Telangana High Court
WP/10543/2004 of Smt. Kosaraju Annapoorna, Vs The Vice Chairman AND Managing Director, on 28 December 2004
COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TWENTY EIGHTH DAY OF DECEMBER TWO THOUSAND AND FOUR PRESENT THE HON'BLE MR JUSTICE GODA RAGHURAM WRIT PETITION NO : 10543 of 2004 Between: Smt. Kosaraju Annapoorna, W/o Appa Rao, R/o 9-162, Kummari
IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD
(Special Original Jurisdiction)
TUESDAY, THE TWENTY EIGHTH DAY OF DECEMBERTWO THOUSAND AND FOUR
PRESENT
THE HON'BLE MR JUSTICE GODA RAGHURAM
WRIT PETITION NO : 10543 of 2004
Between:
Smt. Kosaraju Annapoorna, W/o Appa Rao,R/o 9-162, Kummari Veedhi, Kaikalur (Village and Mandal),Krishna District.
AND
..... PETITIONER
1 The Vice Chairman & Managing Director, A.P.S.F.C. Hyderabad.
2 The A.P. State Financial Corporation,
APSFC, P.B.No.760, 2nd Floor, Pioneer House, Labbipet, Bandar Road, Vijayawada -10.
.....RESPONDENTS
Petition under Article 226 of the constitution of India praying that in thecircumstances stated in the Affidavit filed herein the High Court may be pleased toissue a Writ of Mandamus, or any other appropriate writ, order or direction declaringthe action of the Respondents in issuing Auction Notice, dt. 17-5-2004 to thePetitioner without making recovery from the Loan borrowers is highly arbitrary,illegal and further direct the Respondents to recover the loan amount from the loanborrowers, if necessary by selling the properties offered by them for securing theloan, before taking coercive steps against the Petitioner.
Counsel for the Petitioner: MR.P.VENKAT RAO
Counsel for the Respondents: MS.Y.N.LOHITA (SC FOR AP FINANCE CORP)
The Court made the following:
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ORAL ORDER:
A loan was sanctioned by A.P. Finance Corporation (APFC) to oneM/s.Trans Medi Script Solutions (P) Ltd., Vijayawada for establishinga company in the year 1999. The company was in the business ofmedical, legal and insurance transcriptions. The petitioner was one ofthe guarantors for repayment of the loan amount and had offered hisimmovable property as collateral security by mortgaging the same.The respondent Corporation by notices dated 27.04.2004 and17.05.2004 informed the petitioner that the outstanding amount dueon account of the loan obtained by M/s. Trans Medi Script Solutions(P) Ltd., Vijayawada as specified in the notices is not paid up by him,his properties offered as collateral security will be put to sale. Thesecond notice dated 17.05.2004 reiterates the notice to the petitioneraffording time to him upto 25.05.2004. The details of arrears of theloan amount as on 30.04.2004 have also been stated in the saidnotice dated 17.05.2004. Aggrieved thereby, the writ petition is filedcontending that the conduct of the respondent Corporation in seekingto recover the amounts due from the petitioner as guarantor withoutproceeding against the principal borrowers is arbitrary and illegal, andhe seeks a direction to the respondents to recover the loan amountfrom the principal borrowers, if necessary, by selling the propertiesoffered by them for securing the loan.
On behalf of the respondent Corporation a counter-affidavit has beenfiled by the Senior Branch Manager. It is stated that a term loan ofRs.20.00 lakh was sanctioned to M/s. Trans Medi Script Solutions (P)Ltd., Vijayawada on 14.03.2000 for setting up a medical transcriptionunit, out of which, an amount of Rs.14,75,417/- was released foracquisition of equipment etc. The company had started operations in2000-01. The writ petitioner had provided collateral security for theloan sanctioned and disbursed to the company by the respondentCorporation, by creating an equitable mortgage of the house propertybearing Door No.9-162, Kaikaluru, Krishna District. The counter-affidavit states that despite issuance of several notices and letters tothe principal borrowers, they had not responded nor had thepetitioner as a guarantor responded to the notices dated 10.03.2004and 27.04.2004. Therefore, the notice dated 17.05.2004 was issuedgranting time till 25.05.2004 to clear the outstanding dues dulyintimating the petitioner that in default, appropriate steps would betaken for recovery of dues, if necessary, by putting to sale theproperties offered by the petitioner by way of collateral security. It isfurther stated in the counter-affidavit that the amount due as on30.04.2004 including interest is to a tune of Rs.2,39,400/- and onaccount of default in payment of these amounts, the outstandingdues including the principal and interest, amount to Rs.11,21,400/-.The counter-affidavit also asserts that the Directors of the loaneecompany had not offered any collateral security in respect of anyproperties owned by them except a fixed deposit receipt for anamount of Rs.35,000/- belonging to one of the promoters-ShaikIbrahim which was pledged in favour of the respondent Corporationas collateral security. The Corporation is at liberty and legally entitledto proceed even against the guarantors is sum and substance of thecontention urged on behalf of the respondent Corporation. It is alsostated that except the notice dated 17.05.2004, the respondents hadnot proceeded, at the time of filing of the writ petition, to put theproperties of the petitioner to sale and aggrieved by a mere noticeissued by the respondent Corporation, the petitioner has approachedthis Court without any substantive cause of action.
The petitioner’s contention that the respondent Corporation isdisabled in law from trying to recover the amounts due to it from theguarantors without first proceeding against the principal borrowers, isa contention that has no foundation on any legal principles. Thepetitioner does not substantiate the legal basis for this contention. Atany rate, the writ petition has been filed on the basis of mere noticedated 17.05.2004 issued by the respondent Corporation calling uponthe petitioner to clear the amounts due or else that action will beinitiated to proceed against the properties offered as collateralsecurity. This notice does not per-se provide any cause of action noris the notice stricken with the voice of any illegality, arbitrariness orany other infirmity, warranting interference in the writ petition.
The writ petition is misconceived and is accordingly dismissed. Nocosts. The interim order dated 25.06.2004 stands dissolved.
VGB
_________________
28.12.2004
To
1 The Vice Chairman & Managing Director, A.P.S.F.C. Hyderabad.
2 The A.P. State Financial Corporation, APSFC, P.B.No.760, 2nd Floor, Pioneer House, Labbipet, Bandar Road, APSFC, P.B.No.760, 2nd Floor, Pioneer House, Labbipet, Bandar Road, Vijayawada -10.
3 2CD copies.