Allowed

Chacko John v. M/S.State Bank of Travancore

Kerala HC1 Jun 2016WP(C)/4038/2015

Case brief

AI extract

What is this about?

In a writ petition regarding bank recovery proceedings, the court held that the bank cannot initiate further steps, such as invoking Section 14 of the SARFAESI Act, while the petitioner complied with previous installment directions. The bank must await a review or actual violation of terms before proceeding, and the petitioner's payment shall be appropriated as agreed.

What did the court decide?

Direction to the Respondent Bank that it can take further proceedings only upon violation of the payment terms stated in Ext.P3 judgment; petitioner's payment to be appropriated towards installments.

Chacko John Vs M/S.State Bank of Travancore — Banking and Recovery | Kerala HC (2016)

¶1

IN THE HIGH COURT OF KERALA AT ERNAKULAM

¶2

PRESENT:

¶3

THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE

¶4

WEDNESDAY, THE 1ST DAY OF JUNE 2016/11TH JYAISHTA, 1938

¶5

WP(C).No. 4038 of 2015 (D)

¶6

PETITIONER :

¶7

SRI. CHACKO JOHN, AGED 57, S/O.CHACKO, RESIDING AT NEERUMPLACKAL HOUSE, NELLIMALA P.O., PATHANAMTHITTA.

¶8

BY ADV. SRI.O.V.MANIPRASAD

¶9

RESPONDENT(S) :

¶10

1. M/S.STATE BANK OF TRAVANCORE REPRESENTED BY ITS AUTHORIZED OFFICER, CHIEF MANAGER, REGION V., PATHANAMTHITTA – 689 542.

¶11

2. THE MANAGER, STATE BANK OF TRAVANCORE, NELLIMALA BRANCH, PATHANAMTHITTA-689 542.

¶12

R1 & R2 BY ADV. SRI.R.S.KALKURA, SC

¶13

THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01-06-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

¶14

¶15

...2/-

¶16

WP(C).No. 4038 of 2015 (D)

¶17

APPENDIX

¶18

PETITIONER(S)' EXHIBITS :

¶19

EXT.P1:	TRUE COPY OF THE ADVERTISEMENT IN MALAYALA MANORAMA DAILY DATED 08.11.2013 REGARDING THE PROCEEDINGS INITIATED AGAINST THE PETIITONER BY THE RESPONDENT BANK.
EXT.P2:	TRUE COPY OF THE POSSESSION NOTICE DATED 29.01.2014.
EXT.P3:	TRUE COPY OF THE JUDGMENT DATED 03.02.2014 IN WP(C) NO.3282/2014.
EXT.P4:	TRUE COPY OF THE STATEMENT OF ACCOUNT ISSUED BY THE 2ND RESPONDENT REGARDING THE ACCOUNT OF THE PETITIONER.
EXT.P4(a):	TRUE COPY OF THE NOTICE DATED 28.01.2015.
EXT.P5:	TRUE COPY OF THE LETTER OF ARRANGEMENT DATED 27.05.2010
EXT.P6:	TRUE COPY OF THE AGREEMENT FOR HYPOTHECATION DATED 27.05.2010.

¶20

RESPONDENT(S)' EXHIBITS :

¶21

EXT. R1(a)	TRUE COPY OF THE STATEMENT OF ACCOUNTS PERTAINING TO THE KISSAN CREDIT CARD LOAN.
EXT. R1(b)	TRUE COPY OF THE STATEMENT OF ACCOUNT IN RESPECT OF THE GOLD CARD TERM LOAN MAINTAINED BY THE BANK IN THE NAME OF THE PETITIONER.
EXT. R1(c)	TRUE COPY OF THE CREDIT SLIPS DATED 22.3.2014 & 25.3.2014 EXECUTED BY THE PETITIONER. //TRUE COPY//

¶22

P.A. TO JUDGE

¶23

¶24

**A.M.SHAFFIQUE, J * * * * * * * * * * * *** W.P.C.No.4038 of 2015

¶25

Dated this the 1^st day of June 2016

¶26

J U D G M E N T

¶27

Petitioner has approached this Court for the 2^nd time when steps were taken by the respondent bank by demanding amount in terms of Ext.P4(a) letter dated 28/01/2015.

