The objection by a borrower against the notice under Section 13(2) of the Act must be lodged within 60 days from the date of the receipt of the notice, and the bank is not obligated to consider such objection before proceeding with the measures under Section 13(4) of the Act.

Interlocutory Application No. 4643 of 2010:

This Letters Patent Appeal preferred under Clause 10 of the Letters Patent arises from the judgment and order dated 22nd January, 2008 passed by the learned single Judge in C.W.J.C. No. 9527 of 2007 ED-Reported in 2008(1) PLJR 585.

2. The appellant before us is the State Bank of India and its officers (hereinafter referred to as "the Bank"). The respondents are M/s Prachi Exim India Limited, its Managing Director and the Directors (hereinafter referred to as "the Company").

3. The subject matter of challenge in the writ petition was the action of the Bank in enforcing security interest in respect of the secured asset in exercise of power conferred by Section 13 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act. 2002 (hereinafter referred to as "the Act of 2002").

4. In or around the year 2003, the Company approached the Bank for financial assistance. The Bank extended financial assistance, inter alia, in terms of Cash Credit Loan of Rs. 14 lakhs. According to the Bank, the said account of the Company became irregular and was overdrawn continuously since March 2004 till August 2005. Consequently, the Bank identified the said account as a "non-performing asset". On 8th February, 2007 the Bank gave notice to the Company for discharge of its liability in full under Section 13(2) of the Act of 2002. The said notice was received by the Company on 13th February, 2007.

5. Feeling aggrieved, the Company approached this Court under Article 226 of the Constitution of India in C.W.J.C. No.6500 of 2007. The Company, inter alia, claimed that against the notice under Section 13(2) of the Act of 2002, it had lodged objection on 18th April, 2007. Pending the proceeding before this Court, the Bank proceeded further to exercise power conferred under Section 13(4) of the Act of 2002. The Bank took over possession of two of the secured assets being a house situated at Bhagalpur and a property at Gauripur on 10th and 11th July, 2007 respectively.

6. It appears that unaware of the aforesaid development, the learned single Judge (Corum: Mrs. Mridula Mishra, J.) disposed of the above C.W.J.C. No. 6500 of 2007 on 11th July, 2007. The Court recorded the contention raised by the Company that in response to the notice received by the Company, the Company had filed objection on 18th April, 2007. The Court also recorded the denial by the Bank. Without resolving the issue whether or not such objection was filed, the Court directed the authorized officer of the Bank:

“to consider the objection filed by the Company and dispose it of in accordance with law within two weeks from the date of filing such objection. Till disposal of the objection filed by the petitioner, no coercive action should be taken against the petitioner. The respondent is also directed to communicate the order to the Bank through registered post."

7. It is not in dispute that the above order has become final. It is admitted that the Company did not file any objection after the aforesaid order nor did the Bank consider and decide the objection allegedly filed on 18th April, 2007.

8. The Company filed above C.W.J.C. No. 9527 of 2007 Ed.-Reported in 2008(1) PLJR 585 to challenge the validity of the notice issued under Section 13(2) of the Act of 2002; the action of the, Bank in taking over the possession of the secured assets and the action of the Bank in treating the account of the company as "non-performing asset".

9. According to the Bank, the Bank 'had given notice under Section 13(2) of the Act of 2002 on 8th February, 2007: that was received by the Company on 13th February, 2007. Objection, if any, ought to have been lodged within 60 days from the date of the receipt of the notice: The Company did not lodge any objection. After expiry of 60 days from the date of the delivery of the said notice, the Bank was authorized to proceed further under Section 13(4) of the Act of 2002.

10. The learned