Partly allowed

Manju Shaju v. Esaf Small Finance Bank Limited

Kerala HC6 Dec 2023WP(C)/5925/2023

Case brief

AI extract

What is this about?

The court disposed of the writ petition filing against coercive proceedings under the SARFAESI Act. The court directed the petitioner to clear the outstanding loan dues of 37,19,533.19 plus interest through ten monthly installments. If the petitioner fails to comply, coercive proceedings may resume. Otherwise, such proceedings are deferred.

What did the court decide?

Petitioner directed to remit outstanding amount of ₹37,19,533.19 plus interest in ten monthly installments. Coercive proceedings deferred if payments are made; liable to continue if defaulted.

Manju Shaju Vs Esaf Small Finance Bank Limited — Consumer Protection | 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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WEDNESDAY, THE 6TH DAY OF DECEMBER 2023 / 15TH AGRAHAYANA, 1945

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WP(C) NO. 5925 OF 2023

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PETITIONER:

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MANJU SHAJU
AGED 48 YEARS
W/O SHAJU P J, POONKOTTUKUZHI HOUSE, MANNUTHY P.O,
THRISSUR, PIN – 680651

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BY ADV RAPHAEL THEKKAN

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RESPONDENTS:

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1 ESAF SMALL FINANCE BANK LIMITED, BUILDING NO.VII/83/8, ESAF BHAVAN, MANNUTHY, THRISSUR, PALAKKAD NATIONAL HIGHWAY, THRISSUR, PIN - 680651

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2 ESAF BANK KALATHODE BRANCH, THRISSUR-PALGHAT ROAD, KRISHNAPURAM VILLAGE, THRISSUR, KERALA, PIN – 680655

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BY ADV RASHMI.K.V

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
06.12.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO.5925 Of 2023
 2

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JUDGMENT

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Dated this the 6^th day of December, 2023

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The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by the ESAF Small Finance 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 1^st respondent paid ₹13 lakhs to the petitioner’s husband as Mortgage Loan in the year 2015 by keeping the properties of the petitioner as security. The petitioner states that though the petitioner made remittances promptly during the initial repayment period of the financial advance, she could not pay the repayment installments promptly later due to matrimonial discord between the petitioner her husband. The

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WP(C) NO.5925 Of 2023

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repayment of loans fell into arrears. It happened due to reasons beyond the control of the petitioner.

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Though the petitioner requested the respondents to permit the petitioner to repay the overdue amounts in easy monthly installments, the respondents 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.P1 notice invoking Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

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The petitioner states that she is still in a position to clear the overdue amounts towards the loan, if sufficient time is given to clear the dues in easy monthly installments. If the respondents are permitted to continue with the coercive

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WP(C) NO.5925 Of 2023

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proceedings and auction the secured assets provided by the petitioner, she will be put to untold hardship and loss.

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Standing Counsel entered appearance on behalf of the respondents and denied all the statements made by the petitioner. On behalf of the respondents, it is submitted that the loan was given to the petitioner’s husband in the year 2015. The petitioner’s committed default in repaying the loans.

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The respondents repeatedly reminded the petitioner and required her to clear the dues. The petitioner deliberately omitted to do so. In the circumstances, the respondents 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.P1 notice was issued in these circumstances. The loan account of the petitioner’s husband was declared as NPA in the year 2020. The petitioner has not advanced any legal reasons to thwart the coercive

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WP(C) NO.5925 Of 2023

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proceedings initiated by the respondents.

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The Standing Counsel, however, submitted that if the petitioner is 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 outstanding amount due to the respondents from the petitioner in December, 2023 is ₹37,19,533.19.

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I have heard the counsel for the petitioner and the

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Standing Counsel representing the respondents.

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The specific case of the petitioner is that the petitioner has 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 petitioner. The petitioner has provided substantial security which will safeguard the interest of the respondents.

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WP(C) NO.5925 Of 2023

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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 petitioner 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 petitioner shall remit the outstanding amount of 37,19,533.19 in ten₹ consecutive and equal monthly installments along with accruing interest and other administrative charges, if any. First of such installments shall be paid on or before 08.01.2024.

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(ii) If the petitioner commits default in making payments as directed above, the respondents will be at liberty to continue with the coercive proceedings against the petitioner in accordance with law.

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WP(C) NO.5925 Of 2023

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

Sd/-

N.NAGARESH JUDGE

hmh

WP(C) NO.5925 Of 2023

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APPENDIX OF WP(C) 5925/2023

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PETITIONER EXHIBITS

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Exhibit1

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TRUE COPY OF THE NOTICE RECEIVED BY THE
PETITIONER UNDER SECTION 13(2) OF THE
SARFAESI ACT, 2002 DATED 14.06.2022
FROM THE 1ST RESPONDENT

Manju Shaju v. Esaf Small Finance Bank Limited

Case brief

What is this about?

What did the court decide?

Manju Shaju v. Esaf Small Finance Bank Limited

Case brief

What is this about?

What did the court decide?

What the court decided

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