Section 29 notice and natural justice: clear warning of possession on default can dispense with a separate show-cause notice.

A notice under Section 29 can satisfy natural justice if it clearly warns the borrower that default by the stated date will lead to takeover of the factory premises, so a separate show-cause notice is not necessarily required. The Court also noted that the borrower's representation should ordinarily be considered before the Corporation resorts to the drastic step of taking possession, but fairness depends on the facts and the offer made here was found unreasonable. On that basis, the Section 29 action was not treated as vitiated for want of a separate notice.

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Issues: Whether action taken by the State Financial Corporation under Section 29 was invalid for want of a separate show-cause notice and for non-consideration of the borrower's representation.

Analysis: Natural justice is not confined to any rigid form and its requirements depend on the facts of each case. A notice satisfies the requirement if it clearly informs the affected party that, on failure to remedy the default within the stipulated time, the proposed adverse action will follow. Here, the Section 29 notice required repayment by a fixed date and expressly warned that possession of the factory premises would be taken on default. That was sufficient notice of the contemplated action, and no additional show-cause notice was necessary. The Court also observed that the borrower's representation should ordinarily have been considered by the Corporation before resorting to the drastic step of taking over possession, but on the facts the offer made by the borrower was found unreasonable.

Conclusion: The action under Section 29 was not vitiated for absence of a separate show-cause notice, and the impugned High Court judgment was set aside.

Ratio Decidendi: A notice under Section 29 that clearly informs the borrower of the proposed action upon default can satisfy natural justice without a separate show-cause notice; however, fairness ordinarily requires consideration of any representation before taking drastic possession measures.

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