Kerala High Court
Nazarudheen vs The Quilon Co-Operative Urban Bank Ltd on 25 August, 2025
Author: Anil K.Narendran
Bench: Anil K.Narendran
1
WA No.2066 of 2025
2025:KER:65532
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE ANIL K.NARENDRAN
&
THE HONOURABLE MR.JUSTICE MURALEE KRISHNA S.
MONDAY, THE 25TH DAY OF AUGUST 2025 / 3RD BHADRA, 1947
WA NO. 2066 OF 2025
AGAINST THE JUDGMENT DATED 07.08.2025 IN WP(C) NO.23397 OF 2025
OF HIGH COURT OF KERALA
APPELLANT:
NAZARUDHEEN,AGED 56 YEARS,S/O. ALIYARUKUNJU, A.K. HOUSE,
CHATHINAMKULAM, CHANDANATHOPE PO, KOLLAM, PIN - 691014
BY ADVS.
SMT.O.A.NURIYA, SHRI.RAFEEK. V.K., SMT.REVATHY P.
MANOHARAN, SMT.MUFEEDHA P.
RESPONDENTS:
1 THE QUILON CO-OPERATIVE URBAN BANK LTD,
REPRESENTED THROUGH BRANCH MANAGER, KOLLAM TALUK, KOLLAM
DISTRICT, PIN - 691001
2 THE AUTHORISED OFFICER, QUILON CO-OPERATIVE URBAN BANK LTD,
Q-960, KOLLAM TALUK, KOLLAM DISTRICT, PIN - 691001
3 JOINT REGISTRAR, OFFICE OF THE JOINT REGISTRAR (GENERAL
KOLLAM) OF COOPERATIVE SOCIETIES, CIVILSTATION P.O.,
KOLLAM, PIN - 691013
SMT.D.P.RENU, STANDING COUNSEL
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 25.08.2025, THE
COURT ON THE SAME DAY PASSED THE FOLLOWING:
2
WA No.2066 of 2025
2025:KER:65532
JUDGMENT
Muralee Krishna, J.
The petitioner in W.P.(C)No.23397 of 2025 filed this writ
appeal under Section 5(i) of the Kerala High Court Act, 1958,
challenging the judgment dated 07.08.2025 passed by the learned
Single Judge, dismissing that writ petition.
2. Going by the averments in the writ petition, the appellant
availed a business loan of Rs.30/- lakhs from the 1st respondent
bank and later renewed it to Rs.40/- lakhs in March 2020. Due to
COVID-19 lockdown and ensuing financial crisis, repayments were
disrupted, and the account was declared as Non Performing Asset
(for short 'NPA'). On 11.02.2025, the appellant received Ext.P1
letter issued by the respondent Bank granting One Time
Settlement Scheme (for short 'OTS') facility to the appellant at a
total sum of Rs.57,83,160/-. Simultaneously Bank had appointed
an Advocate Commissioner to take possession of the properties
mortgaged for loans availed by the appellant. The appellant was
then constrained to approach this Court seeking deferment of
possession proceeding eliciting procedural violations under the
2025:KER:65532
Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002, (for short 'SARFAESI
Act') by filing W.P.(C) No.11518 of 2025 and the same got
disposed of vide Ext.P2 judgment dated 05.06.2025 with
directions to pay Rs.5/- lakhs and pursue remedies before the
Debts Recovery Tribunal. The appellant is ready to pay Rs.5/-
lakhs and settle dues within 60 days, if OTS is revived. The
appellant submitted Ext.P3 representation dated 17.06.2025 to
the 3rd respondent. Though vide Ext.P4 letter dated 02.04.2025,
the 3rd respondent positively recommended OTS revival to the
Bank, no decision has been taken by the Bank. Hence, the
appellant filed the writ petition under Article 226 of the
Constitution of India, seeking the following reliefs:
"(i) Issue a writ of mandamus or any other appropriate writ
or order, directing the 3rd respondent to consider Ext.P3
representation dated 17.06.2025 submitted by the
petitioner within a time frame fixed by this Hon'ble Court.
(ii) Issue a writ of mandamus or any other appropriate writ
or order, directing the 1st and 2nd respondents to revive and
re-consider the OTS facility granted to the petitioner as per
Ext.P1 and permit the petitioner to settle the dues under the
2025:KER:65532
said OTS scheme;
(iii) Issue a writ of mandamus or appropriate order directing
the 1st respondent Bank to adjust the payment of
Rs.5,00,000/- contemplated in Ext.P2 judgment towards
OTS facility, if revived.
