Andhra HC (PreTelangana) M/S.Swetha Exports Rep. By Its ... vs 1. Bank Of India & Anr on 22 September, 2017 THE HONBLE THE ACTING CHIEF JUSTICE RAMESH RANGANATHAN AND THE HONBLE MS. JUSTICE J.UMA DEVI Writ Petition Nos.28071 of 2016 22092017 M/s.Swetha Exports rep. by its Prop:Dr.B.Srinivasa Rao .Petitioner 1. Bank of India & Anr. . Respondents Counsel for Petitioner: Sri P.S.Rajasekhar Counsel for respondents: Smt.T.Vidya Rani, Learned Standing Counsel for Bank of India. <GIST: >HEAD NOTE: ? Citations: 1.(2008) 1 SCC 125 2.(2002) 1 SCC 367 3.(2009) 8 SCC 257 THE HONBLE THE ACTING CHIEF JUSTICE RAMESH RANGANATHAN AND THE HONBLE MS. JUSTICE J.UMA DEVI Writ Petition Nos.28071 and 28106 of 2016 COMMON ORDER: (Per the Honble the Acting Chief Justice Ramesh Ranganathan) In these two Writ Petitions, M/s. Swetha Exports and M/s. Swetha Exports India Pvt. Ltd have sought a mandamus to declare the action of the respondents, in taking recourse to the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short the SARFAESI Act) to execute the recovery certificate issued by the Debts Recovery Tribunal, Visakhapatnam (DRT for short) in O.A.Nos.46 and 50 of 2013 against the petitioners, as illegal and arbitrary; and to declare the action of the respondents, in issuing letter dated 08.08.2016 rejecting the petitioners representation dated 24.06.2016 and cancelling the One Time Settlement (OTS) granted vide proceedings dated 19.01.2016, as arbitrary and illegal. The petitioners seek a direction to the respondents to adhere to the OTS granted by them to the petitioners vide proceedings dated 19.01.2016, and to cooperate with them by partially releasing the secured assets proportionate to the payment made by them. The petitioners are carrying on business in the manufacture and export of buffalo and ox horn button blanks ever since 2001. The petitioner in W.P.No.28071 of 2016 obtained an Export Packing Credit and Rupee Advance against bills sent for collection, from the 1st respondentbank, through the 2nd respondent for various limits which stood at Rs.7.10 Crores as on 09.04.2008. The debt, secured by creating equitable mortgage of 12 items of immovable property owned by the proprietor of the petitioner and his family members, was declared a NonPerforming Asset on 31.03.2012. The 2nd respondent issued a notice, under Section13(2) of the SARFAESI Act on 07.07.2012, demanding payment of Rs.7,27,93,768.64 ps. Thereafter, the 2nd respondent issued a demand notice dated 08.01.2013 calling upon the petitioners to pay the amount due of Rs.7,13,00,000/ as on 31.03.2012. The 1st respondent initiated recovery proceedings under Section 19 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter called the RDDB Act) filing O.A.No.46 of 2013 on the file of the DRT for recovery of Rs.8,33,10,044.37 ps. Certificate dated 02.05.2014 was issued for recovery of Rs.9,17,41,263.37 ps, and was forwarded to the Recovery Officer, for realisation of the amount due, under Sections 25 to 29 of the RDDB Act. The Recovery Officer issued notice dated 15.05.2014, in R.P.No.60 of 2014 in O.A.No.46 of 2013, demanding the amount due, and the petitioner was informed that, if they failed to make payment, the amount would be recovered under Sections 25 to 29 of the RDDB Act, the 2nd and 3rd Schedules to the Income Tax Act, 1961 and the Rules made thereunder. Thereafter the 2nd respondent issued notice dated 15.07.2015, under Section 13(4) of the SARFAESI Act r/w Rules 8 and 9 of the Security Interest (Enforcement) Rules, 2002 (hereinafter referred to as the Rules) with respect to 12 items of immovable property furnished as security by the petitioners. The said notice referred to the amount due as Rs.9,17,41,263.37 ps which the petitioners claim is exactly the same amount as is referred to in the recovery certificate issued by the DRT. The 2nd respondent issued sale notice dated 09.10.2015, under Rule 8(6) of the Rules, stating that Rs.9,17,41,263.37 ps. was due. The date of sale was fixed as 23.11.2015, and the reserve price at Rs.529.39 Lakhs for the 12 items of immovable property. The petitioner claims to have informed the 2nd respondent to defer the sale as the reserve price was very low. Thereafter, the 2nd respondent issued another sale notice, under Rule 8(6) of the Rules, dated 26.10.2015 proposing to conduct a sale on 03.12.2015 and 04.12.2015. In the sale notice, the 2nd respondent stated that the amount due was as decreed by the DRT in O.A.No.46 of 2013 which was the subject matter of recovery in R.P.No.60 of 2014. The 2nd respondent fixed the reserve price at Rs.520.09 Lakhs for the 12 items of immovable property. The sale notice dated