respect of the matters wherein the Indian Bank has agreed for the settlement through Lok Adalat. We are extracting the details of few cases wherein the bank has settled for a lesser amount and the details are as set out hereunder : Date of adalat Case number Total amount claimed (Rs.) Amount settled and awarded (Rs.) 29-4-05 OA 827/98 3,26,94,359.00 45,00,000.00 22-1-05 OA 2233/01 17,96,462.00 7,05,000.00 7-2-04 OA 745/01 84,82,962.36 28,00,000.00 7-2-04 OA 474/01 3,59,86,583.00 1,50,00,000.00 7-2-04 OA 513/01 OA 989/01 OA 199/01 7,41,96,579.00 2,92,00,000.00 28-8-04 TA 28/01 1,99,30,840.00 1,00,00,000.00 28-8-04 OA 1881/01 1,13,89,271.00 35,00,000.00 20. A perusal of the above details disclose that the Indian Bank has settled the matter in respect of several loan accounts for a lesser amount though the claim made therein was on the high ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and post-decree interest at a lower rate or may even decline awarding such interest. The discretion shall be exercised fairly, judiciously and for reasons and not in an arbitrary or fanciful manner." (p. 3119) 23. In the light of the principles as set out above and in order to pass an equitable order, we have taken note of the following aspects : ( a )The suit was filed in the year 1999 to recover a sum of Rs. 87,07,258 with future interest. Till the date of filing the suit, the rate of interest charged by the bank varied from 12.5 per cent onwards up to 19.85 per cent at half-yearly rests including penal interest. ( b )As per the pleadings as set out in the plaint, a sum of Rs. 32,74,611 is indicated as outstanding towards the principal and a sum of Rs. 54,32,647 is indicated as memorandum of interest. ( c )It is not in dispute that the appellants have borrowed the loan only for agricultural purposes. If that is so, the said loan should be treated on a different pedestal as per the decision of the Apex Court rendered in Central Bank of India s case ( supra ). ( d )Since the suit is filed in the year 1999, claiming a sum of Rs. 87,07,258 an award of interest pendent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es over and above the principal sum. ( j )The amount of Rs. 96 lakhs was paid by the Anubhav Plantations Ltd., long back, out of total sale consideration of about Rs. 1.80 crores and we intend to protect the Indian Bank rather than Anubhav Plantations Ltd., with regard to the claim of interest is concerned, since the Indian Bank is dealing with the public money. ( k )Since the present litigation has commenced as early as in the year 2000, and some of the proceedings were pursued up to the level of Apex Court, in order to give a quietus to the entire matter, it would be just and necessary to pass an order so as it should bring the entire litigation to a logical end. 24. For the aforesaid reasons and in the interest of justice, the sum of Rs. 2.70 crores should be apportioned in the following manner : ( a )Indian Bank/respondent No. 1 - a sum of Rs. 1.40 crores (Rupees one crore and forty lakhs only). ( b )The administrator representing the Anubhav Plantations Ltd., is entitled to receive a sum of Rs. 1 crore (Rupees one crore only), out of which amount, he shall draw the expenses incurred by him as per the memo filed before the Court. ( c )The Official Liquidator is e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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