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NPAs announced despite top court ban: 2 contempt petitions before Supreme Court

The plea, filed by Aslam Trading Company, has impleaded as respondents, Reserve Bank of India Governor Shaktikanta Das, Chief Executive of Indian Banks’ Association Sunil Mehta and the Chief Manager of Canara Bank.

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Two contempt petitions have been filed in the Supreme Court, seeking punishment to contemnors for not obeying the apex court’s order of September 3, 2020, whereby the court had declared that “accounts, which were not NPA till August 31, 2020, shall not be declared NPA till further orders”.

The petitions have been filed by Advocates Vishal Tiwari and Abhigya, on behalf of Aslam Trading Company and Tarun Polymers.

The plea, filed by Aslam Trading Company, has impleaded as respondents, Reserve Bank of India Governor Shaktikanta Das, Chief Executive of Indian Banks’ Association Sunil Mehta and the Chief Manager of Canara Bank.

The plea by Tarun Polymers has impleaded as respondents Shaktikanta Das, Sunil Mehta and Shashi Ranjan Giri, the Authorised officer of Indian Bank, Allahabad.

The plea has cited the apex court’s direction, whereby the Court had noted, “At the request of Mr Tushar Mehta, Solicitor General, the matter is adjourned for September 10, 2020. Mr Harish Salve, Senior Advocate, submitted that no account shall become NPA at least for a period of two months. In view of the above, the accounts which were not declared NPA till August 31, 2020, shall not be declared NPA till further orders.”

Aslam Trading Company has stated that it was granted by the Bank from time to time, various credit facilities by way of financial assistance against various assets creating security interest in favour of the Bank. The installments of loan were being paid regularly and his account was not turned NPA till August 31, 2020.

However, on April 30, 2021, a Demand Notice under Section 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 to Aslam Trading Company demanding an amount of Rs 1,84,23,701.35 as on April 30, 2021, inclusive of interest up to April 30.

A similar notice was issued to Tarun Polymers by the Bank on April 9, 2021, demanding an amount of more than Rs five crore as on March 31, 2021 inclusive of interest up to March 31.

The pleas stated that both Aslam Trading Company and Tarun Polymers were unilaterally classified as NPA by the respondents on November 12, 2020 and September 28, 2020, respectively, under Section 13 (2) of the SARFAESI Act. However, no showcause notice was given to them.

Further, it was stated that the Demand Notice, along with such demand for the defaulted amount, provided with the threat of recovering the possession of the petitioners, if within 60 days of the Notice, the payment was not made by the petitioner.

According to the petitioners, the stay order was passed in the COVID-19 pandemic in the benefit of stressed borrowers, so that they shall not suffer in present financial crisis during the pandemic. Considering the slump in the petitioners’ work, the Stay order was operating as a life-saving drug to them, but the contemptuous act of the Respondents has brought a major setback to them, making their survival critical.

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They have submitted that the contemptuous act of the Respondents has not only disobeyed the courts order, but also caused severe irreparable damages and loss to the petitioners, as they have lost their image and have been defamed as the possession Notice was published in the newpapers of their locality, which has resulted in the degradation of dignity of petitioners.

The petitioners further alleged that the contemptuous act of the respondents has shaken the confidence of the public and degraded the trust of the borrowers in the bank.

Source:ILNS

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