Surendran vs The Kerala State Co-Op Bank Ltd

Kerala High Court

Surendran vs The Kerala State Co-Op 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. 10999 OF 2024
PETITIONER:

              SURENDRAN
              AGED 62 YEARS
              S/O VASU , SHYAM NIVAS NEDUMBRAM ,
              P.O CHOKLI KANNUR DT, PIN - 670672

              BY ADVS.
              M.R.REENA
              P.S.SUJETH


RESPONDENT:

              THE KERALA STATE CO-OP BANK LTD
              CHOKLI BR , KANNUR DT REP BY ITS AUTHORIZED OFFICER ,
              KANNUR REGIONAL OFFICE ,
              P.B.NO 35 , KANNUR, PIN - 670001

              BY ADV M.SASINDRAN


     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.10999 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 ₹5,70,000/- to the petitioner as Term 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 financial stringency. The repayment of loan fell into arrears. It happened due to reasons beyond the control of the petitioner.

3. Though the petitioner requested the Bank to permit the petitioner to repay the overdue amounts in easy monthly WP(C) No.10999 Of 2024 3 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 Ext.P1 notice.

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 respondent is 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 respondent, it is submitted that the loan was given to the petitioner in the year 2019. The petitioner committed default in repaying the loan. WP(C) No.10999 Of 2024 4

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 Ext.P1 notice was 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 ₹9,16,345/- and the WP(C) No.10999 Of 2024 5 overdue amount as on 21.05.2024 is ₹5,59,558/-.

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 ₹5,59,558/- in ten consecutive and equal monthly installments along with WP(C) No.10999 Of 2024 6 accruing interest and other Bank charges, if 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 respondent 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 hmh WP(C) No.10999 Of 2024 7 APPENDIX OF WP(C) 10999/2024 PETITIONER EXHIBITS Exhibit -P1 A TRUE COPY OF THE DEMAND NOTICE DATED 19-01-2024 PUBLISHED IN DHESHABHIMANI DAILY Exhibit -P2 A TRUE COPY OF THE REPRESENTATION DATED 10-03-2024 SENT BY THE PETITIONER