Case: Syndicate Bank Vs. New Look Rubbers (P) Ltd.

the Managing Director of the company in execution of the decree in O.S.732/87. In fact the KFC was strangulating the industry from one side where as the Bank was doing the same thing on the Managing Director of the company from the other side which was shocking to judicial conscience. In the above circumstances for the ends of justice this court is constrained to interfere and to undo the injustice caused to the petitioner and to save both the industry and the Managing Director of the industry by setting aside the order of taking over the industry and the court sale of the property. The entire amount deposited by the 4th respondent towards price of the auctioned property with 5% of the above amount and interest at 6% from the date of deposit till return shall be paid by the 3rd respondent bank to the 4th respondent. The bank also will have to consider the grant of interest holiday for the period during which the industry had been under the possession of the KFC in pursuance to the take over. Hence for the proper administration of justice, I think it proper to set aside the court sale and to allow C.R.P.2315/98."4. As the order dated 11th April 2001 was a comprehensive one, taking within its ambit the Civil Revision as well as the Writ Petition, two LPAs, one by the Bank and the other by the judgment-debtor, were filed and are pending in the Kerala High Court against the order in the writ petition whereas the present appeal has been filed by the Bank against the order in the Civil Revision. 5. Mr. A.B.Dial, the learned senior counsel for the appellant has pointed out that the High Court had overstepped its jurisdiction as after giving a positive finding that the respondent was not entitled to any relief under section 22 of the SICA or under section 18 FH of the Regulation Act, it had virtually set aside all the effective orders of the Civil Courts which had been made in favour of the appellant Bank and had attained finality. It has further been pleaded that the further direction of the High Court as to the entitlement of the respondent to the benefit of the re-settlement schemes for revival was not the issue before it as the executing court or the High Court could not go beyond the decree itself and hold that the suit which had led the decree was bad having been filed in collusion with one or the other party. Respondent No.2 appearing in person has, however, argued that the High Court had proceeded on the basis that the respondent had been gravely wronged by the Bank and the Kerala Financial Corporation and has also submitted a large number of documents in support of this submission. He has also pointed out that the State Government had taken steps towards the revival of his unit and as such, there was no justification in interfering with the order of the High Court. 6. Before we go to the issues raised, we reproduce here the final directions of the High Court: "1. The order of the 2nd respondent KFC taking possession of the industrial unit New Look Rubbers (P) Ltd. (petitioner company) is set aside and the KFC is directed to surrender possession of the industrial unit to the petitioner forthwith. 2. The 2nd respondent (KFC) shall grant interest holiday for the period from the date of taking possession of the industry till it is handed over to the petitioner. 3. The court sale of the property of the Managing Director of the petitioner company in pursuance to the decree in OS 732/87 of Sub-Court, Trichur, shall stand set aside and the3rd respondent shall return the entire sale amount with a sum equal to 5% of the above amount and with 6% interest on the sale amount from the date of deposit till the date of return to the 4th respondent." 7. We are of the opinion that the High Court has clearly overstepped its jurisdiction. The facts of the case show that the appellant had filed civil suit O.S.No.732/1987 against the respondent for recovery of the sums advanced as loan plus interest. This suit was decreed on 9th April 1990 with the positive finding that there was no harsh or arbitrary behaviour in the proceedings against the respondent. Admittedly, no appeal was filed against the judgment dated 9th April 1990 and it attained finality. The appellant Bank thereafter filed E.P.No.819/1991 for the realization of the decretal amount on which the respondent filed O.S. No.1430/93 praying that the appellant Bank be injuncted from executing the decree in O.S.No.732/1997. This suit too was dismissed on 1st April 1996. Another Pauper Petition No. 19/1997 was filed by the respondent claiming damages from the Bank and this too was dismissed. Admittedly all these matters have attained finality. Two sets of objections in execution petition, E.A. No.847/97 and E.A.No.1197/97 had been filed with regard to the applicability of section 22(1) of SICA and section 18 FH of the Regulation Act and in the meanwhile, the property mortgaged was sold in execution of the decree. The aforesaid objection petitions were dismissed on 21st July 1998. It is against the order in E.A. No.1197/1997 that the present revision was filed. We are therefore of the opinion that in the light of the issues decided by the Civil Court in the various litigations which were allowed to become final and as the decree had already been executed in as much that the mortgaged property has been sold, the directions issued by the High Court are clearly not warranted. We are also of the opinion that there can be no objection to the revival of the respondents unit but that is a matter between the respondent and the Kerala Financial Corporation or other Governmental Agencies and cannot in any manner affect the legal rights that have accrued to the appellant as a consequence of a series of orders/ judgments.

Court's decision (1 = petition accepted / positive for appellant, 0 = rejected / negative): 1

Reasoning from the judgment:
1[ds]7. We are of the opinion that the High Court has clearly overstepped its jurisdiction. The facts of the case show that the appellant had filed civil suit O.S.No.732/1987 against the respondent for recovery of the sums advanced as loan plus interest. This suit was decreed on 9th April 1990 with the positive finding that there was no harsh or arbitrary behaviour in the proceedings against the respondent. Admittedly, no appeal was filed against the judgment dated 9th April 1990 and it attained finality. The appellant Bank thereafter filed E.P.No.819/1991 for the realization of the decretal amount on which the respondent filed O.S. No.1430/93 praying that the appellant Bank be injuncted from executing the decree insuit too was dismissed on 1st April 1996. Another Pauper Petition No. 19/1997 was filed by the respondent claiming damages from the Bank and this too was dismissed. Admittedly all these matters have attained finality. Two sets of objections in execution petition, E.A. No.847/97 and E.A.No.1197/97 had been filed with regard to the applicability of section 22(1) of SICA and section 18 FH of the Regulation Act and in the meanwhile, the property mortgaged was sold in execution of the decree. The aforesaid objection petitions were dismissed on 21st July 1998. It is against the order in E.A. No.1197/1997 that the present revision was filed. We are therefore of the opinion that in the light of the issues decided by the Civil Court in the various litigations which were allowed to become final and as the decree had already been executed in as much that the mortgaged property has been sold, the directions issued by the High Court are clearly not warranted. We are also of the opinion that there can be no objection to the revival of the respondents unit but that is a matter between the respondent and the Kerala Financial Corporation or other Governmental Agencies and cannot in any manner affect the legal rights that have accrued to the appellant as a consequence of a series of orders/ judgments.