Orissa HC imposes Rs 1 lakh fine on bank loan defaulter company proprietor

The bench directed the proprietor of the company to deposit the amount in the welfare fund of Jharsuguda district bar association within four weeks.
Orissa High Court
Orissa High Court Photo | Express

CUTTACK: The Orissa High Court on Monday imposed a fine of Rs 1 lakh on the proprietor of a bank loan defaulter company in whose favour the district consumer commission (Jharsuguda) had passed an interim order restraining auction of properties mortgaged for recovery of the credit amount.

The two-judge bench of Justice Debabrata Dash and Justice V Narasingh held, “This Court cannot be oblivious of the conduct of the proprietor in suppressing material facts relating to pendency of Securitization Application before the Debt Recovery Tribunal, while seeking impugned interim order cannot be lightly brushed aside as it clearly appears to be purposeful to serve the mischievous end.”

The bench directed the proprietor of the company to deposit the amount in the welfare fund of Jharsuguda district bar association within four weeks.

The dispute reached the high court with chief manager-cum-authorised officer, Union Bank of India, challenging the interim order passed by district consumer commissioner (Jharsuguda) on December 14, 2023. While quashing the interim order and proceedings pending before the commission, the bench also expected the commission to “refrain from judicial adventurism of the present nature” while dealing with such Special Acts (Consumer Protection Act, 2019).

The bench also said that the president and members manning the consumer commissions while considering reliefs sought under the Special Acts have the onerous task “to function within the orbit” provided thereunder.

“The least that can be expected from the President and the Members of the District Commissions that before passing any order relating to any alleged violation vis-a-vis the provisions of any Special Act, they will test the propositions claiming the reliefs on the touchstone of law governing the field,” the bench ruled adding it would not lead to avoidable litigation and denude the faith of the common man in the fairness and effectiveness of the redressal mechanism.

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