Writ petition challenging bank recovery proceedings under Securitization Act dismissed. Court held writ jurisdiction under Article 226 precluded except in extraordinary circumstances, directing petitioner to exhaust statutory remedies under the Act.
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WP(C) No.37 of 2023
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE C.S.DIAS
TUESDAY, THE 13TH DAY OF JUNE 2023 / 23RD JYAISHTA, 1945
WP(C) NO. 37 OF 2023
PETITIONER/S:
PULIYILETHU DISTRIBUTORS,
XI/765A, NEAR CCS TECHNOLOGIES, ERAYILKADAVU,
KOTTAYAM 686002 REPRESENTED BY ITS MANAGING PARTNER,
THOMAS P MATHEW., PIN - 686002
BY ADVS.
ANITHA MATHAI MUTHIRENTHY
MIDHUN S. KARUN
LATHA SUSAN CHERIAN
GEORGE A.CHERIAN
GEORGE CHERIAN (SR.)
RESPONDENT/S:
AUTHORISED OFFICER, SOUTH INDIAN BANK LTD
REGIONAL OFFICE, FIRST FLOOR, REGENCY SQUARE,
COLLECTORATE P.O, KOTTAYAM .,
BY ADVS.
MOHAN GEORGE
MOHAN JACOB GEORGE
P.V.PARVATHY (P-41)
REENA THOMAS
NIGI GEORGE
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
13.06.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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WP(C) No.37 of 2023
C.S DIAS,J.
WP(C) No.37 of 2023
----------------------------Dated this the 13th day of June, 2023.
JUDGMENT
The writ petition is filed to direct the respondent to
permit the petitioner to pay off the entire overdue
amount in fifteen equated monthly instalments.
and Enforcement of Security Interest Act (in short,
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WP(C) No.37 of 2023
‘Act’). The petitioner is ready and willing to pay off the entire overdue amount in equated monthly instalments. Hence, the writ petition.
respondent has filed a statement, inter alia, contending that the writ petition is not maintainable in view of the law laid down by the Hon’ble Supreme Court in Phoenix ARC Pvt. Ltd vs. Vishwa Bharati Vidya Mandir and others [2022 (5)SCC 345]. In addition to the same, the loan account has been classified as NonPerforming Asset as early as on 25.2.2022. The Bank had sanctioned a manual TOD, which was disallowed by the statutory auditors. Though the petitioner remitted the overdue amounts subsequently, the statutory auditors did not permit the upgradation of the account
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WP(C) No.37 of 2023
and directed the respondent to classify the account as Non-Performing Asset. The statutory auditors also held that the account was continuously overdrawn, interest was not being serviced and there was stock failure. Hence the petitioner’s request for regularising the loan account cannot be permitted by the respondent. Therefore, the writ petition may be dismissed.
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WP(C) No.37 of 2023
categorically declared that High Courts shall not, unless in extra ordinary circumstances, interfere with proceedings initiated under the Act, in writ proceedings under Article 226 of the Constitution of India.
Resultantly, without prejudice to the right of the petitioner to work out its remedies in accordance with law, the writ petition is dismissed. sd/-
sks/13.6.2023 C.S.DIAS, JUDGE
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WP(C) No.37 of 2023
APPENDIX OF WP(C) 37/2023
PETITIONER EXHIBITS
Exhibit P1A TRUE COPY OF THE NOTICE DATED 3.10.2022
2 issues framed by the court
Whether the High Court has jurisdiction to entertain a writ petition directing a bank to regularize a non-performing loan account under Article 226 of the Constitution.
Whether the petitioner can be permitted to pay off an overdue loan amount in instalments via a writ petition challenging the bank's recovery proceedings.
Colour shows how this judgement treated each authority
Phoenix ARC Pvt. Ltd vs. Vishwa Bharati Vidya Mandir and othersRelied on¶28
Phoenix ARC Pvt. Ltd vs. Vishwa Bharati Vidya Mandir and others [2022 (5)SCC 345] · Who else cites this
South Indian Bank Ltd vs. Naveen Mathew PhilipRelied on¶33
South Indian Bank Ltd vs. Naveen Mathew Philip (2023 LiveLaw (SC) 320)
PULIYILETHU DISTRIBUTORS
AUTHORISED OFFICER, SOUTH INDIAN BANK LTD
C.S. DIAS
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court