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TMI Blog2015 (10) TMI 827X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent No.1- IFCI Ltd. and a term loan worth Rs. 815 lacs was sanctioned in the year 1991. The hotel became operational and came into business on 27.12.1999. The hotel, having 117 well furnished rooms and various restaurants and other luxurious amenities, is being run as a Five Star Hotel in the name and style of 'Hotel Majestic Plaza' in the heart of Ludhiana City. It is pleaded that the implementation of the Hotel Project was delayed, therefore, vide letter dated 12.04.1999, respondent No.1 rescheduled the loans and also granted various concessions by waiving of compound interest and by extending the repayment period. The loan was again restructured on 03.01.2003 while reducing the rate of interest and rescheduling the repayment. The loan was again restructured vide letter dated 31.03.2005. In the year 2007, the petitioner-company decided to renovate the hotel and to meet the cost of renovation, a term loan of Rs. 5.22 crores was obtained from respondent No.3 - Punjab National Bank. In April, 2008 and May, 2010, credit facilities of Rs. 4.50 crores and Rs. 5 crores were obtained from IDBI Bank Limited and Reliance Capital Ltd. respectively. Still further, another credit facility ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on 08.01.2015 leaving the petitioner- company to avail the alternative remedy i.e. proceedings before the Debt Recovery Tribunal at the instance of Punjab National Bank. Thereafter, the petitioner-company filed an application i.e. SA No.118 of 2015 under Section 17 of the Act before the Debt Recovery Tribunal. When the matter was pending and no interim relief was granted, respondent No.1 issued another sale notice dated 10.04.2015. The said application was withdrawn after a fresh sale notice dated 25.06.2015 was published. Thereafter, SA No.372 of 2015 has been filed by the petitioner-company challenging the sale notice dated 25.06.2015, but the same was adjourned to 30.07.2015. It is also pointed out that in order to seek relief, the petitioner-company filed CWP No.14547 of 2015, which was disposed of vide order dated 22.07.2015, whereby the Tribunal has been directed to decide the application filed by the petitioner under Section 17 of the Act expeditiously and that the secured creditors shall not confirm the auction till such time the application is decided by the Tribunal. Learned counsel for the petitioner contends that such proceedings before the Debt Recovery Tribunal are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r alternatively may be dropped in the Tender Box, kept at the Reception of IFCI Tower. Bids received after the bid deadline will not be accepted. The bid proposal will be opened on 10.08.2015 by 11.30 a.m. by the "NPA Sale Committee of IFCI", at IFCI Ltd. IFCI Tower, 61, Nehru Place, New Delhi 110019. 6. In each of the NPA accounts, once the bid is opened, IFCI may in its discretion hold either bilateral negotiations with the highest bidder OR decide to proceed with inter se bidding mode. This discretion exercised by IFCI would be final. 7. IFCI has the sole right to shortlist the participants to the top three bidders, for the purpose of Inter se bidding, if so decided in any account individually, which would be decided by the competent authority of IFCI after opening of the bid. The participant who quotes the highest price in the inter se bidding, if adopted will be the successful bidder subject to: * Bid price being above reserve price. * Approval by the Competent Authority of IFCI. * The bid being rejected for other indices viz., management fee/cash + SR ratio/upside sharing etc. not being viable acceptable. * Conditional and contingent offers shall be liable to be disqual ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the secured asset: Provided that the right to transfer by way of lease, assignment or sale shall be exercised only where the substantial part of the business of the borrower is held as security for the debt; Provided further that where the management of whole, of the business or part of the business is severable, the secured creditor shall take over the management of such business of the borrower which is relatable to the security or the debt; (c) appoint any person (hereafter referred to as the manager), to manage the secured assets the possession of which has been taken over by the secured creditor; (d) require at any time by notice in writing, any person who has acquired any of the secured assets from the borrower and from whom any money is due or may become due to the borrower, to pay the secured creditor, so much of the money as is sufficient to pay the secured debt." The secured creditor has taken action under clause (a) of Section 13(4) of the Act, when it published notice for sale of the secured assets on 25.06.2015, the legality and validity of which is being examined by the Debt Recovery Tribunal. Clause (a) also permits assignment of secured asset. Such assignme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h High Court in the aforesaid judgment as the Court has proceeded on the assumption that assignment of debt could only be under the provisions of the Act. The Court has not examined the provisions of the Transfer of Property Act. In fact, the Gujarat High Court has not noticed the judgment of Supreme Court reported as ICICI Bank Limited v. Official Liquidator of APS Star Industries Limited, (2010) 10 SCC 1. The view as reproduced above, was set aside by the Supreme Court. We find that reliance on the judgment of Gujarat High Court in view of the Supreme Court order is rather unfortunate. The Supreme Court was examining the question as to "Whether the Gujarat High Court was right in holding that assignment of debts by the banks inter se is not an activity permissible under the BR Act, 1949 and consequently all executed contracts of assignment of debts were illegal?"........ xx xx The Gujarat High Court has not only failed to notice the above judgment but also the provisions of the Transfer of Property Act. In view of the above judgment of the Supreme Court, the assignment of debt by a Bank to another Bank in not impermissible under the Banking Regulation Act, 1949. Therefore, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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