Kerala High Court
The South Indian Bank Ltd vs Kunhimoideen on 10 July, 2025
Author: Anil K. Narendran
Bench: Anil K. Narendran
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE ANIL K. NARENDRAN
&
THE HONOURABLE MR. JUSTICE MURALEE KRISHNA S.
THURSDAY, THE 10TH DAY OF JULY 2025 / 19TH ASHADHA, 1947
WA NO.1567 OF 2025
AGAINST THE ORDER DATED 23.06.2025 IN WP(C) NO.22832 OF 2025 OF
HIGH COURT OF KERALA
APPELLANT/RESPONDENT IN WRIT PETITION:
FEDERAL BANK LTD.,
REPRESENTED BY THE AUTHORIZED OFFICER, FIRST
FLOOR, FEDERAL TOWERS, ARAYIDATHUPALAM,
KOZHIKODE, PIN - 673016.
BY ADVS.
SHRI.MOHAN JACOB GEORGE
SMT.P.V.PARVATHY (P-41)
SMT.REENA THOMAS
SMT.NIGI GEORGE
SHRI.ANANTHU V.LAL
SMT.SHERIN VARGHESE
SHRI.BRAHMA R.K.
RESPONDENT/PETITIONER IN WRIT PETITION:
ASIL MOHAMMED, AGED 38 YEARS,
S/O ABOOBACKER, PARASSERY VEEDU, VAIKKATHOOR,
VALANCHERI P.O, KATTIPPARUTHI, VALANCHERI,
MALAPPURAM, PIN - 676552.
BY ADV.SRI.E.A.BIJUMON
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 10.07.2025,
ALONG WITH WA.1596/2025, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
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IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE ANIL K. NARENDRAN
&
THE HONOURABLE MR. JUSTICE MURALEE KRISHNA S.
THURSDAY, THE 10TH DAY OF JULY 2025 / 19TH ASHADHA, 1947
WA NO.1596 OF 2025
AGAINST THE ORDER DATED 12.06.2025 IN WP(C) NO.21656 OF 2025 OF
HIGH COURT OF KERALA
APPELLANT/RESPONDENT IN WRIT PETITION:
THE SOUTH INDIAN BANK LTD,
REP BY THE AUTHORISED OFFICER, REGIONAL OFFICE,
DOOR NO. 733/2, 1ST FLOOR, D&D ARCADE, CHITUR
ROAD, NEAR MANAPULLI KAVU, P.O.KUNNATHURMEDU,
PALAKKAD DISTRICT, PIN - 678013.
BY ADVS.
SHRI.MOHAN JACOB GEORGE
SMT.P.V.PARVATHY (P-41)
SMT.REENA THOMAS
SMT.NIGI GEORGE
SHRI.ANANTHU V.LAL
SMT.SHERIN VARGHESE
SHRI.BRAHMA R.K.
RESPONDENT/PETITIONER IN WRIT PETITION:
KUNHIMOIDEEN, AGED 62 YEARS,
S/O. MOHAMMED, KALATHIL HOUSE, P.O. VALLAPUZHA,
PATTAMBI TALUK, PALAKKAD DISTRICT, PIN - 679336.
BY ADV.SRI.E.A.BIJUMON
THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 10.07.2025,
ALONG WITH WA.1567/2025, THE COURT ON THE SAME DAY DELIVERED THE
FOLLOWING:
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JUDGMENT
Anil K. Narendran, J.
The challenge made in these writ appeals filed under Section
5(i) of the Kerala High Court Act, 1958, is against the interim order
dated 23.06.2025 of the learned Single Judge of this Court in
W.P.(C)No.22832 of 2025 and another interim order dated
12.06.2025 in W.P.(C)No.21656 of 2025. The respondent in the
respective writ appeal availed financial assistance from Federal
Bank Ltd., the appellant in W.A.No.1567 of 2025 arising out of
W.P.(C)No.22832 of 2025 and South Indian Bank Ltd., the
appellant in W.A.No.1596 of 2025 arising out of W.P.(C)No.21656
of 2025. The respondent in the respective writ appeals, who are
the petitioner in W.P.(C)No.22832 of 2025 and W.P.(C)No.21656
of 2025, have approached this Court invoking the writ jurisdiction
under Article 226 of the Constitution of India, seeking a writ of
mandamus commanding the Bank to allow them to pay their dues
in installments. The reliefs sought for in W.P.(C)No.22832 of 2025
read thus:
"(i) issue a writ of mandamus or any other appropriate writ,
direction or order directing the respondent to allow the petitioner
to pay the overdue arrears by 25 monthly installments.
