Allowed

Sri. Akhilesh Mehta, v. State Bank Of India

Telangana HC11 Dec 2023WP/21924/2014

Case brief

AI extract

What is this about?

The High Court allowed a writ petition by a borrower against a public sector bank. The court directed the bank not to publish the petitioner's photograph, name, address, or other details in newspapers as part of its recovery proceedings under the SARFAESI Act.

What did the court decide?

Directing the respondent bank not to publish photographs, names, addresses, or other details of the petitioner in newspapers.

Sri. Akhilesh Mehta, Vs State Bank Of India — Public Procurement and Tenders | Telangana HC (2023)

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132s21

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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

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MONDAY, THE ELEVENTH DAY OF DECEMBER TWO THOUSAND AND TWENTY THREE

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PRESENT

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THE HONOURABLE MRS JUSTICE SUREPALLI NANDA

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WRIT PETITION NO: 21924 OF 2014

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Between:

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Sri. Akhilesh Mehta, S/o. Pravinchand Mehta, Age 40 Years, Occ Business, Director of M/s. A S Steels and, Tubes ( lndia ) Private Limited Situated at R:/o Flat No. 101, Misha Graden, Tadbund Road, Sikh (Village ), Secunderabad^- 5oo oo9'

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...PETrroNER

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AND

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'l . State Bank Of lndia, Rep by its Chief Manager, Bible House (R.P. Road) Branch Keyjee Mansion, Ranigunj Circle, Secunderabad - 500 003.

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The Central Government Of lndia, Rep by its Finance Department, Rep. by^its Chief Secretary at New Delhi.

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...RESPONDENTS

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Petition under Article 226 of the Constitution of India^praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue Writ of Mandamus or any other appropriate writ, order by setting aside impugned dated 11.07.2O14 issugd.by the Respondent No. 1^{Bank as null} and void, illegal arbitrator, un constitutional against the Article 21 of^the Constitution of lndia, consequently direct the Respondent^not to^Publishthe Photographs, names, address and other details in the newspapers.

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l.A. NO: 1OF 2O14(WPMP. NO:27501 OF 20141

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Petition under Section 151 CPC^praying.that in the circumstances^stated in the affidavit filed in support of the^petition, the'High Court^{may be pleasedto} Stay of all further proceedings in^pursuance of the notice dated^{11 .O7.2O14} issued by the respondent No. 1 in Publishing the Photograph,^{name, address,} and other details in the newspapers.

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Counsel for the Petitioner: SRI D.RAGHAVULU Counsel for the Respondent No.l: SRI B.S.PRASAD counser ror the Respondent No'2: 3Ei3+?Lttil,=-EHt?Tt[ir oF rNDrA The Court made the following: OROER

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HON'BLE MRS JUSTICE SUREPALLI NANDA WRIT PETITION 0.21924 0F 2(JL4

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ORDER

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Heard learned counsel appearing on behalf of the petitioner and learned counsel appearing on behalf of the respondents.

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The petitioner approached this Court

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seeking the relief as under:

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"To issue Writ of Mandamus or any other appropriate writ, order by setting aside impugned order dated tl.O7.2OL4 issued by the Respondent No.1 Bank as null and void, illegal arbitrator, unconstitutional against the Article 21 of the Constitution of India, consequently direct the Respondent not to Publish the Photographs, names, address and other details in the newspapers And pass such other order or orders as this Hon'ble Court deems fit and proper in the circumstances of the case."

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The case of the oetitioner as per the averments made trv the etitioner in the affidavit

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fi ti r s e nt Writ Petition, in brief. is as foflows: a) The petitioner is the Director of the AS Steels & Tubes (India) private Limited situated at Flat No.101, Misha Graden, Tadbund Road, Sikh village, Secunderabad.

