IN THE HIGH COURT OF JUDICATURE AT PATNA CWJC No.11322 of 2007 Krishnadeo Narayan Singh, S/o- Late Basudeo Singh, R/o Village-Malti, P.S.-Fulwaria, District-Begusarai. …… Petitioner. VERSUS 1. The State of Bihar. 2. Board of Directors, B.S.F.C., Head Office, Fraser Road, Patna. 3. The Managing Director-cum-Specified Authority, B.S.F.C., Head Office, Fraser Road, Patna. 4. The Branch Manager, B.S.F.C. Branch Office, 41-P, Industrial Area, Deona, Barauni, District-Begusarai. 5. The Assistant General Manager, I/C(Z-II), B.S.F.C., Head Office, Fraser Road, Patna. …… Respondents. ----------- Advocate for the Petitioner : Sri Shubhesh Pandey. Advocate for the B.S.F.C. : Sri Partha Sarthy. Advocate for the State : Sri Anil Kumar Jha, G.A.-2. Sri Uday Bhan Singh, A.C. to G.A.-2. ------------- 04 09.04.2009 The petitioner had small scale industry, which was financed by the Bihar State Financial Corporation. The balance outstanding as on 05.02.2007 was about Rs. 96,93,222.80/-. In 2006, the Corporation came up with a one time settlement scheme to provide an honourable exist to defaulting units who were in heavy debts. This was known as OTS-2006. Under this scheme various options were given to the units which they could themselves choose. Plan A, inter alia, provided for payment of 110% principal outstanding and other charges and the total payment period was one month. Then, there was Plan B, wherein the time period for payment was increased to two months and the liability to pay was 125% of the principle outstanding and other charges. Then, there was Plan C, which give option to pay within six months but now the payment had to be 150% of the principle outstanding. Lastly, there was Plan D, where one year time was given 2 but the liability was 200% of the principle outstanding. All this was irrespective of the balance outstanding. It appears that the petitioner had coming to know of this scheme on 05.02.2007 made an application seeking settlement under Plan A and deposited Rs. 4,80,000/- , being approximately 50% of the principle outstanding. Thus, the petitioner was required to pay the balance amount assessed being the balance of 110% of the principle outstanding within one month of communication of acceptance. It is not in dispute that on 31.05.2007, the acceptance letter from the Corporation was sent to the petitioner, accepting petitioner’s request for bounding under Plan A. In this letter, it was clearly stated that the total amount that the petitioner had to pay was Rs. 11,3,695/-. Accordingly, the balance which the petitioner was now to require to pay within one month was Rs. 6,23,695/-. This letter was returned undelivered. It is a word in the counter affidavit and not disputed that the Branch Office, Begusarai then contacted petitioner’s son on Mobile Phone and informed him of the acceptance and the return of the letter. It is stated that the Branch was informed that everyone was out of station and the letter should not be re-dispatched but would be collected when they would return. Petitioner explains this absence as serious illness which necessitated him and his family to move to Delhi for treatment. Petitioner then returned from Delhi and he was then served with a letter dated 02.07.2007, again intimating him the acceptance of the offer and giving him a chance to pay the balance amount, as indicated above, by 3 07.07.2007. Petitioner immediately responded and requested for 20 days extension. The only response thereto was the first impugned letter dated 25.07.2007 from the Begusarai Branch of the respondent- Corporation, whereby petitioner was informed that the petitioner having defaulted in timely payment of the settlement amount, the settlement had become inoperative. The petition was filed immediately thereafter on 30.08.2007 impugning this decision. It appears that while the writ petition was pending here, the petitioner in order to lessen the burden and establish his bona fide, even though, the settlement had been cancelled on 11.09.2007, deposited the balance amount of Rs. 6,23,695/-. Now, a counter affidavit has been filed by the Corporation. Wherein, it has been stated that seeing the anxiety of the petitioner to pay the amounts and enter into settlement the Managing Director of the Corporation took a sympathetic view of the matter and notwithstanding repudiation of the settlement referred the matter to the Board of Directors of the Corporation. The Board of Directors agreed to grant extension of time but with two stipulations. That petitioner’s case would now be