(ii) Issue a writ of mandamus or any other appropriate writ,
direction or order directing the respondent to stop recovery
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proceedings and hand over a detailed statement of account
deducting the payments made by the petitioner ."
2. The relief sought for in W.P.(C)No.21656 of 2025 read
thus:
"(i) issue a writ of mandamus or any other appropriate writ,
direction or order directing the bank to regularise the loan
account after accepting minimum amount for regularize the loan
amounts.
(ii)issue a writ of mandamus or any other appropriate writ,
direction or order directing the respondent bank to give proper
opportunity to close the loan account giving maximum reductions
on the interest, penal interest and other charges, considering the
pathetic situation of the petitioner."
3. The impugned orders of the learned Single Judge were
passed on the first date on which the respective writ petitions
came up for admission. The interim order dated 23.06.2025 in
W.P.(C)No.22832 of 2025 reads thus:
"Notice before admission. The learned Standing Counsel takes
notice for the respondent and seeks time to file a statement. To
consider the prayers sought in the writ petition seeking
instalment facility and to defer further coercive steps against the
petitioner, as an interim measure, there will be a direction to the
petitioner to remit an amount of Rs.30,00,000/- (Rupees thirty
lakhs only) within one month. It is made clear that if the above
payment is not made, the respondent will be at Liberty to proceed
further, in accordance with law."
4. The interim order dated 12.06.2025 granted by the
learned Single Judge in W.P.(C)No.21656 of 2015 reads thus:
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"Notice before admission.
2. The learned Standing Counsel takes notice for the respondents
and seeks time to file a statement.
3. To consider the prayers sought in the writ petition seeking
instalment facility and to defer further coercive steps against the
petitioner, as an interim measure, there will be a direction to the
petitioner to remit an amount of Rs.20,00,000/-(Rupees twenty
Lakhs only) on or before 12.07.2025. It is made clear that if the
above payment is not made, the respondents will be at liberty to
proceed further, in accordance with law."
5. Challenging the aforesaid interim orders, the appellant
Banks are before this Court in these writ appeals.
6. On 09.07.2024, when these writ appeals came up for
admission, during the course of arguments, the learned counsel
for the appellant Banks placed reliance on the judgment of the
Apex Court in Shobha v. Muthoot Finance Ltd. [2025 (2) KHC
229].
7. Heard the learned counsel for the appellant Bank in the
respective writ appeal and also the learned counsel for the
respondent-borrower.
8. The issue that requires consideration in these writ
appeals is as to whether the interim order dated 23.06.2025 in
W.P.(C)No.22832 of 2025 and the interim order dated 12.06.2025
in W.P.(C)No.21656 of 2015 of the learned Single Judge can be
sustained in law.
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9. On the maintainability of a writ petition under Article
226 of the Constitution of India in respect of the proceedings
initiated by the Bank under the provisions of the Securitisation and
Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002, ('SARFAESI Act'), the learned counsel for the
appellant Banks would rely on the decisions of the Apex Court in
South Indian Bank Ltd. v. Naveen Mathew Philip [(2023)
17 SCC 311] and Shobha v. Muthoot Finance Ltd. [2025 (2)
KHC 229].
10. In Naveen Mathew Philip [(2023) 17 SCC 311], in
the context of the challenge made against the notices issued under
Section 13(4) of the SARFAESI Act, the Apex Court reiterated the
settled position of law on the interference of the High Court
invoking Article 226 of the Constitution of India in commercial
matters, where an effective and efficacious alternative forum has
been constituted through a statute. In the said decision, the Apex
Court took judicial notice of the fact that certain High Courts
continue to interfere in such matters, leading to a regular supply
of cases before the Apex Court. The Apex Court reiterated that a
writ of certiorari is to be issued over a decision when the court
finds that the process does not conform to the law or the statute.
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In other words, courts are not expected to substitute themselves
with the decision-making authority while finding fault with the
process along with the reasons assigned. Such a writ is not
expected to be issued to remedy all violations. When a Tribunal is
constituted, it is expected to go into the issues of fact and law,
including a statutory violation. A question as to whether such a
violation would be over a mandatory prescription as against a
discretionary one is primarily within the domain of the Tribunal.
