Kerala High Court
Somarajan Nair K.R vs The Authorized Officer on 19 August, 2025
Author: Anil K.Narendran
Bench: Anil K.Narendran
WA NO. 30 OF 2025 1 2025:KER:62046
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN
&
THE HONOURABLE MR.JUSTICE MURALEE KRISHNA S.
TUESDAY, THE 19TH DAY OF AUGUST 2025 / 28TH SRAVANA, 1947
WA NO. 30 OF 2025
AGAINST THE JUDGMENT DATED 27.11.2024 IN WP(C) NO.4550 OF
2024 OF HIGH COURT OF KERALA
APPELLANTS/PETITIONERS:
1 SOMARAJAN NAIR K.R.
AGED 62 YEARS
S/O. RAGHAVAN NAIR, KOCHIPARAMPIL HOUSE, KOTHALA.
P.O., KOTTAYAM DISTRICT, PIN - 686502.
2 DHANYAKUMARI. M.R.
AGED 53 YEARS
W/O. SOMARAJAN NAIR. K.R.,KOCHIPARAMPIL HOUSE,
KOTHALA. P.O., KOTTAYAM DISTRICT, PIN - 686502.
BY ADVS.
SRI.M.NARENDRA KUMAR
SMT.HARSHADEV M.
RESPONDENTS/RESPONDENTS:
1 THE AUTHORIZED OFFICER
KERALA STATE CO-OPERATIVE BANK LTD., PALLICKATHODU
BRANCH, ANICKADU. P.O., KOTTAYAM, PIN - 686503.
2 THE AREA MANAGER (VAIKOM)
KERALA BANK, KERALA STATE CO-OPERATIVE BANK, KOTTAYAM
REGIONAL OFFICE, P.B. NO. 140, ENTRAL JUNCTION,
KOTTAYAM, PIN - 686001.
WA NO. 30 OF 2025 2 2025:KER:62046
BY ADVS.
SRI.ATHUL SHAJI
SMT.ANJALY T.A
SHRI.GAUTHAM H.
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 08.08.2025,
THE COURT ON 19.08.2025 DELIVERED THE FOLLOWING:
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JUDGMENT
Muralee Krishna S., J.
This writ appeal is filed under Section 5(i) of the Kerala High
Court Act, 1958, by the petitioners in W.P.(C)No.4550 of 2024,
dissatisfied by the judgment dated 27.11.2024, passed in that writ
petition, whereby, the learned Single Judge disposed of the writ
petition with a direction to the appellants to pay an amount of
Rs.4,00,000/- to the Bank on or before 20.01.2025 and further
directing that if the appellants make the payment as directed, both
the loan accounts of the appellants shall be closed and the Bank
shall issue No Due Certificate to the appellants and will hand over
the title documents of secured assets.
2. According to the appellants, the 1st appellant is
engaged in the business of selling pooja items, and the 2 nd
appellant is a Government Employee, who is working as Librarian
at Ayurveda College, Kannur. The 1st appellant availed a loan of
Rs.9,75,000/- and the 2nd appellant availed an overdraft facility
loan, renewable every year, of Rs.16,00,000/- from the Kerala
State Co-operative Bank Ltd., Pallickathodu Branch in the year
2016 for the purpose of development of business and construction
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of their house. The 1st appellant is the guarantor to the loan
availed by the 2nd appellant, and he had created equitable
mortgage of 76.80 Ares of land and building thereon in Sy.No.64/5
of Koovoppadam Village, Kottayam Taluk as security for
repayment of the said loan facilities. Due to non-payment of the
loan instalments, the Bank classified the loans as non-performing
asset ('NPA' in short). Thereafter, the Bank initiated proceedings
under the provisions of Securitisation and Reconstruction of
Financial Assets and Enforcement of Security Interest Act, 2002
('SARFAESI Act' for short) and the appellants were issued with
Exts.P1 and P2 notices dated 14.12.2021 under Section 13(2) of
the SARFAESI Act. Followed by Exts.P1 and P2 notices, the Bank
issued Exts.P3 and P4 possession notices dated 05.03.2022. The
appellants then filed W.P.(C)No.8289 of 2022 before this Court,
and by Ext.P5 judgment dated 18.03.2022, this Court disposed of
that writ petition. Paragraph 5 and the last paragraph of that
judgment read thus:
"5. On a consideration of the circumstances and the submissions
of the learned counsel, this Court is of the view that petitioners can
be granted an opportunity to repay the overdue amount under the
first loan amounting to Rs.19,00,348/- and the outstanding
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amount under the cash credit facility of Rs.31,54,704/- together in
twenty instalments on the following conditions:
i. The loan liability under both accounts shall be repaid in twenty
equated monthly instalments along with the regular EMIs of the
liability under the personal loan.
