Ashok Sadarangani & Anr vs Union Of India & Ors

2. The writ petitioner No.1, Ashok Sadarangani, opened a Current Account No.314 in the name of his proprietary concern, M/s. Internat Impex, Mumbai, with the Bank of Maharashtra, Overseas Branch, Mumbai. The said account was subsequently converted by the Bank into Cash Credit Account No.3 and Cash Credit facility of Rs.125 lacs, Import Letter of Credit facility of Rs.100 lacs, Bank Guarantee facility of Rs.20 lacs and Forward Contracts upto a limit of Rs.300 lacs, were sanctioned and such decision was conveyed to the Petitioner No.1 by the Bank by its letter dated 7th July, 1999. On 16th October, 1999, the Bank sought additional collateral security of Rs.56 lacs from the Petitioner No.1, who, on 29th December, 1999, submitted a Lease Deed dated 29th December, 1999, in respect of an immovable property leased to M/s. Nitesh Amusements Pvt. Ltd. by Shri Homi D. Sanjana and his family members, through their Constituted Attorney, Shri Kersi V. Mehta. The Petitioners herein were Directors of the aforesaid company.

The documents relating to the said Letters of Credit, including Bills of Lading, Invoice and Bills of Exchange, were accepted and collected by the Petitioner No.1 on behalf of the firm from the Bank and he undertook to make payment on the due date. However, the Petitioners defaulted in payment of their liability of about 188 lacs towards the Bank. On 10th April, 2003, R.C.No.3/E/2003/CBI/EOW/MUM in Case No.3/CPW/2004, was registered at the behest of the Bank of Maharashtra. On 30th June, 2003, on the complaint of the Union Bank of India, Special Case No.3 of 2004, in CBI Case R.C.No.8/E.2003/MUM, was registered by the Central Bureau of Investigation, hereinafter referred to as "CBI", against the Petitioners alleging that they had secured the credit facilities by submitting forged property documents as collaterals and utilized such facilities in a dishonest and 4 fraudulent manner by opening Letters of Credit in respect of foreign supplies of goods, without actually bringing any goods but inducing the Bank to negotiate the Letters of Credit in favour of foreign suppliers and also by misusing the Cash Credit facility.

4. Charge-sheet was filed in the said Special Case No.3 of 2004 on 14th January, 2004. At about the same time, a criminal case, being No.236 of 2001, was registered against Shri Kersi Mehta and others under Section 120-B, r/w 465, 467, 468 and 471 of the Indian Penal Code, hereinafter referred to as the "IPC". The said case was registered primarily on the accusation that Shri Kersi Mehta, in connivance with the Petitioner No.1, had sought to sell or dispose of the property belonging to Shri Homi D. Sanjana, situated at Kandivli and Aksha and that the Powers of Attorney dated 11.1.1996 and 24.1.1999, which had been used by Shri Kersi Mehta in the transactions, were not genuine.

Subsequently, on 27th September, 2010, a compromise proposal relating to the transaction between the Petitioners and the Bank was also mooted by the Asset Recovery Branch at Mumbai of the Bank of Maharashtra and a communication was addressed to the Petitioner No.1, which, however, made it clear that such compromise should not be construed as settlement of 6 criminal complaints/investigations/ proceedings pending in the court against the borrowers/guarantors. As has been submitted during the course of hearing of the writ petition, pursuant to such offer of One-Time Settlement, dues of both the Banks have been cleared by the Petitioners and they have, therefore, entered into a compromise with the Petitioners indicating that they had no further claim against the Petitioners.

21. In the different fact situation of this case and those in B.S. Joshi's case or in Nikhil Merchant's case (supra), we are not inclined to grant the reliefs prayed for in the writ petition and the same is accordingly dismissed.

22. There will, however, be no order as to costs.