Disposed

Karuppayya v. the Authorized Officer

Kerala HC9 Jan 2024WP(C)/170/2024

Case brief

AI extract

What is this about?

Borrower challenged coercive SARFAESI recovery proceedings on Canara Bank housing and MSME loans, citing Covid-19-related default. Court disposed of the petition directing payment of ₹50,000 within one month and the balance in eight monthly instalments, deferring coercive proceedings if paid.

What did the court decide?

Repayment permitted: ₹50,000 in one month plus balance in eight monthly instalments with interest; coercive proceedings deferred subject to compliance.

Karuppayya Vs the Authorized Officer — Banking and Recovery | Kerala HC (2024)

¶1

IN THE HIGH COURT OF KERALA AT ERNAKULAM

¶2

PRESENT

¶3

THE HONOURABLE MR.JUSTICE N.NAGARESH

¶4

TUESDAY, THE 9^TH DAY OF JANUARY 2024 / 19TH POUSHA, 1945

¶5

WP(C) NO. 170 OF 2024

¶6

PETITIONER:

¶7

KARUPPAYYA

¶8

AGED 55 YEARS, S/O. MUTHAYYA,KANDATHIL, ARYAD SOUTH, ALAPPUZHA PIN – 688007.

¶9

BY ADVS. R.REJI M.V.THAMBAN THARA THAMBAN B.BIPIN ARUN BOSE JEENA A.V. THOMAS THOMAS

¶10

RESPONDENTS:

¶11

1 THE AUTHORIZED OFFICER CANARA BANK, REGIONAL OFFICE, GROUND FLOOR, BSNL CTO BUILDING, NEAR IRON BRIDGE, ALAPPUZHA DISTRICT,, PIN – 688011.

¶12

2 THE CHIEF MANAGER CANARA BANK, MULLAKKAL BRANCH MULLAKKAL (PO), ALAPPUZHA PIN – 688011.

¶13

3 THE BRANCH MANAGER CANARA BANK, MULLAKKAL BRANCH MULLAKKAL (PO), ALAPPUZHA PIN – 688011.

¶14

BY ADVS. GOPIKRISHNAN NAMBIAR M K.JOHN MATHAI JOSON MANAVALAN KURYAN THOMAS PAULOSE C. ABRAHAM RAJA KANNAN

¶15

THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 09.01.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

¶16

W.P.(C)No.170 of 2024

¶17

:2:

¶18

J U D G M E N T

¶19

Dated this the 9^th day of January, 2024

¶20

The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by

¶21

the Canara Bank to the petitioner, invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

¶22

The Bank paid ₹2 lakhs to the petitioner as Housing Loan in the year 2013 and ₹30,000/- as MSME Loan in the year

¶23

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 instalments

¶24

promptly later due to Covid-19 pandemic. The repayment of loan fell into arrears. It happened due to reasons beyond the control

¶25

of the petitioner.

¶26

W.P.(C)No.170 of 2024

¶27

:3:

¶28

Though the petitioner requested the Bank to permit

¶29

the petitioner 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

¶30

Security Interest (Enforcement) Rules, 2002 and issued Ext.P1 notice.

¶31

The petitioner states that he is still in a position to

¶32

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 petitioner, he will be put to untold hardship and loss.

¶33

Standing Counsel entered appearance on behalf of

¶34

the Bank and denied all the statements made by the petitioner.

¶35

W.P.(C)No.170 of 2024

¶36

:4:

¶37

On behalf of the respondents, it is submitted that the loans were given to the petitioner in the years 2013 and 2017. The petitioner committed default in repaying the loan.

¶38

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

¶39

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.

¶40

The Standing Counsel, however, submitted that if the petitioner is ready and willing to make a substantial payment soon and remit the balance outstanding amount in MSME Loan and the balance overdue amount in Housing Loan account

¶41

W.P.(C)No.170 of 2024

¶42

:5:

¶43

immediately thereafter, a short breathing time can be granted to the petitioner to clear the dues. The Standing Counsel submitted that the outstanding amount in MSME Loan account due to the Bank from the petitioner as on 09.01.2024 is ₹39,792/- and the overdue amount in Housing Loan account as on 09.01.2024 is ₹1,36,000/-.

¶44

I have heard the learned Counsel for the petitioner

¶45

and the learned Standing Counsel representing the Bank.

¶46

The specific case of the petitioner is that the petitioner

¶47

has been making the repayment and maintaining the loan account initially. The default in repayment 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.

¶48

In the facts and circumstances of the case, I am inclined to dispose of the writ petition giving a short and

¶49

W.P.(C)No.170 of 2024

¶50

:6:

¶51

reasonable time to the petitioner to clear off the liability.

¶52

The writ petition is therefore disposed of with the following directions:

¶53

(i) The petitioner shall remit an amount of ₹50,000/- within a period of one month from today. (ii) The petitioner shall remit the balance overdue amount in Housing Loan and outstanding amount in MSME Loan, subsequent consecutive eight equal monthly instalments thereafter, along with accruing interest and other Bank charges, if any. (iii) If the petitioner commits default in making payments as directed above, the respondents will be at liberty to continue with coercive proceedings against the petitioner in

¶54

W.P.(C)No.170 of 2024

¶55

:7:

¶56

accordance with law.

¶57

(iv) The petitioner shall also pay current EMIs in Housing Loan account along with the aforesaid payments.

¶58

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

¶59

Sd/-

¶60

N. NAGARESH JUDGE

¶61

ams

¶62

W.P.(C)No.170 of 2024

¶63

:8:

¶64

APPENDIX OF WP(C) 170/2024

¶65

PETITIONER EXHIBITS Exhibit P1 TRUE COPY OF THE SALE NOTICE DATED 17.2.2023 ISSUED BY THE 1ST RESPONDENT Exhibit P2 TRUE COPY OF THE STATEMENT OF ACCOUNT OF THE PETITIONER FOR THE PERIOD FROM 1.10.2013 TO 31.12.2022

Karuppayya v. the Authorized Officer

Case brief

What is this about?

What did the court decide?

Karuppayya v. the Authorized Officer

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

Similar cases

The South Indian Bank Ltd. Vs the Sub Registrar

S.Subramanian, Vs Union Bank of India Represented by Its Authorized Officer

Ismail P.P Vs District Collector

Suresh Vs Kerala State Co-Operative Bank (Kerala Bank)

Anilkumar Ayyappan Vs the Authorized Officer/Chief Manager[ Sanctions]

Sibin Vs the Regional Passport Officer,Regional Passport Office Cochin