ii. The first instalment shall be paid on or before 18.04.2022 and
the remaining on the 18th day of every succeeding months.
iii. Once the overdue amount of Rs.19,00,348/- due under the
personal loan is cleared, the said account shall be regularised.
iv. In the event of default of any one instalment, the respondent
bank shall be entitled to proceed in accordance with law.
v. In order to enable the petitioner to repay the entire amounts, all
coercive proceedings shall be kept in abeyance.
The writ petition is disposed of as above."
3. The appellants contend that the repayment facility
granted by this Court in Ext.P5 judgment is equivalent to a decree
granting instalments, whereby the decree debt is allowed to be
discharged in instalments. There is merger of the liability, which
gets crystallised in the decree, and the original cause of action
vanishes. The appellants further plead that they repaid the loan
liability under both accounts in 20 equated monthly instalments
along with regular EMIs of the liability. But the 1st respondent sent
Exts.P6 and P7 notices dated 12.10.2023 to the appellants
claiming that the 1st appellant is liable to pay Rs.4,25,000/- +
interest and Rs.59,708/- aggregating a total sum of Rs.4,84,708/-
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and the 2nd appellant is liable to pay Rs.8,75,068/-. Subsequent
to Exts.P6 and P7 notices, the Bank received 19th and 20th
instalments from the appellants on 09.11.2023 and 22.11.2023.
Thus, the 1st appellant has paid a total sum of Rs.19,00,000/- and
the 2nd appellant has paid a total sum of Rs.31,54,700/- to the
Bank. Thereafter, the appellants submitted Ext.P10 representation
dated 27.12.2023 to the Bank to treat the loan accounts as closed.
However, the Bank refused to accept the same, and hence, the
appellants filed W.P.(C)No.4550 of 2024, which resulted in the
impugned judgment. The reliefs sought in the writ petition are as
under:
"i) Issue a writ of certiorari or other appropriate, writ, order or
direction calling for the records leading to Exhibit-P6 and Exhibit-
P7 and quash the same.
ii) Issue a writ of mandamus or other appropriate, writ, order or
direction commanding the first respondent/Bank to return the
documents of title with other documents of the Petitioners
property."
4. In the writ petition, on behalf of the respondents, the
learned Standing Counsel for the respondents filed a statement
dated 27.06.2024, producing therewith Exts.R1(a) copy of
Statement of Account pertaining to the appellants. Paragraphs 2
to 4 of that statement read thus:
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"2. It is submitted that; the petitioner had approached this
Hon'ble Court earlier in the year 2022 with Writ Petition (Civil)
No. 8289 of 2022 and the same was disposed by this Hon'ble
Court vide judgment dated 18.02.2022. The petitioners had
availed two different loan accounts namely i. personal loan and
ii. Cash credit facility. The over due under the personal loan was
Rs. 19,00,348/- (Rupees Nineteen Lakh Three Hundred and
Forty-Eight Only) and the outstanding under the cash credit
facility was Rs. 31,54,704/- (Rupees Thirty-One Lakh Fifty-Four
Thousand Seven Hundred and Four Only) and this Hon'ble Court
grant 20 equated installments along with the regular EMIs of the
liability under the personal loan and directed the bank to
regularize the cash credit facility availed by the petitioners once
the overdue amount of Rs. 19,00,348/- (Rupees Nineteen Lakh
Three Hundred and Forty Eight Only) is cleared further this
Hon'ble Court also observed that, in the event of default of any
one instalment, the respondent bank shall be entitled to proceed
in accordance with law.
