JUDGMENT :

Krishna Rao, J.

1. The petitioners have filed the present writ petition challenging an e-mail dated 5th July, 2024 and the notice dated 8th July, 2024, wherein and where under the bank has declared the account of the petitioner as Non-Performance Assets hereinafter referred to as “NPA”.

2. The petitioner company is a Micro, Small and Medium Enterprises hereafter referred to as “MSME”. In the year 2013, the petitioners availed credit facilities from the respondent bank for expansion of their business. On 7th March, 2020, the loans taken by the petitioners were restructured by the respondent bank and the pre-existing credit facilities in the accounts of the petitioner company were renewed. Soon after restructuring the whole world suffered due to COVID-19 pandemic, the petitioners could not revive its business despite of restructuring. In the meantime, several correspondences were made between the petitioners and the respondents.

3. On 19th June, 2024, the bank has issued an e-mail to the petitioners informing that the accounts of the petitioner company will be declared as NPA on 24th June, 2024, due to credit shortfall and also continuously overdrawn and pending overdue in respect of the four bank accounts of the petitioner company.

4. Mr. Deepan Sarkar, Learned Advocate, representing the petitioners submits that on 28th June, 2024, the petitioners received a WhatsApp message from the bank instructing the petitioners to deposit Rs. 40,000/- by the same day and an additional amount of Rs. 5,80,000/- by the next day so that the bank accounts of the petitioner company are not declared as NPA. As per instructions, the petitioners immediately deposited the said amount.

5. Mr. Sarkar submits that despite of depositing the said amount, on 30th June, 2024, an amount of Rs. 14,58,063/- was debited from the CCOL account of the petitioner company without any prior notice to the petitioners. The bank has further debited an amount of Rs. 1,03,287.56/- without any prior notice to the petitioners. He submits that when the petitioners enquired from the bank with regard to the deduction of the said amount, the bank informed the petitioners that the same was deducted as penal charges for delayed payment.

6. Mr. Sarkar submits that on 5th July, 2024, the petitioners received an e-mail wherein the bank has declared the account of the petitioners as NPA on 30th June, 2024. On 8th July, 2024, the petitioners also received a registered letter from the bank declaring the account of the petitioners as NPA. He submits that the bank has illegally deducted penal interest and additional interest without giving any prior intimation to the petitioners.

7. Mr. Sarkar submits that on 11th July, 2024, the petitioners have submitted new plan for restructuring but without considering the request of restructuring, the bank has issued a recall notice and guarantee invocation letter to the petitioners on 22nd July, 2024, demanding payment of Rs. 92,017,526.20/-. On 7th August, 2024, the bank has also issued a notice under Section 13(2) of the SARFAESI Act, 2002 to the petitioner no. 1, thus the petitioners have filed the present writ petition.

8. During the pendency of the writ petition, the petitioners have sent an increased offer of compromise for One Time Settlement (OTS) and the same was accepted by the bank on 30th August, 2025 but the petitioners were some issues with regard to the conditions of the OTS. The petitioners have deposited an amount of Rs. 5,00,000/- on 31st August, 2025 and submitted a request for modification of the conditions in the OTS. The petitioners failed to pay the next instalment and due to which the bank has cancelled the OTS on 2nd January, 2026.

9. Mr. Sarkar has relied upon the judgment in the case of Olive Tree Retail Pvt. Ltd. and Another Vs. South Indian Bank Ltd. and Another reported in 2023 SCC OnLine Cal 2397 and submits that appropriate stage to move Tribunal having not yet been reached and it would be too early to move the Tri