(1.) The petitioners are engaged in the business of developing properties. The second petitioner is a Director of the first petitioner (hereafter the company) incorporated under the Companies Act, 1956.

(2.) On or about 31.8.1993, the company had acquired an immovable property at 42/C, Ballygunge Circular Road Kolkata 700019 (hereafter the said property) by and/or under a registered deed of lease from one Bengal Bihar Construction Private Limited (in liquidation). On 28.2.1997, the company created mortgage in favour of the respondent (hereafter the Bank) over and in respect of the said property by depositing the lease deed in original in lieu of grant of a credit facility viz. "Inland Letter of Credit" in terms of an arrangement entered into by and between them on 26.2.1997.

(3.) Apart from the above mortgage, the Bank had obtained hypothecation of raw materials, goods and stocks under a deed of hypothecation dated 28.2.1997 from the petitioners.

(4.) Alleging default on the part of the company to repay its debts/dues, the Bank had initiated legal proceedings against the company as well as its guarantors before the Calcutta Debts Recovery Tribunal No. 1 by filing an application under section 19 of The Recovery of Debts due to Banks and Financial Institutions Act, 1993. It was registered as OA No.135 of 2001. During pendency of the said proceedings, the company and the Bank entered into negotiation for settlement of the debts owed by the former. Ultimately, it was mutually agreed by and between the parties that the company would be required to pay a sum of Rs. 54 lakh towards full and final settlement of the claim of the Bank within 31.3.2006 and upon payment of such amount, all the securities held by the Bank would stand released.

(5.) A communication to this effect was made by the Advocate for the Bank vide letter dated 25.3.2006, addressed to one of the Directors of the company. The letter reads as follows: "Under instructions from my client Punjab and Sind Bank, Asset Recovery Branch of 14/15, Old Court House Street, Kolkata-7000 001 I write to you as follows :That the settlement proposal initiated for your Account for which O.A. No.135 of 2001 is pending before the Debts Recovery Tribunal-I, Kolkata has been sanctioned by the Head Office on the following terms: 1. That you will suffer a decree for the entire amount of suit with pendenti lite and future interest till realisation along with costs as prayed in the plaint. 2. The above decree shall be deemed to have been satisfied, if you pay a sum of Rs. 54 Lacs latest by 30.3.2006. 3. In case of the default in the above payment, full amount of decree as per (i) above, shall become immediately payable. 4. If you pay the settlement amount before obtaining the consent decree, the factum of settlement be got recorded in the Court towards satisfaction of Banks claim in the suit. 5. Concession will be credited in the account only after full and final adjustment of the account. 6. Securities held will be released only after the full and final adjustment of the account. 7. Cases filed/pending against the Bank if any, are to be withdrawn by you to the entire satisfaction of the Bank. Please act strictly in terms of the aforesaid sanction to avail the same".

(6.) According to the petitioners, the securities would include the original lease deed of the said property, the original guarantee documents executed by Sri Jagadish Prasad Podder and Sri Sushil Kumar Podder (individual guarantors) and three public limited companies (the corporate guarantors) and the deed of hypothecation of the raw materials, goods and stocks.

(7.) Upon receipt of the aforesaid-letter, the company acted according to the terms and conditions mentioned therein and under cover of letter dated 29.3.2006 forwarded a pay order of even date for the settled sum of Rs. 54 lakh to the Bank towards full and final settlement of its dues and pro-tanto in respect of the aforesaid credit facility account.

(8.) I