Jobimol Abraham and Bobby v. Federal Bank Ltd

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR. JUSTICE GOPINATH P. THURSDAY, THE 5[TH] DAY OF JANUARY 2023 / 15TH POUSHA, 1944** **WP(C) NO. 104 OF 2023** ## **PETITIONERS:** 1 JOBIMOL ABRAHAM, W/O.BOBBY, AGED 37 YEARS, VELLAKKOTTU HOUSE, NEDUMKANDAM P.O, NEDUMKANDAM VILLAGE, IDUKKI, PIN – 685 553. 2 BOBBY, AGED 40 YEARS, S/O MICHEAL,VELLAKKOTTU HOUSE, NEDUMKANDAM P.O NEDUMKANDAM VILLAGE, IDUKKI, PIN – 685 553. BY ADV BIBIN KUMAR ## **RESPONDENT:** FEDERAL BANK LTD, NEDUMKANDAM BRANCH,CHERUVALLIL BUILDING CENTRAL JUNCTION, NEDUMKANDAM P.O NEDUMKANDAM VILLAGE, IDUKKI PIN – 685 553, REP. BY ITS AUTHORISED OFFICER. BY ADV LEO GEORGE THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 05.01.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO. 104 OF 2023 2 ## **JUDGMENT** Petitioners availed two loans from the respondent Bank. One is a term loan and the other is a cash credit facility. The learned counsel appearing for the petitioners would submit that the petitioners do not dispute the liability. It is submitted that the petitioners are only seeking some accommodation to clear the liability in instalments. 2. The learned counsel appearing for the respondent Bank would submit that the respondent Bank has no objection in granting instalments provided the entire amount is paid before 31.03.2023. It is submitted that the petitioners are chronic defaulters and no further indulgence can be shown to the petitioners. It is submitted that the petitioners committed default in repayment of the above two loans and the total outstanding amount as on 04.01.2023 is Rs.25,77,422/-(Rupees twenty five lakhs seventy seven thousand four hundred and twenty two only). 3. I have heard the learned counsel for the petitioners as well as the learned Standing Counsel for the respondent. 4. Having heard the learned counsel for the petitioners and the learned counsel appearing for the WP(C) NO. 104 OF 2023 3 respondent Bank, I am of the opinion that some indulgence can be shown to the petitioners clear the entire liability in instalments. This Court in _**Sundaram BNP Paribas Home Finance Ltd. v. Nisha**_ [2016(1) KHC 167], held as follows: “ _3. The appellant, aggrieved by the said direction, has come up in the writ appeal. Adv.Sri.C.Varghese Kuriakose, learned counsel for the appellant contended that the learned Single Judge ought not to have exercised jurisdiction under Article 226 of the Constitution of India by interfering in a proceedings under the SARFAESI Act. It is submitted that the Apex Court in United Bank of India v. Satyawati Tondon and Others [2010 KHC 4518] has held that the Supreme Court, in exercise of writ jurisdiction under Article 226 of the Constitution of India, should not interfere in matters under the SARFAESI Act and no such interim order be granted staying the SARFAESI Act. He placed reliance on another judgment of the Apex Court in Devi Ispat Ltd. and another v. State Bank of India and Others [2014 KHC 4262] where the same proposition has been laid down. Another judgment relied upon by the learned counsel for the appellant is Federal Bank Ltd. v. Sagar Thomas [2003 KHC 1206]. He referred to another judgment in Mardia Chemicals v. Union of India [2004 KHC 584]._ _4. We have considered the submission of the learned counsel for the appellant and perused the records._ _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_ WP(C) NO. 104 OF 2023 4 _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 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 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_ WP(C) NO. 104 OF 2023 5 _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 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_ WP(C) NO. 104 OF 2023 6 _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 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 2[nd] 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.”_ The Division Bench has considered the judgments of the Supreme Court and has taken the view that where the liability is not disputed and where the borrower is asking only for some accommodation to clear the liability in instalments, such relief can be granted in exercise of jurisdiction under Article 226 of the Constitution of India. 5. Therefore, the writ petition will stand disposed of permitting the petitioners to clear the entire liability of Rs.25,77,422/-(Rupees twenty five lakhs seventy seven thousand four hundred and twenty two only) along with any accrued interest, costs and charges from the petitioner on WP(C) NO. 104 OF 2023 7 the following conditions: - (i)The outstanding amount of Rs.25,77,422/(Rupees twenty five lakhs seventy seven thousand four hundred and twenty two only) along with any accrued interest, costs and charges shall be repaid in ten equated monthly instalments. - (ii)The first instalment shall be paid on or before 31.01.2023 and the subsequent instalments shall be paid on or before the last working day of every succeeding month. - (iii) In the event of default of any one instalment, the respondent bank shall be entitled to proceed in accordance with law. - (iv) In order to enable the petitioner to repay the entire amounts, all coercive proceedings shall be kept in abeyance. The proceedings initiated by the Bank under Section 14 of the SARFAESI Act shall not be closed and further orders may be sought by the Bank if the petitioners commit any default in payment of any of the instalments as directed in this judgment. It will always be open to the petitioners to seek the benefit of One Time Settlement notwithstanding the directions contained in this judgment. The writ petition is disposed of as above. Sd/- **GOPINATH P. JUDGE** DK WP(C) NO. 104 OF 2023 8 ## **APPENDIX OF WP(C) 104/2023** PETITIONER EXHIBITS Exhibit P1 THE TRUE COPY OF THE REQUEST LETTER SUBMITTED BY THE 1ST PETITIONER BEFORE THE RESPONDENT BANK DATED 5/7/2022 Exhibit P2 A TRUE COPY OF THE NOTICE ISSUED BY THE ADVOCATE COMMISSIONER TO THE PETITIONER DATED NIL