SURAYYA v. AUTHORISED OFFICER

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 Bank paid ₹20 lakhs as Housing Loan and ₹7.5 lakhs as Vehicle Loan in the year 2016 and ₹1 lakh as Crop Loan in the year 2015, to the petitioner. The petitioner states that though the petitioner made remittances promptly during the initial repayment period of the financial advance, W.P.(C)No.13805 of 2024 :3: she could not pay the repayment instalments promptly later due to Covid-19 pandemic and financial crisis. 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 invoking Section 13(4) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 .

The petitioner states that she is still in a position to clear the overdue amounts towards the loan, if sufficient time is given to clear the dues in easy monthly instalments. If the W.P.(C)No.13805 of 2024 :4: respondent is permitted to continue with the coercive proceedings and auction the secured assets provided by the petitioner, she 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 years 2015 and 2016. The petitioner committed default in repaying the loans.

The Bank repeatedly reminded the petitioner and required her 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 W.P.(C)No.13805 of 2024 :5: Bank.

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 is ₹39,43,000/- and the overdue amount as on

11.04.2024 is ₹13,38,000/-.

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.13805 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 outstanding amount of ₹7.83 lakhs in the Vehicle Loan account, ₹80,000/- in the Crop Loan account and the overdue amount of ₹3.95 lakhs in the Housing Loan in 12 equal and consecutive monthly instalments along with accruing interest and other Bank charges, if any. The first instalment shall be paid on or before 01.07.2024. (ii) If the petitioner commits default in making payments as directed above, the W.P.(C)No.13805 of 2024 :7: respondent will be at liberty to continue with coercive proceedings against the petitioner in accordance with law. (iii) The petitioner shall also pay current EMIs of Housing Loan along with the aforesaid payments. (iv) If the petitioner makes payments as directed above, coercive proceedings, if any, against the petitioner shall stand deferred. Sd/- JUDGE N. NAGARESH W.P.(C)No.13805 of 2024 :8: APPENDIX OF WP(C) 13805/2024 PETITIONER'S EXHIBIT Exhibit P1 TRUE COPY OF THE NOTICE DATED 14/3/2024 UNDER SECTION 13(4) OF SARFAESI ACT.