Disposed

Ibrahim v. Vs Nilamabur Co-Op Urban Bank Ltd.

Kerala HC6 Mar 2024WP(C)/8294/2024

Case brief

AI extract

What is this about?

Writ petitioner sought relief against coercive recovery proceedings initiated by a cooperative bank for a defaulted business loan. Acknowledging the petitioner's ability to pay, the Court directed repayment in monthly installments to defer auction proceedings.

What did the court decide?

Recovery of ₹4,54,550 in 10 consecutive monthly installments; coercive proceedings deferred pending payment of dues.

Ibrahim v Vs Nilamabur Co-Op Urban Bank Ltd. — Consumer Protection | 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 6^TH DAY OF MARCH 2024/16TH PHALGUNA, 1945 WP(C) NO. 8294 OF 2024

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PETITIONER:

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IBRAHIM V., AGED 49 YEARS, S/O KUNJI MOHAMED, VILAYILCHOLA HOUSE, KUTTIMUNDA POOKOTTUMANNA P.O., MALAPPURAM DT., PIN – 679334

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BY ADVS. M.R.REENA P.S.SUJETH

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RESPONDENT:

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NILAMABUR CO-OP URBAN BANK LTD., NILAMBUR BR, MALAPPURAM DT REP BY ITS AUTHORIZED OFFICER, NILAMBUR (PO), MALAPPURAM DT, PIN – 679329

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BY ADVS. RAMESH BABU T C.K.SREEJITH(K/2048/1999)

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06.03.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

W.P.(C) No.8294/2024

: 2 :

JUDGMENT

Dated this the 6^th day of March , 2024

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The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by the Nilamabur Co-operative Urban 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 ₹7 lakhs to the petitioner as Business Loan in the year 2020. 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. It happened due to reasons beyond the control of the petitioner.

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W.P.(C) No.8294/2024

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: 3 :

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Though the petitioner requested the Bank to

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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 2020. The petitioner committed default in repaying the loan.

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W.P.(C) No.8294/2024

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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 01.03.2024 is ₹8,17,653/and the overdue amount as on 01.03.2024 is ₹4,54,550/-.

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W.P.(C) No.8294/2024

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: 5 :

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I have heard the counsel for the petitioner and

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the 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 account 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 overdue amount of ₹4,54,550/- in 10 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 27.03.2024.

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W.P.(C) No.8294/2024

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: 6 :

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(ii) If the petitioner commits default in

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

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

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Sd/-

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N. NAGARESH JUDGE

W.P.(C) No.8294/2024

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APPENDIX OF WP(C) 8294/2024

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PETITIONER'S EXHIBITS:

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Exhibit P1 A TRUE COPY OF THE POSSESSION NOTICE DATED 05-10-2023 ISSUED BY THE RESPONDENT

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Exhibit P2 A TRUE COPY OF THE REPRESENTATION DATED 15-01-2024 SENT BY THE PETITIONER

Ibrahim v. Vs Nilamabur Co-Op Urban Bank Ltd.

Case brief

What is this about?

What did the court decide?

Ibrahim v. Vs Nilamabur Co-Op Urban Bank Ltd.

Case brief

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What did the court decide?

What the court decided

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