(iv) Stay all further coercive proceedings including
dispossession proceedings initiated against the petitioner
under the SARFAESI Act in respect of the loan accounts in
question, pending final decision on the OTS."
3. In the writ petition, on behalf of respondents 1 and 2, a
statement dated 28.06.2025 was filed by the learned Standing
Counsel, opposing the relief sought for in the writ petition and
producing therewith Annexure R2(a) to R2(e) documents.
4. After hearing both sides and on appreciation of materials
on record, the learned Single Judge dismissed the writ petition as
said above. Paragraphs 2 to 5 and the last paragraph of that
judgment read thus:
"2. As far as Ext.P1 is concerned, the same was issued on
11.02.2025, granting OTS facility and directing the
petitioner to pay the same before 28.02.2025, which
admittedly has not been complied with. There cannot be any
direction issued by this Court extending the time to comply
with the OTS facility.
3. Earlier, the petitioner had approached this Court by filing
2025:KER:65532
W.P.(C) No.17428 of 2024, disposed of by Ext.R2(a)
judgment on 07.06.2024, taking note of the fact that the
petitioner had remitted an amount of Rs.1,00,000/- under
the interim order passed by this Court in W.P.(C) No.17428
of 2024, the further proceedings by the bank was deferred
and the petitioner was directed to approach the Debts
Recovery Tribunal.
4. Thereafter, the petitioner again filed W.P.(C) No.11518 of
2025, which was disposed of on 05.06.2025, recording the
submission of the Bank, that a total outstanding of more
than Rs. 69/- lakhs is due. Taking note of the fact that the
securitisation application preferred by the petitioner as S.A
No.503/2024 was pending and was posted to 11.07.2025,
all coercive steps till that day were stayed on condition that
the petitioner remits an amount of Rs.5/- lakh on or before
30.06.2025. It was further directed that it was open to the
petitioner to move to the Debts Recovery Tribunal seeking
appropriate reliefs. The direction of this Court regarding
payment was also not complied with, and the payment was
made belatedly on 14.07.2025.
5. This Court had directed the petitioner, even at that stage,
to file an appropriate application before the Debts Recovery
Tribunal in the pending securitisation application. Under
such circumstances, no further orders can be passed in this
writ petition. The petitioner had already approached this
Court by filing two writ petitions, which are also based on
the same cause of action. Accordingly, I am not inclined to
2025:KER:65532
pass any orders in this writ petition, and the same will stand
dismissed".
5. Heard the learned counsel for the appellant-writ petitioner
and the learned Standing Counsel for the respondents 1 and 2.
6. The learned counsel for the appellant would submit that
by Ext.P4 letter dated 02.04.2025, the 3 rd respondent, Joint
Registrar(General Kollam), requested the General Manager to
include the appellant in the One Time Settlement Scheme. Without
considering the said request, the 1st respondent is proceeding with
the SARFAESI proceedings. Against the SARFAESI proceedings,
the appellant has moved the Debts Recovery Tribunal, and the
same is pending consideration. But, now the Bank issued a
possession notice even after the payment of Rs.5/- Lakhs by the
appellant. Therefore, the impugned judgment is liable to be set
aside, and the relief sought in the writ petition may be granted
against the respondents.
7. On the other hand, the learned Standing Counsel for
the respondents 1 and 2 would submit that the appellant
repeatedly filed writ petitions before this Court against the
SARFAESI proceedings initiated by the Bank. The total
2025:KER:65532
outstanding as of now is more than Rs.63/- lakhs. Apart from
that, the wife of the appellant also availed a loan of Rs.40/- lakh,
and she also failed to make any amount towards that loan account.
The Securitisation Application filed by the appellant is pending
before the Debts Recovery Tribunal. The writ petition is not
maintainable, and hence no interference is needed on the
impugned judgment.
8. Law is well settled regarding the jurisdiction of this
Court to interfere with the proceedings initiated by the Bank under
the provisions of the SARFAESI Act.
9. 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
2025:KER:65532
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].
10. This position was reiterated by the Apex Court in South
Indian Bank Ltd. (M/s.) v. Naveen Mathew Philip [2023 (4)
KLT 29] and after discussing the various judgments on the point
as well as the circumstances in which the High Court can interfere
with in 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
2025:KER:65532
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".
11. 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.
12. 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.
