Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Default in repayment State Financial Corporation Act |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | State Financial Corporation Act, 1951 : Object and purpose of-Discussed Section 29-Borrower-Default in repayment-Right of Corporation to sell property of the borrower-Held: If inspite of giving an opportunity to pay debts, the borrower fails, then Corporation can exercise the right to sell its property to third party since the object of the Act is to obtain the best price by maximum public participation-On facts, Borrower was given fair chance to either bring better offer or a one time settlement, but borrower failed to so, hence sale to third party not void, illegal and contrary to Section 29. Administrative law : Judicial review-Adjudication by Financial Corporation-Interference with-Scope and ambit of-Held: High Court while exercising writ jurisdiction cannot sit as an appellate authority over the acts and deeds of- the Corporation-Action of Financial Corporation not to be interfered with unless same is unfair or malafide-Constitution of India-Article 226. Respondent-borrower defaulted in repaying the loan amount. Appellant-Corporation (KSIIDC) passed an order under Section 29 of the State Financial Corporation Act, 1951 for taking over the unit of borrower for recovery of its due and issued advertisement, inviting offers for sale of the unit. Sale was finalized in favour of one Vinpack Ltd. The borrower filed Writ Petition before the High Court challenging the sale as void, illegal and contrary to Section 29 of the Act. Thereafter, borrower sought to bring prospective purchasers but failed to bring any concrete better offer. Borrower then offered to purchase the unit on the same terms on which KSIIDC had agreed to sell the unit to Vinpack Ltd. Single Judge issued directions that the sale effected by KSIIDC to T the Vinpack Ltd. would be set aside if the borrower deposits the same amount in instalments. Borrower failed to avail the opportunity and KSIIDC sold the unit to the Vinpack Ltd. On appeal, Division Bench directed KSIIDC to undertake the entire process of selling of the unit again by giving an opportunity to borrower to bring better offer. Hence the present appeal by the KSIIDC and the Vinpack Ltd. |
Judge | Honble Mr. Justice Y.K. Sabharwal |
Neutral Citation | 2005 INSC 166 |
Petitioner | Karnataka State Industrial Investment And Development Corporation Ltd. |
Respondent | M/s. Cavalet India Ltd. And Ors. |
SCR | [2005] 2 S.C.R. 1183 |
Judgement Date | 2005-03-30 |
Case Number | 2062 |
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