IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) THURSDAY, THE FOURTH DAY OF SEPTEMBER TWO THOUSAND AND EIGHT PRESENT THE HON'BLE SRI JUSTICE V.V.S.RAO WRIT PETITION No. 21183 of 2004 Between: B.V.C. Lime Industries, rep. by its Proprietor B. Viswaroopa Chary S/o Manibhushana Chary R/o Chilakaluripet, Guntur District ..... PETITIONER AND The A.P. State Financial Corporation, rep by its Branch Manager, Guntur Branch, Guntur .....RESPONDENT Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court may be pleased to issue Writ order or direction more particularly one in the nature of Writ of Mandamus to declare the impugned notice bearing Ref.No.AFC/GNT-BR/CSR/2004-05/2875 dt 1-10-2004 issued by the respondent as illegal, arbitrary, unjust and consequently set aside the same by aﬀording an opportunity to the petitioner to avail the beneﬁt of clearing the loan amount under One Time Settlement scheme. Counsel for the Petitioner: SMT. KAVITHA GOTTIPATI Counsel for the Respondent: MR.M.VIDYASAGAR The Court made the following: THE HON’BLE SRI JUSTICE V.V.S. RAO WRIT PETITION No.21183 of 2004 ORDER: The petitioner is a proprietary concern, which was established for manufacturing of burnt lime. It availed a term loan of Rs.1,43,000/- from the respondent Corporation in the year 1988-1989. The loan was secured by equitable mortgage of the assets of the petitioner industry. The petitioner alleges that in May 1990, the factory was damaged in a cyclone and the petitioner could not pay the loan amount as per schedule. Yet again, the petitioner sought additional loan of Rs.1,26,000/-. The respondent released an amount of Rs.63,000/- towards rehabilitation/relief. The petitioner alleges that it has been approaching the Corporation for One Time Settlement (OTS). Even before the same could be considered, the Senior Branch Manager, Guntur, sent a letter dated 01.10.2004 informing the petitioner that its unit was advertised for sale on 18.06.2004, that it was sold to the highest bidder and that the unit was also handed over, duly appropriating the sale proceeds towards the loan. The petitioner was also advised to pay an amount of Rs.10,28,966/-, in default of which action would be initiated under the A.P. Revenue Recovery Act, 1864. Feeling aggrieved by the same, the present writ petition is ﬁled seeking its invalidation. The respondent ﬁled counter aﬃdavit opposing the writ petition. It is stated that the petitioner availed a sum of Rs.1,98,700/- towards loan including adhoc payment of Rs.63,000/- during the cyclone period, after adjusting insurance amount paid by M/s. New India Assurance Company. The petitioner did not pay the installments regularly and as on 31.10.2004, an amount of Rs.10,72,915/- was due and payable by the petitioner. The petitioner never approached the respondent in spite of demand notices. But, it ﬁled a writ petition, being W.P.No.9829 of 1991, questioning a telegram issued by the Corporation calling upon the petitioner to clear the arrears. The same was disposed of by this Court on 30.07.1991, giving liberty to the petitioner to make a representation to the respondent. Accordingly, on 03.08.1991, the petitioner made a representation, which was disposed of on 05.09.1991 allowing further time to the petitioner to pay the loan amount including interest. The petitioner did not do so and, therefore, after issuing a ﬁnal notice, unit was advertised for sale on 18.06.2004. The Corporation also addressed letters dated 27.01.2003 and 05.06.2003 to the petitioner calling upon it to avail opportunity to close the account under OTS scheme, in vain. Therefore, unit was sold for a sum of Rs.90,000/-. The sale proceeds were appropriated and the unit was handed over under a panchanama to the highest bidder. The learned counsel for the petitioner raised the only ground that the petitioner went on making representations to permit it to avail the OTS scheme, but without considering the same, the respondent sold the industrial unit, without prior notice to the petitioner. She, however, submits that on 24.07.2008, the respondent addressed a letter to the petitioner advising it to avail OTS and close the loan account. Per contra, the learned Standing Counsel submits that the respondent adopted a transparent method of bringing the unit to sale under Section 29 of the State Financial Corporations Act, 1951 (the Act, for short) and that the petitioner has not availed many opportunities given by the Corporation. He, however, does not dispute the communication dated 24.07.2008 sent by the Senior Branch Manager, Guntur, to the petitioner. A perusal of the counter averments, which are not speciﬁcally denied by ﬁling reply aﬃdavit, would show that the Corporation has shown abundant lenience to the petitioner, presumably because the petitioner is a small-scale unit. Indeed, when the unit was damaged in 1990 cyclone, the Corporation also released additional loan limits under a special rehabilitation scheme. Even before issuing the advertisement for sale under Section 29 of the Act, the Corporation has been advising the petitioner to avail OTS scheme. This approach of the Corporation to recover its loan with interest in this case cannot be criticized as unreasonable and arbitrary. The Corporation acted very fairly and in a transparent manner. Therefore, the writ petition is misconceived. A copy of the communication, dated 24.07.2008, from Senior Branch Manager, Guntur, addressed to the petitioner has been placed before this Court (which is made part of the record) and it would show that the petitioner was advised to avail OTS facility and close the loan account. Therefore, nothing prevented the petitioner even now to approach the respondent for settlement, so that loan account can be closed. In this writ petition, no relief can however be granted to the petitioner. Subject to the above observations, the writ petition is accordingly dismissed. No costs. ____________ V.V.S.RAO,J 4th September, 2008 IBL