13. From the pleadings in the writ petition as well as from
the statement filed by the learned Standing Counsel for
respondents 1 and 2, we notice that this is the third writ petition
2025:KER:65532
filed by the appellant against the recovery proceedings initiated
by the Bank in respect of a business loan of Rs.40/- lakhs availed
by him, which was later converted into NPA due to non-payment
of the loan instalments. The first writ petition filed by the appellant
was W.P.(C)No.17428 of 2024. Pursuant to the interim order in
that writ petition, the appellant remitted an amount of Rs.1/- lakh.
Noting the same, the writ petition was disposed of by this Court
by Annexure R2(a) judgment dated 07.06.2024, with a direction
to defer recovery proceedings for a period of ten days to enable
the appellant to approach the Debts Recovery Tribunal. In
pursuance of that judgment, the appellant filed S.A.No.503 of
2024 before the Debts Recovery Tribunal. Meanwhile, by
Annexure R2(b) letter dated 11.02.2025, an OTS facility was
offered to the appellant, by virtue of which the appellant had to
remit Rs.57,83,160/-. But without availing the facility, the
appellant filed W.P.(C)No.11518 of 2025, which resulted in Ext.P2
judgment dated 05.06.2025 as mentioned above. In that
judgment, the appellant was directed to remit Rs.5/-lakhs on or
before 30.06.2025. Subsequently, the appellant submitted a
2025:KER:65532
representation dated 17.06.2025, and that representation was
disposed of by the Bank on 24.06.2025, and by Annexure R2(c)
letter the same was intimated to the appellant. Again, the
appellant submitted Annexure R2(e) fresh representation on
27.06.2025 to the Bank. Thereafter, he came up with the third
writ petition, viz., W.P.(C) No.23397 of 2025.
14. From the pleadings and materials on record, we did not
find a special circumstance as stipulated in Mathew K.C. [2018
(1) KHC 786] that entitles the appellant to approach this Court
with a writ petition under Article 226 of the Constitution of India
against the proceedings initiated under the SARFAESI Act by the
Bank.
15. Apart from the above, in the instant case, the appellant
seeks a further relief by way of a writ of mandamus commanding
the respondents to consider his request for OTS. The Apex Court
in The Bijnor Urban Cooperative Bank Limited, Bijnor and
Ors. v. Meenal Agarwal and Ors. [(2023) 2 SCC 805], while
dealing with a question of whether such a direction can be given
to the Bank by exercising the jurisdiction under Article 226 of the
2025:KER:65532
Constitution of India, held thus:
"5.2 Therefore, as per the guidelines issued, the grant of
benefit of OTS Scheme cannot be prayed as a matter of right
and the same is subject to fulfilling the eligibility criteria
mentioned in the scheme. The defaulters who are ineligible
under the OTS Scheme are mentioned in clause 2,
reproduced hereinabove. A wilful defaulter in repayment of
loan and a person who has not paid even a single installment
after taking the loan and will not be able to pay the loan will
be considered in the category of "defaulter" and shall not be
eligible for grant of benefit under the OTS Scheme. Similarly,
a person whose account is declared as "NPA" shall also not
be eligible. As per the guidelines, the Bank is required to
constitute a Settlement Advisory Committee for the purpose
of examining the applications received and thereafter the
said Committee has to take a decision after considering
whether a defaulter is entitled to the benefit of OTS or not
after considering the eligibility as per the OTS Scheme. While
making recommendations, the Settlement Advisory
Committee has to consider whether efforts have been made
to recover the loan amount and the possibility of recovery
has been minimized, meaning thereby if there is possibility
of recovery of the amount, either by initiating appropriate
proceedings or by auctioning the property mortgaged and/or
the properties given as a security either by the borrower
and/or by guarantor, the application submitted by the
borrower for grant of benefit under the OTS Scheme can be
2025:KER:65532
rejected."
16. This position was reiterated by a Division Bench of this
Court in Idukki District Police Co-operative Society Ltd. No.
1-490 v. Rasheed A. K. [2025 (4) KHC 44].
Having considered the pleadings and materials on record
and the submissions made at the Bar, in the light of the judgments
referred above, we find that the learned Single Judge rightly
dismissed the writ petition. The appellant did not make out any
ground to interfere with the impugned judgment by exercising
appellate jurisdiction.
In the result, the writ appeal stands dismissed.
Sd/-
ANIL K.NARENDRAN, JUDGE
Sd/-
sks MURALEE KRISHNA S., JUDGE
2025:KER:65532
PETITIONER ANNEXURES
Annexure A1 TRUE COPY OF WP(C) 11518
Annexure A2 Certified copy of judgment in WP(C)No.23397
of 2025
