Meghna PET Industries Ltd and others Vs. Md. Mostafa Kamal and others, 59 DLR (AD) (2007 143

Case No: Civil Petition for Leave to Appeal Nos. 477-478 of 2005

Judge: M. M. Ruhul Amin ,

Court: Appellate Division ,,

Advocate: Mr. Rafique-ul-Huq,Mr. Abdur Razzaq,Mr. Mahbubur Rahman,,

Citation: 59 DLR (AD) (2007) 143

Case Year: 2007

Appellant: Meghna PET Industries Ltd.

Respondent: Md. Mostafa Kamal

Subject: Business and Commercial Law,

Delivery Date: 2006-5-17

 
Supreme Court
Appellate Division
(Civil)
 
Present:
JR Mudassir Husain CJ
MM Ruhul Amin J
Amirul Kabir Chowdhury J
 
Meghna PET Industries Ltd.
.........Petitioner (In Civil Petition No. 477 of 2005)
Prime Edible Oil Ltd. & another
........Petitioners (In Civil Petition No. 478 of 2005)
Vs.
Md. Mostafa Kamal & others
........Respondents (In both the cases)
 
Judgment
May 17, 2006
 
Constitution of Bangladesh, 1972
Article 102
 The Sonali Bank was not justified in sending names of the applicants to Bangladesh Bank for inclusion in the CIB report as defaulter borrowers. Since Sonali Bank had already approved in its board meeting dated 7-4-2004 the change of ownership of Meghna Group of Industries in favour of writ-petitioners and others and also transfer of entire share of the writ petitioner-applicants in ‘Ka’ group industries in favour of existing owners and in view of the fact that Sonali bank had already rescheduled the repayment of loan by the writ petitioner applicants in respect of ‘Kha’ group industries vide letter dated 22nd March, 2006  Annexure-9 to the affidavit dated 4-4-2006 and the writ petitioner-applicants have been regularly paying the installment of loan money, the Sonali Bank was not justified in sending names of the applicants to Bangladesh Bank for inclusion in the CIB report as defaulter borrowers.
 
Lawyers Involved:
Mahbubur Rahman, Senior Advocate, instructed by Md. Zahirul Islam, Advocate-on-Record— For the Petitioners (In Civil Petition No. 477 of 2005).
Abdur Razzaq, Senior Advocate, instructed by Md. Zahirul Islam, Advocate-on-Record—For the Petitioners. (In Civil Petition No. 478 of 2005).
Rafique-ul-Huq and Khandker Mahbubuddin Ahmed, Senior Advocate instructed by Ahsanullah Patwary, Advocate-on-Record—For the Respondent Nos. 1 & 2 ( In both cases).
Not represented—Respondent Nos. 3-9. (In Civil Petition No. 477 of 2005).
Not represented—Respondent Nos. 3-7. (In Civil Petition No. 478 of 2005).
 
Civil Petition for Leave to Appeal Nos. 477-478 of 2005
(From the judgment and order dated 7th & 8th December, 2004 by the High Court Division in Writ Petition Nos. 2173 & 1776 of 2004)
 
Judgment

MM Ruhul Amin J.
 
1. These two petitions for leave to appeal are directed against the common judgment and order dated 7th & 8th December, 2004 passed by a Division Bench of the High Court Division in Writ Petition Nos. 2173 & 1776 of 2004 making both the Rules absolute and the respondents were directed to delete the names of the writ-petitioners from the report of Credit Information Bureau (CIB) forthwith.
 
