IN THE HIGH COURT AT CALCUTTA (CONSTITUTIONAL WRIT JURISDICTION)

APPELLATE SIDE Present :

The Hon’ble Justice Partha Sarathi Chatterjee WPA 9820 of 2021 With CAN 1 of 2025 Riddhi Siddhi Cold Storage (P) Ltd. & Ors.

Vs.

The Punjab National Bank & Ors.

For the petitioners : Mr. Debabrata Saha Ray, Ld. Sr. Adv, Mr. Subhankar Nag, Mr. Dwipan Dasgupta, Mr. Pingal Bhattacharya, Ms. Surabita Biswas.

For the PNB : Mr. Samrat Sen, Ld. Sr. Adv., Mr. Abhishek Banerjee, Ms. Parna Roy Choudhury.

Heard on : 18.07.2025 Judgment on : 05.08.2025 Partha Sarathi Chatterjee, J.:-

Prelude:

1. Four Cold Storage Companies—viz., (i) Riddhi Siddhi Cold Storage (P) Ltd.; (ii) Siddhanth Vedant Cold Storage (P) Ltd.; (iii) Siddhi Vinayak Himghar (P) Ltd.; and (iv) Rajaram Sevak Multipurpose Cold Storage (P)

Ltd. (hereinafter collectively referred to as "the companies")—along with their common directors, have invoked the extraordinary jurisdiction of this Hon’ble Court to challenge the classification of their loan accounts as Non-Performing Assets (for short, NPAs) by the respondent bank, allegedly in contravention of the directives and regulatory norms issued by the Reserve Bank of India (for short, RBI) concerning the restructuring of loan accounts. Asserting their bona fide status as Micro, Small, and Medium Enterprises (for short, MSMEs), the petitioners seek the issuance of an appropriate writ, order, or direction, particularly in the nature of mandamus, commanding the respondent bank to consider and act upon their restructuring proposal in accordance with the applicable RBI guidelines.

Petitioners' Contentions:

2. Sans unnecessary details, the essential facts, as outlined in the writ petition, that led to the institution of the present writ petition are that the petitioner Nos. 1 to 4 are existing companies within the meaning of the Companies Act, 2013 (for short, "the 2013 Act"). Vide sanction letter dated 17.09.2019, the companies were extended credit facilities by United Bank of India (for short, "UBI") to the tune of Rs. 50 lakhs.

3. At the express instance and encouragement of United Bank of India (for short, "UBI"), four sick units (then classified as NPAs), namely—(i) M/s. Ma Sarada Multipurpose Cold Storage (P) Ltd., later taken over and operated as Rajaram Sevak Multipurpose Cold Storage (P) Ltd. (Petitioner No. 4); (ii) Raichanga Agro Food Processing Industries (P) Ltd., later taken over as Riddhi Siddhi Cold Storage (P) Ltd. (Petitioner No. 1); (iii) Gouri Cold Storage (P) Ltd., later operated as Siddhi Vinayak Himghar (P) Ltd. (Petitioner No. 3); and (iv) Nabadiganta Cold Storage (P) Ltd., later taken over as Siddhanth Vedant Cold Storage (P) Ltd. (Petitioner No. 2)—were purchased by the petitioners upon categorical assurances from UBI that adequate credit facilities, including working capital limits, would be sanctioned to ensure the smooth functioning of the said units. Pursuant to such takeovers, the credit exposure of the petitioners was significantly enhanced from the initial sanctioned limit of Rs. 50 lakhs to approximately Rs. 73 crores.

4. However, the promised credit facilities were never fully disbursed by the respondent bank, resulting in severe operational difficulties for the cold storage units. It is further alleged that the land intended for ingress and egress to one of the factory premises, acquired for a consideration of Rs. 34 lakhs, was not made available, thereby indicating a defective sale on the part of the bank.

5. Despite these challenges, and notwithstanding major setbacks caused by the demonetization in 2016 and a significant decline in potato prices in 2018, the petitioners have made substantial repayments to the bank since 2009, amounting to Rs. 13.54 crore towards principal, Rs. 19.50 crore towards interest and cheques, and Rs. 105.69 crore by way of rollovers.

6. Acknowledging the adverse conditions being faced by MSMEs across the country, RBI issued a circular dated 01.01.2019. By virtue of this circular, the restructuri