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b) The respondent No.1 Bank sanctioned cash credit facility Rs.1,60,00,000/- and SME care facility of Rs.25,00,000/- to the petitioner for improvement of Business against mortgage of two properties i.e., residential plot-35 covered in Sy.No.66,7 3,74,77 & 78, admeasuring 300 Square yards situated at Royal Enclave, Hasmathpet Road, Secunderabad Cantonment, and Flat No.101 on first floor, admeasuring^plinth area of 1250 Sq.ft including Common Area together with 3g.00 sq.yards undivided share of land in premises bearing No.2-4-82, Misha Graden situated at Shamlal Estate, Sikh Village, Secunderabad in Sy.No.B & 9.

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c) Thereafter, after availing the loan the petitioner started investing the moriey for the improvement of the Business and due to the various problems, the said business has not improved within the time. The petitioner approached the respondent Bank and explained the situation time to time and requested for co-operation of the respondent Bank but the respondent Bank without considering the request proceeded under SARFAESI ACT. It is further submitted that the loan was sanctioned in the year 20L3, subsequently, the petitioner paid interest up to date and the account is not NpA.

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d) While things stood, the respondent Bank issued recovery proceedings iliegally in order to harass the petitioner. It is further submitted that without any prior Notices the respondent Bank issued the notice dated 11.07.2014 threatening the petitioner and his guarantors that the respondent No.1 would publish/display the details including name, address, photograph and details of the borrower and guarantors.

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e) Thereafter, the respondent Bank published a Sale Notice dated ZL.O7.ZOL4 which is pubtished on 22.07.20L4 in the New India Express, Hyderabad daily Newspaper. It is submitted that the respondent Bank initiated the proceedings illegally in violation of the rules made under the SARFASI Act, 2002.

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f) It is further submitted that the credit facility granted by the bank is to the tune of Rs.1,95,00,000/_ whereas the present outstanding claiming by the Bank of Rs.1,88,06,3t6/- only. It clearly establishes that the overdue amount of the petitioner is only a sum of Rs.3,06,316/-. It is submitted that for an amount of Rs.3,06,316/- publishing the photographs of the petitioner and the guarantors is illegal and high handed action of respondent No.1 bank.

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S)^{The petitioner} did not receive any notice till the month of )une, 2Ol4 but on 14.O7.2OL4 when the petitioner went to the bank then the bank gave copies of the alleged sale notices and the notice dated Ll.O7.2Ol4 which is under challenge in the present writ

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petition. The petitioner did not receive any demand notice, possession notice as per law, is the specific case of the petitioner.

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h) It is further submiLted by the learned counsel appearing on behalf of the petitioner that the respondent No.1 bank is causing harm to the social life of the petitioner/Guarantor and the alleged notice dated Lt.O7.2Ot4 is against the Article ZL of Constitution of India and Rule g of the SARFASI proceedings. It is further contended by the learned counsel appearing on behalf of the petitioner that no enactment empowers the respondent Bank either expressly or impliedly to publish the photograph of Borrowers/guarantors as such the issuance of notice dated 11.07.2014 is illegal and the same in initiated only to tarnish the reputation of the petitioner and his guarantors. The impugned notice issued by the respondent is unconstitutional and the same deserves to be set aside. Hence, this Writ petition.

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This Court passed Interim orders dated

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O4.O8.20f4 observed as under:

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"Notice before admission returnable in four (04) weeks. There shall be interim stay of Notice to Borrower/Guarantor, dated tl.O7.2OL4 to the extent of publication of name, address, photographs and other details of petitioner in newspapers. Post after four weeks."

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Counter Affidavit filed by the respondent

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No.1, in brief, is as under:

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a) State Bank of India, represented by its Chief Manager reported that the petitioner has offered immovable properties by way of collateral security in respect of the loan taken by them. The loan account has become a non performing asset and the respondent No.1 has contemplated steps under SARFAESI Act, 2002 and respondent No.1 has issued notice under Section 13(2) of the SARFAESI Act, 2002 on 31,01.2014 and Section 13 (4) possession notice on 24.04.2014 and published the possession notice dated

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26.04.2014 in the Newspaper and proceeding with the sale of the Schedule properties.

