G.Balasubramaniam Vs Indian Overseas Bank — Writ and Judicial Review | Madras HC (2025)

G.Balasubramaniam Vs Indian Overseas Bank — Writ and Judicial Review | Madras HC (2025)

What the court decided

AI extract

Outcome

Petition disposed on agreed terms: the bank may appropriate the petitioner's Court deposit of Rs.4,21,49,112/- with accrued interest and shall thereafter hand over all documents of the mortgaged property at Avinashi Road, Coimbatore, thereby redeeming it; the petitioner is to furnish a letter indemnifying the bank against any claim in respect of the property; both sides to co-operate to complete the process within a week; no order as to costs; interim applications closed.

Issue for consideration

Whether a writ of mandamus under Article 226 should issue directing the respondent bank to act upon the petitioner's exercise of the right to redeem the property at Avinashi Road, Coimbatore and release its mortgage over it. +1 more

Court's answer

Upon appropriating the petitioner's deposit of Rs.4,21,49,112/- together with accrued interest, the bank shall hand over all documents relating to the mortgaged property; in other words, the mortgaged property shall be redeemed.

Ratio / Principle

While handing over the documents relating to the mortgaged property, the petitioner is to give the bank a letter indemnifying the bank against any claim in respect of the mortgaged property.

Key takeaways

Both parties are to co-operate with each other so that the entire process (appropriation, indemnity letter and hand-over of documents) is completed within a week.ratio¶44

Detailed headnote1 paragraphs

Writ Petition - Article 226 mandamus - redemption of mortgaged property - consent-based disposal. Petitioner, who had earlier deposited Rs.4,21,49,112/- in the High Court (interim order of 27.3.2024 had allowed the bank's conditional withdrawal of that deposit), prayed for a mandamus directing Indian Overseas Bank to act upon his exercise of the right to redeem the property at Avinashi Road, Coimbatore and release its mortgage. Counsel stated all dues stood paid and that appropriation of the deposit with accrued interest would close all three loan accounts (the property also being collateral for two other accounts totalling Rs.134 crore). Disposing the petition, the Court directed that upon appropriation of Rs.4,21,49,112/- with accrued interest the bank shall hand over all documents of the mortgaged property, thereby redeeming it; the petitioner is to give the bank a letter indemnifying it against any claim in respect of the property; both parties to co-operate to complete the process within a week; no costs; interim applications closed. (Order made by the Chief Justice, countersigned by Senthilkumar Ramamoorthy, J.)

W.P.No.5454 of 2024

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED: 03.01.2025

CORAM :

THE HON'BLE MR.K.R.SHRIRAM, CHIEF JUSTICE AND

THE HON'BLE MR.JUSTICE SENTHILKUMAR RAMAMOORTHY

W.P.No.5454 of 2024 and W.M.P.Nos.9697 and 6023 of 2024

G.Balasubramaniam .. Petitioner

Vs

Indian Overseas Bank rep by its Chief Manager Specialised Asset Recovery Management Branch 11/952 Cross Cut Road, Gandhipuram, Coimbatore - 641 012.

.. Respondent

Prayer : Petition filed under Article 226 of the Constitution of India seeking issuance of a writ of mandamus directing the respondent to act upon the exercise of right by the petitioner to redeem the said property situated at Avinashi Road, Coimbatore and thereby release their mortgage over the said property.

For Petitioner

: Mr.S.R.Rajagopal Senior Advocate for Mr.R.Praveennath

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W.P.No.5454 of 2024

For Respondent

: Mr.M.L.Ganesh

ORDER

(Order of the Court was made by the Hon'ble Chief Justice)

On 27.3.2024, the following order came to be passed:

“The application is filed by the bank for withdrawal of the amount deposited by the writ petitioner amounting to Rs.4,21,49,112/- (Rupees four crore twenty one lakhs forty nine thousand one hundred twelve only) in this Court.

It is submitted by the learned counsel for the bank that the property that was the subject matter of sale and pursuant to which the amount is deposited is also collateral for two other loan accounts totalling to Rs.134 crore.

The learned senior advocate for the writ petitioner submits that the other two loan accounts have been discharged and the letter of discharge is also given by the bank. After depositing the amount of Rs.4,21,49,112/-, the entire outstanding amount of all the three accounts would be wiped out.

Today, we are only considering the application for withdrawal. The bank wants to withdraw the amount as the year end is in the offing. At the same time, the rights of the writ petitioner will also have to be protected.

The bank is allowed to withdraw the amount deposited by the writ petitioner in this Court of Rs.4,21,49,112/- (Rupees four crore twenty one lakhs forty nine thousand one hundred twelve only) on the following conditions:

a) The amount withdrawn by the bank would be kept in a separate account which would carry interest;

b) As and when directed by this Court, the bank will have to redeposit the amount in the Court within a period of seven days from the date of the order;

c) The respondent bank shall not proceed further with the property in whatsoever manner.

d) The aforesaid order is without prejudice to the rights and contentions of either of the parties.

Place the matter on 16.04.2024”

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W.P.No.5454 of 2024

Shri Rajagopal submits that all amounts payable to the bank have been paid and even the amount of Rs.4,21,49,112/-, referred to in paragraph 5 of the order quoted above, together with accrued interest, can be appropriated by the bank.

Shri Rajagopal states that would close the entire account and Shri Ganesh states that there will be few lakhs here and there which would be a shortfall. Shri Rajagopal states that petitioner will discuss with the bank and sort it out.

Upon appropriating Rs.4,21,49,112/- together with accrued interest, the bank shall handover all documents relating to the mortgaged property. In other words, the mortgaged property shall be redeemed.

Shri Ganesh states that while handing over the documents relating to the mortgaged property, petitioner will have to give a letter indemnifying the bank against any claim in respect of the mortgaged property. Shri

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W.P.No.5454 of 2024

Rajagopal states he shall handover the said letter to the bank.

Both counsels state that their respective clients will co-operate with each other so that the entire process is completed within a week from today.

Petition is disposed of accordingly. There shall be no order as to costs. Consequently, interim applications stand closed.

(K.R.SHRIRAM, C.J.) (SENTHILKUMAR RAMAMOORTHY,J.) 03.01.2025 Index : Yes/No NC : Yes/No sasi

To:

The Chief Manager Indian Overseas Bank Specialised Asset Recovery Management Branch 11/952 Cross Cut Road, Gandhipuram, Coimbatore - 641 012.

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W.P.No.5454 of 2024

THE HON'BLE CHIEF JUSTICE AND SENTHILKUMAR RAMAMOORTHY,J.

(sasi)

W.P.No.5454 of 2024

03.01.2025

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