K.S.F.C. vs MICRO CAST RUBBER & ALLIED PRODUCTS&ORS.

The Supreme Court upheld the actions of the Karnataka State Financial Corporation under Section 29 of the State Financial Corporations Act, 1951, allowing it to take possession of a sick unit due to continuous loan defaults. The Court emphasized that the Corporation acted within its statutory powers in attempting to sell the unit after multiple failed attempts to rehabilitate it. The decision to accept the highest bid for the unit was affirmed, reinforcing the principle that financial institutions must protect their interests in cases of default.