Dismissed

Ajas T v. Kerala Bank,Represented by Its Authorized Officer

Kerala HC10 Jan 2024WP(C)/64/2024

Case brief

AI extract

What is this about?

The High Court of Kerala disposed of a writ petition challenging coercive proceedings under the SARFAESI Act initiated by a bank for loan default. The Court granted a stay on auction proceedings, directing the petitioner to clear dues and overdue amounts through monthly instalments.

What did the court decide?

Coercive proceedings deferred; order for repayment of overdue amount in 12 equal monthly instalments starting 12.02.2024.

Ajas T Vs Kerala Bank,Represented by Its… — 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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WEDNESDAY, THE 10TH DAY OF JANUARY 2024/20TH POUSHA, 1945
WP(C) NO. 64 OF 2024

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PETITIONER:

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AJAS T
AGED 35 YEARS, S/O SALAMIYA BEEVI ,
BISMILLA MANZIL, PALLIMUKKU,
CHADAYAMANGALAM PO KOLLAM,
PIN – 691 534.

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BY ADV

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SREERAJ M.D.

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RESPONDENT:

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KERALA BANK,
REPRESENTED BY ITS AUTHORIZED OFFICER
KERALA BANK,CHADAYAMANGALAM BRANCH,
PIN – 691 534.

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BY ADV

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P.C.SASIDHARAN, STANDING COUNSEL

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 10.01.2024, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:

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W.P.(C) No.64 of 2024

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: 2 :

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JUDGMENT

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Dated this the 10 day of January, 2024

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The petitioner has approached this Court

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aggrieved by the coercive proceedings for recovery of financial advance made by the Kerala 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 ₹14 lakhs to the petitioner as Mortgage Loan in the year 2022. 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 promptly later. The repayment of loan fell into arrears later due to severe financial crisis and he lost his job. It happened due to reasons beyond the control of the petitioner.

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W.P.(C) No.64 of 2024

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: 3 :

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Though the petitioner requested the Bank to permit 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 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 instalments. If the respondent is 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 respondent, it is submitted that the loan was given to the petitioner in the year 2022. The petitioner committed default in repaying the loan.

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W.P.(C) No.64 of 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 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 is 16,38,184/- and the overdue amount as on₹ 04.01.2024 is 3,22,862/-.₹

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W.P.(C) No.64 of 2024

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: 5 :

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I have heard the learned Counsel for the petitioner

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and the learned Standing Counsel representing the Bank.

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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 his 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 ₹3,22,862/- in 12 equal and consecutive monthly instalments along with accruing interest and other Bank charges, if any.

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W.P.(C) No.64 of 2024

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: 6 :

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(ii) First of such instalments shall be paid on or before 12.02.2024.

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

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

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(v) If the petitioner pays the instalments as directed above, any coercive proceedings against the petitioner shall stand deferred.

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Sd/-

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N. NAGARESH JUDGE

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AMR

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W.P.(C) No.64 of 2024

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: 7 :

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APPENDIX OF WP(C) 64/2024

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PETITIONER’S EXHIBIT

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Exhibit P1TRUE COPY OF THE POSSESSION NOTICE
DATED 17/3/2023.

Ajas T v. Kerala Bank,Represented by Its Authorized Officer

Case brief

What is this about?

What did the court decide?

Ajas T v. Kerala Bank,Represented by Its Authorized Officer

Case brief

What is this about?

What did the court decide?

What the court decided

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Statutes considered

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