Disposed

Roy Ks v. the Kerala State Co-Operative Bank Ltd., (Kerala Bank)

Kerala HC7 Feb 2024WP(C)/132/2024

Case brief

AI extract

What is this about?

Borrower challenged coercive SARFAESI proceedings by Kerala State Co-operative Bank for an overdraft defaulted after Covid-19. Court disposed of the petition permitting the outstanding amount to be paid in twelve equal monthly installments, with coercive proceedings deferred on compliance and revived on default.

What did the court decide?

Outstanding amount of ₹32,06,162/- permitted to be paid in 12 consecutive equal monthly installments; coercive proceedings deferred on compliance.

Roy Ks Vs the Kerala State Co-Operative Bank Ltd… — Banking and Recovery | Kerala HC (2024)

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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 7^TH DAY OF FEBRUARY 2024/18TH MAGHA, 1945 WP(C) NO. 132 OF 2024

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PETITIONER:

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ROY K.S., AGED 51 YEARS, S/O SCARIA, KONGANPUZHAKKALAYIL, MOOZHIKULANGARA P.O., KOTTAYAM DISTRICT, PIN – 686601

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BY ADVS. JAYADEEP SAJAN MATHEW J.ELENJICKAL MEERA R. MENON SIDHARTH.A.J

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RESPONDENTS:

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1 THE KERALA STATE CO-OPERATIVE BANK LTD., (KERALA BANK)

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REP. BY ITS MANAGING DIRECTOR & CHIEF EXECUTIVE OFFICER, COBANK TOWERS, PALAYAM, THIRUVANANTHAPURAM, PIN - 695033

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2 KERALA STATE CO-OPERATIVE BANK LTD., ETTUMANOOR BRANCH, REPRESENTED BY ITS AUTHORIZED OFFICER, OPPOSITE PRIVATE BUS STAND, SH 1, ETTUMANOOR, KOTTAYAM, PIN - 686631 3 THE ADVOCATE COMMISSIONER ( NAVANEETH.M ) APPOINTED BY THE HON'BLE CHIEF JUDICIAL MAGISTRATE COURT KOTTAYAM IN M.C NO: 642/2023, PIN – 696001

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BY ADVS. SRI.ATHUL SHAJI

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 07.02.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P.(C) No.132/2024

: 2 :

JUDGMENT

Dated this the 7^th day of Februar y, 2024

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The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by the Kerala State Co-operative Bank 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 ₹15 lakhs to the petitioner as Overdraft facility in the year 2017. The petitioner states that though the petitioner made remittances promptly during the initial repayment period of the financial advance, he could not pay the repayment installments promptly later due to Covid-19 pandemic. The repayment of loan fell into arrears.

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It happened due to reasons beyond the control of the petitioner.

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Though the petitioner requested the Bank to permit the petitioner to repay the overdue amounts in easy

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W.P.(C) No.132/2024

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: 3 :

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monthly installments, 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.P1 notice.

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The petitioner states that he 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 proceedings and auction the secured assets provided by the petitioner, he will be put to untold hardship and loss.

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Standing Counsel entered appearance on behalf of the Bank 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 in the year 2017. The petitioner committed default in repaying the loan.

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W.P.(C) No.132/2024

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: 4 :

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The Bank repeatedly reminded the petitioner and required him to clear the dues. The petitioner deliberately omitted to do so. In the circumstances, the Bank had no other go than to proceed against the petitioner 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 petitioner has 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 petitioner is ready and willing to make a substantial payment soon and remit the balance overdue 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 Bank from the petitioner as on 31.01.2024 is ₹32,06,162/-.

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

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W.P.(C) No.132/2024

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: 5 :

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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 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 petitioner to clear off the liability.

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The writ petition is therefore disposed of with the

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following directions:

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(i) The petitioner shall remit the outstanding amount of ₹32,06,162/- in 12 consecutive and equal monthly installments along with accruing interest and other Bank charges, if any. First of such installments shall be paid on or before 06.03.2024.

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W.P.(C) No.132/2024

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: 6 :

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(ii) If the petitioner commits single default

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

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Sd/-

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N. NAGARESH JUDGE

W.P.(C) No.132/2024

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APPENDIX OF WP(C) 132/2024

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PETITIONER'S EXHIBITS:

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Exhibit P1 TRUE COPY OF THE POSSESSION NOTICE TO THE PETITIONER ISSUED BY THE 3RD RESPONDENT DATED 26.12.2023 Exhibit P2 TRUE COPY OF THE REMITTANCE SLIP DATED 23.01.2024

Roy Ks v. the Kerala State Co-Operative Bank Ltd., (Kerala Bank)

Case brief

What is this about?

What did the court decide?

Roy Ks v. the Kerala State Co-Operative Bank Ltd., (Kerala Bank)

Case brief

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What did the court decide?

What the court decided

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