TaxTMI 
TaxTMI 
2007 (2) TMI 698
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.... assistant of ₹ 30 lacs to the PFC. The application was accepted and the entrepreneurpetitioner was sanctioned loan in two parts. A term loan of ₹ 21,25,000/- @ 15.5% interest p.a. was sanctioned as per the terms and conditions specified in the letter dated 28.10.2002 (P-1). Under the Scheme, the entrepreneur-petitioner was also sanctioned a soft loan of ₹ 7,50,000/- @ 5% interest p.a. All the terms and conditions of the soft loan have been incorporated in the letter dated 28.10.2002 (P-2). On 18.11.2002, the entrepreneur-petitioner also executed a mortgage deed (P-4). The entrepreneur-petitioner availed term loan to the extent of ₹ 17,00,000/- as is evident from the perusal of letter dated 7.4.2003, written by the entrepreneur-petitioner (P-7). There are numerous representations made by the entrepreneur-petitioner for the release of soft loan of ₹ 7,50,000/-, which was to be released under the Scheme. It is appropriate to mention that the amount of ₹ 17,00,000/- as term loan released to the entrepreneur-petitioner, was utilized in purchase of machinery and construction of building etc. Eventually, the entrepreneur-petitioner served a legal notic....
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.... as is being charged on amount of term loan." In respect of soft loan, the stand of the PFC is that the SIDBI could not release the same to it, which was duly sanctioned by it in favour of the entrepreneur-petitioner on 28.10.2002 (P-2). The matter was stated to have been placed in a meeting of Review Committee of the PFC, held on 11.7.2003, which is stated to have taken the following decision:- "The Committee considered the case and observed that NEF component is yet to be released. After detailed deliberation, the Committee has recommended that release of NEF be linked with the sanction of the same by SIDBI and to process the case for the release of further loan amount on the basis of the norms and an undertaking be also obtained from the borrower for raising the funds equivalent to the NEF sanctioned under the scheme. The Committee has further recommended that the borrower may immediately be advised to clear the default." It is appropriate to mention that the Scheme was framed by the SIDBI. The PFC was to disburse the soft loan only if the same was to be reimbursed by the SIDBI to it, failing which it was to disburse the soft loan on the same rate of interest which was be....
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....een pointed out that the PFC ought to have disbursed the term loan and soft loan to the entrepreneur-petitioner and claimed refinance of the same from the SIDBI. It has further been asserted that the PFC had expressed its inability to disburse the soft loan to the entrepreneur-petitioner for various reasons. However, it appears that the principal reason was that the PFC was insisting on de-linking of refinance of soft loan under the Scheme from refinance of term loan, which the SIDBI had found to be contrary to the refinance scheme. Mr. Kanwaljit Singh, learned counsel for the entrepreneur-petitioner has vehemently submitted that deserting the entrepreneur-petitioner midstream would be impermissible to respondent Nos. 1 and 3 because after availing term loan of ₹ 17,00,000/- and investing its own capital, the entrepreneur-petitioner cannot be left high and dry to face the vagaries of liquidation. He has emphasised that once the term loan of ₹ 21,25,000/- has been sanctioned as per the terms and conditions laid down in sanction letter dated 28.10.2002 (P-1) and soft loan of ₹ 7,50,000/- has been sanctioned at the interest rate of 5%, then after releasing a part o....
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....- was sanctioned by SIDBI and in that regard reference has been made to the application dated 19.12.2002 (Annexure R-1 attached with the written statement of SIDBI) and the averments made in para 2 of the written statement filed by the SIDBI to point out that the amount of ₹ 7,50,000/- was mentioned in this application by the PFC and it was asserted that the same had already been disbursed by the PFC to three units which included the unit of the entrepreneur-petitioner. He has then made reference to para 7 of the additional affidavit to argue that both term loan of ₹ 21,25,000/- and soft loan of ₹ 7,50,000/- were sanctioned by SIDBI to the PFC on 7.5.2004. After hearing learned counsel for the parties and perusing the documents with their able assistance, we are of the considered view that this petition deserves to be allowed. The stand of the PFC, in fact, has been completely exploded by written statement filed by the SIDBI, inasmuch as, the amount of soft loan had, in fact, been sanctioned. On account of some inter se controversy between the PFC and the SIDBI the soft loan was not availed by the PFC and the same cannot constitute the basis for the PFC to insis....