The principles of natural justice, including notice and opportunity of hearing, are an integral part of Section 29 of the State Financial Corporations Act, 1951, and any action taken by the Corporation without affording such opportunity is void ab initio.

G.S. Singhvi, J. - This petition has been filed to quash the notice Annexure P-3 dated 9.7.1996 issued by the General Manager, Haryana Financial Corporation (hereinafter described as HFC) to take over the possession of the factory belonging to the petitioner and other consequential actions taken by the official respondents. The petitioner has also prayed for directing the respondents to return the possession of the factory to it.

2. From the pleadings of the parties, it appears that there is a serious dispute between Shri Ramesh Chander Jhamba, who has filed the present petition as Director of M/s Subhari Papers (P) Ltd., and the respondents No. 4 and 5 who also claim to be the Directors of the Company. However, that dispute and the litigation between the parties on the issue as to who should control the Company is not very much relevant for the purpose of deciding this petition. Suffice it to say that H.F.C. had given loan to the petitioner-Company and some dispute has been going on the question of repayment of the loan. On 18.10.1995 H.F.C. agreed to reschedule the instalments payable by the petitioner upto 4.6.1995 and directed it to make the payment in accordance with the conditions incorporated in paragraph 2 of the letter dated 18.10.1995.

3. On 9.7.1996, the General Manager of H.F.C. is said to have issued notice to the petitioner for taking over the possession of the factory and to sell it of by auction or by private negotiations for recovery of the amount due from the petitioner. According to the petitioner this notice was not served upon it or any of its Directors but a copy thereof was handed over on 10.7.1996 to one of the Directors of the Company, namely, Sh. Rajat Gupta at the time of taking over of possession. The petitioner has questioned the legality of the action taken by the respondents No. 1 to 3 to take over the possession of the factory on the ground of violation of the principles of natural justice. The petitioner has asserted that before dispossessing it from the factory premises, the official respondents were duty bound to give notice and opportunity of hearing to it and as no such notice and hearing was given, the impugned action is liable to be declared as void. The respondents No. 1 to 3 have pleaded that possession of the factory was taken in view of the communication Annexure R-1 written by some of the Directors of the petitioner-company to the Managing Director of H.F.C.

4. Although, learned counsel for the parties have addressed us at considerable length on various issues raised in the pleadings, in our opinion it is not necessary to deal with the questions whether the respondents No. 1 to 3 can take action against the petitioner for the failure of its Directors to get the change in the constitution approved by H.F.C. or due to their failure to repay the outstanding dues. We are also not required to adjudicate the dispute between the Directors of the Company because the same is already subject matter of other litigation. For the purpose of this order, it is sufficient to observe that the learned counsel appearing for the respondents could not place any material before the Court to show that the notice Annexure P-3 allegedly issued on 9.7.1996, had been served upon the petitioner before the actual take over of the factory was accomplished on 10.7.1996. Shri Sehgal tried to justify the action of the official respondents by making reference to the letter which is said to have been written by some of the erstwhile Directors of the Company that they were unable to repay the loan taken from H.F.C. Shri Sehgal also referred to the letter written by the guarantors who wanted to be relieved from the liability of repayment of loan. However, we are not convinced with the submission of Shri Sehgal that on the strength of Annexure R-1, the official respondents could take over the factory premises without affording opportunity of hearing to the petitioner. Undoubtedly, the action taken by the official