HONOURABLE SRI JUSTICE A. GOPAL REDDY AND HONOURABLE SRI JUSTICE SAMUDRALA GOVINDARAJULU WRIT PETITION No. 19716 OF 2009. DATED 25T H NOVEMBER, 2009. BETWEEN M/s. Shiva Shakthi Agencies, Prop. R.Nagendra Babu Vijayawada, and, anr. … Petitioners And The State Bank of India, rep. By its Asst. General Manager, Main Branch,Vijayawada, and, anr. …Respondents. HONOURABLE SRI JUSTICE A. GOPAL REDDY AND HONOURABLE SRI JUSTICE SAMUDRALA GOVINDARAJULU WRIT PETITION No. 19761 OF 2009 ORDER: (Per Hon’ble Sri Justice A. Gopal Reddy) This Writ Petition is ﬁled seeking a Writ of Mandamus to declare that the State Bank of India One Time Settlement-SME.2009 applies to the petitioners’ loan account besides directing the respondents to receive and process the application of the ﬁrst petitioner in accordance with the provisions of the scheme. The ﬁrst petitioner obtained loan facility for a sum of Rs.3,00,000/- under cash credit for the purpose of carrying on business in the name and style M/s. Shiva Shakthi Agencies (ﬁrst petitioner herein), for which, the respondent obtained a demand promissory note, agreement of hypothecation and guarantee on 11.12.2001, and, the Second petitioner has executed a letter of memorandum of deposit of title deeds in favour of the respondent-bank creating an equitable mortgage for the property in an extent of 74.22 square meters, situated in RS.No. 72/2 of Vijayawada, which is an undivided joint share in a total extent of 517 square yards with a residential building. As the petitioners committed default in repaying the loan amount, the respondent-bank ﬁled suit being O.S.No. 682 of 2004 on the ﬁle of the First Additional Senior Civil Judge, Vijayawada for recovery of the sum of Rs.3,94,640/- together with future interest and costs. In the said suit, a preliminary decree was passed on 21.09.2006 for a sum of Rs.5,21,852/- with subsequent interest at the rate of 6% per annum on the suit amount from the date of redemption till the date of realization. As the petitioners failed to discharge the decreetal amount, the respondents have initiated recovery proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 ( for brevity ‘the Act’) and took possession of the secured asset on 3.11.2007 through the order dated 27.10.2007 in Crl.M.P.No. 2581 of 2007 on the ﬁle of the Chiefk Metropolitan Magistrate, Vijayawada. Aggrieved by the same, the petitioners ﬁled Writ Petition No. 25367 of 2007 and this Court by order 19.06.2009 disposed of the said Writ Petition granting three months time to the petitioners to repay the entire balance loan amount. In the said order, liberty was also granted to the respondent bank to take necessary action in the event of the petitioners failing to discharge the loan amount within the time stipulated in the said order. It is stated that, the petitioners have not paid the amount as directed by this Court in the order dated 19.06.2009. It is contended by the learned Counsel for the petitioners that pursuant to the order of this Court dated 19.6.2009, though the ﬁrst petitioner has addressed a letter dated 11.07.2009 to the respondent- bank to provide details of the balance amount payable by him, but the respondent-bank did not send any reply. Thereafter, it is stated that the petitioner has approached the respondent-bank with ‘State Bank of India One Time Settlement-SME,2009’ scheme to settle the account. It is their case that as per the terms of the said scheme, the ﬁrst petitioner has to pay 5% of the amount demanded in the notice dated 26.6.2004 and later 25% of the balance of the settlement amount with in one month from the date of settlement and the rest of the amount in six equal monthly instalments. It is their further case that the ﬁrst petitioner has paid substantial amount and that the loan account is covered by the One Time Settlement Scheme and therefore requested respondent-bank to avail the beneﬁt of the said scheme to him. It is the grievance of the ﬁrst petitioner that the respondent-bank has denied the same stating that the said scheme does not apply to the loan account of the ﬁrst petitioner. Hence, the present Writ Petition. This Court while ordering notice before admission on 16.09.2009, granted interim direction not to take any coercive steps against the petitioners. The respondent-bank ﬁled WVMP.No.3664 of 2009 along with counter to vacate the said interim order, mainly contending that the State Bank of India OTS-SME 2009 Scheme does not applicable to the decreed cases by the Courts and therefore the respondents cannot apply the said scheme to the petitioners’ loan account inasmuch as decree dated 21.09.2006 is passed against the petitioners in OS.No. 682 of 2004. It is further contended that the petitioners are liable to pay the entire balance amount as ordered by this Court in WritPetition No. 25367 of 2007, dated 19.6.2009. Later, the learned Counsel for the petitioners ﬁled WPMP.Nos. 33125 of 2009 and 33126 of 2009 seeking to implead (i) the Reserve Bank of India represented by its Chief General Manager,(ii) State Bank of India, represented by its Managing Director and (iii) Executive Committee of Central Board, State Bank of India as party respondents 3 to 5 in the Writ Petition, and, to amend the prayer by adopting the prayer that Clause 1.6 of the SME (SBI OTS.SME.2009) as illegal and ultra virus to the provisions of the Constitution of India besides