Anil Jacob Mathew v. The South Indian Bank Ltd.

## `IN THE HIGH COURT OF KERALA AT ERNAKULAM` ## `PRESENT` ## `THE HONOURABLE MR. JUSTICE GOPINATH P.` ``` MONDAY, THE 16[TH] DAY OF JANUARY 2023 / 26TH POUSHA, 1944 ``` ## `WP(C) NO. 741 OF 2023` ## `PETITIONER:` ``` 1ANIL JACOB MATHEW AGED 54 YEARS S/O. V.C. MATHEW, RESIDING AT VANIYAPURACKAL HOUSE, NEAR S.B. COLLEGE, CHANGANACHERRY, KOTTAYAM, PIN - 686101 BY ADVS. LIJI.J.VADAKEDOM TOM E. JACOB REXY ELIZABETH THOMAS ATHUL V. VADAKKEDOM ``` ## `RESPONDENTS:` ``` 1THE SOUTH INDIAN BANK LTD REPRESENTED BY ITS AUTHORIZED OFFICER 'SIB HOUSE' REGISTERED OFFICE, T.B. ROAD, MISSION QUARTERS, THRISSUR, PIN - 680001 2AUTHORIZED OFFICER THE SOUTH INDIAN BANK LTD., 'SIB HOUSE' REGISTERED OFFICE, T.B. ROAD, MISSION QUARTERS, THRISSUR, PIN - 680001 3SOUTH INDIAN BANK LTD., REPRESENTED BY ITS BRANCH MANAGER BRANCH KANJIKUZHY, VI/29C, KANJIKUZHY JUNCTION, MUTTAMBALAM P.O., KOTTAYAM, PIN - 686004 BY ADVS. SRI.K.K.JOHN,SC,SOUTH INDIAN BANK MOHAN JACOB GEORGE P.V.PARVATHY (P-41)(K/000036/1991) REENA THOMAS(R-364) NIGI GEORGE(K/1169/2012) ADV. MOHAN JACOB GEORGE, STANDING COUNSEL THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 16.01.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WPC No.741 of 2023 ``` 2 ## **JUDGMENT** ## **Dated this the 16[th] day of January, 2023** The petitioner availed two separate loans from the respondent bank; one of the loan is a ‘Kissan Cash Credit Facility’, while the other is a housing loan. The petitioner had also availed business loans for the purposes of running a bar hotel (partnership firm) which was subject matter of Ext.P4 judgment of this Court. 2. Learned counsel appearing for the petitioner would submit that the only source of income is from running of the bar hotel. It is submitted that the terms of Ext.P4 judgment has been complied with without any default. It is submitted that at present there are no overdues in respect of the housing loan. It is submitted that in respect of Kissan Cash Credit Facility, the outstanding amount as in the month of December, 2022 was approximately Rs.44 lakhs. It is ``` WPC No.741 of 2023 ``` 3 submitted that thereafter the petitioner has remitted approximately a sum of Rs.22 lakhs and the present outstanding amount in respect of cash credit facility is Rs.22.50 lakhs. 3. Adv.Mohan Jacob George, learned counsel appearing for the respondent bank would submit that though there are no overdues in respect of the housing loan, at present, the same cannot be regularised as the Kissan Cash Credit Facility is remaining in NPA status. It is submitted that if the petitioner wishes to regularise the housing loan account he must pay off the entire outstanding in Kissan Cash Credit account before 31.03.2023. 4. Learned counsel appearing for the petitioner submits that the petitioner is not disputing the liability and requires only a reasonable time to clear the outstanding amount. It is submitted that the fact that the petitioner is paying the amount in terms of Ext.P4 judgment and the fact that the petitioner brought ``` WPC No.741 of 2023 ``` 4 down the outstanding in respect of Kissan Cash Credit Facility from Rs.44 lakhs in December, 2022 to Rs.22.50 lakhs presently and the fact that the petitioner has cleared the entire overdue in respect of the housing loan, it is sufficient to show the petitioner is not a recalcitrant defaulter and he is only seeking an accommodation to clear the liability. 5. A Division Bench judgment of this Court in **Sundaram BNP Paribas Home Finance Ltd. v. Nisha [2016(1) KLT SN 72 (C. No.74)]** held as follows: “5. It is clear from the judgment of the learned Single Judge as noted above that the learned Single Judge has considered the sole prayer of the petitioner to permit her to remit the balance amount outstanding to the bank in easy instalments. The petitioner thus accepted the liability as disclosed by the bank in the impugned notice. The only indulgence granted by the learned Single Judge was that the amount of Rs.10,55,662/- which was outstanding along with the accrued interest was permitted to be paid in ten equal and successive monthly instalments ``` WPC No.741 of 2023 ``` 5 commencing from 30/11/2015. The said payment was in addition to the regular instalments. Under the second direction, it was directed that in the event the petitioner commits default in respect of any of the instalments, she will loose the benefit of the judgment of the learned Single Judge and the bank was free to continue the recovery proceedings against her from the stage at which it stands at the relevant date. The judgment in Satyawati Tondon (supra), on which strong reliance has been placed by the learned counsel for the appellant was a case where, challenging the proceedings under the SARFAESI Act, a writ petition was filed and this Court had stayed the SARFAESI proceedings. The Apex Court noted the submissions of the parties and the order passed by the High Court by which the High Court had restrained the bank from taking proceedings under the SARFAESI Act with regard to the property of the petitioner. In paragraph 24, the Apex Court laid down the following: “24. There is another reason why the impugned order should be set aside. If respondent No.1 had any tangible grievance against the notice issued under Section 13(4) or action taken under Section 14, then she could have availed remedy by filing an application under Section 17(1). The ``` WPC No.741 of 2023 ``` 6 expression `any person' used in Section 17(1) is of wide import. It takes within its fold, not only the borrower but also guarantor or any other person who may be affected by the action taken under Section 13(4) or Section 14. Both, the Tribunal and the Appellate Tribunal are empowered to pass interim orders under Sections 17 and 18 and are required to decide the matters within a fixed time schedule. It is thus evident that the remedies available to an aggrieved person under the SARFAESI Act are both expeditious and effective. