MADHAVAN M.K v. STATE BANK OF INDIA

The petitioner has approached this Court aggrieved by the coercive proceedings for recovery of financial advance made by the State 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 ₹32 lakhs to the petitioner as Housing Loan and ₹1.35 lakh as Suraksha Loan in the year

2015. The petitioner states that though the petitioner made remittances promptly during the initial repayment period of W.P.(C)No.18091 of 2024 :3: the financial advance, he could not pay the repayment instalments promptly later due to Covid-19 pandemic. 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 Exts.P1 and P2 notices.

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 W.P.(C)No.18091 of 2024 :4: the respondents are permitted to continue with the coercive proceedings and auction the secured assets provided by the 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 respondents, it is submitted that the loans were given to the petitioner in the year 2015. 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 Exts.P1 and P2 notices were issued in these circumstances. The petitioner has not advanced any W.P.(C)No.18091 of 2024 :5: legal reasons to thwart the coercive proceedings initiated by the Bank.

The Standing Counsel, however, submitted that if the petitioner is ready and willing to remit the balance outstanding amount in instalments, 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 23.05.2024 is ₹32,70,613/-.

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 W.P.(C)No.18091 of 2024 :6: safeguard the interest of the Bank.

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 ₹32,70,613/- in 15 equal and consecutive monthly instalments along with accruing interest and other Bank charges, if any. The first instalment shall be paid on or before 28.06.2024. (ii) If the petitioner commits default in making payments as directed above, the respondents will be at liberty to continue with coercive proceedings against the W.P.(C)No.18091 of 2024 :7: petitioner in accordance with law. (iii) If the petitioner makes payments as directed above, coercive proceedings, if any, against the petitioner shall stand deferred. Sd/- N. NAGARESH JUDGE W.P.(C)No.18091 of 2024 :8: APPENDIX OF WP(C) 18091/2024 PETITIONER'S EXHIBITS Exhibit-P1 Exhibit-P2 A TRUE COPY OF THE DEMAND NOTICE DATED 21.12.2022 ISSUED UNDER SECTION 13(2) OF THE SARFAESI ACT. A TRUE COPY OF THE POSSESSION NOTICE DATED 18.08.2023 ISSUE BY THE RESPONDENT BANK.