Partly allowed

Mrs. Jasitha Onden v. the State Bank of India

Kerala HC17 Jun 2016OP (DRT)/39/2016

Case brief

AI extract

What is this about?

The High Court ordered the release of the petitioner's passport impounded in debt recovery proceedings, conditioned upon her furnishing ₹25 lakhs security as collateral, authorizing a proxy for notices, and undertaking to return to India within one year for continued proceedings.

What did the court decide?

Passport released subject to furnishing ₹25 lakhs collateral security, authorizing notice recipient via affidavit, and undertaking to return to India within 12 months.

Mrs. Jasitha Onden Vs the State Bank of India — Pension and Retirement Benefits | Kerala HC (2016)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE

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FRIDAY, THE 17TH DAY OF JUNE 2016/27TH JYAISHTA, 1938

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OP (DRT).No. 39 of 2016 (O)

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IA NO. 2792/15 AND IA NO. 1862/15 IN OA 26/2014 OF DEBT RECOVERY TRIBUNAL, ERNAKULAM

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PETITIONER :

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MRS. JASITHA ONDEN

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AGED 41, W/O.ONDEN, LOVE DALE, VILLA NO. 29, LESLY VILLAS, KARAPARAMBA, KOZHIKKODE -673010, PRESENTLY 28/331 B, C, D, 3RD CROSS ROAD, GIRI NAGAR, KADAVANTHARA, ERNAKULAM- 682036.

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BY ADVS.SRI.S.RENJITH SRI.K.R.PRATHISH

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RESPONDENT :

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THE STATE BANK OF INDIA MADAM CAME ROAD, NARIMAN POINT, MUMBAI, LOCAL HEAD OFFICE AT S.S.KOVIL ROAD, THAMBANOOR, TRIVANDRUM, BRANCH OFFICE RETAIL ASSET, SME CENTRE, PALARIVATTOM - 682026, REPRESENTED BY ITS MANAGER.

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BY ADVS. SMT.S.LAKSHMY SRI.TOM K.THOMAS

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THIS OP (DEBT RECOVERY TRIBUNAL) HAVING COME UP FOR ADMISSION ON 17-06-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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...2/-

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OP (DRT).No. 39 of 2016 (O)

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APPENDIX

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PETITIONER(S)' EXHIBITS :

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EXT. P1 COPY OF THE PETITION TO RELEASE THE PASSPORT FILED AS IA.NO.2792/2015.

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EXT. P2 COPY OF THE JUDGMENT DATED 15.12.2015 IN OP(DRT) NO.159/2015 OF THIS HON'BLE COURT.

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EXT. P3 COPY OF THE COUNTER AFFIDAVIT FILED BY THE RESPONDENT BANK BEFORE THE DEBT RECOVERY TRIBUNAL, ERNAKULAM.

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EXT. P4 COPY OF THE REPLY AFFIDAVIT FILED BY THE PETITIONER BEFORE THE DEBT RECOVERY TRIBUNAL, ERNAKULAM.

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EXT. P5 COPY OF THE AUTHORISATION LETTER DATED 03.11.2015 ISSUED TO THE PETITIONER TO THE BANK.

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EXT. P6 COPY OF THE REPLY LETTER DATED 07.11.2015. EXT. P7 COPY OF THE COMMON ORDER DATED 05.02.2016 IN IA.NO.1861/2015, IA.NO.1862/2015 AND IA.NO.2792/2015 IN OA.NO.26/2014

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RESPONDENT(S)' EXHIBITS :

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EXT.R1(A) COPY OF ORDER IN IA NO. 380/2014 IN OA NO. 26/2014 OF DEBT RECOVERY TRIBUNAL DATED 24-2-2014.

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EXT.R1(B) COPY OF ORDER IN IA NO. 381/2014 IN OA NO. 26/2014 OF DEBTS RECOVERY TRIBUNAL, ERNAKULAM.

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EXT.R1(C) COPY OF ORDER IN IA NO.5906/2015 IN OS NO. 106/2015 OF PRINCIPAL MUNSIFF, ERNAKULAM DATED 4-3-2016.

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EXT.R1(D) COPY OF VALUATION REPORT DATED 8-4-2016. EXT.R1(E) COPY OF FINAL ORDER IN OA NO. 26/2014 OF DEBTS RECOVERY TRIBUNAL, ERNAKULAM DATED 13-4-2015..

//TRUE COPY//

P.A. TO JUDGE

A.M.SHAFFIQUE, J.

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O.P.(DRT).No.39 of 2016

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----------------------------------- Dated this the 17^th day of June, 2016

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J U D G M E N T

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The petitioner has approached this Court challenging Ext.P7 order dated 05.02.2016 passed by the Debt Recovery Tribunal in I.A.No.2792 of 2015, by which the Tribunal declined to release the passport of the petitioner.