3. It is respectfully submitted that, the petitioners have cleared
their overdue in personal loan account and in cash credit facility
in 20 equated monthly installments without fail but, the
petitioner has failed in paying the regular EMI's along with the
overdue. Thus, the respondents were constrained to initiate
recovery proceedings against the petitioners. True copy of the
statement of account pertaining to the petitioners is produced
herewith and marked as Exhibit R1(a)
4. It is submitted that, as on 25.06.2024 the over due in the 1 st
petitioner's loan account (Loan N0. 1324 6035 7000 054) is Rs.
2,19,719/- (Rupees Two Lakh Nineteen Thousand Seven Hundred
and Nineteen Only) + miscellaneous expenses and the over due
in the 2nd petitioner's cash credit facility is Rs.4,48,251/- (Rupees
WA NO. 30 OF 2025 8 2025:KER:62046
Four Lakhs Forty-Eight Thousand Two Hundred and Fifty-One
Only) + miscellaneous expenses."
5. Subsequently, the respondents filed a counter affidavit
dated 29.08.2024, opposing the reliefs sought in the writ petition
and producing therewith Exts.R1(b) and R1(c) documents.
Paragraphs 3 to 6 of that counter affidavit read thus:
"3. It is submitted that the petitioners have remitted only the
overdue amount of Rs.19,00,348/- in the Ordinary loan account
and the outstanding amount under the cash credit facility of
Rs.31,54,704/- in twenty instalments. The petitioners have not
paid the regular EMIs in the ordinary loan and the interest accrued
in the Cash Credit Account. It is submitted that it is the liability of
the petitioners to remit balance EMIs in the ordinary loan and
accrued interest in the Cash Credit account up to the date of closing
of both loans.
4. It is submitted that the period of ordinary loan sanctioned to
first petitioner has expired on 22.09.2022. The overdue under
ordinary loan account of the first petitioner as on 31.07.2024 is Rs.
2,23,238/-. The above amount is the balance loan instalments for
the period from February 2022 to September 2022 and overdue
interest charged in the ordinary loan account from February 2022
to July 2024. True copy of the statement evidencing the pending
loan installments for the period from February 2022 to September
2022 and overdue interest charged in the ordinary loan account
from February 2022 to July 2024 is produced herewith and marked
as Exhibit - R1(b).
5. It is submitted that the second petitioner has remitted the
outstanding amount of Rs.31,54,704/- in the Cash Credit account
in twenty instalments as allowed by the court. The above amount
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includes interest accrued in to the cash credit account for the
period up to January 2022 only. The second petitioner is liable to
pay interest accrued in the Cash Credit account for the period from
February 2022 till closure of the Cash Credit account, which has
not been remitted. Interest accrued on Cash Credit account for the
period from February 2022 to July 2024 comes to Rs.4,58,774/-
as on 31.07.2024. The true copy of the statement evidencing the
interest accrued in the Cash Credit facility for the period from
February 2022 to July 2024 is produce herewith and marked as
Exhibit - R1(c)
6. Thus, a total amount of Rs. 6,82,012/- (Rupees Six lakh eighty-
two thousand and twelve only) is still outstanding as dues from the
petitioners as on 31.07.2024, which the petitioners are legally
liable to pay to the respondent bank with further interest and
charges till payment in full."
6. After hearing both sides and verifying the materials on
record, the learned Single Judge disposed of the writ petition as
stated above. Paragraphs 2 to 5 and the last paragraph of that
judgment read thus:
"2. There is some dispute regarding the compliance of the
judgment dated 18.03.2022 passed in W.P.(C.) No.8289/2022, by
the petitioners.
