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TMI Blog2021 (5) TMI 404X X X X Extracts X X X X X X X X Extracts X X X X ..... eddy, the Senior Counsel, appearing on behalf of Sri P.Vikram, counsel for the petitioner, Sri D.V.Seetharam Murthy, the Senior Counsel, appearing on behalf of Sri G.P.Yashvardhan, counsel for the 1st respondent, and Sri G. Kalyan Chakravarthy, counsel for the 3rd respondent. 3. It has been contended by the petitioner that it is a registered Company under the Companies Act, 1956 and it is doing the business of manufacturing urea and other fertilizers. The petitioner Company has obtained loans from various Banks including the respondent Banks for running its business, however due to various issues including lockdown, the petitioner Company could not repay the loan amount to the respondent Banks. As per the circular dated 07.06.2019 issued by RBI, the lender Banks have entered into Inter-Creditor Agreement (ICA) for the purpose of finalizing and implementing the Resolution Plan (RP) on 19th and 27th of March, 2020, and as per the Joint Lenders Meetings held on 19th and 27th of March, 2020, all the lenders, in principle, based on the discussions, have come to the conclusion that the broad contours of modified RP (at existing Cut-Off date of March 31, 2020) will now be as under: Part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eiterated its earlier conclusions which were arrived on 19th and 27th of March, 2020. 6. Learned Senior Counsel appearing for the petitioner had contended that the Joint Lenders have met behind the back of the petitioner on 04.06.2020 and taken a U-turn by declining to revive the petitioner Company contrary to the conclusion assured in meeting held on 19th & 27th March 2020. Challenging the same, the present writ petition is filed. 7. Senior Counsel appearing for the petitioner had further contended that without considering the fact that the petitioner is a manufacturing unit of urea, which is of paramount importance for the development of the country, and without taking the national interest into account, the respondents have taken a U-turn from its earlier Resolution Plan, and therefore, the action of the respondents in taking a U-turn vide letter dated 04.06.2020 is an arbitrary exercise. Senior Counsel also contended that the petitioner can always challenge, by way of writ proceedings, any arbitrary action of the respondent Banks. With regard to maintainability of a writ, the Senior Counsel contended that a writ petition is maintainable whenever there is any violation in cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder: "11. On the other hand, Mr.S.S. Ray, learned counsel appearing on behalf of Respondents 2 to 4 submitted that no writ petition would be maintainable against the respondent institution. In support of his submission, the learned counsel has placed reliance on Pradeep Kumar Biswas v. Indian Institute of Chemical Biology [(2002) 5 SCC 111: 2002 SCC (L&S) 633] particularly making reference to para 40 of the aforesaid judgment. Para 40 of the aforesaid judgment is extracted hereunder: (SCC p. 134) "40. The picture that ultimately emerges is that the tests formulated in Ajay Hasia v. Khalid Mujib Sehravardi [(1981) 1 SCC 722 : 1981 SCC (L&S) 258] are not a rigid set of principles so that if a body falls within any one of them it must, ex hypothesi, be considered to be a State within the meaning of Article 12. The question in each case would be - whether in the light of the cumulative facts as established, the body is functionally, functionally and administratively dominated by or under the control of the Government. Such control must be particular to the body in question and must be pervasive. If this is found then the body is a State within Article 12. On the other hand, when t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were drawn in the Joint Lenders Meeting held on 19th and 27th of March, 2020, have not been fructified into an agreement/contract, therefore, in the absence of an agreement/contract entered in pursuance of the conclusions drawn in the meeting held on 19th and 27th of March, 2020, no conclusiveness has been arrived; and that to revive the petitioner Company was one of the deliberations made in the Joint Lenders Meeting, but since the petitioner Company was not agreeing to various issues and not willing to extend the guarantees / surieteis and also, in spite of repeated requests, the petitioner company was not cooperating with regard to change of management and other issues, the respondents had no other option except to take a decision vide letter dated 04.06.2020. 13. Senior Counsel appearing for the 1st respondent further submitted that the respondents have approached the National Company Law Tribunal (NCLT) by filing a petition i.e., CP(IB) No.348/7/HDB/2020 and the NCLT would examine whether the Company can be revived or not and the matter would be referred to a Committee of Creditors and if the petitioner Company can be revived, then every step would be taken to revive the Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity of a restructuring plan, is unmerited. The relief as sought by the petitioner - to direct the respondent banks to consider and accept the resolution plan and the options put by the petitioner - is plainly not maintainable. This Court cannot issue a mandamus directing the respondent banks to restructure the financial assistance granted by them to the petitioner." 16. Senior Counsel for the 1st respondent had also contended that since the petitioner was not willing to extend the sureties, the respondents have no other option except to approach the NCLT by filing a case and the question of the respondents taking a U-turn, as contended by the petitioner, would not arise; that the decision taken by the respondents on 04.06.2020 was in the interest of public money, therefore, the writ petition itself is not maintainable; that all the contentions which are being raised by the petitioner in the present writ petition, can always be raised before the NCLT for revival of the Company under Insolvency and Bankruptcy Code, and the NCLT would refer the matter to professionals for revival of the Company and the professionals would be in a better position and well equipped to assess the chanc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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