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A counter affidavit has been filed by the respondent Bank inter alia stating that the passport was impounded as per order dated 03.03.2014 in I.A.No.381/2014 at the instance of the Bank. The order came to be passed when all attempts on the part of the Bank to recover the huge liability from the petitioner could not be successful.

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It is stated in the counter affidavit that the petitioner had availed of a loan for 82 lakhs under CGTMSI Scheme, by which₹ there is no collateral security and only the movables purchased by the petitioner were to be treated as the security for the loan. The petitioner committed serious default and accordingly, O.A.No.26/2014 was filed for determining the amount due from the petitioner. During the pendency of the original application, when it is found that the petitioner was attempting to leave the country, this application was filed and accordingly, orders had been passed. The petitioner remained ex-parte and thereafter, an application was filed

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O.P.(DRT).No.39 of 2016

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to set aside ex-parte order and for releasing her passport, which ultimately resulted in Ext.P7 order.

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The learned counsel for the petitioner submits that in so far as the petitioner cannot be arrested and detained for non payment of any amount determined by the Tribunal, there is no reason to impound her passport. She intends to go abroad for a job opportunity and only in such circumstance, she will be in a position to repay the loan amount as well. She does not have any property worthy of sale to discharge the liability. The movables in the shop room are already hypothecated to the Bank and the Bank had already initiated SARFAESI proceedings to take possession of the secured assets and for sale thereof. It is submitted that the petitioner has no objection to the Bank taking any steps, but if she is unnecessarily detained, she will be left with no other remedy and her livelihood will be affected.

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The learned counsel appearing for the respondent Bank however places reliance on the judgment of a Division Bench of this Court in Annai Jayabharathi v. Debt Recovery Tribunal [2005 (1) KLT 921] wherein it is held that, the Debt Recovery Tribunal has necessary powers to direct for impounding of passport, especially in instances where the amounts can be recovered by arrest and detention as well. In fact, in the order passed by the Tribunal, reference has been made to the aforesaid Division Bench

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O.P.(DRT).No.39 of 2016

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judgment.

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The learned counsel for the petitioner, however, relies upon a decision of this Court in Veena Madhukant v. State Bank of India and Others [2007 (4) KHC 189] where a Full Bench had occasion to consider the question, when amounts are due to the Bank and financial institutions, whether the Recovery Officer could issue orders to arrest and detain a woman who is a debtor to the Bank. It was held that the provisions of the Act read along with the second schedule to the Income Tax Act which mutatis mutandis applies to the powers of the Recovery Officer does not enable arrest and detention of a woman in civil prison for recovering any amount.

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The facts being so, it is clear that there is no reason to detain the petitioner merely for the reason that steps could be taken to arrest and detain her in the civil prison. No such proceedings could be initiated by the recovery officer for recovering money from a lady, if she has no other assets worthy of being attached and sold in execution of the decree passed or award made by the Tribunal. However, her presence may be required for the Bank to take steps for realising the secured assets and presently, steps are being taken in that regard. If she is not present and the notice could not be served on her, the Bank will have to again incur expenditure for effecting service of notice. It is submitted that even in this proceedings, when notice could not be served, paper publication

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O.P.(DRT).No.39 of 2016

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had to be effected by incurring huge expenditure.

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Having regard to the above factual situation, I am of the view that if at all any modification has to be made to the impugned order, it can only be on certain conditions. The petitioner will have to authorise a person to receive notice on her behalf and she should undertake that she shall come back within a specified time. For that purpose, she will have to give a guarantee through a third person along with sufficient collateral security to ensure her presence as and when it is required during the above proceedings.

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Considering all the above aspects, I am of the view that Ext.P7 order can be modified and this original petition can be disposed of as under :

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The passport of the petitioner shall be released on the following conditions :

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That the petitioner shall authorise another person to receive notices/summons on her behalf. This shall be done by filing an affidavit before the Debt Recovery Tribunal.

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The petitioner shall furnish security for an amount ₹25 lakhs (Rupees Twenty five laksh only) by way of collateral security to ensure that the petitioner shall come back to India in one year. The collateral security shall be given by a surety to the satisfaction

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O.P.(DRT).No.39 of 2016

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of the Debt Recovery Tribunal and such person shall guarantee that, if the petitioner fails to appear as and when called upon by the Debt Recovery Tribunal (after the one year period), the said amount shall be recovered by proceeding against the collateral security. It would suffice that the collateral security is in the form of mortgage by deposit of title deeds.

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On compliance of the aforesaid conditions, the Debt Recovery Tribunal shall issue necessary intimation to the Passport Officer to release the passport to the petitioner.

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The petitioner shall come back to India after 12 months from the date of receipt of the passport.

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On return to India, the petitioner shall file necessary affidavit before the Tribunal.

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Sd/-

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A.M.SHAFFIQUE, JUDGE.

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Mrs. Jasitha Onden v. the State Bank of India

Case brief

What is this about?

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Mrs. Jasitha Onden v. the State Bank of India

Case brief

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