Radhakrishnan Mullath vs Union Of India
2021 Latest Caselaw 15279 Ker

             IN THE HIGH COURT OF KERALA AT ERNAKULAM
                               PRESENT
         THE HONOURABLE THE CHIEF JUSTICE MR.S.MANIKUMAR
                                  &
             THE HONOURABLE MR. JUSTICE SHAJI P.CHALY
     THURSDAY, THE 22ND DAY OF JULY 2021 / 31ST ASHADHA, 1943
                          WA NO. 913 OF 2021
AGAINST THE JUDGMENT IN WP(C) 12041/2021 OF HIGH COURT OF KERALA,
                              ERNAKULAM
APPELLANTS/PETITIONERS:

    1     RADHAKRISHNAN MULLATH,
          AGED 71 YEARS
          S/O.KANANGATH RADHAKRISHNA MENON, MULLATH   HOUSE,
          KARIKKAD P.O., THRISSUR DISTRICT-680 519.
    2     SANDHEEP RADHAKRISHNA MENON,
          AGED 43 YEARS
          S/O.RADHAKRISHNAN MULLATH, MULLATH HOUSE,   KARIKKAD
          P.O., THRISSUR DISTRICT-680 519.
    3     DILEEP RADHAKRISHNA MENON,
          AGED 33 YEARS
          S/O.RADHAKRISHNAN MULLATH, MULLATH HOUSE,   KARIKKAD
          P.O., THRISSUR DISTRICT-680 519.
    4     DEEPAK RADHAKRISHNA MENON,
          AGED 38 YEARS
          S/O.RADHAKRISHNAN MULLATH, MULLATH HOUSE,   KARIKKAD
          P.O., THRISSUR DISTRICT-680 519.
    5     ODUMPULLY SYAMALA DEVI,
          AGED 63 YEARS
          W/O.RADHAKRISHNAN MULLATH, MULLATH HOUSE,   KARIKKAD
          P.O., THRISSUR DISTRICT-680 519.
          BY ADVS.
          V.JOHN MANI
          S.JAYANT
          JACKSON JOHNY
          VARGHESE SABU
          K.K.SETHULAKSHMI
          GAYATHRI MENON
 W.A.No.913   of 2021                2




RESPONDENTS:

     1        UNION OF INDIA,
              REPRESENTED BY SECRETARY, DEPARTMENT OF FINANCIAL
              SERVICES, MINISTRY OF FINANCES, 3RD FLOOR, JEEVAN DEEP
              BUILDING, SUNSAD MARG, NEW DELHI-110 001.

     2        THE CHIEF MANAGER, CANARA BANK,
              KUNNAMKULAM BRANCH, XV/524D, CENTRE PLAZA, THRISSUR
              ROAD, KUNNAMKULAM, THRISSUR-680 503.


              SRI.P.VIJAYAKUMAR, ASG FOR R1
              SRI.M.GOPIKRISHNAN NAMBIAR FOR R2


      THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 22.07.2021,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 W.A.No.913   of 2021                      3




                                    JUDGMENT

Dated this the 22nd day of July, 2021

SHAJI P.CHALY,J

This appeal is preferred by the petitioners in the writ petition, challenging

the judgment of the learned Single Judge dated 21.6.2021 in W.P.(C)

No.12041/2021, whereby the learned Single Judge dismissed the writ petition

declining the reliefs sought for by the petitioners under the provisions of

Securitisation and Reconstruction of Financial Assets and Enforcement of Security

Interest Act, 2002. The learned Single Judge after assimilating the factual and

legal situations permitted the petitioners to clear off the liability of an amount of

Rs.5,46,25,726/-(Rupees Five Crores forty six thousand twenty five thousand

seven hundred and twenty six only) in eight successive monthly installments

commencing from 21.7.2021 and if the petitioners are complying with the

directions, the respondent bank was directed to keep the coercive action initiated

against the petitioners in abeyance, with a further rider that the respondents

would be at liberty to continue the action under the SARFAESI Act, if a single

installment is defaulted.

2. The contention advanced by the appellants in the appeal is that appellants

wanted to clear of only the defaulted instalments of the loan amount and to

regularise the Overdraft facility, however, the learned Single Judge without

considering the entire aspects put forth by the appellants, directed the appellants

to clear of the entire liability under the loan transaction in eight successive

installments commencing from 21.7.2021. It was also pointed out that since the

amount remaining in the loan transaction is a huge amount, appellants would not

be in a position to pay the same in eight successive monthly installments. It was

further submitted that considering the current pandemic situation, learned Single

Judge ought to have considered the willingness of the appellants to clear the

defaulted instalments, and ought to have been permitted to remit the regular

monthly loan installment, after regularising the loan account .

3. We have heard, learned counsel for appellants Sri.John Mani and perused

the pleadings and materials on record.

