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2017 Supreme(Ker) 1210
IN THE HIGH COURT OF KERALA AT ERNAKULAM
A.K. JAYASANKARAN NAMBIAR, J.
Devi Prasad - Petitioner
Versus
Authorized Officer & Ors. - Respondent
WP(C).No. 20775 of 2017 (V)
Decided On : 22-06-2017
Advocate Appeared:
For the Petitioner: Smt. Liza P. Cherian
For the Respondents: Sri. V.V. Surendran, SC
The necessity of issuing a fresh notice under Section 13(2) of the SARFAESI Act to legal heirs of a deceased borrower before initiating recovery proceedings against their share in the property.
Headnote:
SARFAESI Act - Recovery of Loan - Fresh Notice under Section 13(2)
Fact of the Case:
The petitioner challenges the recovery steps initiated by the respondent bank against a property offered as security for a loan availed by the petitioner's father. The petitioner argues that proceedings continued without issuing a fresh notice under Section 13(2) after the death of the father.
Finding of the Court:
The court allows the respondent bank to proceed against the rights of other legal heirs but emphasizes that proceedings against the petitioner's share in the property should only be initiated after issuing a notice under Section 13(2) to the petitioner.
Issues: Dispute over recovery proceedings under the SARFAESI Act and the requirement of issuing a fresh notice under Section 13(2) after the death of the borrower.
Ratio Decidendi: The court's decision is influenced by the absence of a fresh notice under Section 13(2) to the petitioner, who is a legal heir of the deceased borrower, and emphasizes the necessity of such notice before initiating proceedings against the petitioner's share in the property.
Final Decision: The court disposes the writ petition, allowing the respondent bank to proceed against the rights of other legal heirs but mandating the issuance of a notice under Section 13(2) to the petitioner before initiating proceedings against the petitioner's share in the property.
The petitioner has approached this Court aggrieved by recovery steps initiated by the respondent bank against a property that was offered as security for a loan availed by the petitioner's father. In the writ petition, the case of the petitioner is essentially that after the death of his father, the respondents had continued with the proceedings under the Securitisation and Reconstructions of Financial Assets and Enforcement of Security Interest Act, 2002, hereinafter referred to as 'the SARFAESI Act', without issuing a fresh notice under Section 13(2) to the petitioner. The learned counsel for the respondent bank would submit that in proceedings that were initiated when the father was alive, the petitioner's father as also the mother and other siblings of the petitioner were put on notice, and the proceedings initiated before the Debts Recovery Tribunal was only after giving notice to them. It is stated that a notice was issued to the said siblings and mother of the petitioner even at the stage, when the Magistrate was approached under Section 14. Pursuant to an earlier direction from this Court in Ext.P2 judgment, the respondents had also issued a notice to the petitioner at the stage of proceedings before the Magistrate.
2. I have heard the learned counsel for the petitioner and the learned Standing Counsel for the respondent bank.
On a consideration of the facts and circumstances of the case and the submissions made across the bar, I dispose the writ petition, leaving it open to the respondent bank to proceed against the rights possessed by the other legal heirs of the deceased borrower in the property in question. Inasmuch as a fresh notice under Section 13(2) has not been issued to the petitioner in the writ petition, and the petitioner is also a legal heir of the deceased borrower, I make it clear that, proceedings against the petitioner's share in the property shall be initiated only after issuing a notice under Section 13(2) to the petitioner.