The issues governing waiver, acquiescence and estoppel are also
primarily within the domain of the Tribunal. The object and
reasons behind the SARFAESI Act are very clear as observed
in Mardia Chemicals Ltd. v. Union of India [(2004) 4 SCC
311]. While it facilitates a faster and smoother mode of
recovery sans any interference from the court, it does provide a
fair mechanism in the form of the Tribunal being manned by a
legally trained mind. The Tribunal is clothed with a wide range of
powers to set aside an illegal order, and thereafter, grant
consequential reliefs, including repossession and payment of
compensation and costs. Section 17(1) of the SARFAESI Act gives
an expansive meaning to the expression 'any person', who could
approach the Tribunal.
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11. In Naveen Mathew Philip [(2023) 17 SCC 311] the
Apex Court noticed that, in matters under the SARFAESI Act,
approaching the High Court for the consideration of an offer by
the borrower is also frowned upon by the Apex Court. A writ
of mandamus is a prerogative writ. The court cannot exercise the
said power in the absence of any legal right. More circumspection
is required in a financial transaction, particularly when one of the
parties would not come within the purview of Article 12 of
the Constitution of India. When a statute prescribes a particular
mode, an attempt to circumvent that mode shall not be
encouraged by a writ court. A litigant cannot avoid the non-
compliance of approaching the Tribunal, which requires the
prescription of fees, and use the constitutional remedy as an
alternative. In paragraph 17 of the decision, the Apex Court
reiterated the position of law regarding the interference of the
High Courts in matters pertaining to the SARFAESI Act by quoting
its earlier decisions in Federal Bank Ltd. v. Sagar Thomas
[(2003) 10 SCC 733], United Bank of India v. Satyawati
Tondon [(2010) 8 SCC 110], State Bank of Travancore v.
Mathew K.C. [(2018) 3 SCC 85], Phoenix ARC (P) Ltd. v.
Vishwa Bharati Vidya Mandir [(2022) 5 SCC 345] and
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Varimadugu Obi Reddy v. B. Sreenivasulu [(2023) 2 SCC
168] wherein the said practice has been deprecated while
requesting the High Courts not to entertain such cases. In
paragraph 18 of the said decision, the Apex Court observed that
the powers conferred under Article 226 of the Constitution of India
are rather wide, but are required to be exercised only in
extraordinary circumstances in matters pertaining to proceedings
and adjudicatory scheme qua a statute, more so in commercial
matters involving a lender and a borrower, when the legislature
has provided for a specific mechanism for appropriate redressal.
12. In Shobha v. Muthoot Finance Ltd. [2025 (2) KHC
229], on the question of maintainability of writ petitions under
Article 226 of the Constitution of India against a private non-
banking finance company, the Apex Court laid down as follows;
(1) For issuing a writ against a legal entity, it would have to
be an instrumentality or agency of a State or should have
been entrusted with such functions as are Governmental or
closely associated therewith by being of public importance
or being fundamental to the life of the people and hence
Governmental.
(2) A writ petition under Article 226 of the Constitution of
India may be maintainable against (i) the State
Government; (ii) Authority; (iii) a statutory body; (iv) an
instrumentality or agency of the State; (v) a company which
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is financed and owned by the State; (vi) a private body run
substantially on State funding; (vii) a private body
discharging public duty or positive obligation of public
nature; and (viii) a person or a body under liability to
discharge any function under any Statute, to compel it to
perform such a statutory function.
(3) Although a non-banking finance company like the
Muthoot Finance Ltd. with which we are concerned is duty
bound to follow and abide by the guidelines provided by the
Reserve Bank of India for smooth conduct of its affairs in
carrying on its business, yet those are of regulatory
measures to keep a check and provide guideline and not a
participatory dominance or control over the affairs of the
company.
(4) A private company carrying on banking business as a
Scheduled bank cannot be termed as a company carrying
on any public function or public duty.
(5) Normally, mandamus is issued to a public body or
authority to compel it to perform some public duty cast upon
it by some statute or statutory rule. In exceptional cases, a
writ of mandamus or a writ in the nature of mandamus may
issue to a private body, but only where a public duty is cast
upon such private body by a statute or statutory rule and
only to compel such body to perform its public duty.