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 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 are code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi ``` WPC No.741 of 2023 ``` 7 judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute." 6. There cannot be any dispute to the proposition laid down by the Apex Court that the High Court, in exercise of jurisdiction under Article 226 of the Constitution of India should not stay the proceedings under the SARFAESI Act and ordinarily the petitioner should be asked to avail statutory remedy provided under Section 17 of the SARFAESI Act. In Satyawati Tondon (supra), the High Court entertained the writ petition and stayed the further proceedings under Section 13(4) of the SARFAESI Act. Present is the case where, although possession notice was sought to be quashed in the prayer made, at the time of hearing, the only prayer pressed was that the petitioner may be permitted to clear the outstanding amount due to the bank in easy instalments. The only indulgence asked for was to grant her some time to clear the outstanding amount along with interest accrued together with regular instalments. The learned Single Judge exercised his discretion in granting ``` WPC No.741 of 2023 ``` 8 ten instalments to pay the entire outstanding amount along with interest accrued with regular instalments. The learned Single Judge did not stay the proceedings and, by the 2nd direction, gave liberty to the bank to proceed further from the stage at which it stands at the relevant date, in the event of any single default committed by the petitioner. We are of the view that the interest of the bank was protected by the judgment passed by the learned Single Judge and it cannot be said to be an order by which the proceedings of the bank were either stayed or interfered with. 7. The next judgment relied upon by the learned counsel for the appellant is Mardia Chemicals (supra). It was a case where the Apex Court had occasion to consider the provisions of the SARFAESI Act and the Apex Court held that the conditions laid down in Section 17(2) of the SARFAESI Act for making deposit for filing an application are unreasonable and arbitrary. It is contended by the learned counsel that in view of the condition of deposit having been held to be arbitrary and unreasonable, it is open for the petitioner to file an application under Section 17 for redressal of her grievance and this was not a case where the Court should have entertained a writ petition. There is no doubt regarding the ``` WPC No.741 of 2023 ``` 9 proposition laid down by the Apex Court in Mardia Chemicals (supra). Petitioner, of course, had a statutory remedy under Section 17 to approach the Debt Recovery Tribunal to challenge the proceedings under the SARFAESI Act. But, as noted above, petitioner in the writ petition having accepted the entire liability and the learned Single Judge exercised his discretion in granting a breathing time to the petitioner to clear the outstanding, we do not think that the learned Single Judge has committed any error in passing the judgment, as noted above.’’ 6. Having regard to the facts and circumstances of the case of this case as narrated above, I am of the view of the petitioner is not a recalcitrant defaulter. The fact that the petitioner has complied with Ext.P4 judgment and the fact that there are no overdues presently in respect of the housing loan and the fact that he brought down the outstanding amount in the Kissan Cash Credit Facility from Rs.44 lakhs in December, 2022 to Rs.22.50 lakhs (at present) shows that the petitioner can be granted some accommodation in the light of the law laid down in ``` WPC No.741 of 2023 ``` 10 ## **Sundaram BNP Paribas Home Finance Ltd.** (Supra). 7. Accordingly, there will be a direction to the respondent bank to accept repayment of the entire outstanding amount of Rs.22,50,000/(approximately) in the Kissan Cash Credit Facility along with bank charges from the petitioner on the following conditions: - (i) The outstanding amount of Rs.22,50,000/(approximately) together with any accrued interest/costs shall be repaid in ten (10) equated monthly instalments; (ii) The first instalment shall be paid on or before 31.01.2023 and subsequent instalments shall be paid on or before the last working day of every succeeding month; - (iii) The petitioner shall continue to pay the regular EMIs in respect of the housing loan. On the liability in the Kissan Cash Credit Facility being ``` WPC No.741 of 2023 ``` **==> picture [13 x 9] intentionally omitted <==** settled in the manner permitted by this judgment, the housing loan account of the petitioner shall be regularised. - (iv) In the event of default of any one instalment, the respondent bank shall be entitled to proceed in accordance with law; - (v) In order to enable the petitioner to repay the entire amounts, all coercive proceedings shall be kept in abeyance. The writ petition is disposed of as above. **Sd/-** **GOPINATH P.** **JUDGE** SKP/16-01 ``` WPC No.741 of 2023 ``` 12 ## `APPENDIX OF WP(C) 741/2023` ``` PETITIONER’S EXHIBITS: EXHIBIT P1THE COPY OF THE NOTICE ISSUED UNDER SECTION 13(4) OF THE SARFAESI ACT IN DEEPIKA DAILY DATED 4/11/2021 EXHIBIT P2THE COPY OF THE NOTICE DATED 21/12/2022 ISSUED BY THE ADVOCATE COMMISSIONER EXHIBIT P3THE COPY OF THE ACCOUNT STATEMENT OF KCC LOAN (KISSAN CREDIT CARD) STANDING THE NAME OF THE PETITIONER EXHIBIT P3(A)THE COPY OF THE ACCOUNT STATEMENT OF HOUSING LOAN STANDING THE NAME OF THE PETITIONER EXHIBIT P4THE COPY OF THE JUDGMENT DATED 8/8/2022 IN WP(C) NO. 6624/2022 BEFORE THE HONOURABLE HIGH COURT OF KERALA ``` ``` RESPONDENTS' EXHIBITS:NIL ``` ## `TRUE COPY` ``` P.A. TO JUDGE ```