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A bare perusal of the notice dated 02.06.2014 issued to the petitioner under the provisions of Rule B(5) & (6) of the Security Interest (Enforcement) Rules, 2002 reads as under:

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a) However under the Securitisation and reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and in exercise of the powers conferred under Section 13(2) read with Rule 9 of the Security Interest (Enforcement) Rules, 2002, the respondent No.1 through demand notice dated 3t.OL.2Ol4 demanded the petitioner company to repay the amount of Rs.1,88,06,316/(Rupees One crore eighty eight lakh six thousand three hundred and sixteen only) as on 31.01.2014 + interest at contractual rate from 01.02.2014 and expenses thereon within 60 days from the date of receipt of the said Notice.

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b) As the petitioner failed to repay the amount demanded in the notice, the respondent No.1 took possession of the properties mortgaged by the petitioner on 24.O4.2014 in exercise of the powers conferred under Section 13(4) of the Act read with Rule 8(1) of the Rules. The possession notice was also published in the 'Andhra Jyothi' &^.The New India Express' Newspapers on 26.04.2014 as required under Rule 8(2) of the Rules.

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c) The borrower/guarantors/Mortgagers in particular and the public in general are hereby cautioned not to deal with the properties and any dealings with the properties will be subject to the charge of the State bank of India, Bible House (R.P.Road) Branch, Secunderabad for an amount of Rs.1,88,06,3L6/- (Rupees One Crore Eighty Eight Lakh).

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d) The petitioner was informed that the properties mortgaged by the Banks State Bank of India, Bible House (R.p. Road) Branch, Secunderabad will be sold in public auction by inviting tenders/quotations from the public in case the amount due to the Bank as demanded in the 37.OL.2014 is not repaid within a period of 30 days from the date of the notice dated 02.06.2074.

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The respondent No.1 issued a legal notice dated LL'07.20L4 stating that the petitioner had defaurted in paying interest/ defaulted in payment of due instalments of the loan accounts with them For more than 3 months and the loan accounts have been classified as NpA and the Respondent No.1 reminded the petitioner on several occasions about the defaulted

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instalments/interest through all possible modes of communication viz., letters, notices, telephone and personal visits to regularize/pay the over dues of the loan accounts. Till date the petitioner neither regularized the account nor liquidated the loan dues. Thus, the petitioner has committed breach of the terms and conditions of loan covenants and are deliberately evading repayment of dues. The respondent No.1 advised the petitioner to repay the overdues/regularise the accounts within 15 days from the notice dated LL.O7.2OL4 i.e., by 26.07.2OL4 and in case of the failure to do so, the bank may be constrained to proceed to publish/display your name, address, photograph and other details in the newspapers and other a ppropriate places.

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Taking into consideration the submissions made by the learned counsel appearing on behatf of petitioner, and duly considering the interim orders of this Court dated O4.OB.2O14 passed in the present writ petition, the Writ petition is allowed directing the respondent No.1 Bank not

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to publish the photographs, nanre, address and other details of the petitioner in the newspapers.

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However, there shall be no order as to costs.

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Miscellaneous petitions, if any, pending in this

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Writ Petition, shall stand closed.

SD/.V.KAVITHA

//TRUE COPY//

ASSTSTANT REGISTR

SECTION OFFICER

To,

The Chief Manager, State Bank Of lndia, Bible House (R.P. Road) Branch Keyjee Mansion, Ranigunj Circle, Secunderabad - 500 003.

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The Chief Secretary, Central Government Of lndia, Finance Department, at New Delhi.

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One CC to SRI D-RAGHAVULU, Advocate [OPUC]

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One CC to SRI B.S.PRASAD, Advocate TOPUCI

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One CC to SRI GADI PRAVEEN KUMAR, DEPUTY SOLICITOR GENERAL OF lNDIA, High Court for the State of Telangana at Hyderabad [OPUC]

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Two CD Copies

BSR

GJP

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HIGH COURT

DATED: 1111212023

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ORDER

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WP.No.21924 of 2014

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ALLOWING THE WRIT PETITION,

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WITHOUT COSTS

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@'&w

Sri. Akhilesh Mehta, v. State Bank Of India

Case brief

What is this about?

What did the court decide?

Sri. Akhilesh Mehta, v. State Bank Of India

Case brief

What is this about?

What did the court decide?

What the court decided

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