Disposed

Joy Varghese v. Indusind Bank Ltd.

Kerala HC12 Dec 2023WP(C)/14288/2023

Case brief

AI extract

What is this about?

Writ petitioners challenged coercive recovery proceedings under the SARFAESI Act initiated by IndusInd Bank due to default on a business loan. The Court allowed the petition and granted time to clear dues through an instalment plan, deferring coercive measures if payments are made as directed.

What did the court decide?

Petitioners to remit Rs. 20 lakhs in one month and balance in 12 monthly installments; coercive proceedings deferred upon compliance.

Joy Varghese Vs Indusind Bank Ltd. — Banking and Recovery | Kerala HC (2023)

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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 N.NAGARESH

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TUESDAY, THE 12TH DAY OF DECEMBER 2023 / 21ST AGRAHAYANA, 1945

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WP(C) NO. 14288 OF 2023

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PETITIONERS:

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1JOY VARGHESE
AGED 56 YEARS
S/O VARGHESE, MUTTANTHOTTIL HOUSE,
ERUMATHALA P.O.,
ALUVA EAST, NEAR GTN, VAZHAKULAM,
ERNAKULAM DISTRICT, PIN - 683112

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2 SHINY JOY AGED 54 YEARS W/O JOY VARGHESE, , MUTTANTHOTTIL HOUSE, ERUMATHALA P.O., ALUVA EAST, NEAR GTN, VAZHAKULAM, ERNAKULAM DISTRICT-, PIN – 683112

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BY ADVS.
K.S.PRENJITH KUMAR
BEA MARY BENNY

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RESPONDENTS:

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1 INDUSIND BANK LTD, REPRESENTED BY ITS CHAIRMAN, 2401 GEN. THIMMAYYA ROAD (CANTONMENT), PUNE, MAHARASHTRA, PIN - 411011

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2 THE BRANCH MANAGER, INDUSIND BANK LTD., COCHIN BRANCH, GOURINARAYANA BUILDINGS, M.G ROAD, KOCHI, PIN, PIN - 682035

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3 INDIABULLS ASSET RECONSTRUCTION COMPANY LTD., REPRESENTED BY ITS AUTHORISED OFFICER, INDIABULLS FINANCE CENTRE, TOWER-1, 9TH FLOOR, SENAPATI BAPAT MARG, ELPHINSTONE ROAD, MUMBAI- 400013, PIN - 400013

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BY ADVS.
ANISH JOSE ANTONY
RENJITH.R(K/695/2000)
ANJU MOHAN(K/916-D/2000)
B.H.ANSIL(K/305/2010)

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
12.12.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO.14288 Of 2023

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JUDGMENT

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Dated this the 12^th day of December, 2023

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The petitioners have approached this Court aggrieved by

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the coercive proceedings for recovery of financial advance made by the Indusind Bank Limited to the petitioner, invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

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The Bank paid ₹32 lakhs to the petitioners as Business Loan in the year 2016. The petitioners state that though the petitioners made remittances promptly during the initial repayment period of the financial advance, they could not pay the repayment instalments promptly later due to unexpected medical expenses and Covid-19 pandemic. The repayment of

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loan fell into arrears. It happened due to reasons beyond the control of the petitioners.

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WP(C) NO.14288 Of 2023
 3

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Though the petitioners requested the Bank to permit

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the petitioners to repay the overdue amounts in easy monthly instalments, the Bank authorities were not yielding. The authorities, instead started coercive proceedings invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and the Security Interest (Enforcement) Rules, 2002 and issued Ext.P3 notice.

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The petitioners state that they are still in a position to clear the overdue amounts towards the loan, if sufficient time is given to clear the dues in easy monthly instalments. If the respondents are permitted to continue with the coercive proceedings and auction the secured assets provided by the petitioners, they will be put to untold hardship and loss.

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Standing Counsel entered appearance on behalf of

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the Bank and denied all the statements made by the petitioners. On behalf of the respondents, it is submitted that the loan was

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WP(C) NO.14288 Of 2023

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given to the petitioners in the year 2016. The petitioners

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committed default in repaying the loan.

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The Bank repeatedly reminded the petitioners and required them to clear the dues. The petitioners deliberately omitted to do so. In the circumstances, the Bank had no other go than to proceed against the petitioners invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The impugned Ext.P3 notice was issued in these circumstances. The petitioners’ loan account was declared as NPA in the year 2020. The petitioners have not advanced any legal reasons to thwart the coercive proceedings initiated by the Bank.

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The Standing Counsel, however, submitted that if the petitioners are ready and willing to make a substantial payment soon and remit the total outstanding amount immediately thereafter, a short breathing time can be granted to the petitioner to clear the dues. The Standing Counsel submitted that the

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WP(C) NO.14288 Of 2023

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outstanding amount due to the Bank from the petitioner as on 08.12.2023 is ₹42,39,396.59.

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I have heard the counsel for the petitioners and the Standing Counsel representing the Bank.

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The specific case of the petitioners is that the petitioners have been making the repayment and maintaining the loan account initially. The default in repayment of the loan occurred lately due to reasons beyond the control of the petitioners. The petitioners have provided substantial security which will safeguard the interest of the Bank.

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In the facts and circumstances of the case, I am inclined to dispose of the writ petition giving a short and reasonable time to the petitioners to clear off the liability.

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The writ petition is therefore disposed of with the following directions:

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(i) The petitioners shall remit ₹20 lakhs within one month and the balance outstanding

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WP(C) NO.14288 Of 2023

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amount in 12 ensuing consecutive and equal monthly instalments immediately thereafter along with accruing interest and other Bank charges, if any.

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(ii) If the petitioners commit single default in making payments as directed above, the respondent will be at liberty to continue with the coercive proceedings against the petitioners in accordance with law.

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(iii) If the petitioners make payments as directed above, coercive proceedings, if any, against the petitioner shall stand deferred.

Sd/-

N.NAGARESH

JUDGE

hmh

WP(C) NO.14288 Of 2023

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APPENDIX OF WP(C) 14288/2023

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PETITIONER EXHIBITS

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Exhibit P1A TRUE COPY OF THE DISCHARGE SUMMARY
SHOWING THE MEDICAL CONDITION OF THE 1ST
PETITIONER
Exhibit P2A TRUE COPY OF THE NOTICE BEARING NO.
IARCL/DG/FY20-21 DATED 15.10.2020 ISSUED
BY THE 3RD RESPONDENT

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Exhibit P3A TRUE COPY OF THE NOTICE DATED 11-04-
2023 ISSUED BY THE ADVOCATE COMMISSIONER
IN MC NO. 16/2021 ON THE FILES OF
ADDITIONAL CHIEF JUDICIAL MAGISTRATE,
ERNAKULAM

Joy Varghese v. Indusind Bank Ltd.

Case brief

What is this about?

What did the court decide?

Joy Varghese v. Indusind Bank Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

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