Telangana High Court
WP/18322/2002 of M/s.NAVODAYA INDUSTRIES Vs A.P.State Financial Corporation on 31 December 2008
COURT OF JUDICATURE OF ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) FRIDAY THE TWENTY FIRST DAY OF NOVEMBER TWO THOUSAND AND EIGHT :PRESENT: THE HON'BLE SRI JUSTICE L.NARASIMHA REDDY WRIT PETITION NO : 18322 of 2002 Between: M/s. NAVODAYA INDUSTRIES, rep. by its Managing Partner
IN THE HIGH COURT OF JUDICATURE OF ANDHRA PRADESH AT HYDERABAD(Special Original Jurisdiction)
FRIDAY THE TWENTY FIRST DAY OF NOVEMBERTWO THOUSAND AND EIGHT
:PRESENT:
THE HON'BLE SRI JUSTICE L.NARASIMHA REDDY
WRIT PETITION NO : 18322 of 2002
Between:
M/s. NAVODAYA INDUSTRIES, rep. by its Managing PartnerMr.K.Sathyanarayana S/o.Shankaraiah, R/o.11-23-2259,Ganeshnagar,Warangal
AND
..... PETITIONER
A.P.State Financial Corporation, Warangal Branch, Balsamudram, Hanamkonda, rep. by it’s Sr. Branch Manager.
.....RESPONDENT
Petition under Article 226 of the Constitution of Indiapraying that in the circumstances stated in the Affidavit filed herein theHigh Court may be pleased to pass an order, direction or writ,particularly, one in the nature of the Writ of Mandamus directing theRespondent Corporation to waive the attachment and release alldocuments of the petitioners as the loan amount was duly repaid by1992 itself.
The petition coming on for hearing, upon perusing thepetition and the affidavit filed herein and the orders of the High Courtdated 27-1-2003 made in WPMP.No. 23040 of 2002, and dt: 15-3-2004made in WVMP.No. 23040 of 2002, and dt: 10-12-2007 & 09-6-2008made herein and upon hearing the arguments of Sri Akella Srinivas,Advocate for the Petitioner and of Sri Y.N.Lohita Advocate for therespondent, the Court made the following:
ORDER:
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“On noticing that the advertisement threatening the defaultersof the Andhra Pradesh Financial Corporation with the inevitableconsequence of being arrested and handcuffed, this Courtpassed an order on 19-11-2008 directing the learned counsel tofurnish the particulars as to the officials who are responsible ofissuance of the advertisement on 09-09-2002.
Today the learned standing counsel has stated that theproposal was mooted by one Sri C.Jagannath Reddy, the thenGeneral Manager of the Corporation and it was approved by thethen Managing Director, Sri J.C. Mohanty, IAS. It is stated that SriJagannath Reddy retired from service, whereas Sri J.C. Mohantywas transferred to another organization and is said to have takenvoluntary retirement.
A perusal of advertisement discloses that the Corporation conveyed a message to its entrepreneurs, who are due to pay theamounts, either to clear the arrears or to face arrest. The SeniorBranch Manager addressed a letter, dated: 12-09-2002 to thepetitioner with the following warning.
“AVOID ARREST & IMPRISONMENT. BE RESPONSILBLE CITIZEN.”
The Corporation is the creation of a statute enacted by theParliament. The object is to provide financial assistance to theintending entrepreneurs without any profit motive and atreasonable interest. Even if it is to be treated as a financialagency simplicitor, it is expected, to act as model agency so thatthe others can emulate it. The threats and extortions of the naturementioned in the advertisement do not befit the organization andin a way, run contrary to the norms stipulated by the ReserveBank of India, and the basic tenets of human dignity protectedunder the Constitution of India.
The Reserve Bank of India itself issued guide lines in thecontext of recovery of amounts in April, 2008 on noticing thatcertain banks are employing recovery agents who in turn areresorting to objectionable methods. In those cases at least themodus operandi occasional and concealed. In the instant case,the Corporation has openly administered threat and warning tothe entrepreneurs who had obtained loan from it.
The Corporation is directed to explain as to how far it canjustify such a course of action and indicate as to why thenecessary directions in this regard be not issued. Post after two weeks.
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By that time, the learned standing counsel shall furnishstatement of account in relation to the account of the petitioner.”
ASSISTANT REGISTRAR
// TRUE COPY //
for ASSISTANT REGISTRAR
To
1. The Senior Branch Manager, A.P.State Financial Corporation, Warangal Branch, Balsamudram, Hanamkonda. Warangal Branch, Balsamudram, Hanamkonda.
2. One C.C.to Sri Akella Srinivas, Advocate. (OPUC)
3. One C.C.to Sri Y.N.Lohita, Advocate.
4. One spare copy.
ABDRAFTED ON 24-11-2008
HIGH COURT
LNRJ
DATE: 21-11-2008
NOTE: POST AFTER TWO WEEKS
ORDER
WP. NO. 18322 OF 2002
DIRECTION
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