(6) Merely because a Statute or a rule having the force of a
statute requires a company or some other body to do a
particular thing, it does not possess the attribute of a
statutory body.
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(7) If a private body is discharging a public function and
the denial of any rights is in connection with the public
duty imposed on such body, the public law remedy can
be enforced. The duty cast on the public body may be
either statutory or otherwise and the source of such
power is immaterial but, nevertheless, there must be a
public law element in such action.
(8) According to Halsbury's Laws of England, 3rd Ed.
Vol.30, p.682, "a public authority is a body not necessarily
a county council, municipal corporation or other local
authority which has public statutory duties to perform,
and which performs the duties and carries out its
transactions for the benefit of the public and not for
private profit". There cannot be any general definition of
public authority or public action. The facts of each case
decide the point.
13. On the question of maintainability of a writ appeal
under Section 5(i) of the Kerala High Court Act, against an interim
order passed by a learned Single Judge during the pendency of
the writ petition, the Larger Bench in K. S. Das v. State of Kerala
[1992 (2) KLT 358] held that the word 'order' in Section 5(i) of
the Kerala High Court Act includes, apart from other orders, orders
passed by the High Court in miscellaneous petitions filed in the
writ petitions provided the orders are to be in force pending the
writ petition. An appeal would lie against such orders only if the
orders substantially affect or touch upon the substantial rights or
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liabilities of the parties or are matters of moment and cause
substantial prejudice to the parties. The nature of the 'order'
appealable belongs to the category of 'intermediate orders'
referred to by the Apex Court in Madhu Limaye v. State of
Maharashtra [(1977) 4 SCC 551]. The word 'order' is not
confined to 'final order' which disposes of the writ petition. The
'orders' should not however, be ad-interim orders in force pending
the miscellaneous petition or orders merely of a procedural nature.
14. In Thomas P. T. and another v. Bijo Thomas and
others [2021 (6) KLT 196], a Division Bench of this Court
noticed that the view that was upheld by the Larger Bench in K.S.
Das [1992 (2) KLT 358] was that even though an appeal could
be filed against an interlocutory order passed in a writ petition, in
order to be qualified for challenge in an appeal, the order shall be
either substantially affecting or touching upon the substantial
rights or liabilities of the parties or which are matters of moment
and cause substantial prejudice to the parties. According to the
Larger Bench, the nature of the order appealable belongs to the
category of intermediate orders referred to by the Apex Court in
Madhu Limaye [(1977) 4 SCC 551]. It was, however, clarified
by the Larger Bench that such orders should not, however, be ad
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interim orders or orders merely of a procedural nature.
15. This Court had occasion to consider the challenge made
against the interim order passed by the learned Single Judge
staying recovery proceedings under the SARFAESI Act in writ
petitions filed under Article 226 of the Constitution of India. Such
writ appeals are already disposed of permitting the bank to raise
the question of maintainability by filing counter affidavit in the writ
petitions. In those judgments, it was observed that we have no
doubt that the learned Single Judge will deal with the
maintainability of the writ petition, taking note of the judgment of
the Apex Court in the decisions referred to supra, before
proceedings with the writ petition further on merits.
16. In these writ appeals filed by the appellant Banks,
similar interim orders passed by the learned Single Judge are
under challenge. In view of the law laid down by the Apex Court
in Shobha v. Muthoot Finance Ltd. [2025 (2) KHC 229], a
writ petition seeking interference in the SARFAESI proceedings
initiated by a private non-banking finance company or seeking
installment facility to pay the dues in such proceedings, is not
maintainable in law. The interim order granted by the learned
Single Judge in such a writ petition, which substantially affects the
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rights and cause prejudice to a private non-banking financial
institution, is an order against which an appeal under Section 5(i)
of the Kerala High Court Act, 1958 can be entertained.
In such circumstances, these writ appeals are allowed by
setting aside the impugned orders dated 23.06.2025 in
W.P.(C)No.22832 of 2025 and dated 12.06.2025 in
W.P.(C)No.21656 of 2015 passed by the learned Single Judge.
Sd/-
ANIL K. NARENDRAN, JUDGE
Sd/-
MURALEE KRISHNA S., JUDGE
DSV/-