2. In Writ Petition No.1776 of 2004 the writ-petitioners' case is that they were the sponsor directors of Meghna PET Industries Ltd an enterprise of Meghna Group of Industries. The writ-petitioners and two others namely Mr. MF Kamal and Mr. Md. Zakaria were the directors of Meghna PET Industries Ltd. Meghna PET Industries Ltd. obtained loan from Saudi Bangladesh Industrial and Agricultural Investment Company Ltd (SABINCO), a public limited company to the tune of Taka 3 crore on 17'-12-1996 and this loan was secured by creat­ing mortgage by way of security against the assets of Meghna PET Industries Ltd. and in addition thereto the writ-petitioners as directors of the said Company also stood personal guarantee to secure the said loan. Since the said loan was not repaid by the aforesaid borrowing company i.e. Meghna PET Industries Ltd. within 6 months of its being due as per the definition of the Bangladesh Bank, the said Company became the defaulting borrower company within the meaning of section 5(GaGa) of the Bank Companies Act, 1991. An agreement by way of Memorandum of Understanding (MOA) was reached on 16-2-2001 by and between the representatives of (a) Meghna PET Industries Ltd (b) Prime Edible Oil Ltd and (c) Meghna Cold Storage Ltd as the first party and the representatives of (i) Meghna Vegetable Oil Ltd (ii) Baghdad Vegetable Oil Industries Ltd and (iii) Mercantile Shipping Lines Ltd as the second party in presence of the representatives of SABINCO and Sonali Bank. By the said agreement the writ-petitioners subsequently transferred their entire shares in Meghna PET Industries Ltd to the other directors Mr. Md. Zakaria, Mr. Abu Taher and Mr. MF Kamal of Meghna PET Industries Ltd and thus ceased to be the directors of Meghna PET Industries Ltd. The further case is that pursuant to the said agreement the writ-petitioners acquired shares of the said Mr. Md. Zakaria, Mr. MF Kamal and Mr. Abu Taher in the aforesaid three companies, namely, Meghna Vegetable Oil Ltd., Baghdad Vegetable Oil Industries Ltd and Mercantile Shipping Lines Ltd. with the consent and concurrence of the said financial institution, SABINCO which granted loan to Meghna PET Industries Ltd By this arrangement the writ-petitioners ceased to be the shareholders and directors of Meghna PET Industries Ltd and in turn Mr. Md. Zakaria, Mr. MF Kamal and Mr. Abu Taher ceased to be the shareholders and also directors of Meghna Vegetable Oils Industries Ltd. Since the writ-petitioners ceased to be the share­holders and directors of Meghna PET Industries Ltd they ceased to be liable to repay the said loan to SABINCO even as guarantors. But Bangladesh Bank in disregard of this position not only included in the report of its Credit Information Bureau (CIB) the names of Meghna PET Industries Ltd. as sub­standard (ss) because of its failure to repay the out­standing loan but also included the names of the writ-petitioners as borrowers in relation to SABINCO.
 
3. In Writ Petition No.2173 of 2004 the case of the writ-petitioners are similar to their case in the aforesaid writ petition with some variation. Prime Edible Oil Ltd. and Meghna Cold Storage Ltd. obtained loan from Sonali Bank when the writ-petitioners were the shareholder directors of these two companies. The writ-petitioners as shareholder directors stood personal guarantee against the aforesaid loan. Although the writ-petitioners gave personal guarantee as share holders and directors of Prime Edible Oil Ltd. and Meghna Cold Storage Ltd against the said loan obtained by these two companies from Sonali Bank, they subsequently ceased to be liable even as guarantors to repay the said loan as they ceased to be the shareholders and directors of the said companies because of their transfer of shares from the said companies under the said agreement. Despite such factual position Bangladesh Bank has illegally included the names of the writ-petitioners in the report of its Credit Information Bureau (CIB) showing them as the defaulting borrowers. Because of the inclusion of their names in the report of the Credit Information Bureau of Bangladesh Bank, the writ-petitioners have become disentitled to any loan or financial assistance from any bank or financial institution as defaulting borrowers in view of section 27 KaKa (3) of the Bank Companies Act. Hence the petitioners filed these two writ petitions.
 
