Dismissed

Palipati Devasahayam v. The Andhra Bank

Telangana HC6 Mar 2012WP/5670/2012

Case brief

AI extract

What is this about?

The Court dismissed a writ petition challenging a Section 13(2) notice of demand issued by a bank under the SARFAESI Act. Holding that issuance of such a notice is a mandatory condition precedent for enforcement without court intervention, the Court ruled the petition untenable but granted liberty to approach the bank under Section 13(8) considering the petitioners' repayment request.

What did the court decide?

A liberty is granted to the petitioners to approach the bank under Section 13(8) of the Act to consider their request for repayment time.

Palipati Devasahayam Vs The Andhra Bank — Banking and Recovery | Telangana HC (2012)

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THE HON’BLE SRI JUSTICE V.V.S.RAO

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AND

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THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY

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WRIT PETITION No.5670 OF 2012

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March 06, 2012

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Between: Palipati Devasahayam, S/o.Chinnappa And others

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Petitioners

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And

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The Andhra Bank, Main Branch, Gandhi Chowk, Khammam Represented by its Manager

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... Respondent

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THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON’BLE SRI JUSTICE G.KRISHNA MOHAN REDDY

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WRIT PETITION No.5670 OF 2012

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ORDER: (Per Hon’ble Sri Justice V.V.S.Rao)

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The first petitioner availed housing loan (Rs.5.00 lakhs) from the respondent bank. When repayment of the loan became irregular and the account became non-performing asset, the respondent issued notice of demand under Section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the Act) on 21.10.2011 calling upon the petitioner to pay an amount of Rs.2,65,710/- within a period of sixty (60) days from the date of the notice. The first petitioner allegedly made representations to the respondent requesting to grant five months’ time for repayment of entire loan amount. Alleging that the representations were not considered, the first petitioner along with his wife and son (petitioners 2 and 3) filed the instant writ petition seeking invalidation of the notice of demand.

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Under the provisions of the Act, any bank or financial institution can enforce the security interest without intervention of the Court. As a condition precedent for enforcing the security interest as contemplated under Section 13(4) of the Act, a bank is mandatorily required to issue a notice of demand requiring the borrower to discharge the full liability within a period of sixty (60) days. In compliance with the statute, the bank issued notice of demand under Section 13(2) of the Act and therefore, writ petition

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would not lie. Though admittedly the impugned notice was issued on 21.10.2011 so far the respondent bank has not issued the possession notice under Section 13(4) of the Act. In view of the same, the petitioners are given liberty to approach the bank under Section 13(8) of the Act, in which event, the bank may consider the petitioners’ request.

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The writ petition, with the above observations, is accordingly dismissed. The miscellaneous petition shall stand dismissed. No costs.

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_______________ (V.V.S.RAO, J)

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________________________________ (G.KRISHNA MOHAN REDDY, J)

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March 06, 2012 YS

Palipati Devasahayam v. The Andhra Bank

Case brief

What is this about?

What did the court decide?

Palipati Devasahayam v. The Andhra Bank

Case brief

What is this about?

What did the court decide?

What the court decided

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