3. The learned counsel for the respondent bank submits that the
balance outstanding amount in respect of the two loan accounts
is Rs.6,82,012/-. She further submits that if the petitioners make
lump sum payment of Rs.4,00,000/- within two months, the
petitioners' loan accounts shall be closed, and the title documents
of the secured asset shall be handed over to the petitioners.
4. The learned counsel for the petitioners submits that the
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petitioners shall pay Rs.4,00,000/- on or before 20.01.2025.
5. Considering the aforesaid submissions on behalf of the parties,
the present writ petition is disposed of with a direction to the
petitioners to pay an amount of Rs.4,00,000/- to the bank, on or
before 20.01.2025. If the petitioners make the payment of
Rs.4,00,000/- on or before 20.01.2025, both loan accounts of the
petitioners shall be closed, and the bank shall issue no due
certificate to the petitioner and will hand over title documents of
the secured asset.
With the aforesaid direction, the present writ petition stands
finally disposed of."
7. Heard the learned counsel for the appellants and the
learned counsel for the Bank.
8. The learned counsel for the appellants would submit
that the appellants have cleared the due amount in instalments as
directed in Ext.P5 judgment dated 18.03.2022. Hence, the
initiation of SARFAESI proceedings against the appellants is illegal.
9. On the other hand, the learned counsel for the Bank
would submit that it is true that the appellants have paid 20
equated monthly instalments as directed in Ext.P5 judgment.
However, they did not make the payment of the regular EMIs as
directed. Hence, the Bank continued with the SARFAESI
proceedings.
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10. It is trite that, except in exceptional circumstances, a
writ petition under Article 226 of the Constitution of India against
the proceedings initiated under the SARFAESI Act is maintainable.
11. In Authorized Officer, State Bank of Travancore
and Another v. Mathew K.C. [2018 (1) KHC 786], the Apex
Court held that the High Court under Article 226 of the
Constitution of India can entertain a writ petition only under
exceptional circumstances and that it is a self-imposed restraint
by the High Court. The four exceptional circumstances such as,
where the statutory authority has not acted in accordance with the
provisions of the enactment in question, or in defiance of the
fundamental principles of judicial procedure, or has resorted to
invoke the provisions which are repealed, or when an order has
been passed in total violation of the principles of natural justice,
were re iterated in paragraph 6 of the said judgment by relying on
the judgment of the Apex Court in Commissioner of Income
Tax and Others v. Chhabil Dass Agarwal [(2014) 1 SCC
603].
12. This position was reiterated by the Apex Court in South
Indian Bank Ltd. (M/s.) v. Naveen Mathew Philip [2023 (4)
WA NO. 30 OF 2025 12 2025:KER:62046
KLT 29] and after discussing the various judgments on the point
as well as the circumstances in which the High Court can interfere
within matters pertaining to the SARFAESI Act, held as under:
"Unfortunately, the High Court overlooked the settled law that the
High Court will ordinarily not entertain a petition under Art.226 of
the Constitution if an effective remedy is available to the
aggrieved person and that this rule applies with greater rigour in
matters involving recovery of taxes, cess, fees, other types of
public money and the dues of banks and other financial
institutions. In our view, while dealing with the petitions involving
challenge to the action taken for recovery of the public dues, etc.
the High Court must keep in mind that the legislations enacted by
Parliament and State Legislatures for recovery of such dues are a
code unto themselves inasmuch as they not only contain
comprehensive procedure for recovery of the dues but also
envisage constitution of quasi - judicial bodies for redressal of the
grievance of any aggrieved person. Therefore, in all such cases,
the High Court must insist that before availing remedy under
Art.226 of the Constitution, a person must exhaust the remedies
available under the relevant statute". (Underline supplied)
13. In PHR Invent Educational Society v. UCO Bank
[2024 (3) KHC SN 3] the Apex Court held that it is more than a
settled legal position of law that in matters arising out of RDB Act
and SARFAESI Act, the High Court should not entertain a petition
under Art.226 of the Constitution particularly when an alternative
statutory remedy is available.
