R.Arumugaswamy v. The Punjab National Bank
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 20.05.2021
CORAM
THE HONOURABLE DR. JUSTICE ANITA SUMANTH and THE HONOURABLE MR.JUSTICE SENTHILKUMAR RAMAMOORTHY Writ Petition No.12072 of 2021 WMP.Nos.12849 & 12850 of 2021 R.Arumugaswamy, Suspended Director, RA Samy Trading Company Pvt. Ltd., No.21, Ranganathan Street T-Nagar, Chennai-600017
...Petitioner
Vs
1. The Punjab National Bank Rep. By its General Manager, Recovery Streesed Asset Management Branch, Arulmani Building, No.27, Whites Road, Chennai-600014
2. The Deputy General Manager SASTRA Special Department Punjab National Bank, TTK Road, Chennai 600014
3. The Chief Manager, Recovery, Punjab National Bank, Stressed Asset Management, Zonal Office, Chennai-600014
4. Ashok Velamur Sheshadri The Liquidator for M/s.R.A.Samy Trading Pvt. Ltd. Office: A2, II Floor, Dynamic Apartments, Parangusapuram Street, Aziz Nagar, Kodambakkam, Chennai-600024
...Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India praying to Writ of certiorarified mandamus calling for the records of the impugned communication in ZS/RA SAMY dated 29.04.2021 issued by the 1st respondent Bank to the
petitioner and quash the same and consequently direct the 1st respondent Bank to accept the One-time settlement by proposing a reasonable a fair amount agreeable to both the parties. For Petitioner : Mr.Naveen Kumar Murthi For Respondents : Mr.M.L.Ganesh-R1 to R3
O R D E R
(Order of the Court was made by Dr.ANITA SUMANTH,J.) This writ petition is filed by an individual, an erstwhile director of RA Samy Trading Company Pvt. Ltd. ('company'). The petitioner prays for a certiorarified mandamus calling for and quashing impugned communication dated 29.04.2021, issued by the Punjab National Bank ('Bank') to the petitioner and a direction to the bank to accept the one time settlement offered by the company.
2. Heard Mr.Naveen Kumar Murthi, learned counsel for the petitioner and Mr.M.L.Ganesh, learned counsel who has accepted notice for the Punjab National Bank, Recovery Stressed Asset Management Branch/R1 to R3. We are not issuing notice to Ashok Velamur Sheshadri, the liquidator appointed by the National Company Law Tribunal ('NCLT') who is arrayed as R4, in the light of the order that we have passed herein.
3. Having heard both learned counsel in detail, we are of the view that this writ petition is not maintainable before us.
4. The company is, admittedly, in default of credit facilities that had been obtained by it from the bank. The bank had approached the NCLT in terms of Section 7 of the Insolvency & Bankruptcy Code, 2016 ('IB Code'). The application was admitted and Corporate Insolvency Resolution Process (CIRP) was commenced as against which an appeal was preferred by the company before the National Company Law Appellate Tribunal (NCLAT) that was unsuccessful.
5. The process of liquidation was thereafter commenced by order of the NCLT dated 20.04.2021, and the company is stated to have challenged the same by way of an appeal before the NCLAT that is pending.
6. In the meanwhile, the petitioner had approached the bank for a one time settlement. Since there was no response forthcoming, the petitioner moved a writ petition in W.P.No.20106 of 2020 and a Division Bench of this Court, by order dated
04.01.2021 directed the bank to dispose the petitioner's representation dated 17.12.2020 seeking a settlement of the outstanding dues, within a period of four weeks from date of receipt/uploading of that order.
7. Pursuant to the aforesaid order of this Court, the petitioner's representation has come to be rejected by the Bank by way of the impugned communication dated 29.04.2021. The impugned communication addressed to the petitioner rejects the request for one time settlement on the ground that since the company was itself under liquidation, Mr.R.Arumugaswamy, erstwhile director of the company, had no locus standi to make any representation in the name of the company.
8. We find nothing untoward or illegal in the stand taken by the bank. In fact, that is also one of the reasons why we are of the view that this writ petition is not maintainable before us. Post liquidation, any litigation initiated on behalf/at the instance of the liquidated entity can only be by the Liquidator. The second reason is that the company is before the NCLAT challenging the order of liquidation and hence must seek any interim relief including the consideration of its offer for settlement of arrears, only before that forum.
9. With the aforesaid observations, this writ petition is dismissed permitting the company to approach the NCLAT in regard to appropriate relief that it may seek, in accordance with law. Connected miscellaneous petitions are closed. There shall however, in the light of the circumstances as above, be no order as to costs.
s/d- Assistant Registrar True Copy Sub-Assistant Registrar Ska To 1.The Punjab National Bank Rep. By its General Manager, Recovery Streesed Asset Management Branch, Arulmani Building, No.27, Whites Road, Chennai-600014 2.The Deputy General Manager SASTRA Special Department Punjab National Bank, TTK Road, Chennai 600014
3.The Chief Manager, Recovery, Punjab National Bank, Stressed Asset Management, Zonal Office, Chennai-60001 Writ Petition No.12072 of 2021 WMP.Nos.12849 & 12850 of 2021 KV(CO) SP(22/07/2021)