Disposed

Krishan Kumar and Anr. v. I.C.I.C.I. Bank Home Finance Company Limited and Ors.

Punjab & Haryana HC4 Jan 2012CWP/117/2012

Case brief

AI extract

What is this about?

The Punjab and Haryana High Court disposed of a writ petition challenging notices issued by Arcil Arms under the SARFAESI Act. The court held that since the loan account was assigned to the securitization company, the petitioner must direct settlement efforts and remittance to Arcil Arms, not the original lender, and remanded the matter for filing objections with the transferee.

What did the court decide?

Petition disposed of; petitioners directed to file representation and offer settlement with Arcil Arms along with a cheque.

Krishan Kumar and Anr. Vs I.C.I.C.I. Bank Home… — Banking and Recovery | Punjab & Haryana HC (2012)

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CWP No. 117 of 2012

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IN THE PUNJAB AND HARYANA HIGH COURT AT CHANDIGARH

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CWP No. 117 of 2012

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Date of Decision: January, 04, 2012

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Krishan Kumar and another

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…Petitioners

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Versus

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The ICICI Bank Home Finance Company Limited and others

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..Respondent

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CORAM: HON'BLE MR. JUSTICE M.M. KUMAR HON'BLE MR. JUSTICE AJAY KUMAR MITTAL

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Present: Mr. A.K. Khunger, Advocate for the petitioners.

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To be referred to the Reporters or not?

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Whether the judgment should be reported in the Digest?

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M.M. KUMAR, J.

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The instant petition is directed against notice dated 11.07.2011 (P-5) issued by Arcil Arms-respondent No.4, under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for brevity ' the SARFAESI Act'). It has also been prayed that notice dated 19.12.2011 (P-1)) concerning taking of possession be also quashed.

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It is appropriate to mention that the petitioners are borrower of the ICICI Bank which in terms of Section 5 of the SARFAESI Act has assigned and transferred their loan account

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CWP No. 117 of 2012 -2-

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to Arcil-respondent No.4 under its Retail Loan Fortfolio 001Trust. Accordingly, a notice under Section 13(2) of the SARFAESI Act was issued by Arcil Arms-respondent No.4 (P-5). The petitioners filed a representation under Section 13(3)(a) of the SARFAESI Act and asked respondent No.2-ICICI Bank to deposit the entire outstanding amount.

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Some objections were also raised with regard to demand raised by Arcil Arms-respondent No.4. The aforesaid objections appear to have been replied on 08.11.2011, wherein Arcil Arms-respondent No.4 has inivited the petitioners for discussion and settlement of accounts at their Ludhiana office. This was followed by a letter written by the petitioners to all the respondents. In para 16 of letter dated 28.11.2011, it has been highlighted that the petitioners sent a cheque of ` 5,30,836/- dated 28.11.2011 towards balance principal amount to respondent No.2. Once original lenderrespondent No.2 has assigned and transferred the facility agreement, security documents and all other transactional documents in terms of Section 5 of the SARFAESI Act then there was no question of sending a cheque to original lender, namely, ICICI Bank-respondent No.2. This has again resulted in issuance of a notice for taking possession of secured assets on 19.12.2011 by Arcil Arms-respondent No.4. 4. We have heard learned counsel for the petitioner at a considerable length. The petitioners are required to settle the dispute concerning their loan with the transferee

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CWP No. 117 of 2012 -3-

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company, namely, Arcil Arms-respondent No.4. It cannot keep dealing with ICICI Bank-respondent No.2. It is appropriate to mention that Arcil Arms-respondent No.4 is a securitization company under Section 3 of the SARFAESI Act with the Reserve Bank of India. The strict financial control could be met only by 12 securitization companies, which could be registered under Section 3 of the SARFAESI Act. The Arcil Arms-respondent No.4 is a company based in Bombay and its promoters banks are State Bank of India; ICICI and IDBI. The aforesaid facts have been placed before this Court in CAPP No. 23 of 2009 decided on 15.12.2009. Therefore, it was required by the petitioners to deal with Arcil Armsrespondent No.4, which is authorised under Section 3 of the SARFAESI Act to enter into any assignment and transfer of assets of original lender as per provisions of Section 5 of the SARFAESI Act. Therefore the cheque was required to be sent to Arcil Bank-respondent No.4.

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In view of the above, we dispose of the petition with liberty to petitioners to move an appropriate application/ objection to Arcil Arms-respondent No.4 along with their offer for settlement of accounts. The petitioners have misdirected their efforts and the offer of settlement by issuing cheque in favour of ICICI Bank-respondent No.2. Therefore, at this stage, we relegate the petitioners to the remedy of filing a detailed representation and presenting the offer of compromise along with another cheque to Arcil Arms-

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CWP No. 117 of 2012

respondent No.4.

Accordingly, the writ petition stands disposed of in

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the above terms.

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(M.M. KUMAR) JUDGE

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(AJAY KUMAR MITTAL) JUDGE

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January 4, 2012 Atul

Krishan Kumar and Anr. v. I.C.I.C.I. Bank Home Finance Company Limited and Ors.

Case brief

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Krishan Kumar and Anr. v. I.C.I.C.I. Bank Home Finance Company Limited and Ors.

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What did the court decide?

What the court decided

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