RAKESH RAJ.M.N v. THE BRANCH MANAGER

The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by the Union Bank of India to the petitioner, invoking the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act,

The petitioner availed two loans in the year 2017 as Housing Loan for an amount of ₹11 lakhs and ₹16.3 lakhs as Term Loan. The petitioner states that though the petitioner made remittances promptly during the initial repayment period of the financial advance, he could not pay W.P.(C) No.9477 of 2024 :3: the repayment instalments promptly later. The repayment of loans fell into arrears. It happened due to reasons beyond the control of the petitioner.

Though the petitioner requested the Bank to permit the petitioner to repay the overdue 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.P1 notice.

The petitioner states that he is still in a position to clear the overdue amounts towards the loans, 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 W.P.(C) No.9477 of 2024 :4: petitioner, he will be put to untold hardship and loss.

Standing Counsel entered appearance on behalf of the Bank and denied all the statements made by the petitioner. On behalf of the respondent, it is submitted that the loans were given to the petitioner in the year 2017. The petitioner committed default in repaying the loans.

The Bank repeatedly reminded the petitioner and required him to clear the dues. The petitioner deliberately omitted to do so. 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.P1 notice was issued in these circumstances. The petitioner has not advanced any legal reasons to thwart the coercive proceedings initiated by the Bank. W.P.(C) No.9477 of 2024 :5:

The Standing Counsel, however, submitted that if the petitioner is ready and willing to make a substantial payment soon and remit the balance overdue 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 29.02.2024 is ₹34,92,200/- and the overdue amount as on 29.02.2024 is ₹1,40,000/-.

I have heard the counsel for the petitioner and the Standing Counsel representing the Bank.

The specific case of the petitioner is that the petitioner has been making the repayment and maintaining the loan accounts initially. The default in repayment 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. W.P.(C) No.9477 of 2024 :6:

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.

The writ petition is therefore disposed of with the following directions: (i) The petitioner shall remit an amount of ₹30,000/- on or before 27.03.2024. (ii) The petitioner shall remit the balance overdue amount in subsequent consecutive 10 equal monthly instalments thereafter, along with accruing interest and other Bank charges, if any. (iii) If the petitioner commits default in making payments as directed above, the respondent will be at liberty to continue with W.P.(C) No.9477 of 2024 :7: coercive proceedings against the petitioner in accordance with law. (iv) The petitioner shall also pay current EMIs along with the aforesaid payments. (v) If the petitioner makes payments as directed above, coercive proceedings, if any, against the petitioner shall stand deferred. JUDGE Sd/- N. NAGARESH W.P.(C) No.9477 of 2024 :8: APPENDIX OF WP(C) 9477/2024 PETITIONER'S EXHIBIT Exhibit P1 THE TRUE COPY OF THE NOTICE ISSUED BY THE RESPONDENT DATED 29.02.2024 WITH REFERENCE NUMBER VPZ/NPA 665/85 TO THE PETITIONER