Abdul Latheef vs Federal Bank Ltd
2023 Latest Caselaw 11485 Ker

                 IN THE HIGH COURT OF KERALA AT ERNAKULAM
                                 PRESENT
                   THE HONOURABLE MR.JUSTICE N.NAGARESH
    WEDNESDAY, THE 8TH DAY OF NOVEMBER 2023 / 17TH KARTHIKA, 1945
                         WP(C) NO. 36905 OF 2023
PETITIONER

              ABDUL LATHEEF
              AGED 67 YEARS
              S/O MUHAMMED MOIDEEN, RESIDING AT TC 54/407, MMJ HOUSE,
              KARAKKAMANDAPAM, NEMOM P.O., THIRUVANANTHAPURAM,
              PIN - 695020

              BY ADVS.
              R.HARIKRISHNAN (H-308)
              G.SUDHEER
              SMRITHI S.S.


RESPONDENT:

              FEDERAL BANK LTD.
              REPRESENTED BY ITS AUTHORIZED OFFICER, PATTOM BRANCH,
              PATTOM, THIRUANANTHAPURAM, PIN - 695004

              SRI.SUJESH KUMAR

     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
08.11.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 WP(C) NO.36905 OF 2023
                                  2




                         JUDGMENT

Dated this the 8th day of November, 2023

The petitioner has approached this Court aggrieved by

the coercive proceedings for recovery of financial advance

made by the Federal 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 petitioner who is partner of a business Firm

"Timber Casa", had availed Cash Credit facility by mortgaging

the property of the petitioner. 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 as the business went

down during Covid-19 pandemic. The repayment of loan fell

into arrears. It happened due to reasons beyond the control of WP(C) NO.36905 OF 2023

the petitioner.

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 Ext.P2

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.

The petitioner committed default in repaying the credit facility. WP(C) NO.36905 OF 2023

6. The Bank repeatedly reminded the petitioner and

required him to clear the dues. The petitioner deliberately

omitted to do so. The petitioner's Cash Credit account is

declared as NPA in the year 2022. 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.P2 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 outstanding 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 08.11.2023 is

₹75,52,386/-.

WP(C) NO.36905 OF 2023

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 account

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 an amount of

₹5 lakhs within a period of two weeks from

today i.e. on or before 22.11.2023.

(ii) The petitioner shall remit the balance

outstanding amount in subsequent consecutive WP(C) NO.36905 OF 2023

ten equal monthly installments, along with

accruing interest and other Bank charges, if

any.

(iii) If the petitioner commits single 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.

(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.36905 OF 2023

APPENDIX OF WP(C) 36905/2023

PETITIONER EXHIBITS

Exhibit P1 COPY OF THE SUMMONS ISSUED TO PETITIONER DIRECTING HIM TO APPEAR BEFORE THE DRT ON 15.09.2023 Exhibit P2 COPY OF THE NOTICE DATED 16.10.2023 ISSUED BY THE ADVOCATE COMMISSIONER