@JUDGMENTTAG-ORDER
K. Chandru, J.@mdashThe matter came to be posted on being specially ordered by the Hon''ble Chief Justice vide order dated 17.8.2011.
2. The Petitioner is a Private Limited Company dealing in Leather. In the present Writ Petition, they have come forward to challenge a communication dated 7.10.2010 issued by the Respondent Tamil Nadu Industrial Investment Corporation Limited (for short ''TIIC''). In that communication, the Respondent TICC after referring to the previous reminders informed the Petitioner that despite their reminders and personal visits, the Petitioner has not paid the amount of loan taken from the Corporation. Therefore, in the impugned notice, it was indicated that dues to the TIIC works out to Rs. 1,25,62,000/- and the TIIC had decided to take possession of the Unit and they were asked to be present. Challenging the said notice, the Writ Petition came to be filed.
3. When the matter came up on 20.10.2010, the learned Standing Counsel for the Respondents was directed to take notice and subsequently interim stay was ordered subject to the Petitioner depositing a sum of Rs. 25 Lakhs. Thereafter, the Writ Petition was admitted on 22.1.2011.
4. On notice from this Court, the Respondents have filed a counter affidavit dated 3.1.2011 in the Miscellaneous Application and also on 30.11.2010 in the main Writ Petition.
5. It is seen from the records that the Petitioner had availed term loan of Rs. 33.75 Lakhs and also subsidy bridge loan of Rs. 8.27 Lakhs on 23.1.1995 for setting up their processing unit at No. 35, SIPCOT Industrial Complex, Ranipet, Vellore. The loan was said to be repaid in 28 quarterly instalments after a moratorium period of 18 months with interest at the rate of 3% per annum over and above SIDB/IDBI rate for refinance with a minimum of 17%$ per annum. After the moratorium given to the Petitioner to repay the loan, the period of repayment started from 1.1.1998. The Petitioner also gave a primary and collateral security of their property and machinery. Subsequently, when they failed to repay the loan, despite several concessions were extended to them including reduction in the rate of interest and rescheduling the principal amount, even then the Petitioner had not paid the said amount and the Respondent TIIC advised the Petitioner to settle the amount under One Time Settlement Scheme. But the One Time Settlement offered by the Petitioner was not accepted by the TIIC. Therefore, the entire amount was directed to be recovered from the Petitioner. It was also stated that the Petitioner earlier filed the Writ Petition being W.P. No. 13127 of 1997 challenging the recovery action of the TIIC but the Writ Petition was dismissed. Subsequently, the Petitioner''s repeated request for OTS was rejected by the Respondents. Therefore, in order to recover the amount, Section 29 of the State Financial Corporation Act, 1951 was invoked.
6. In the counter filed in the Miscellaneous Application, in page 5, it was averred as follows:
Accordingly, the officials of the 2nd Respondent Corporation went to the factory premises for taking possession. The son of the main promoter Thiru D. Sivaprakasam of the Petitioner company was also present at the factory site at the time of taking possession. The officials of the 2nd Respondent Corporation took inventory of the assets, viz., machinery available in the premises and took photographs. However, the son of the main promoter prevented the officials from discharging their official duty and caused chaos with the help of their workers. The Respondent Corporation requested the Village Administrative Officer to be present at the factory site. In the meanwhile the promoter''s son with the help of workers locked all the entrances to the main factory hall and the VAO was not able to crosscheck the inventory taken by the officials of the Respondent Corporation. Hence, the officials of the Respondent Corporation locked the remaining doors of the factory hall and affixed the seal and posted the security to safeguard the assets of the company under mortgage. The Respondent Corporation also informed the officials of the police station concerned about the happenings at the time of taking possession of the assets in order to avoid any further untoward incidents.
7. It is a very sorry state of affairs that the Petitioner''s earlier Writ Petition was dismissed. He has failed to avail the OTS as per the terms prescribed by the TIIC. He has not availed the same and allowed both the principal and interest to accumulate and thereafter rushing to the Court when possession was sought to be taken and seeking to interdict the action of the TIIC, the Court cannot allow the maintenance of such Writ Petition.
8. The power conferred u/s 29 of the State Financial Corporation Act was intended to achieve the object of the Act as held in Swastic Automobiles v. Bhiar State Financial Corporation reported in AIR 2001 SC 5. The Supreme Court also held that the power u/s 29 of the Act is de-hors the power u/s 31 of the Act and it is open to the Corporation to invoke the necessary recovery machinery provided to the Corporation. The relationship between the Petitioner and the Corporation is purely contractual. Unless there is a gross violation of the provisions of the Act, this Court cannot interdict the action of the Corporation.
9. Under such circumstances, it is not open to this Court to interfere with the contractual term on the plea even such terms are amenable for judicial review. In this context, it is necessary to the judgment of the Supreme Court in
10....Indeed, in a matter between the corporation and its debtor, a writ court has no say except in two situations: (1) there is a statutory violation on the part of the corporation or (2) where the corporation acts unfairly i.e., unreasonably. While the former does not present any difficulty, the latter needs a little reiteration of its precise meaning. What does acting unfairly or unreasonably mean? Does it mean that the High Court exercising its jurisdiction under Article 226 of the Constitution can sit as an appellate authority over the acts and deeds of the corporation and seek to correct them? Surely, it cannot be. That is not the function of the High Court under Article 226. Doctrine of fairness, evolved in administrative law was not supposed to convert the writ courts into appellate authorities over administrative authorities. The constraints - self-imposed undoubtedly - of writ jurisdiction still remain. Ignoring them would lead to confusion and uncertainty. The jurisdiction may become rudderless.
11. The obligation to act fairly on the part of the administrative authorities was evolved to ensure the rule of law and to prevent failure of justice. This doctrine is complementary to the principles of natural justice which the quasi-judicial authorities are bound to observe. It is true that the distinction between a quasi-judicial and the administrative action has become thin, as pointed out by this Court as far back as 1970 in A.K. Kraipak v. Union of India. Even so the extent of judicial scrutiny/judicial review in the case of administrative action cannot be larger than in the case of quasijudicial action. If the High Court cannot sit as an appellate authority over the decisions and orders of quasi-judicial authorities it follows equally that it cannot do so in the case of administrative authorities. In the matter of administrative action, it is well known, more than one choice is available to the administrative authorities; they have a certain amount of discretion available to them. They have "a right to choose between more than one possible course of action upon which there is room for reasonable people to hold differing opinions as to which is to be preferred". (Lord Diplock in Secretary of State for Education and Science v. Metropolitan Borough Counsel of Tameside.) The Court cannot substitute its judgment for the judgment of administrative authorities in such cases. Only when the action of the administrative authority is so unfair or unreasonable that no reasonable person would have taken that action, can the Court intervene....
10. In the light of the above, there is no case made out. Accordingly the writ petition stands dismissed. No costs. The connected Miscellaneous Petitions are closed.
