This Writ Petition is filed for issuance of a Writ in the nature of Certiorari for quashing the Impugned Communication dt.16.05.2018 (Annexure P-1) issued by respondent-Bank whereby the request dt.10.05.2018 (Annexure P-2) of the petitioner’s company to grant a further time beyond stipulated date of 21.05.2018 for making repayment of balance amount of ₹2.52 Crores (alongwith interest on Bank rate) out of total One Time Settlement amount of ₹10.54 Crores, has been declined.

The petitioner is a private Company incorporated under the Companies Act, 1956 engaged in sale of electronics goods.

Vide sanction letter dt.28.08.2012, the respondent-Bank sanctioned a cash credit (Hypothecation) Limit of ₹15.00 Crores to the petitioner. For the said loan, stocks/assets of the petitioner’s Company were offered for hypothecation as primary security, and for additional security, an equitable mortgage of property, comprising Hotel Metro, SCO No.401-402, Sector 35, Chandigarh in the name of M/s AMG Hotels Pvt. Ltd. having value of 26.30 Crores, was also offered.

The petitioner’s business suffered a setback allegedly on account of recession or global economic meltdown in the year 2014 and the loan account of the petitioner was declared as Non Performing Asset (NPA) by the respondent-Bank on 02.03.2015, and notice dt.03.03.2015 was issued under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as “the Act”) demanding ₹15,98,27,434.62 to be paid within 60 days. Later, another notice dt.08.04.2015 was issued under Section 13(2) of the Act, demanding ₹16,24,03,431.86.

Petitioner sent a reply/representation dt.10.06.2015 under Section 13 (3A) of the Act.

According to petitioner, the respondent-Bank though mandatorily required, did not consider objections/reply of the petitioner to the notice under Sec.13(2) and did not give any reply thereto.

Subsequently, the respondent-Bank published a possession notice under Section 13(4) of the Act in the Newspaper ‘The Tribune’ on 30.06.2015 stating that it had taken symbolic possession of the running Hotel of the mortgagor company on 26.06.2015 on the ground that the petitioner defaulted in payment of the amount mentioned in the notice dt.08.04.2015 issued to the petitioner under Section 13(2) of the Act.

According to the petitioner, it had deposited 49.64 Lakhs in July/August 2015 apart from a further deposit of ₹1.50 Crores in the Cash Credit Account after classification of the loan account as NPA. Petitioner also claims to have put on sale certain personal properties including residential house to liquidate dues of the respondent-Bank with an honest intention to repay the loan amount.

The respondent-Bank issued and published a sale notice in the Newspaper ‘The Tribune’ dt.01.11.2015, proposing to conduct e-auction of the immovable property of the mortgagor on 05.12.2015.

The petitioner then approached the DRT by filing a Securitization Application under Section 17 of the Act on 26.11.2015. However, the said auction did not succeed and the respondent-Bank issued another notice dt.15.12.2015. According to the petitioner, there was also an attempt to settle the matter in Lok Adalat in the DRT, but the same did not succeed. Thereafter, the respondent-Bank filed an OA before the DRT, Chandigarh on 25.04.2016.

The OTS Offer

Notwithstanding the same, the respondent-Bank sent a letter dt.11.09.2017 to the petitioner informing the petitioner that it had come out with a scheme of One Time Settlement (OTS), and that the petitioner is eligible for the OTS under the said scheme named as SBO-OTS-2017. It stated that the ledger outstanding as on 31.03.2017 is ₹ 13,99,89,273.99, and the OTS amount offered was ₹ 10,53,75,069.74.

In response thereto, the petitioner vide letter dt.31.10.2017 deposited an upfront amount of ₹ 1.40 Crores, and submitted its offer for settlement.

The respondent-Bank vide letter dt.21.11.2017 sanctioned the OTS prop