4. The subject issue arises under the provisions of the SARFAESI Act, 2002.

The Apex Court had occasion to consider as to whether the writ petition is

maintainable against the proceedings initiated under the SARFAESI Act in various

judgments and finally in Authorised Officer, State Bank of Travancore and

another v. Mathew K.C. reported in [(2018) 3 SCC 85] held that the writ court

may not be right in entertaining writ petitions against the action initiated under

the provisions of the SARFAESI Act. The relevant paragraphs of the judgment in

K.C.Mathew (supra) reads thus:

"15. It is the solemn duty of the Court to apply the correct law without waiting for an objection to be raised by a party, especially when the law stands well settled. Any departure, if permissible, has to be for reasons discussed, of the case falling under a defined exception, duly discussed after noticing the relevant law. In financial matters grant of ex-parte interim orders can have a deleterious effect and it is not sufficient to say that the aggrieved has the remedy to move for vacating the interim order. Loans by financial institutions are granted from public money generated at the tax payers expense. Such loan does not become the property of the person taking the loan, but retains its character of public money given in a fiduciary capacity as entrustment by the public. Timely repayment also ensures liquidity to facilitate loan to another in need, by circulation of the money and cannot be permitted to be blocked by frivolous litigation by those who can afford the luxury of the same. The caution required, as expressed in Satyawati Tandon (supra), has also not been kept in mind before passing the impugned interim order:-

"46. It must be remembered that stay of an action initiated by the State and/or its agencies/instrumentalities for recovery of taxes, cess, fees, etc. seriously impedes execution of projects of public importance and disables them from discharging their constitutional and legal obligations towards the citizens. In

cases relating to recovery of the dues of banks, financial institutions and secured creditors, stay granted by the High Court would have serious adverse impact on the financial health of such bodies/institutions, which (sic will) ultimately prove detrimental to the economy of the nation. Therefore, the High Court should be extremely careful and circumspect in exercising its discretion to grant stay in such matters. Of course, if the petitioner is able to show that its case falls within any of the exceptions carved out in Baburam Prakash Chandra Maheshwari v. Antarim Zila Parishad, Whirlpool Corpn. v. Registrar of Trade Marks and Harbanslal Sahnia v. Indian Oil Corpn. Ltd. and some other judgments, then the High Court may, after considering all the relevant parameters and public interest, pass an appropriate interim order."

16. The writ petition ought not to have been entertained and the interim order granted for the mere asking without assigning special reasons, and that too without even granting opportunity to the Appellant to contest the maintainability of the writ petition and failure to notice the subsequent developments in the interregnum. The opinion of the Division Bench that the counter affidavit having subsequently been filed, stay/modification could be sought of the interim order cannot be considered sufficient justification to have declined interference.

17. The writ petition ought not to have been entertained and the interim order granted for the mere asking without assigning special reasons, and that too without even granting opportunity to the Appellant to contest the maintainability of the writ petition and failure to notice the subsequent developments in the interregnum. The opinion of the Division Bench that the counter affidavit having subsequently been filed, stay/modification could be sought of the interim order cannot be considered sufficient justification to have declined interference.

18. We cannot help but disapprove the approach of the High Court for reasons already noticed in Dwarikesh Sugar Industries Ltd. vs. Prem Heavy Engineering Works (P) Ltd. and Another, 1997 (6) SCC 450, observing :-

"32. When a position, in law, is well settled as a result of judicial pronouncement of this Court, it would amount to judicial impropriety to say the least, for the subordinate courts including the High Courts to ignore the settled decisions and then to pass a judicial order which is clearly contrary to the settled legal position. Such judicial adventurism cannot be permitted and we strongly deprecate the tendency of the subordinate courts in not applying the settled principles and in passing whimsical orders which necessarily has the effect of granting wrongful and unwarranted relief to one of the parties. It is time that this tendency stops."

5. Considering the facts and circumstances involved in the case at hand, we

are of the view that a notice is already issued under section 13(2) of the

SARFAESI Act and proceedings have started. If at all the appellants are aggrieved

by any action, it is for the appellants to pursue the remedy in contemplation of

the provisions of the SARFAESI Act. Therefore in our view the learned Single

Judge was right in declining the reliefs sought, for interference with the

SARFAESI proceedings and granting the possible relief of instalment payment of

the due amounts .

Taking into account the aforesaid factual and legal circumstances, we do not

think appellants have made out any case for interference in the judgment of the

learned Single Judge exercising the powers conferred on this Court under section

5 of the Kerala High Court there being no jurisdictional error or other legal

infirmities justifying us to do so. Needless to say, writ appeal fails, accordingly it

is dismissed.

Sd/-

S.MANIKUMAR

CHIEF JUSTICE

Sd/-

                                                 SHAJI P.CHALY

smv                                                   JUDGE