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The State Bank of India and Ors. Vs. Hind Drug Distributors, a Partnership Firm, Constituted under India Partnership Act and Ors. - (High Court of Patna) (19 Jun 2018)

Bank cannot refuse any payment which is made by a loanee of outstanding amount



The appeal has been preferred against the order passed by the learned single Judge, who has exonerated the private Respondent from making further payments of outstanding dues against the loan granted by the Bank and which became NPA. A SARFAESI proceeding was initiated for non-payment of the outstanding dues, which culminated into an order on 21st February, 2013 passed in S.A. No. 211 of 2012 by the Debts Recovery Tribunal, Patna. The final outstanding worked out for settlement of the outstanding dues was fixed as Rs. 24,10,587.00. The bank had also waived off an amount of almost Rs. Ten lakhs and odd as part of the final settlement. The direction passed by the Debts Recovery Tribunal was to pay the total amount in three equal installments within a period of three months.

Admitted position is that after the initial payment of a token amount of Rs. Five lakhs on 22nd March, 2013 and then Rs. Three lakhs on 9th April, 2013, the balance amount of the outstanding dues was not settled by the private Respondent. The major payment finally was made after almost three years on 17th March, a2016.

Since, there was a delay of more than three years and the private respondent did not honour the direction and the order passed by the Debts Recovery Tribunal by adhering to the time frame, the Bank has now objected to the order passed by the learned single Judge by showing that, the interest component, which has accumulated over the period of time due to non-settlement of the total outstanding dues, cannot be wished away or waived by the learned single Judge by taking a view that since a sum of Rs. 24,30,000.00 has already been paid and the Bank accepted the said amount without any demur, therefore, the account should stand closed and satisfied.

The Bank is correct in making his submission and objection against the impugned order on the ground that the private Respondent cannot draw advantage of his own wrong if he did not close the account by making payments within the time frame fixed by the DRT and the settlement if at all of the fixed amount by the DRT was made after more than three years of passing of the order, the interest component, which accumulated in the meantime, cannot be wished away.

The Bank cannot refuse any payment which is made by a loanee of outstanding amount, they have obligation to receive the said amount as and when it is paid by a loanee. But merely because they have not specifically said that, it is a final settlement against the outstanding dues, it does not mean that, the interest component and liability of the loanee to pay for delayed payment for almost three years cannot be saddled upon him. To that extent the learned single Judge seems to be in error by waiving or directing the Bank to issue the No Dues Certificate on the basis of payment of Rs. 24,30,000.00 despite a delay of more than three years, was unwarranted. The impugned order dated 22nd July, 2016 to that extent is quashed. The appeal is allowed.


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