¶28

According to the petitioner, he had taken two loans from the respondent bank. One loan was for an amount of Rs.10,00,000/- and the other for an amount of Rs.1,00,000/-. He had also mortgaged his property. Since he could not repay the amount as per the terms of the agreement, SARFAESI proceedings have been initiated by the bank against him. In the meantime, he approached this Court by filing W.P.C.No.3282/2014 and this Court granted time for the petitioner to clear the overdue amounts. The operative portion of the aforesaid judgment reads as follows:

¶29

“After hearing both the sides, the writ petition is disposed of, directing the petitioner to clear the 'overdue' amount in respect of the Term loan and also the entire liability under the Cash Credit Facility by way of 4 equal monthly

¶30

W.P.C.No.4038/2016

¶31

¶32

instalments, the first of which shall be effected on or before 28.02.2014, to be followed by similar three more instalments to be effected on or before the last working day of the succeeding months. This will be in addition to the liability of the petitioner to remit the regular monthly instalments in respect of the Term loan. Subject to the above, the term loan account will stand regularised and the revenue recovery proceedings now stated as being pursued against the petitioner and his property shall be kept in abeyance. It is made clear that, if any default is committed by the petitioner in remitting any of the four instalments as above or if any two consecutive defaults are made in respect of the regular E.M.Is with respect to the Term Loan, the respondent Bank will be at liberty to proceed with further steps from the stage where it stands now, for realisation of the amount in a lump.”

¶33

According to the petitioner, he remitted the amount in time as per the directions issued in the judgment. Further, he had deposited an amount of Rs.1,50,000/- towards payment in monthly instalments, as per the directions of the judgment.

¶34

W.P.C.No.4038/2016

¶35

¶36

Petitioner submits that the bank had appropriated the said amount immediately and thereafter has informed the petitioner that the accounts have become irregular. Petitioner submits that the attempt of the respondent bank is to invoke Section 14 of the SARFAESI Act and dispossess the petitioner when he had complied with the directions issued in terms of Ext.P3 judgment.

¶37

Learned counsel appearing for the respondent bank submits that a mistake happened to be occurred in stating the overdue amount while making submissions in W.P.C.No.3282/2014. Learned counsel for the bank submits that steps are being taken to file a review petition in W.P.C.No.3282/2014.

¶38

Be that as it may, as long as the petitioner had complied with the directions issued by this Court in Ext.P3 judgment, it is not open for the respondent bank to take further steps, in accordance with law. The obligation of the petitioner is to remit the amounts, as stated in Ext.P3 judgment.

¶39

Under such circumstances, this writ petition is disposed of as under:

¶40

W.P.C.No.4038/2016

¶41

¶42

i) Respondent Bank can take further proceedings only if the petitioner had violated the terms of payment as stated in Ext.P3.

¶43

ii) Rs.1,50,000/- paid by the petitioner shall be appropriated towards monthly instalments, as agreed in Ext.P3 judgment.

¶44

Iii) Further proceedings can be initiated for non-payment only if there is violation of the terms of Ext.P3 judgment.

¶45

iv) However, this direction will be subject to any review of the order in W.P.C.No.3282/2014.

¶46

(sd/-)

¶47

(A.M.SHAFFIQUE, JUDGE)

¶48

jsr

Chacko John v. M/S.State Bank of Travancore

Case brief

What is this about?

What did the court decide?

Chacko John v. M/S.State Bank of Travancore

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

Quilon Medical Trust Vs State of Kerala

Timber Merchant Association Vs Commissioner of Commercial Taxes

Binoy Vs the Joint Regional Transport Officer

Viveka Essence Mart Vs the Commercial Tax Officer

M.V. Sarasamma Vs Vijayaamma

Smt.Chachuykutty Thomas Vs the Assistant Commissioner of Central Excise