TaxTMI 
TaxTMI 
2003 (10) TMI 389
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....e dated July 23, 2003/Annexure 4 to the Writ Petition. 3. It is not disputed that petitioner is the guarantor in respect of certain loans taken by the company, M/s. Meekan Transmission incorporated under Indian Companies Act, 1956 for manufacturing automatic gears in the factory situate at 19 kms. stone, G.T. Road, Bhawanipur, Mandhana, Kanpur Nagar. Petitioner is also the Managing Director of the Company (writ para 3). 4. In para 4 of the Writ Petition it is stated that the petitioner, Purshottam Sutwala, was sanctioned loan as per terms and conditions contained in the bond/Annexure 1 to the Writ Petition and (according to the conditions of the Loan Agreement bond) Pradeshiya Industrial and Investment Corpo-ration of U.P. called the ....
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....h non providing of the guarantee also threatened to put off execution of the rehabilitation of the scheme...." 8. Petitioner further admits, vide para 16 of the Writ Petition, "That ultimately the BIFR did not see eye to eye with the stand of the petitioner accordingly, by order dated 20-2-1996 the BIFR came to the conclusion that sanctioned scheme had fallen. It (IDBI) accordingly ordered that advertisement for the change in management be published." 9. Further in paras 17 & 18 of the Writ Petition it is pleaded that later a second rehabilitation package was approved by BIFR on July 10, 1997 but that also failed and that efforts at the behest of 'BIFR' with the tacit participation and at the behest of the petitioner and his company d....
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....n, specify;" Section 4(A) of Companies Act, while specifying various financial institutions does not include PICUP. Counsel for the petitioner has not been able to show anything otherwise and had to concede to the above submission of the Respondent No. 1 and finally this point was not agitated and rather dropped. Thus the argument of the learned counsel for the Petitioner on this score fails. (ii)It is next argued, with reference to the judgment of Apex Court in the case of Unique Butyle Tube Industries (P.) Ltd. v. U.P. Financial Corpn. [2003] 2 SCC 455 that impugned recovery certificate could not be issued at the instance of PICUP for recovering loan as land revenue in view of section 34 of Recovery of Debts Due to Banks and F....
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....eferred to the Supreme Court judgment rendered in the case of Kailash Nath Agarwal v. PICUP observing- "Since section 22(1) only prohibits recovery against the industrial company, there is no protection afforded to guarantors against recovery proceedings under the U.P. Act." Learned counsel for the Petitioner has not disputed that petitioner (in the present petition) is a guarantor. The submission of the learned counsel for the Petitioner has no force and fails. (iv)Lastly, learned counsel for the Petitioner contended that recovery certificate could not be issued on the basis of the liabilities in view of earlier bond/agreement which stood superseded in view of scheme proposed by BIFR and which was impliedly accepted by all the con....
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....ner himself never accepted the scheme expressly or impliedly and also there is nothing to suggest that parties in any manner acted upon the said scheme. It is advised, in view of the admission of the petitioner himself, that such scheme is still born child creating no obligation or to say altered obligation of the parties in any manner whatsoever. (e)Court do not expect such an argument being advanced in view of Writ Para 38 which is reproduced- "That the BIFR having overruled the stand of the petitioner, the old guarantee bond is still existing and having accordingly suspended execution of the first rehabilitation scheme, the bond guarantee executed by the petitioner cannot be said to be ink existence, consequently the entire proceed....