Muhammad Salim vs Kerala State Co-Operative Bank Ltd. ...

Kerala High Court

Muhammad Salim vs Kerala State Co-Operative Bank Ltd. ... on 21 May, 2024

Author: N.Nagaresh

Bench: N.Nagaresh

               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                        PRESENT
          THE HONOURABLE MR.JUSTICE N.NAGARESH
 TUESDAY, THE 21ST DAY OF MAY 2024 / 31ST VAISAKHA, 1946
                WP(C) NO. 17757 OF 2024
PETITIONER:

         MUHAMMAD SALIM
         AGED 58 YEARS
         S/O MUHAMMED, SHARAF VILLA (HOUSE) IRINGAL,
         KOTTAKKAL P.O, KOZHIKODE DIST., PIN - 673521

         BY ADVS.
         P.S.BINU
         K.SEENA


RESPONDENTS:

    1    KERALA STATE CO-OPERATIVE BANK LTD.,
         REP. BY THE BRANCH MANAGER
         PAYYOLI BRANCH, PAYYOLI (PO)
         KOZHIKODE DISTRICT., PIN - 673522

    2    THE AUTHORISED OFFICER (SARFAESI ACT)
         KERALA STATE CO-OPERATIVE BANK LTD.
         CALICUT REGIONAL OFFICE, CHALAPPURAM P.O,
         KOZHIKODE DIST., PIN - 673002

         BY SRI. P.C. SASIDHARAN, SC

     THIS WRIT PETITION (CIVIL) HAVING COME UP          FOR
ADMISSION ON 21.05.2024, THE COURT ON THE SAME          DAY
DELIVERED THE FOLLOWING:
 WP(C) NO.17757 OF 2024
                               2




                        JUDGMENT

Dated this the 21st day of May, 2024 The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by the Kerala State Co-operative Bank Limited to the petitioner, invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

2. The Bank paid ₹13,00,000/- to the petitioner as Ordinary Loan in the year 2019. 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 installments promptly later due to business loss. The repayment of loan fell into arrears. It happened due to reasons beyond the control of the petitioner. WP(C) NO.17757 OF 2024 3

3. Though the petitioner requested the Bank to permit the petitioner to repay the overdue amounts in easy monthly installments, 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 Exts.P1 and P2 notices.

4. 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 installments. If the respondents are 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.

5. Standing Counsel entered appearance on behalf of the Bank and denied all the statements made by the petitioner. On behalf of the respondents, it is submitted that the loan was given to the petitioner in the year 2019. The WP(C) NO.17757 OF 2024 4 petitioner committed default in repaying the loan.

6. 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 Exts. P1 and P2 notices were issued in these circumstances. The petitioner has not advanced any legal reasons to thwart the coercive proceedings initiated by the Bank.

7. 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 21.05.2024 is ₹21,47,863/- and the WP(C) NO.17757 OF 2024 5 overdue amount as on 21.05.2024 is ₹11,72,563/-.

8. I have heard the counsel for the petitioner and the Standing Counsel representing the Bank.

9. 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 loan 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.

10. 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.

11. The writ petition is therefore disposed of with the following directions:

(i) The petitioner shall remit the overdue amount of ₹11,72,563/- in ten consecutive and equal monthly installments along with accruing interest and other Bank charges, if WP(C) NO.17757 OF 2024 6 any. First of such installments shall be paid on or before 21.06.2024.

(ii) If the petitioner commits default in making payments as directed above, the respondents will be at liberty to continue with the coercive proceedings against the petitioner in accordance with law.

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

(iv) If the petitioner makes payments as directed above, coercive proceedings, if any, against the petitioner shall stand deferred.

Sd/-

N.NAGARESH JUDGE DCS WP(C) NO.17757 OF 2024 7 APPENDIX OF WP(C) 17757/2024 PETITIONER EXHIBITS Exhibit P1 THE COPY OF THE SALE NOTICE ISSUED BY THE 2ND RESPONDENT DATED 20.01.2023 Exhibit P2 THE COPY OF THE NOTICE ISSUED BY THE ADVOCATE COMMISSIONER APPOINTED BY THE CHIEF JUDICIAL MAGISTRATE, KOZHIKODE IN C.M.P NO.717/2024 DATED 30.04.2024