4. The respondents filed an application for dismissing the leave petitions on the grounds, inter alia, that an agreement was signed among the directors of the Meghna Group of Industries on 16-2-2001 for bifurcation of Meghna Group. First group comprising Mr. Md. Zakaria, Mr. MF Kamal & Mr. Abu Taher were given ownership of (i) Meghna PET Industries Ltd, (ii) Meghna Cold Storage Ltd and (iii) Prime Edible Oil Industries Ltd and the second group comprising Mr. Mostafa Kamal, Mrs. Beauty Akhter and Mr. Md. Yasin were given ownership of (i) Meghna Vegetable Oil Industries Ltd., (ii) Baghdad Vegetable Oil Industries Ltd and (iii) Mercantile Shipping Lines Ltd. Subsequently, another agreement was signed on 3-11-2001 wherein the management of Sonali Bank and SABINCO were the parties and subsequently the applicants resigned from the directorship of the Meghna PET Industries Ltd., Prime Edible Oils Ltd. and Meghna Cold Storage Ltd. and transferred their entire shares on different dates to the existing directors of those three Companies and thereby the relationship of the writ petitioners with the Meghna PET Industries Ltd, Prime Edible Oils Ltd. and Meghna Cold Storage Ltd. ceased to exist with the consent of Sonali Bank and SABINCO. In spite of cessation of relationship with the Meghna PET Industries Ltd the Bangladesh Bank has shown the names of the applicants in the Credit Information Report (CIB) on 29-12-2003 as substandard (SS). Being aggrieved the writ petitioners filed both the writ petitions. The Rules were made absolute and the respondents were directed to delete the names of the writ petitioners from the report of the Credit Information Bureau (CIB). Thereafter, Sonali Bank as petitioners filed these two civil petitions for leave to appeal and obtained stay order on the ground that the writ petitioners furnished personal guarantee and, as such, they are guarantors to the loan and liable to be included in the CIB report as defaulting borrowers.
 
5. It was further stated that Meghna PET Industries Ltd. was financed by Dutch Bangla Bank Ltd, Local Office, Motijheel C/A, Dhaka and Saudi Bangladesh Industrial and Agricultural Investment Company Ltd. (SABINCO) Brac Centre, 75, Mohakhali, Dhaka-1212. Both the SABINCO and Dutch Bangla Bank Ltd. released the personal guarantee of the writ petitioner applicants and in such view of the matter there is no scope to include the names of the applicants in the CIB report on account of Meghna PET Industries Ltd in any manner. It was further stated that Sonali Bank did not finance the Meghna PET Industries Ltd and there was no relationship with Sonali   Bank regarding Meghna PET Industries Ltd and, as such, Sonali Bank has no locus standi to file the instant civil petition for leave to appeal and the same was misconceived, malafide and, as such, liable to be dismissed.
 
6. We have heard Khandker Mahbubuddin Ahmed with Mr.Rafique-ul-Huq in support of the application for dismissing the leave petition on the ground of fraudulent misrepresentation and Mr. Mahbubur Rahman, the learned Counsel for the petitioner in Civil Petition No.477 of 2005 and Mr. Abdur Razzaq, the learned Counsel for the peti­tioner in Civil Petition No. 478 of 2005 and perused the judgment of the High Court Division and other connected papers.
 
7. Mr. Ahmed submits that in view of the decision of the Board of directors of Sonali Bank dated 7-4-2004 Annexure-1 to the affidavit dated 14-4-2006 approving the change of ownership and transfer of shares of the writ petitioner-applicants in the 'Ka' group industries in favour of the existing shareholders and directors they are no longer liable for the loan money of 'Ka' group of industries and, as such, their names cannot be included in the CIB report maintained by Bangladesh Bank. He further submits that so far as 'Kha' group of industries are concerned, namely, (i) Meghna Vegetable Oil Industries Ltd., (ii) Baghdad Vegetable Oil Industries Ltd. and (iii) Mercantile Shipping Lines Ltd., the loan obtained by the writ petitioner-applicants was re-scheduled by Sonali Bank vide letter dated 22nd March, 2006 addressed to its engaged Advocate Mr. Abdullah Al Mamun and they are regularly paying the loan instalments. The letter dated 22nd March, 2006 of Sonali Bank is reproduced below:  
 
সোনালী ব্যাংক
স্থানীয় কার্যালয়
মতিঝিল, ঢাকা।
শিল্প ঋণ বিভাগ
নং- স্থাঃকাঃ/শিঋবি/৪২০                               তারিখঃ ২২ মার্চ, ২০০৬

জনাব আবদুল্লাহ আল মামুন,
ব্যারিষ্টার-এট-ল
এডমিরালটি চেম্বার,
৫৩, ডিআইটি এক্সটেনশন রোড, ঢাকা।
বিসয়ঃ সিপি মামলা নং-৪৭৯/২০০৫ এবং ৪৮০/২০০৫ প্রত্যাহার প্রসঙ্গে।
 
