Supreme Court Of India
UDYAMI EVAM KHADI GRAMODYOG WELFARE SANSTHA - Appellant
Versus
STATE OF U.P. - Respondent
Appeal (Civil) 5637 Of 2007
Decided On : 12/05/2007
.
Suppression of Material Fact - Jurisdiction of Superior Courts - U. P. Khadi and Village Industries Board Act, 1960 - Section 35a, Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - [Section 35a of the U. P. Khadi and Village Industries Board Act, 1960, Recovery of Debts Due to Banks and Financial Institutions Act, 1993] - The court discussed the jurisdiction of superior courts to dismiss a writ petition for alleged suppression of material fact. It also referenced and discussed the provisions of Section 35a of the U. P. Khadi and Village Industries Board Act, 1960 and the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The court highlighted the importance of approaching the court with clean hands and the consequences of repeated filing of writ petitions, emphasizing the equitable nature of writ remedy and the need to avoid abuse of the legal process.
Fact of the Case:
The appellant, a cooperative society, applied for loans for establishing industries and defaulted in making payments. Recovery proceedings were initiated against the society, leading to multiple writ petitions being filed questioning the legality thereof. The High Court dismissed a fresh writ petition on the grounds of suppression of material fact, leading to the appeal.
Finding of the Court:
The court found that the appellants had suppressed the material fact of filing multiple writ petitions on the same cause of action, leading to the dismissal of the fresh writ petition.
Issues: The issues involved the jurisdiction of superior courts to dismiss a writ petition for alleged suppression of material fact and the repeated filing of writ petitions on the same cause of action.
Ratio Decidendi: The court emphasized the need to approach the court with clean hands and avoid abuse of the legal process, highlighting the equitable nature of writ remedy. It also referenced and discussed the provisions of Section 35a of the U. P. Khadi and Village Industries Board Act, 1960 and the consequences of repeated filing of writ petitions.
Final Decision: The appeal was dismissed with costs, and the counsel's fee was quantified at Rs. 50,000/-.
S. B. SINHA, J.
( 1 ) LEAVE granted.
( 2 ) EXTENT of Superior Courts' jurisdiction to dismiss a writ petition for alleged suppression of material fact is involved in this appeal which arises out of a judgment and order dated 19. 07. 2006 passed by the High Court of judicature at Allahabad, Lucknow Bench, Lucknow in WP No. 4274 (M/b)of 2006.
( 3 ) BASIC fact of the matter is not in dispute. Appellant is a cooperative society (Samiti ). It applied for loan for establishment of an industry for manufacturing 'aluminum Pottery' from the respondents. A loan of Rs. 5,24,000/- was sanctioned in the year 1991. A sum of Rs. 3,09,000/- was released by the respondents. Again, a sum of Rs. 90,000/- was sanctioned in 1996. It filed an application for grant of loan of rs. 22,00,000/- under the 'consortium Bank Credit Scheme' for establishing an unit for manufacturing P. V. C. Shoe Sole. A sum of Rs. 16,20,000/- was sanctioned and Rs. 13,20,000/- was released. The Samiti allegedly defaulted in making payments. Recovery proceedings were initiated against the samiti. Several writ petitions were filed by it questioning the legality thereof.
( 4 ) A purported public interest litigation was also filed wherein Suresh chandra Sharma (Appellant No. 2 herein) was also a party; praying for the following reliefs:
"i) to hold the provisions of Section 35a of the u. P. Khadi and Village Industries Board Act, 1960 to be unconstitutional and declaring the same ultra vires the provisions of Articles 14, 21 and 300a of the Constitution of India;
ii) issue a writ, order or direction in the nature of Certiorari to quash the recovery certificates dated 14. 9. 05, 19. 7. 05 and 10. 9. 2002 contained in annexures Nos. 4,5 and 6 issued by U. P. Khadi and Gramodyog Board, Lucknow.
iii) issue a Writ, order or direction in the nature of Mandamus commanding the opposite party Nos. 2,3 and 4 to get recovery of amount due against the members of Petitioners society through due process of law other than recovery the same as arrears of land revenue"
( 5 ) IT appears some other writ petitions were also filed by the appellant, as would appear from the counter affidavit filed on behalf of the respondents. However, fresh recovery proceeding had been initiated which were not the subject matter of challenge in the writ petitions filed by the Appellant before the High Court.
( 6 ) A fresh writ petition was filed. The same has been dismissed by reason of the impugned judgment holding that the appellants have suppressed the material fact, viz. , filing of four writ petitions on the same cause of action and, thus, it was not maintainable. Appellants are, thus, before us.
( 7 ) MR. Uma Datta, learned counsel appearing on behalf of the appellants, would submit that the statement made by the writ petitioners that no other writ petition was filed on the same cause of action was correct as from a perusal of the four writ applications, reference whereof was made by the high Court in its impugned judgment, it would appear that they were filed on different causes of action.
( 8 ) MR. S. Wasim A. Qadri and Mr. Girdhar G. Upadhyay, learned counsel appearing on behalf of the respondents, on the other hand, submitted that in different writ petitions, the petitioners questioned the recovery proceedings, citations and sale of the property, as orders were passed at different stages of the same recovery proceedings.
( 9 ) ALTHOUGH the prayers made in the four writ applications are apparently different, having gone through the writ applications, it became evident that the core issue in each of the matter centers round recovery of the amount advanced to the appellants by the bank. Evidently, orders passed in different stages of the proceedings as also new proceedings based upon fresh calculation on interest on the principal sum had been in question from time to time. As indicated hereinbefore, even a public interest litigation was filed wherein also Appellant No. 2 was a party. Maybe that validi
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