Remanded

Hdfc Bank Limited v. Linson P.S.

Kerala HC13 Jan 2017OP (DRT)/95/2016

Case brief

AI extract

What is this about?

The High Court held that the DRT order directing the respondent to pay the admitted amount and initiating de novo proceedings exceeded the DRT's power. The matter was remanded to the DRT for consideration within the Act's scope, without prejudice to the maintainability of the subsidy claim.

What did the court decide?

Original Petition disposed; matter remanded to DRT for consideration within three months; parties to appear on 25.01.2017.

Hdfc Bank Limited Vs Linson P.S. — Banking and Recovery | Kerala HC (2017)

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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 K.VINOD CHANDRAN

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FRIDAY, THE 13TH DAY OF JANUARY 2017/23RD POUSHA, 1938

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O.P.(DRT).No.95 of 2016 (O)

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[AGAINST THE ORDER IN S.A.306/2016 OF DEBT RECOVERY TRIBUNAL, ERNAKULAM DATED 07-09-2016]

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PETITIONER(S):-

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HDFC BANK LIMITED, HDFC BANK HOUSE, SENAPATI BAPAT MARG, PAREL, MUMBAI - 400 013, REPRESENTED BY ITS AUTHORIZED OFFICER.

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BY ADV. SRI.T.RAJESH.

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RESPONDENT(S):-

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LINSON P.S, PANAKKAL HOUSE, PALLIPORT P.O, MUNAMBAM, ERNAKULAM - 683 515.

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BY ADV. SMT.K.P.SANTHI.

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THIS OP (DEBT RECOVERY TRIBUNAL) HAVING BEEN FINALLY HEARD ON 13-01-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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OP (DRT).No.95 of 2016 (O)

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APPENDIX

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PETITIONER(S)' EXHIBITS:-

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EXHIBIT P1	THE TRUE COPY OF THE CMP NO.296 OF 2016 FILED UNDER SECTION 14 OF THE ACT BEFORE THE LEARNED CHIEF JUDICIAL MAGISTRATE ERNAKULAM.
EXHIBIT P2	THE TRUE COPY OF THE ORDER DTED 20-02-2016 OF THE LEARNED CHIEF JUDICIAL MAGISTRATE ERNAKULAM IN CMP NO.296 OF 2016.
EXHIBIT P3	THE TRUE COPY OF THE JUDGMENT IN WP(C) NO.7886 OF 2016 DATED 10-03-2016.
EXHIBIT P4	THE TRUE COPY OF THE JUDGMENT IN WRIT APPEAL NO.945 OF 2016 DATED 14-06-2016.
EXHIBIT P5	THE TRUE COPY OF THE SECURITIZATION APPLICATION S.A NO.306 OF 2016 FILED BY THE RESPONDENT.
EXHIBIT P6	THE TRUE COPY OFTHE WRITTEN STATEMENT FILED BY THE PETITIONER DATED 18-07-2016.
EXHIBIT P7	THE TRUE COPY OF THE DOCUMENT PRODUCED BEFORE THE DEBT RECOVERY TRIBUNAL ALONG WITH LIST OF DOCUMENTS.
EXHIBIT P8	THE TRUE COPY OF THE ORDER OF THE DEBT RECOVERY TRIBUNAL, ERNAKULAM DATED 07-09-2016 IN S.A NO 306 OF 2016.

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RESPONDENT(S)' EXHIBITS:-

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------------------------NIL.

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Vku/[ true copy ]

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K. Vinod Chandran, J

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O.P.(DRT).No.95 of 2016-O

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Dated this the 13^th day of January, 2017

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JUDGMENT

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The petitioner-Bank is aggrieved with the order passed by

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the Debts Recovery Tribunal [for brevity “DRT”] in a Securitisation Application filed by the respondent, produced at Exhibit P8.

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The brief facts to be noticed are that the respondent is

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the legal heir of the original borrower. On default being committed in a loan, the Bank had initiated proceedings under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 [for brevity “SARFAESI Act”] against the mortgaged properties. The original borrower died and the legal heir, who was in possession of the property, approached the DRT with S.A.No.306 of 2016. The main contention raised by the petitioner before the DRT was that there was a subsidy entitled to the borrower, granted by the NABARD; however, to be applied for and obtained by the petitioner-Bank. Even after deducting the amounts claimed as subsidy,

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the respondent had admitted the liability of an amount of Rs.7,00,000/[Rupees seven lakhs] exists. Only in that context the petitioner-Bank

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OP(DRT) No.95 of 2016

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submitted before the DRT that the SARFAESI proceedings would be deferred if the petitioner pays that admitted amount. The respondent was agreeable to the said proposal. The DRT directed the respondent to pay the admitted amount of Rupees Seven Lakhs by 30.09.2016 and directed the petitioner-Bank to give up the present SARFAESI proceedings and proceed to recover the balance outstanding by initiating de novo SARFAESI proceedings.

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The order exceeds the power available to the DRT, as pointed out by the learned Counsel appearing for the respondent-Bank, especially since SARFAESI proceedings could be interfered only with specific reasons shown; as delineated in sub-section (3) of Section 17 of the SARFAESI Act. No such irregularity has been found by the DRT.

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Furthermore, it is to be noticed that both were agreed that the contention raised by the respondent before the DRT had to be answered. The Bank has a specific contention that there could be no consideration of the computation of amounts or the specific claim raised by the respondent of the subsidy, being considered by the DRT in a Securitisation Application. In any event, these are all matters which have to be raised before the DRT. Since no irregularity in proceedings has been found, the order at Exhibit P8 cannot be sustained.

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OP(DRT) No.95 of 2016 - 3 -

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The respondent, obviously, has paid up the money on

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30.09.2016, as directed by the DRT. Hence, the Securitisation Application would have to be considered by the DRT; which adjudication has to be carried on within the powers and scope, conferred under the SARFAESI Act. The consideration shall be made untrammelled by the observations made herein, which only recorded the submissions of the respective parties as stated at the Bar. The parties shall appear before the DRT along with a certified copy of this judgment on 25.01.2017 and the matter shall be considered and disposed of within a period of three months from that date. The Bank shall also be entitled to raise the question of maintainability insofar as the issue relating to subsidy.

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The Original Petition is disposed of as above. No costs.

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Sd/- K.Vinod Chandran Judge.

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vku/-

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[ true copy ]

Hdfc Bank Limited v. Linson P.S.

Case brief

What is this about?

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Hdfc Bank Limited v. Linson P.S.

Case brief

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