considered under Plan C and thus there would additional liability plus till that liability was fully discharged, petitioner would be liable to pay simple interest of 10% from the time the amount was due till the time it is fully discharged on reducing balance basis. This was communicated to the petitioner by Corporation’s letter dated 22.10.2008. So, now after over a year petitioner is being asked to pay an additional amount, because now the settlement amount has stood 4 increased to Rs. 14,85,756/- from about Rs. 11,00,000/- earlier. Over and above, this petitioner would be liable to pay interest on the outstanding amount of this settlement amount from 1st June 2007 onwards at 10% simple interest. Petitioner now challenges this. Heard the parties. In my view, notwithstanding the settlement is lapsing, the Corporation has taken a sympathetic view of the matter and rightly extended the period. Even now, the Corporation has made a measure sacrifice as against a liability of about Rs. 96,00,000/-. It was settling the dues once and for all for about Rs. 14.85 lakhs. The additional amount that the petitioner is being required to deposit is only about Rs. 3.82 lakhs. In my view, this does not call for any interference. But, it is a different matter so far as interest is concerned. Petitioner’s request of July 2007 has been responded in October 2008. Petitioner is already being required to pay Rs. 3.82 lakhs in excess. Petitioner is already being burdened with additional payment of about Rs. 3.82 lakhs over his normal liability. In such a situation, to burden him further with interest would not be fair, if petitioner deposits the differential amount within one month from today, the Corporation would not charge interest. In ordering the aforesaid, I take inspiration from the judgment of the Apex Court in the case of S.J.S. Business Enterprises (P) Limited Vs. State of Bihar & Ors. since reported in (2004) 7 Supreme Court Cases 166 and in particular paragraph 23 thereof, which is quoted hereunder:- “In Jagdamba Oil Mills it was observed (at SCC p. 507, para 15) that 5 the Court may “assist the borrower who has intention to repay, but is prevented by insurmountable difficulties in meeting the commitments”. The borrower in that case had made no payment whatsoever to State financial corporation of its outstanding loan. As not even a minimal portion of the amount borrowed had been paid the Court refused to help the defaulter. The borrower, in this case had paid over Rs. 14 lakhs as against the principal amount of Rs. 44.56 lakhs. A further amount of Rs. 10 lakhs was paid on 27-3-2002 by the appellant to BICICO i.e. the day after the impugned sale notice was published. Before the High Court a sum of Rs. 10 lakhs was paid pursuant to the interim order. In addition, the appellant had approached BICICO to settle its outstanding dues under the one-time settlement policy. As we have already recorded, we entertained the special petition on the condition that the appellant would deposit a sum of Rs. 1 crore over and above the amount already paid by it to BICICO. This the appellant has also done. All this shows that the appellant could not be 6 termed to be such a defaulter who deserved no sympathy or assistance by the Court.” After this order was dictated in Court, learned counsel for the petitioner submitted that petitioner has to sell property to raise this amount. Considering the depressed market condition and desperate situation, the petitioner would require some more time. Considering the anxiety and bona fide shown in making payments earlier, it would be in fitness of things to permit the petitioner to make payment within two months from today. He further submits that he requires to sell some of the property which is mortgaged to the Corporation and till the sale deeds are returned by the Corporation he will not be able to sell those properties. The solution to this is simple, it would be open to the petitioner to negotiate for sale of the property and ask the purchasers to make payment directly to the Corporation and once the full payment of the difference amount, as noticed above, is made the Corporation would immediately release the sale deeds and clear the charge on the properties so that petitioner would be able to execute sale deeds free from encumbrances to the purchasers, who have paid to the Corporation or advanced money to the petitioner for payment to the Corporation. With these observations and directions, the writ petition stands disposed of. Trivedi/ ( Navaniti Prasad Singh, J.)