P.V. SANJAY KUMAR, J.

1. Challenge in this writ petition is to the action of the Syndicate Bank in trying to auction the properties of the petitioner firm situated in Sy.Nos.97/A and 98/A of M.Venkatayapalem Village, Khammam Rural Mandal and District, along with plant and machinery, for recovery of the dues of Rs. 53,38,046/- towards its cash credit and term loan accounts, under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short, 'the SARFAESI Act').

2. The grievance of the petitioner firm is that the bank is not following the prescribed procedure, including the R.B.I. guidelines and the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme, as it did not disclose the amounts recovered from the CGTMSE and it did not claim 75% of the amount in default from the CGTMSE. A consequential direction is sought to the bank not to interfere with the petitioner firm's possession over the subject properties and to recover the amount in question from the CGTMSE.

3. The case of the petitioner firm is as follows: It secured a term loan of Rs. 60,00,000/- and cash credit OD of Rs. 5,00,000/- from the Syndicate Bank, having insured it under the CGTMSE scheme. In terms of this scheme, in the event of default in repayment of the loan, the CGTMSE is liable to pay 75% of the amount in default to the bank and only the remaining 25% of the amount due is liable to be recovered by auctioning the secured assets. While so, the Syndicate Bank, without claiming 75% of the amount due from the CGTMSE and without disclosing full and proper facts as to the procedure adopted by it in terms of the scheme, was attempting to recover 100% of the amount due through sale of the petitioner firm's properties. Claiming that it would be put to irreparable loss and injury if the bank did not follow the procedure under the CGTMSE scheme, the petitioner firm filed the present writ petition.

4. When this matter was taken up for hearing on 31.10.2017, Sri A.Krishnam Raju, learned counsel for the Syndicate Bank, informed this Court that the bank would not take any coercive measures against the petitioner firm till the next date of hearing and undertook to file his counter. Again, on 14.11.2017, the learned counsel stated that no coercive steps would be taken against the petitioner firm till the next date of hearing. This was reiterated thereafter on 27.11.2017 and 11.12.2017. Comprehensive arguments having been advanced by all the learned counsel, final orders were reserved in the writ petition on 27.12.2017 and this Court directed that no coercive measures should be taken pending further orders.

5. Sri Mummaneni Srinivasa Rao, learned counsel for the petitioner firm, would contend that the Syndicate Bank is following the procedure prescribed under the CGTMSE scheme and once the petitioner firm insured its loan accounts with the CGTMSE to its knowledge, it is open to the bank to unilaterally proceed against the secured assets under the SARFAESI Act without taking recourse to the recovery procedure prescribed under the CGTMSE scheme. Learned counsel would further contend that after recovery of 75% of the amount in default from the CGTMSE, the bank is at liberty to auction the secured assets for recovery of the balance 25% only. In effect, his contention is that the bank cannot recover 100% of the amount due straightaway by sale of the secured assets.

6. Sri A.L.Raju, learned counsel for the CGTMSE, would state that as per Clause 10 of the CGTMSE scheme, the lending institution may invoke the guarantee in respect of the credit facility after the account became a Non-Performing Asset (NPA) and the same would be marked on the online portal of the CGTMSE, subject to compliance with the procedure prescribed under the CGTMSE scheme. The guaranteed amount would be released in