Allowed

Shyamal Karar and Ors. v. Kotak Mahindra Bank Limited

DRT3 Apr 2024SA/52/2023

Case brief

AI extract

What is this about?

The Debts Recovery Tribunal allowed a Section 17 SARFAESI application and a related review petition challenging SARFAESI measures taken by Kotak Mahindra Bank. The court set aside notices and a District Magistrate order, directing the bank to allow EMI payments after the ECLG moratorium.

What did the court decide?

Demand Notice, Possession Notice, and District Magistrate order set aside; Applicant directed to pay EMI after moratorium.

Shyamal Karar and Ors. versus Kotak Mahindra Bank… — Contract and Commercial Disputes | DRT (2024)

¶1

¶2

DEBTS RECOVERY TRIBUNAL – 1, KOLKATA JEEVANSUDHA BLDG. 9^TH FLOOR, 42/C, J.L.NEHRU ROAD, KOLKATA – 700071

¶3

BEFORE SHRI AMBUJA MOHAN DAS, PRESIDING OFFICER

¶4

SA No. 52 of 2023

¶5

1.SHYAMAL KARAR., Ichhapur Purba Para, Santragachi, Howrah -711 104.

¶6

AMAL KARAR Ichhapur Purba Para, Santragachi, Howrah -711 104.

¶7

BIMAL KARAR Ichhapur Purba Para, Santragachi, Howrah -711 104.

¶8

RINA DAS

¶9

Kumar Para Lane Kadam tala,Howrah-711 101.

…………Applicants

Vs.

The Authorised Officer Kotak Mahindra Bank Ltd.

¶14

Apeejay House ,5^th Floor, Block-B, 15, Park Street,Kolkata-700 016.

¶15

Kotak Mahindra Bank Ltd.

¶16

Apeejay House ,5^th Floor, Block-B, 15, Park Street, Kolkata-

700 016.

……….Respondents.

Present:

For Applicant: Mr.Samik Basu, Ld. Counsel For Respondents: Mr. Samrat Mukherjee and

¶21

Ms. Kasturi Dasgupta,Ld. Counsels

¶22

¶23

J U D G M E N T

¶24

Delivered on 3^rd April, 2024

¶25

The Sarfaesi Applicants have filed this application under section

¶26

17 of the Sarfaesi Act for challenging the Sarfaesi action of the Respondent Bank such as Demand Notice and Possession Notice and order of the District Magistrate South 24 Parganas dated 17/01/2023.

¶27

The Applicants have contended that Applicant no. 1 is the sole proprietor of Karar Enterprise and J. A. Enterprises. The Applicant has obtained loan of Rs. 35 lakhs against the property vide sanction letter dated 23/03/2018 by the Respondent Bank by mortgaging the joint property which stands recorded in the name of Nandalal Karar (deceased).

¶28

The loan of Applicant no. 1 covered by insurance policies issued by Kotak Mahindra Life Insurance Company vide annexure “C”,”C-1”,”C-2” and “C-3”. It is contended by the Applicant that in

¶29

the event of the default the said policies would cover the dues of the Respondent Bank. Due to outbreak of Covid 19 Pandemic and lock down on and from 25/03/2020 which continues for years the business of the Applicant no. 1 jeopardized and the business premises remain shut down. It is contended by the Applicant that the loan account remained standard as recorded from the sanction of a sum of Rs. 6,57,000/- Emergency Credit Line Guarantee Scheme(ECLGS) by the Respondent dated

¶30

¶31

04/09/2020. The said ECLG scheme starts from 04/09/2020 with 12 months moratorium period. The Applicant has annexed the sanctioned letter dated 04/09/2020 vide letter ‘D’.

¶32

It is further contended by the Applicant, that the ECLG Scheme has been issued by Government of India 100% guarantee coverage of GECL loan to the Borrower in the crisis arising from Covid 19 Pandamic. As per Demand Notice dated 30/09/2021 the Respondent Bank has classified the account as NPA on 08/08/2021 during the period of moratorium of ECLG scheme which according to the Ld. Advocate for the Applicant is illegal. The Demand Notice is not sustainable and Possession Notice is also not tenable.

¶33

It is further alleged by the Applicant that the Respondent Bank has illegally obtained the order of the Ld. District Magistrate, Howrah dated 17/01/2023. Ld. District Magistrate, Howrah has passed order without expressing satisfaction on the nine points which is required u/s 14(1) first proviso. The Applicants have also filed IA/332/2023 challenging the order of the Ld. District Magistrate, Howrah on the above ground.

