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Central Bank of India V/s M/S Maruti Acetylene Co. Ltd.
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Central Bank of India V/s M/S Maruti Acetylene Co. Ltd.
Central Bank of India V/s M/S Maruti Acetylene Co. Ltd.

Facts of the case

This appeal has been filed before the Honorable Supreme Court against the order of the Honorable High Court of Madras dismissing the appeal of the appellant by the order dated 13th June 2008 pursuing to C.R.P No. 1137/2008 and C.R.P No. 1417/2008. The respondent herein applied and took advance (loan) from the appellant bank herein but the failure of the respondent to pay the advance the appellant herein initiated the proceedings against the respondent before the Debt Recovery Tribunal. There was an arrangement entered by the parties to the proceeding as to settle the account over the failure to pay the advance amount in full and final agreed price according to the guidelines issued by the Reserve bank of India. The amount was to be made certain at Rs. 70,00,000/-. The said application after due consideration by the Debt Recovery Tribunal and was dismissed stating that the offer by the respondent was on the lower side by application filed in the Debt Recovery Appellate Tribunal as an appeal against the order of the DRT. The Debt Recovery Appellate Tribunal in the appeal made said that the amount of Rs. 25,00,000/- should be deposited in the interest-bearing account in the bank and provided a temporary injunction. The Debt Recovery Appellate Tribunal after careful consideration to facts and another dismissal of the decision and by according to the law in the behalf agreed with the decision by the Debt Recovery Tribunal and confirmed the same order. The appellant then filed a Civil Appeal against the same in the High Court. The High Court considering all the factor before reaching to the conclusion made it final and reached to decision and passed an interim order on 30th April 2008. High Court decides and agreed to settle the amount of the advance at Rs. 1,00,00,000/- inclusive of the money already paid and the rest of the payment should be made according to the instruction provided by the High Court, but the court provided an opportunity to the respondent bank to file the approval regarding such settlement.

Issues of the case

  1. Should the amount be settled as OTS of Rs. 1 Cr.?
  2. Is the order of the High Court according to the law?


The Honorable Supreme Court after hearing the learned counsels representing both the parties in the matter above and considering the facts and the precedents submitted established by the Honorable Judges to support the prayers and pleadings of the parties in the matter above states its observation herein that The Honourable Supreme Court states that considering the matter presented before it can firmly be established the respondent herein does not accept the offer provided after the due hearing processed before the Honourable High Court. And it is settled that it is the sole responsibility of the High Court to consider the matter when it comes to the institution as a revision application to consider all the factor and decision previously given in this behalf by other courts if any. The decision by reputed the appellate Tribunal of payment in the adjustment of the amount in form settlement at Rs. 25,00,000/- was dismissed by way of revision in civil revision was agreed by this Court and achieved the finality. The High Court at this stage of interlocutory order was deficient in providing further guidelines. This Court further accepts the amount of Rs. 75, 00,000/- decided and agrees for such amount to be deposited in the no-lien bank account. The amount involved which was affirmed by the High Court in the matter above earlier was one crore rupees wherein such matter was filed against in the High Court for re-appreciation of the matter.

It is important to consider that on the date of 13th June 2008 wherein it was decided that the bank will return the entire sum of money which was to be returned within the period of seven days further if the sum of money that has to be to be returned will also be paid with interest accrued therein as mentioned by the rate of contractual interest. The Honourable Supreme Court is in a full presumption of the legality of the matter that the principle should be followed by the High Court while applying its revisional jurisdiction on the matter from the appellate authority should provide a well-settled mind in analyzing all the corner of the matter and interpretation the applicable in the law in context to such matter. As the order that was placed by the appellate authority after due consideration of the matter concluded the matter with the order that INR 25 lacs should be paid, herein the order of such amount should be in adjustment was the rationale provided by the appellate authority. Thus the order was dismissed in the civil revision application filed before the court, such order, by all means, seems to be valid and final but considering the direction provided by the High court at the very interlocutory stage was improper and so such order or direction pr4ovided by the High Court should not sustain and received as dismissed. The Supreme Court agrees and accepts that the remaining amount which all-round INR 75 lacs will have to be deposited in the no-lien account. As the rest of the amount is concerned, that should have been refunded by the High Court to the interest accrued thereupon, and so another interest applicable as the amount was deposited in the no-lien account.

This court suggests that contractual rate as decided by the High Court to be paid as interest on that amount was not valid and cannot be accepted rather it should direct the refund of the interest accruing upon that amount as the amount was deposited in the no-lien account. The Honourable Supreme Court agrees with the judgment but set aside the impugned judgment regarding the contractual rate decided by the High Court.

The Honourable Supreme Court setting aside an impugned part of the judgment passed by the Honourable High Court decided to allow the appeal. The Court further allowing appeals charges no cost to such and decision provided by the court should be considered by the High Court on its own merits.

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