Kerala High Court
Pamba Industries vs Canara Bank on 3 April, 2024
Author: N.Nagaresh
Bench: N.Nagaresh
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE N.NAGARESH
WEDNESDAY, THE 3RD DAY OF APRIL 2024/14TH CHAITHRA, 1946
WP(C) NO. 10480 OF 2024
PETITIONERS:
1 PAMBA INDUSTRIES,
T.C. 51/3184, ARAMADA P.O.,
PUNNAKKAMUGAL, THIRUVANANTHAPURAM,
REPRESENTED BY ITS PARTNER JAYARAJ J,
S/O JAYADEVAN PILLAI,
AGED 37 YEARS,
RESIDING AT ALAPPURATHU PUTHENVEEDU,
THOTTUVA, ANAYADI P.O.,
PALLIKKAL VILLAGE, ADOOR TALUK,
PATHANAMTHITTA, PIN - 690532
2 MUTHUKRISHNAN K.P.,
AGED 70 YEARS,
S/O PARAMESWARAN PILLAI,
RESIDING AT T.C 21/1180,
CHAITANYA, KARAMANA P.O.,
MANACADU VILLAGE,
THIRUVANANTHAPURAM TALUK,
THIRUVANANTHAPURAM, PIN - 695002
BY ADVS.
NIRMAL V NAIR
ENCIL K. SABU
NESILI NAZEER
RESPONDENT:
CANARA BANK,
POOJAPPURA BRANCH,
PREETHA BUILDING, TC2/716(1),
POOJAPPURA, THIRUVANANTHAPURAM,
REPRESENTED BY ITS AUTHORISED OFFICER,
PIN - 695012
W.P.(C) No.10480/2024
:2:
BY ADVS.
GOPIKRISHNAN NAMBIAR M
K.JOHN MATHAI(K/413/1984)
JOSON MANAVALAN(J-526)
KURYAN THOMAS(K/131/2003)
PAULOSE C. ABRAHAM(MAH/58/2006)
RAJA KANNAN(K/356/2008)
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 03.04.2024, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:
W.P.(C) No.10480/2024
:3:
JUDGMENT
Dated this the 3rd day of April, 2024
The petitioners have approached this Court
aggrieved by the coercive proceedings for recovery of
financial advance made by the Canara Bank to the
petitioners, invoking the provisions of the Securitisation and
Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002.
2. The Bank paid ₹60 lakhs to the petitioners as
Cash Credit Loan and ₹2.98 lakhs as GECL Loan in the
years 2020 and 2021 respectively. The petitioners state
that though the petitioners made remittances promptly
during the initial repayment period of the financial advance,
they could not pay the repayment instalments promptly later
due to Covid-19 pandemic and loss in business. The
repayment of loans fell into arrears later. It happened due
to reasons beyond the control of the petitioners.
3. Though the petitioners requested the Bank to
permit the petitioners to repay the outstanding amounts in
easy monthly instalments, 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.P5 notice.
4. The petitioners state that they are still in a
position to clear the outstanding amounts towards the loan,
if sufficient time is given to clear the dues in easy monthly
instalments. If the respondent is permitted to continue with
the coercive proceedings and auction the secured assets
provided by the petitioners, they 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
petitioners. On behalf of the respondent, it is submitted that
the loans were given to the petitioners in the years 2020
and 2021 respectively. The petitioners committed default in
repaying the loans.
6. The Bank repeatedly reminded the petitioners
and required them to clear the dues. The petitioners
deliberately omitted to do so. In the circumstances, the
Bank had no other go, than to proceed against the
petitioners invoking the provisions of the Securitisation and
Reconstruction of Financial Assets and Enforcement of
Security Interest Act, 2002. The impugned Ext.P5 notice
was issued in these circumstances. The petitioners have
not advanced any legal reasons to thwart the coercive
proceedings initiated by the Bank.
7. The Standing Counsel, however, submitted that if
the petitioners are ready and willing to make a substantial
payment soon and remit the balance outstanding amount
immediately thereafter, a short breathing time can be
granted to the petitioners to clear the dues. The Standing
Counsel submitted that the outstanding amount due to the
Bank from the petitioners as on 02.04.2024 is ₹64,12,015/-.
8. I have heard the counsel for the petitioners and
the Standing Counsel representing the Bank.
9. The specific case of the petitioners is that the
petitioners have 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 petitioners. The petitioners have
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 petitioners to clear off the liability.
11. The writ petition is therefore disposed of with the
following directions:
(i) The petitioners shall remit an amount
of ₹10 lakhs and shall clear the total
outstanding amount in the GECL Loan
account along with accruing interest and
other Bank charges, if any, on or before
20.04.2024.
(ii) The balance outstanding amount in
the Cash Credit Loan shall be paid by the
petitioners in 10 equal and consecutive
monthly instalments soon thereafter.
(iii) If the petitioners commit default in
making payments as directed above, the
respondents will be at liberty to continue
with coercive proceedings against the
petitioners in accordance with law.
(iv) If the petitioners adheres to the time
schedule, any coercive proceedings
against the petitioners will stand deferred.
Sd/-
N. NAGARESH
JUDGE
SR
APPENDIX OF WP(C) 10480/2024
PETITIONER'S EXHIBITS:
Exhibit P1 A TRUE COPY OF THE REGISTERED
PARTNERSHIP DEED DATED 29-4-2016 OF
PAMBA INDUSTRIES REGISTERED AT NEMOM
SRO
Exhibit P2 A TRUE COPY OF THE RETIREMENT DEED
DATED 26-12-2022
Exhibit P3 A TRUE COPY OF THE DEMAND NOTICE
DATED 19-12-2023
Exhibit P4 A TRUE COPY OF THE LOAN RECALL NOTICE
DATED 01-02-2024
Exhibit P5 A TRUE COPY OF THE POSSESSION NOTICE
DATED 6-03-2024 UNDER SECTION 13(4)
OF THE SARFAESI ACT ISSUED BY THE
RESPONDENT BANK.