¶34

The Respondent Bank has filed affidavit in opposition to the SA as well as IA/332/2023, wherein Respondent Bank has contended that after availing loan facilities under ECLG scheme the Applicant has not paid for more than 90 days for which the account has been classified as NPA on 08/08/2021. Thereafter

¶35

¶36

the Respondent Bank has issued Demand Notice dated 30/09/2021, Possession Notice dated 23/12/2021. Respondent Bank has filed application before the Ld. District Magistrate, Howrah for necessary order to take possession of the property. 7. It is contended by the Respondent Bank that ECLG scheme is an extension of security not additional collateral security. Respondent Bank has further contended that they have taken Sarfesi measures after issuance of Demand Notice dated 30/09/2021, Possession Notice dated 23/12/2021 and obtained order of the Ld. District Magistrate, Howrah to take possession of the property and prayed for dismissal of the SA and IA/332/2023. 8. Applicants have also filed reply to the affidavit in opposition filed by the Respondent Bank. The specific contention of the Applicant is that the ECLG scheme which has been sanctioned by the Respondent Bank in favour of the Applicant is facility of Rs. 6,57,000/-.

¶37

As per said scheme during the moratorium period interest has to be calculated on monthly basis. The term loan shall be paid 36 equated monthly installments commencing from the next month after completion of moratorium i.e from 13^th month. The ECLG scheme was signed by the parties on 04/09/2020, thereafter the moratorium period extends upto 04/09/2021. The Respondent Bank classified the account as NPA on 08/08/2021. The classification of account appears to be in contravention of ECLG

¶38

¶39

agreement between the Applicant and the Respondent Bank. The Applicants are required to pay EMI after the period of moratorium in 36 equated monthly installments. Hence, entire Sarfaesi action of the Respondent Bank is in contravention of ECLG Agreement between the Applicant and the Respondent Bank. The Applicants are required to pay EMI from 04/09/2021, hence, there is valid ground to allow SA and IA/332/2023. It is ordered as follows:

¶40

O R D E R

¶41

i) SA/52/2023 and IA/332/2023 are allowed on contest against the Respondents.

¶42

Consequently, pending I.A.s are also disposed of.

¶43

ii) Demand Notice dated 30/09/2021, Possession Notice dated 23/12/2021 and order of the District Magistrate South 24 Parganas dated 17/01/2023 are set aside.

¶44

iii) Respondent Bank is directed to allow the Applicant to pay monthly EMI after the period of moratorium of the ECLG agreement from 04/09/2020.

¶45

Copy of the Judgment/Final Order be uploaded in the Tribunal’s website.

¶46

¶47

File is consigned to the Record Room.

¶48

(Dictated to P.S., transcribed by her, corrected, signed and pronounced by me in the open Court on this the day 3^rd April, 2024.

¶49

Place: Kolkata ( Ambuja Mohan Das ) Date: 3^rd April , 2024 Presiding Officer

¶50

¶51

	Order Sheet (continuation)
Case NO. S	A/52/2023 SHYAMAL KARAR & ORS. VS. THE A.O. ,KOTA MAHINDRA BANK LTD. & ANR.	K
Date of the Order	Order with Signature	Office action with date and dated Signature of Parties when necessary
3^rdApril 2024	Present:
	For Applicant: Mr.Samik Basu, Ld. Counsel
	For Respondents: Mr. Samrat Mukherjee and Ms. Kasturi Dasgupta,Ld. Counsels
	Matter was heard from the parties on 05/02/2024.
	The detailed order in six pages annexed separately. The gist of the order is as follows:
	O R D E R
	i) SA/52/2023 and IA/332/2023 are allowed on contest against the Respondents. Consequently, pending I.A.s are also disposed of.
	ii) Demand Notice dated 30/09/2021, Possession Notice dated 23/12/2021 and order of the District Magistrate South 24 Parganas dated 17/01/2023 are set aside.
	iii) Respondent Bank is directed to allow the Applicant to pay monthly EMI after the period of moratorium of the ECLG agreement from 04/09/2020.
	Copy of the Judgment/Final Order be uploaded in the Tribunal’s website.
	File is consigned to the Record Room. (Dictated to P.S., transcribed by her, corrected, signed and pronounced by me in the open Court on this the day3^rd April, 2024.
	Place: Kolkata ( Ambuja Mohan Das ) Date: 3^rdApril , 2024 Presiding Officer

¶52

¶53

Order Sheet (continuation)
Case NO. SA/52/2023 SHYAMAL KARAR & ORS. VS. THE A.O. ,KOTAK
MAHINDRA BANK LTD. & ANR.
Office action with
date and dated
the Order Date of Order with Signature Parties when Signature of necessary

Shyamal Karar and Ors. v. Kotak Mahindra Bank Limited

Case brief

What is this about?

What did the court decide?

Shyamal Karar and Ors. v. Kotak Mahindra Bank Limited

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

Ms La Chemico Pvt. Ltd. versus PNB Housing Finance Limited

Kamal Amim versus Bank of India

Ms Iqbal Tannery versus Punjab National Bank

Industrial Investment Bank of India Ltd. versus Jammu and Kashmir Bank Limited

Canara Bank versus Siddhanta Impex India Pvt. Ltd.

Amit Prasad versus PNB Housing Finance Limited