মহোদয়,
প্রাসঙ্গিক বিষয় জানানো জাছে যে, মেঘনা গ্রুপের ‘খ’ পক্ষ ভুক্ত শিল্প প্রতিষ্ঠানসমূহের ঋণ হিসাবসমূহ সুদ মওকুফ ও পুনঃ তফসিলকরণ  অনুমোদিত হওয়ায় এবং ঋণগ্রহীতা কর্তৃক পুনঃ তফসিল পরবর্তী আদায়যোগ্য কিস্তিসমূহ সূচি অনুযায়ী পরিশোধ হচ্ছে বিধাই ব্যাংক কর্তৃক মেঘনা গ্রুপের ‘খ’ পক্ষ (জনাব মোস্তফা কামাল ও মিসেস বিউটি আক্তার) কর্তৃপক্ষ ব্যাংককে রেসপনডেন্ট করে দায়েরকৃত ৪টি রিট মামলা (নম্বর-১৯৬৯/২০০৫, ১৯৭০/২০০৫, ২৬৬৮/২০০৫, ২৬৬৯/২০০৫) এবং ব্যাংক কর্তৃক দায়েরকৃত উপরুক্ত আপিল মামলা একই সঙ্গে প্রত্যাহার করার শর্তে সিআইবি ডাটাবেজ সংশোধনের অনুমোদন দিয়েছেন এবং মেঘনা গ্রুপের জনাব মোস্তফা কামাল এ বিষয়ে সম্মতি প্রদান করেছেন। (কপি সংযুক্ত)

এমতাবস্থায়, ব্যাংক কর্তৃক দায়েরকৃত আপিল মামলা দুটি এবং ঋণগ্রহীতা কর্তৃক দায়েরকৃত রিট মামলা সমূহ একইসঙ্গে প্রত্যাহারের প্রয়োজনীয় পদক্ষেপ গ্রহনের জন্য আপনাকে অনুরোধ করা হল।

আপনার বিশ্বস্ত,
উপ- মহা ব্যবস্থাপক
 
8. From this letter, it appears that the loan obtained by owners of 'Kha' group industries that is writ petitioner-applicants, were re-scheduled by Sonali Bank and the owners of 'Kha' group of industries were paying the installments of loan regularly to the Bank.
 
9. Mr. Ahmed further submits that in the above circumstances the names of the   writ petitioner-applicants as owners of 'Kha' group of industries cannot be sent by the Sonali Bank for inclusion in the CIB report maintained by Bangla­desh Bank as loan defaulters.
 
10. Mr. Mahbubur Rahman and Mr. Abdur Razzaq, the learned Counsels, mainly argued that the writ petitioner-applicants are personally liable for the loan money sanctioned in favour of 'Ka' group of industries as they personally executed bank guarantee for repayment of the loan and although they ceased to be shareholders and directors of the 'Ka' group of industries belonging to the existing directors and shareholders, they are still liable to repay the loan for executing personal guarantee in favour of Sonali Bank. Therefore, their names were rightly sent to Bangladesh Bank for inclusion in the CIB report. Mr Abdur Razzak further submits that in view of the fact that the writ petitioner-applicants executed personal guarantee in respect of the loan sanctioned in favour of 'Ka' group of industries, they are equally liable like borrowers to repay the loan and in case of failure of the borrowers to repay the loan, the guarantors are liable to repay the same.
 
11. In the facts and circumstances of the case and in view of the discussion made above, we are of the view that since Sonali Bank had already approved in its Board meeting dated 7-4-2004 the change of ownership of Meghna Group of Industries in favour of writ-petitioners (i.e. 'Kha' group) and others (i.e. 'Ka' group) and also transfer of entire share of the writ petitioner-applicants in 'Ka' group industries in favour of existing owners and in view of the fact that Sonali Bank had already rescheduled the repayment of loan by the writ petitioner applicants in respect of 'Kha' group industries vide letter dated 22nd March, 2006 Annexure-9 to the affidavit dated 4-4-2006 and the writ petitioner-applicants have been regularly paying the instal­ment of loan money, the Sonali Bank was not justified in sending names of the applicants to Ban­gladesh Bank for inclusion in the CIB report as defaulter borrowers. Accordingly, the application for dismissing the civil petition for leave to appeal Nos. 477-478 of 2005 is allowed.
 
Both the civil petitions are dismissed.
 
Ed.