Disposed

Pinky.Kv v. the Authorised Officer

Kerala HC21 Feb 2024WP(C)/1535/2024

Case brief

AI extract

What is this about?

Borrowers challenged coercive SARFAESI proceedings by a co-operative bank for a mortgage loan default. The Court permitted the overdue amount of ₹67,053/- to be paid in 12 equal monthly instalments with current EMIs; on compliance, coercive proceedings stand deferred.

What did the court decide?

Overdue ₹67,053 payable in 12 monthly instalments plus interest/charges and current EMIs; coercive proceedings deferred on compliance, resumable on default.

Pinky.Kv Vs the Authorised Officer — 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 21^ST DAY OF FEBRUARY 2024/2ND PHALGUNA, 1945

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WP(C) NO. 1535 OF 2024

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PETITIONERS:

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1 PINKY K.V., AGED 42 YEARS, D/O.VELAYUDHAN, VALIYAVEETIL HOUSE,

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PAZHOOR, PEPATHI, PIN - 686664

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2 THANKAMANI, AGED 72 YEARS,

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D/O.VELAYUDHAN, VALIYAVEETIL HOUSE, PAZHOOR, PEPATHI, PIN – 686664

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BY ADV V.P.SHEEJA

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RESPONDENTS:

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1 THE AUTHORISED OFFICER, PEOPLE'S URBAN CO-OPERATIVE BANK, LTD,THRIPUNITHURA, ERNAKULAM, PIN - 682301

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2 THE PEOPLE'S URBAN CO-OPERATIVE BANK LTD., THRIPUNITHURA, ERNAKULAM, REPRESENTED BY SECRETARY, PIN – 682301

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BY ADVS. DEVAPRASANTH P.J SMINI JOSE(K/262/2015)

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21.02.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P.(C) No.1535/2024

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JUDGMENT

Dated this the 21^st day of Februar y, 2024

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The petitioners have approached this Court

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aggrieved by the coercive proceedings for recovery of financial advance made by the People's Urban Co-operative 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 ₹7 lakhs to the petitioners as Mortgage Loan in the year 2019. 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. The repayment of loan fell into arrears later. It happened due to reasons beyond the control of the petitioners.

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W.P.(C) No.1535/2024

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: 3 :

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Though the petitioners requested the Bank to permit 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.P1 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 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 2019.

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W.P.(C) No.1535/2024

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: 4 :

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The petitioners 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.P1 notice was 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 petitioners to clear the dues. The Standing Counsel submitted that the outstanding amount due to the Bank from the petitioners as on 21.02.2024 is ₹4,99,205/and the overdue amount as on 21.02.2024 is ₹67,053/-.

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W.P.(C) No.1535/2024

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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

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petitioners have been making the repayment and maintaining the loan account initially. The default in repayment of the account 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 petitioner shall remit the overdue amount of ₹67,053/- in 12 consecutive and equal monthly installments along with accruing interest and other Bank charges,

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W.P.(C) No.1535/2024

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if any. First of such installments shall be paid on or before 21.03.2024.

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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 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.

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(iv) If the petitioners pay the amount as directed above, any coercive proceedings against the petitioners will stand deferred.

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Sd/-

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N. NAGARESH JUDGE

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W.P.(C) No.1535/2024

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