being in violation of Reserve Bank of India directions, respectively. The learned Counsel for the petitioners contended that once the virus of the scheme is questioned by seeking amendment of the prayer in the Writ Petition, the Writ Petition cannot be dismissed and it has to be admitted. He contended that the Reserve Bank of India has issued circular instructions stating that the One Time Settlement Scheme should be non-discretionary and non-discriminatory for recovery of non-performing loans, and, therefore, Clause 1.6 thereof insofar as it relates non application of the beneﬁcial scheme to the decreed cases, is liable to be struck down as the same is violative of Article 19(1)(g)k of the Constitution. He further contended that since the decree passed in the suit is a preliminary decree, it cannot be said that One Time Settlement Scheme is not applicable to the loan account of the first petitioner. We do not ﬁnd any force in the submissions of the learned Counsel for the petitioners. It is pertinent to mention that earlier the petitioner has ﬁled appeal before the Debts Recovery Tribunal aggrieved by the notice dated 26.6.2004 issued under Section 13(2) of the Act, wherein, the Tribunal granted conditional interim relief, which was not complied by the ﬁrst petitioner. Thereafter, the appeal was dismissed for default and on ﬁling restoration application, it was restored and ultimately the appeal was ended in dismissal. The preliminary decree passed by the Civil Court in O.S. No. 682 of 2004, dated 21.9.2006 attained finality. Thereafter, the respondent-bank took possession of the secured assets trough the order of the Court below in Crl.M.P.No. 2581 of 2007, dated 27.10.2007. Questioning the same the ﬁrst petitioner ﬁled Writ Petition No.25367 of 2007, which was disposed of by the order dated 19.06.2009 granting three months’ time to the petitioner to pay the entire balance loan amount. The said order was also not complied by the petitioner. The petitioner again ﬁled the present writ petition contending that the action of the respondent-bank in not applying the State Bank of India One Time Settlement-SME 2009 scheme to the ﬁrst petitioner’s loan account is illegal and arbitrary. When the respondent-bank ﬁled vacate stay petition stating that the said scheme is not applicable to the decreed cases, the ﬁrst petitioner ﬁled two interlocutory applications, one for impleadment and the other for amendment of prayer, as stated supra. Nowhere it is stated that the guidelines framed by the fourth respondent-bank are statutory in nature and they are not binding on the banks. The intention of the Reserve Bank of India in issuing circular instructions is that the application of the OTS scheme should be non-discretionary or non-discriminatory. The learned Counsel for the petitioners except arguing that Clause 1.6 of the said OTS scheme is violative of provisions of the Constitution and directions of the Reserve Bank of India, he did not demonstrate as to how it is violative of public interest or provisions of the Constitution. It is relevant to state here that while exercising the power of judicial review, the Court sitting under Article 226 of the Constitution is not the appellate authority and the Constitution does not permit the Court to direct or advise the executive in matter of policy or to sermonize any matter which under the Constitution lies within the sphere of the legislature or the executive, provided these authorities do not transgress their constitutional limits or statutory power. The scope of judicial enquiry is conﬁned to the question whether the decision taken by the Government/competent authority thereof is against any statutory provisions or it violates the fundamental rights of the citizens or is opposed to the provisions of the Constitution. The Supreme Court in catena of decisions held that the policy decision must be left to the government as it alone can adopt which policy should be adopted after considering all the points from diﬀerent angles. In matter of policy decisions or exercise of discretion by the Government so long as the infringement of fundamental right is not shown Courts will have no occasion to interfere and the Court will not and should not substitute its own judgment for the judgment of the executive in such matters. In the present case, the learned Counsel for the petitioners failed to show that Clause 1.6 of the SME(SBI OTS) SME 2009 is violative of Articles 14 and 19(1)(g) of the Constitution or public interest. Pertinent to state from the above factual matrix that the ﬁrst petitioner is successfully avoiding payment of loan amount from 2004. If the intention of the petitioner is fair enough to discharge the debt, he could have certainly complied the directions of this Court. The conduct of the petitioner in prosecuting the lis by ﬁling petitions one after the other speaks volumes about his diligence, and it is manifest that he wants to protract the lis as long as he can and gain time at the cost of playing delaying tactics. We do not see any merit in the Writ Petition. The Writ Petition is dismissed. Consequently, interim direction granted on 16.09.2009 shall stand vacated. No order as to costs. ----------------------------------- JUSTICE A. GOPAL REDDY ------------------------------------------------------ JUSTICE SAMUDRALA GOVINDARAJULU Dated 25th November, 2009. Msnr.