Allowed

Abdulla Kunhi v. the Authorized Officer/Chief Manager

Kerala HC4 Jan 2024WP(C)/140/2024

Case brief

AI extract

What is this about?

High Court disposed of a writ petition challenging coercive proceedings initiated by a bank for recovery of a housing loan. The petitioner was granted a scheme to clear dues in equal monthly installments, with coercive actions deferred contingent upon timely payment; default would resume enforcement.

What did the court decide?

Directed petitioners to remit ₹2 lakhs balance in ten equal monthly installments from 05.02.2024 with interest; coercive proceedings deferred if terms met; default allowed resumption of proceedings.

Abdulla Kunhi Vs the Authorized… — Contract and Commercial Disputes | 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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THURSDAY, THE 4TH DAY OF JANUARY 2024 / 14TH POUSHA, 1945

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WP(C) NO. 140 OF 2024

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PETITIONERS:

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1ABDULLA KUNHI
AGED 56 YEARS
S/O. ABDUL RAHIMAN,
RESIDING AT BANDICHAL HOUSE, THEKKIL POST,
KASARAGOD DISTRICT, PIN - 671541

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2NASEEMA K

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AGED 47 YEARS
W/O.ABDULLA KUNHI,
RESIDING AT BANDICHAL HOUSE, THEKKIL POST,
KASARAGOD DISTRICT, PIN – 671541

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BY ADVS.
T.MADHU
C.R.SARADAMANI
RENJISH S. MENON
VRINDA T.S.
AISWARYA JAYAPAL

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RESPONDENTS:

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1THE AUTHORIZED OFFICER/CHIEF MANAGER
INDIAN BANK, ZONAL OFFICE,
GROUND FLOOR DR.SB'S DENTISTRY AND ORTHODONTICS
CLINIC BUILDING WEST NADAKKAVU, KANNUR ROAD,
NADAKKAVU P O, KOZHIKODE, PIN – 673011

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2THE MANAGER
INDIAN BANK, KASARAGOD BRANCH,
KASARAGOD DISTRICT, PIN – 671121

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SRI.S.EASWARAN-STANDING COUNSEL

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
04.01.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO.140 OF 2024

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JUDGMENT

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Dated this the 4^th day of January, 2024

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The petitioners have approached this Court aggrieved

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by the coercive proceedings for recovery of financial advance made by the Indian Bank to the petitioners, 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 ₹4,80,000/- to the petitioners as Housing Loan in the year 2015. 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 Covid-19 pandemic. The repayment of loans fell into arrears. It happened due to reasons beyond the control of the petitioners.

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WP(C) NO.140 OF 2024

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Though the petitioners requested the Bank to

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permit the petitioners to repay the overdue amounts in easy 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 Exts.P1 to P3 notices.

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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 installments. 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 given to the petitioners in the year 2015. The

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WP(C) NO.140 OF 2024

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petitioners committed default in repaying the loans.

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The Bank repeatedly reminded the petitioners and required them 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 petitioners invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The impugned Exts.P1 to P3 notices were issued in these circumstances. 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 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 petitioners as on 04.01.2024 is ₹5,18,000/- and the

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WP(C) NO.140 OF 2024

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overdue amount as on 04.01.2024 is ₹2 lakhs.

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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 loans 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

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following directions:

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(i) The petitioners shall remit the balance overdue amount of ₹2 lakhs in ten consecutive and equal monthly installments along with accruing interest and other Bank

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WP(C) NO.140 OF 2024

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charges, if any. First of such instalments

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shall be paid on or before 05.02.2024.

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

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(iii) The petitioners shall also pay current EMIs along with the aforesaid payments. (iv) If the petitioners make payments as directed above, coercive proceedings, if any,

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against the petitioners shall stand deferred.

Sd/-

N.NAGARESH

JUDGE

hmh

WP(C) NO.140 OF 2024

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APPENDIX OF WP(C) 140/2024

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PETITIONER EXHIBITS

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Exhibit-P1THE TRUE COPY OF THE NOTICE DATED
13/12/2022 ISSUED UNDER SECTION 13(2)
OFTHESECURITIZATIONAND
RECONSTRUCTION OF FINANCIAL ASSETS AND
ENFORCEMENT OF SECURITY INTEREST ACT
2002 BY THE FIRST RESPONDENT TO THE
PETITIONERS
Exhibit-P2THE TRUE COPY OF THE NOTICE DATED
14/2/2023 ISSUED UNDER SECTION 13(4)
OFTHESECURITIZATIONAND
RECONSTRUCTION OF FINANCIAL ASSETS AND
ENFORCEMENT OF SECURITY INTEREST ACT
2002
Exhibit-P3THE TRUE COPY OF THE NOTICE DATED
4/7/2023 ISSUED UNDER SECTION 13(2) OF
THE SECURITIZATION AND RECONSTRUCTION
OF FINANCIAL ASSETS AND ENFORCEMENT OF
SECURITY INTEREST ACT 2002

Abdulla Kunhi v. the Authorized Officer/Chief Manager

Case brief

What is this about?

What did the court decide?

Abdulla Kunhi v. the Authorized Officer/Chief Manager

Case brief

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What did the court decide?

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