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14. A learned Single Judge of this Court in Jasmin K. v.
State Bank of India [2024 (3) KHC 266] reiterated the
position of law laid down by the Apex Court in the aforementioned
judgments.
15. In LIC Housing Finance Ltd. v. Nagson and
Company [2025 KHC OnLine 7406], the Apex Court noticed
that despite the said Court in a series of judgments - United
Bank of India v. Satyawati Tondon [(2010) 8 SCC 110] being
one among them - having cautioned the High Courts to exercise
writ jurisdiction judiciously while entertaining challenges to the
actions by secured creditors under Section 13 of the SARFAESI
Act, 2002 to enforce their security interest in view of the scheme,
purpose and object of the enactment, some of the High Courts
look the other way and grant interim relief on the mere asking.
The Apex Court still come across cases where, without just and
sufficient reason being recorded, proceedings taken by secured
creditors have been interdicted by the High Courts, with or without
imposition of conditions, amounting to great disservice of
institutional credibility.
16. The appellants availed the loans mentioned in the writ
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petition from the Kerala State Co-operative Bank Ltd.,
Pallickathodu Branch, and the loans were converted into NPA due
to default in repayment of the same. When the Bank initiated
proceedings under the SARFAESI Act, the appellants approached
this Court with W.P.(C)No.8289 of 2022. By Ext.P5 judgment dated
18.03.2022, a learned Single Judge of this Court disposed of that
writ petition, granting instalment facility to the appellants. Along
with 20 equated monthly instalments, the appellants were
directed to pay regular EMIs of the liability under the personal loan
also. According to the respondents, the appellants did not clear
the regular monthly EMIs and hence, the Bank proceeded further
for recovery of the balance amount, which was submitted as
Rs.6,82,012/- before the learned Single Judge while considering
W.P.(C)No.4550 of 2024. The learned counsel for the Bank agreed
to close the loan if the appellants make a lump sum payment of
Rs.4,00,000/- on or before 20.01.2025. The learned counsel for
the appellants also agreed to the same. It is thereafter, the
appellants came up with the instant appeal.
17. From the pleadings and materials on record, it is
evident that the loans of the appellants were converted into NPA,
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and the respondents proceeded against the secured asset under
the provisions of the SARFAESI Act. If the appellants have any
grievance against the initiation of proceedings under the
provisions of the SARFAESI Act, then the remedy available to them
is to approach the Debts Recovery Tribunal under Section 17 of
the SARFAESI Act. The appellants have not made out any special
circumstances to approach this Court with the writ petition under
Article 226 of the Constitution of India without approaching the
Debts Recovery Tribunal, before which the statutory remedy is
provided to the appellants.
18. Having considered the pleadings and material on
record and the submission made at the Bar in the light of
judgments referred to supra, we find no reason to interfere with
the impugned judgment of the learned Single Judge.
In the result, the writ appeal stands dismissed.
Sd/-
ANIL K.NARENDRAN, JUDGE
Sd/-
MURALEE KRISHNA S., JUDGE
DSV/-
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APPELLANTS' EXHIBITS
Exhibit P1 ENGLISH TRANSLATION OF EXHIBIT P1
Exhibit P2 ENGLISH TRANSLATION OF EXHIBIT P2
Exhibit P3 ENGLISH TRANSLATION OF EXHIBIT P3
Exhibit P4 ENGLISH TRANSLATION OF EXHIBIT P4
Exhibit P5 ENGLISH TRANSLATION OF EXHIBIT P5
Exhibit P7 ENGLISH TRANSLATION OF EXHIBIT P7
Exhibit P10 ENGLISH TRANSLATION OF EXHIBIT P10
Exhibit P11 ENGLISH TRANSLATION OF EXHIBIT P11
Exhibit P12 ENGLISH TRANSLATION OF EXHIBIT P12
